Vodafone Idea Shares Rise 10% As Centre Approves Limited Relief On Additional AGR Dues Worth Rs 9,450-Crore
The possible relief would be confined to the Rs 9,450-crore additional demand raised for the period up to financial year 2017, in line with the Supreme Court’s Oct. 27 ruling
Shares of telecom operator Vodafone Idea Ltd. rose over 12% in trade on Monday, as the Government approves offering limited relief to the company by reviewing and correcting potential duplicate entries and calculation errors in additional adjusted gross revenue (AGR) dues, as NDTV Profit learnt from officials related to the matter.
The possible relief would be confined to the Rs 9,450-crore additional demand raised for the period up to financial year 2017, in line with the Supreme Court’s Oct. 27 ruling, which permitted reassessment of discrepancies in the Department of Telecommunications’ (DoT) demand calculations.
Photo: NDTV Profit
In the wake of the apex court's order, the DoT, along with other concerned ministries, is now in consultation with the Solicitor General’s office to examine the full implications of the ruling.
This development comes on the back of an amended plea that was filed by Vodafone Idea in September, in which the telecom company contested the DoT's fresh demand and formally requested a recalculation of its total AGR liability.
All of this comes against the backdrop of Vodafone Idea struggling with a massive debt burden. This potential relief, therefore, is being closely watched by investors, especially considering the fact that the company faces an Rs 18,000 crore AGR installment payment due March 31, 2026.
Any correction in the oustanding dues could provide significant breathing room for Vodafone Idea as it looks to expand its offerings and services, whilst dealing with a massive debt burden that reflects on the company's financials quarter after quarter.
As far as the stock itself is concerned, Vodafone Idea is currently trading with a relative strength index of 42, which suggests neutral market sentiment.
