Vodafone Idea Shares Rise 5% as Supreme Court Agrees to Hear Plea on AGR Dues

On October 11, shares of Vodafone Idea saw a more than 5 percent increase, building on gains from the previous session. This upward trend of 7 percent over two days followed the telecom company’s move to approach the Supreme Court regarding its Adjusted Gross Revenue (AGR) dues, and the apex court agreed to consider the matter.

By 1:15 pm, Vodafone Idea shares were trading at Rs 11.65, reflecting a 5.4 percent increase from the previous closing price.

In its curative petition, the telecom major argued that the penalty and the interest on the penalty imposed by the Supreme Court’s 2019 judgment are so substantial that they pose a significant threat to the company’s existence. Vodafone Idea emphasized that the penalty and the interest on the penalty exceed the principal amount itself, prompting the telco to request a reconsideration of the judgment.

Year-to-date, the stock has gained 45 percent, outperforming the 8 percent increase in the Nifty 50. Over the past year, the telecom stock has risen by more than 34 percent. The stock exhibits low volatility with a 1-year Beta of 0.93.

Vodafone Idea’s Financials, Debt, and Shareholding

In the April-June quarter of FY24, Vodafone Idea reported a widened consolidated net loss of Rs 7,840 crore. However, consolidated revenue from operations in the same quarter increased marginally by 2.3 percent to reach Rs 10,655.5 crore.

As of June 30, 2023, the total gross debt (excluding lease liabilities and including interest accrued but not yet due) stood at Rs 2,11,760 crore. Of this debt, Rs 9,500 crore was from banks and financial institutions, while Rs 1,660 crore was raised through debt instruments.

Promoters hold a 50.4 percent stake in Vodafone Idea based on shareholding data from the June quarter. Foreign Institutional Investors (FIIs) maintain a 2.3 percent stake, while Domestic Institutional Investors (DIIs) hold 33.9 percent of the telco. The public holds a 13.4 percent stake in Vodafone Idea.

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