Vodafone Idea shares rose 10% intraday before closing 9.1% higher Monday on an ET report that the government is considering a proposal to waive 50% of interest, 100% of penalties, and interest on penalties, which make up the majority of the adjusted gross revenue (AGR) dues levied on telcos following the 2019 Supreme Court order. On Monday, the Bombay Stock Exchange saw Vodafone Idea open at Rs10.03 and close at Rs9.95.
Potential AGR Waiver
In order to help telecom businesses and guarantee the sector’s long-term stability, reports indicate that the government is mulling a plan to waive or restructure AGR dues. Dues of thousands of crores have put Vodafone Idea’s viability in the cutthroat telecom industry in jeopardy, placing it in the center of AGR-related issues. In addition to relieving the company’s financial strain, this action would level the playing field for all businesses.
If the waiver is granted, Vodafone Idea’s financial situation may improve, allowing it to concentrate on growing its network and deploying 5G. Though this announcement has increased confidence, industry experts have warned that the company still confronts obstacles, such as the need to increase income creation and deal with fierce competition.
About Vodafone Idea Limited
Vodafone Idea Limited (VIL) offers 2G, 3G, and 4G voice and data services throughout India. In 2007, Hutchison Telecom sold its 67% direct and indirect share and loan interests in Hutchison Essar Limited to Vodafone Group PLC, which then joined the Indian market. Following an IPO, the company was listed on the BSE and NSE in 2007. In August 2018, Idea Cellular Ltd. and Vodafone Group Plc. reached an agreement to merge. Vodafone Idea Ltd. was created through the merger of Idea Cellular with Vodafone India Ltd. and Vodafone Mobile Services Ltd. After the merger, 26% of the business was held by the Aditya Birla Group and 45.2% by the Vodafone Group.
