Vodafone Idea Stock Soars After Supreme Court’s AGR Remarks
Vodafone Idea (Vi) shares rebounded sharply, climbing 11% from the day’s low, after the Supreme Court of India clarified that the Centre faces no legal barrier in reconsidering the telecom giant’s AGR (Adjusted Gross Revenue) dues. The ruling has reignited hopes of financial relief for the debt-laden company, sending its stock soaring.
Market Rally: Vi Shares Bounce Back
- Intraday surge: Vi’s stock plunged to ₹13.50 (day’s low) before rallying to ₹15—an 11% jump.
- Closing price: Settled at ₹14.80, up 7.5% from the previous session.
- Investor sentiment: Optimism grew after SC’s observation that the government could revisit AGR terms.
Why Vi Needs Urgent Financial Relief
Vodafone Idea has been battling:
✔ ₹58,254 crore AGR dues (as per SC’s 2019 verdict).
✔ Mounting debt despite the 2021 moratorium on payments.
✔ Subscriber losses and delayed 5G rollout due to funding shortages.
A govt-backed bailout (like equity conversion or extended moratorium) could stabilize Vi’s finances and prevent a Jio-Airtel duopoly.
Will the Government Intervene? Key Scenarios
- Equity Conversion: Centre may convert interest dues into stake, becoming a part-owner.
- Extended Moratorium: More time to repay AGR dues.
- Tariff Hikes: Higher ARPU (Average Revenue Per User) to boost cash flow.
Expert Views: Is Vi’s Recovery Sustainable?
- Sanjiv Bhasin (IIFL Securities): “SC’s stance is a lifeline. Govt support could revive Vi.”
- Hemang Jani (Motilal Oswal): “Stock rally depends on concrete relief measures.”
What’s Next for Vodafone Idea?
- Fundraising: Critical for 4G upgrades and 5G launch.
- Subscriber Retention: Network improvements needed.
- Policy Clarity: Govt’s decision on AGR relief will decide Vi’s fate.
Final Takeaway: Cautious Optimism
While SC’s remarks boosted Vi’s stock, long-term survival hinges on govt action, funding, and operational turnaround. Investors should watch for official announcements.
