NEW DELHI: Shares of Vodafone Idea (Vi) jumped over 9 per cent on Monday, as investors rushed to buy the telecom stock following reports that the Supreme Court has expanded the scope of relief on the company’s adjusted gross revenue (AGR) dues.
The rally added roughly Rs8,776 crore to Vi’s market valuation, underscoring renewed investor optimism in the beleaguered telco.
Vodafone Idea has been struggling with a heavy debt burden and long-standing AGR liabilities, which are calculated based on a telecom operator’s adjusted gross revenue – the income used to determine licence fees and spectrum charges payable to the government.
Since the Supreme Court’s original AGR verdict in 2019, the company has been negotiating repayment schedules and seeking relief measures to manage cash flow pressures.
Media reports over the weekend suggested that the apex court has now widened the ambit of relief, potentially easing payment obligations for Vodafone Idea and providing a framework for more manageable settlements with the Department of Telecommunications (DoT).
This development was interpreted by investors as a positive signal for the company’s balance sheet and near-term liquidity.
On the trading floor, Vodafone Idea’s shares hit a high of Rs9.85, compared with Monday’s opening price of Rs9.02, marking a gain of 9.2 per cent. Market analysts noted that the stock’s sharp uptick reflected both relief hopes on AGR liabilities and expectations that the company could stabilize its operations with reduced financial pressure.
Despite the surge, Vodafone Idea remains under significant stress due to competition from rivals, rising network investment costs, and legacy debt.
However, the Supreme Court’s latest move is seen as a crucial step in allowing the telco to focus on operational consolidation and growth, while the market appears to be responding positively to the prospect of reduced legal and financial uncertainty.
Investors and market watchers will closely follow official communications from Vodafone Idea and the Department of Telecommunications in the coming days to gauge the final contours of the AGR relief framework.
