Vodafone Idea has approached the Supreme Court seeking relief from over ₹30,000 crore in AGR dues, primarily consisting of penalties and interest. The telco’s stock rose 3.6% following the petition. The company is also seeking an urgent hearing scheduled for May 19. The Indian government, now the largest shareholder with a 49% stake, had earlier approved the conversion of dues into equity. Despite challenges, brokerages remain positive about Vi’s future due to recent policy support and equity infusion.
Debt-laden telecom operator Vodafone Idea has filed a petition in the Supreme Court seeking relief on over ₹30,000 crore in Adjusted Gross Revenue (AGR) dues, primarily comprising penalties and interest. This legal move has boosted investor sentiment, with the company’s share price rising 3.6% to close at ₹7.23 apiece on Wednesday, May 15.
In its plea, Vodafone Idea argued that the government is unable to grant any waiver or relief due to the Supreme Court’s earlier binding judgment on AGR-related dues. The company has requested an urgent hearing, which has now been scheduled for May 19, according to CNBC TV18.
Government’s Stake and Governance Rights
Earlier, Vodafone Idea’s board approved changes to the shareholders’ agreement that allow the Aditya Birla Group and Vodafone Group to retain governance and management control, even as the Indian government’s stake rose. The government had previously converted ₹36,950 crore of dues into equity, increasing its holding to 48.99% from 22.6%.
As a result, the Aditya Birla Group now holds 9.5%, and the Vodafone Group 16.07%, down from earlier levels.
An extraordinary general meeting (EGM) is scheduled for June 3, where shareholders will vote on the governance amendment proposal.
Brokerage Optimism and Credit Upgrade
Despite continued financial strain and subscriber losses, global brokerage Citi has maintained a ‘buy’ rating on Vodafone Idea with a target price of ₹12, citing the positive impact of the government’s equity conversion.
Adding to the optimism, credit rating agency ICRA recently upgraded the telecom operator’s rating to investment grade (BBB-) from BB+, reflecting improved prospects.
Financial Outlook and Subscriber Trends
Vodafone Idea plans a capital expenditure of ₹50,000–₹55,000 crore over the next three years to revamp its operations and push for growth. However, in March alone, the company lost 5.41 lakh subscribers, reducing its total base to 20.53 crore users.
The telecom firm has emphasised the urgent need for tariff hikes and ARPU (average revenue per user) growth to ensure revenue stability amid rising data consumption.
With government backing, strategic amendments, and fresh capital, Vodafone Idea aims to stabilize its position in India’s fiercely competitive telecom market while addressing legacy debt challenges through legal means.
