Vodafone Idea Share Today: Shares of Vodafone Idea Ltd (VIL) fell sharply on Monday in the early trading session, dropping 3.96 per cent to Rs 8.48 on the BSE, as investors turned cautious ahead of a crucial Supreme Court hearing related to its long-standing adjusted gross revenue (AGR) dues.
The apex court, led by Chief Justice of India BR Gavai, is scheduled to hear today a fresh plea filed by Vodafone Idea seeking the quashing of additional AGR demands raised by the Department of Telecommunications (DoT) for the financial year 2016-17.
The telecom department recently asked the company to pay an extra Rs 5,606 crore, reigniting concerns over the operator’s already heavy debt burden.
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Why this matters
The AGR case has been a major overhang for Indian telecom operators for years. In its landmark 2019 judgment, the Supreme Court had upheld the DoT’s definition of AGR, which included both telecom and non-telecom income, drastically increasing the dues owed by companies like Vodafone Idea and Bharti Airtel.
In September 2020, the top court gave telcos 10 years to clear their AGR liabilities, requiring 10 per cent upfront by March 2021 and the balance in annual instalments until 2031. However, the court also made it clear that the dues determined by the DoT were final and could not be reassessed or disputed.
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Vodafone Idea, which has been struggling under massive debt and stiff competition, had earlier sought rectification of alleged errors in the calculation of dues.
But in 2021, the Supreme Court rejected its review plea. The latest Rs 5,606 crore demand from the DoT for FY17, therefore, has triggered fresh uncertainty, as it appears to run counter to the earlier settlement framework.
Government’s stake and investor concerns
The case is further complicated by the government’s own position. The Centre currently owns nearly 50 per cent of Vodafone Idea, following a debt-to-equity conversion aimed at saving the financially stressed company.
During the last hearing, Solicitor General Tushar Mehta indicated that the government itself is exploring a possible resolution, acknowledging that its stake makes it a direct stakeholder in the company’s survival.
Still, until the Supreme Court provides clarity, investors remain wary. The fear is that any additional burden could derail Vodafone Idea’s ongoing efforts to raise funds, invest in 5G rollout, and reduce losses.
