NEW DELHI: The Department of Telecom (DoT) has demanded that debt-ridden telecom operator Vodafone Idea either deposit a bank guarantee of Rs6,090.7 crore for one year or make a cash payment of Rs5,493.2 crore by March 10, 2025. The requirement stems from a shortfall in the aggregate payment made for spectrum acquired during the 2015 auction, the company said.
Vodafone Idea Non-Executive Director Himanshu Kapania explained that while payments for previous spectrum auctions largely exceeded the pro-rated usage of the spectrum, the 2015 auction saw a one-time partial shortfall.
Weighing equity route
The company is currently in discussions with the DoT to settle the dues through equity, which could help alleviate its cash flow pressures.
As of December 2024, the group’s outstanding bank debt, including accrued but not due interest, stands at Rs2,345.1 crore.
In addition, its deferred payment obligations toward spectrum (payable through FY2044) and adjusted gross revenue (AGR) dues (payable through FY2031) aggregate to over Rs2.27 lakh crore.
The operator also has obligations to clear a Rs1,200 crore bank loan and Rs2,188.6 crore in spectrum dues by December 31, 2025. Installments related to spectrum, AGR in FY26, and the shortfall from the 2015 auction add up to Rs32,723.5 crore.
Kapania added that if there is any shortfall in payment to the government, the company expects it to be converted into equity.
Govt, largest shareholder
The government remains the largest single shareholder in Vodafone Idea, holding a 23.15 per cent stake as of December 31, 2024, while the Aditya Birla Group and Vodafone Group hold 14.76 per cent and 22.56 per cent stakes respectively.
In its latest quarterly report, Vodafone Idea reported a narrowing of losses to Rs6,609.3 crore during the December quarter, bolstered by a sequential rise in average revenue per user.
Operational revenue for the quarter reached Rs11,117.3 crore, marking an increase of over 4 per cent compared to the corresponding period last year. This latest directive from the DoT underscores the mounting financial pressures on Vodafone Idea as it struggles with significant debt and deferred obligations, casting further uncertainty on its financing strategy in the wake of the telecom reforms package 2021.
