Vodafone Idea shares have been on an upward trajectory over the past three trading sessions, buoyed by media reports suggesting that the government is considering relief measures for the debt-laden telecom company in relation to its hefty Adjusted Gross Revenue (AGR) dues. While Vodafone Idea has denied receiving any formal proposal of relief from the government regarding the Rs 84,000 crore dues, the speculation alone has driven renewed investor interest.
On Thursday, June 26, Vodafone Idea’s stock closed 1.12% higher at Rs 7.21, marking a cumulative gain of over 10.5% in just three sessions. The rally comes amid reports that the government is evaluating options such as extending the AGR repayment timeline from six to twenty years and replacing compound interest with simple interest on the pending dues. Another proposal under consideration reportedly involves allowing Vodafone Idea to pay a nominal annual sum of Rs 1,000–1,500 crore until a more permanent resolution is reached.
Despite the optimism in the market, Vodafone Idea issued a formal clarification denying any communication from the government on this front. “As and when there is any development which requires disclosure, we will do the needful,” the company said in its regulatory filing.
This surge in stock activity coincides with warnings from Vodafone Idea CEO Akshaya Moondra, who stated in a recent letter to the Department of Telecommunications that the company will be unable to continue operations beyond FY26 without timely government intervention. The letter emphasized that discussions with banks for further funding have stalled in the absence of clarity on the AGR liability.
Analyst Rohan, speaking to ET NW’s Swadesh panel, remarked on the precarious nature of Vodafone Idea’s situation, calling it highly unpredictable. “The company is in a very difficult phase. While I don’t see a major downside at current levels, there’s also limited scope for a major upside unless something transformative happens,” he said.
Rohan added that a merger with BSNL might be the only viable path forward. “The government owns a significant stake in Vodafone Idea now and has been trying to revive BSNL. A merger could potentially turn things around for both entities. It may be the only shot at revival,” he noted.
The government currently holds a 48.99% stake in Vodafone Idea, following its recent equity conversion of Rs 36,950 crore in lieu of spectrum auction dues. Despite Vodafone’s financial woes, the government has consistently reiterated its support for maintaining a three-private-player telecom market to preserve healthy competition and consumer choice.