Vodafone Idea shares end 4% up ahead of Supreme Court's Friday hearing

Synopsis

Vodafone Idea shares surged 7% intraday amid investor hopes for Supreme Court relief on Rs 9,450 crore AGR dues. The apex court will hear the plea on September 26, a crucial decision impacting funding plans, debt resolution, and operational continuity for the debt-laden telecom operator seeking clarity on dues reconciliation.

Shares of Vodafone Idea rallied 7% intraday on Tuesday to hit the day's high of Rs 8.97 on the NSE amid hopes of some relief from India's Supreme Court on the government's Adjusted Gross Revenue (AGR) dues demand of Rs 9,450 crore. The apex court will hear the case on Friday, September 26.

The stock witnessed strong response from investors as 128.6 crore shares changed hands on the NSE with total traded value recorded at Rs 1,117.51 crore. It closed the Tuesday session at Rs 8.75, gaining 4.3%

The stock has been quite volatile amid developments around the AGR issue with news of a government relief on many occasions followed by the denial.

The Supreme Court will hear a case on the telecom operator’s plea challenging the Department of Telecom’s (DoT) additional AGR dues demand of Rs 9,450 crore.

AGR dues dispute

Vodafone Idea has petitioned the apex court to quash the DoT’s demand, arguing that the Rs 9,450 crore claim “goes beyond the scope” of the apex court’s earlier ruling on AGR liabilities. Out of the total demand, about Rs 2,774 crore pertains to the post-merger entity, while Rs 5,675 crore relates to liabilities of the pre-merger Vodafone Group.

The company contends that the computation includes duplication of figures and has sought a reconciliation of dues, beginning with the pre-FY17 period.

On its part, the DoT has told the court that the demand “is not a reassessment or recalculation but stems from the finalisation of pending accounts,” with officials attributing the discrepancy to gaps identified after financial accounts were closed.

Stakes for funding and operations

The outcome of the hearing carries high stakes for Vodafone Idea, which has been in talks with lenders to secure additional funding. During the June quarter earnings call, CEO Akshaya Moondra said that “lenders were waiting for clarity on the AGR issue before proceeding with funding plans.”

Moondra added that the company “has been engaging with the government” and stressed that a prompt resolution would enable it to move forward with capital expenditure and its broader funding strategy.

Vodafone Idea, weighed down by debt and pending dues, has in the past benefited from government relief measures, including spectrum payment deferments, reform packages, and the conversion of liabilities into equity. The telco has urged that the current dispute be resolved before March to ensure timely funding arrangements.

The telecom operator's shares are down a little over 16% over the last one year but the stock is up 9.2% so far in 2025.

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