Vodafone Idea seeks more government support to tackle AGR, spectrum dues: Report

If approved, this move could increase the government’s stake in the company from the current 22.6% to 49%

Telecom operator Vodafone Idea has approached the government for additional financial support as it struggles to repay its adjusted gross revenue (AGR) and spectrum dues, NDTV Profit reported.

In a letter sent to Telecom Secretary Neeraj Mittal on March 11, Vodafone Idea has requested the government to convert a larger portion of its outstanding dues into equity. If approved, this move could increase the government’s stake in the company from the current 22.6 percent to 49 percent, sources told NDTV Profit.

Vodafone Idea is seeking relief for Rs 36,950 crore worth of AGR and spectrum dues, with an urgent payment of Rs 13,089 crore due in the coming weeks, the report said. The financially stressed telecom firm has indicated that it lacks the capacity to meet these payments and has sought assistance under the 2021 Telecom Relief Package.

While Vodafone Idea has yet to respond to NDTV Profit’s queries, Moneycontrol has not independently verified the report.

The development follows reports that the government has declined to offer any waiver on AGR dues for telecom companies. If Vodafone Idea’s request is granted, analysts estimate that it could provide a relief of Rs 52,000 crore, reducing nearly 75 percent of its outstanding AGR liability and about 25 percent of its total debt. This could potentially add Rs 7 per share to Vodafone Idea’s equity value, according to earlier analyst estimates.

Vodafone Idea had previously sought to challenge the AGR dues calculation by filing a curative plea in the Supreme Court in July 2024, arguing against the inclusion of non-core revenue in AGR calculations. However, in September 2024, the Supreme Court dismissed the plea, dealing a significant setback to the telecom operator.