Desk. Vodafone Idea, which has been facing problems in India’s telecom sector for a long time, has finally got relief, but this news has brought mixed messages for investors. On Wednesday, the Union Cabinet approved a five-year moratorium on the company’s Adjusted Gross Revenue (AGR) dues of Rs 87,695 crore. This means that Vodafone Idea will not have to pay the AGR related dues immediately and this payment will be made in installments over ten years between FY32 to FY41.
However, despite this announcement, there was a huge fall in the shares of Vodafone Idea. On Wednesday, the stock fell to close at ₹10.76, which means investors got a big shock. Experts say that this reaction in the market is due to the fact that the relief will be applicable for a long time and the company will still have to make bigger payments in the future.
As per the central plan, no interest will be charged during the moratorium, which will help Vodafone Idea in handling its huge debt and operational challenges. After the end of the moratorium, the remaining amount will have to be paid in six to ten installments. The AGR dues will be assessed by the Department of Telecom, taking into account the deduction verification guidelines and audit reports. For this, the government will form a committee which will decide the methods of management and payment of the outstanding amount.
Government sources said the move is aimed at protecting the government’s 49% stake in Vodafone Idea, maintaining competition in the telecom market and protecting the interests of 20 crore Vodafone Idea customers. However, AGR dues for FY18 and FY19, which have been settled under the Supreme Court’s 2020 order, will have to be paid between FY26 to FY31 and there will be no change.
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