Vodafone Idea Shares Tank After Supreme Court Defers AGR Hearing
Shares of Vodafone Idea Ltd. tanked nearly 8% on Friday after the Supreme Court deferred the hearing in the AGR dues to Oct. 6.
Shares of Vodafone Idea Ltd. tanked nearly 8% on Friday after the Supreme Court deferred the hearing on the AGR dues to Oct. 6.
The company petitioned the apex court, challenging the additional AGR demand of Rs 9,450 crore issued by the Department of Telecommunications, which was pending until the financial year 2019.
The telecom operator has argued that the demand goes beyond the scope of the apex court’s earlier ruling on AGR liabilities, as per reports. Of the total dues, Rs 2,774 crore pertains to the post-merger Vodafone Idea entity, while Rs 5,675 crore relates to liabilities of the pre-merger Vodafone Group.
Solicitor General Tushar Mehta, appearing on behalf of the government, said the Department requires more time to present its side of the case.
Vodafone Idea Share Price Movement
Vodafone Idea stock fell as much as 8% intraday to Rs 7.90 apiece on the NSE.
Vodafone Idea stock fell as much as 8% intraday to Rs 7.90 apiece on the NSE, compared to a 0.6% decline in the benchmark Nifty 50. The relative strength index was at 72.
It had declined 21% in the last 12 months and risen 3% on a year-to-date basis.
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The AGR Dispute
The AGR issue dates back over a decade, involving a prolonged dispute between telecom companies and the government over the definition of adjusted gross revenue. In its 2019 ruling, the Supreme Court upheld the government's broader interpretation, which includes revenue from non-core operations. This dramatically increased the dues owed by several telecom operators.
In 2020, the apex court rejected any reassessment or recalculation of these dues and allowed the companies a 10-year window to pay them in installments, with interest.
The government has become the single largest shareholder in Vodafone Idea after acquiring shares worth Rs 36,950 crore in lieu of outstanding spectrum auction dues in March. Earlier, the government had acquired around 33% stake in 2023 in lieu of statutory dues worth over Rs 16,000 crore.
Vodafone Idea owes more than Rs 83,000 crore in AGR dues to the government at present — of which — the company has sought a waiver on Rs 45,000 crore.
