Vodafone Idea Stocks Soar: Government May Offer Interest-Free Moratorium

Vodafone Idea Shares Hit 52-Week High

The shares of Vodafone Idea (Vi) rose over 3% to reach a new 52-week high on December 15, after reports suggested that the government may offer an interest-free moratorium of 4-5 years on the company's pending Adjusted Gross Revenue (AGR) dues of over Rs 83,000 crore.

Stock Performance

The shares of the company reached Rs 12.03 apiece in morning trading hours on Monday, before slightly falling to Rs 11.66 at 10:15 am. This significant increase in stock price is a welcome boost for the company, which has been struggling with debt and financial stress.

Interest-Free Moratorium

According to reports, after the moratorium ends, Vodafone Idea will be required to pay the outstanding amount in six installments. However, the amount may be reduced by half after a reassessment of liabilities. A committee, headed by a secretary-level official, will be formed to discuss the proposal with the telecom department and Vodafone Idea.

Background

Vodafone Idea has been facing significant financial challenges, with AGR dues of over Rs 83,400 crore and annual payments of nearly Rs 18,000 crore scheduled from March 2025. The company has repeatedly warned that it cannot survive without funding support, and banks have been hesitant to lend due to its financial situation. With over 18,000 employees and nearly 198 million subscribers, the company's fate has significant implications for the telecom industry.

Recent Developments

In recent weeks, the Supreme Court allowed the government to reassess and reconcile all dues of Vodafone Idea, including interest and penalties, up to FY17. This decision was seen as a major relief for the company. Additionally, the government became the largest shareholder in Vodafone Idea in March this year, after converting dues worth Rs 36,950 crore into equity, taking its stake to nearly 49%.

• The shares of Vodafone Idea hit a fresh 52-week high of Rs 12.03 apiece.
• The stock has rapidly increased by around 97% from its 52-week low of Rs 6.12 per share in August.
• Vodafone Idea employs over 18,000 people and has nearly 198 million subscribers.

As the situation unfolds, investors and industry experts will be closely watching the developments surrounding Vodafone Idea's stock market performance and the government's decision on the interest-free moratorium. With key terms like telecom stocks, AGR dues, and interest-free moratorium being closely followed, the future of Vodafone Idea hangs in the balance.