Vodafone Idea shares jump 7% as telco’s AGR plea reportedly gets Sept 19 hearing date

Shares of Vodafone Idea jumped nearly 7% on Monday, hitting an intraday high of Rs 8.19 on the BSE, after the telco’s petition challenging the Department of Telecom’s (DoT) additional Adjusted Gross Revenue (AGR) dues was scheduled for a tentative hearing on September 19.

The stock witnessed sharp buying interest following the update and was among the top gainers in the telecom space during the session.

According to reports, Vodafone Idea has approached the Supreme Court seeking to quash the DoT’s demand for additional AGR dues amounting to Rs 9,450 crore. The plea argues that the demand goes beyond the scope of the Supreme Court’s earlier ruling on AGR liabilities.


The reports further stated that the DoT is likely to submit its explanation to the court, terming the demand a result of gaps in prior accounting that were identified after the completion of financial accounts.

The DoT has clarified in its affidavit that the additional dues are not a reassessment or recalculation but stem from the finalisation of pending accounts.

Out of the total demand raised by the DoT, around Rs 2,774 crore pertains to the post-merger entity (Idea Group and Vodafone Idea), following their consolidation in August 2018, while Rs 5,675 crore relates to the liabilities of the pre-merger Vodafone Group.

Vodafone Idea has challenged the computation, claiming that certain figures were duplicated and has sought a fresh reconciliation of dues, starting from the pre-FY17 period.

Vodafone Idea has also been in talks with banks regarding additional funding requirements. During the June quarter earnings call, CEO Akshaya Moondra highlighted that lenders were waiting for clarity on the AGR issue before proceeding with funding plans.

Moondra noted that the company has been engaging with the government and emphasised that resolving this matter promptly would enable the company to move forward with its capex and funding strategy.

The company has reiterated its commitment to continue with capital expenditure and has been exploring both banking and non-banking sources for funding.

Also read: RailTel shares in focus after bagging Rs 210 crore order from Bihar Education Council

Past government measures, such as spectrum payment deferments, reform packages, and conversion of dues to equity, have supported the telecom sector, and the company has requested that the current dispute be resolved before March to facilitate timely funding arrangements.

(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)