Vodafone Idea share price crashes 12%. Why is the telecom stock falling depsite SC's relief on AGR dues?

Vodafone Idea share price: Shares of debt-ridden telecom firm Vodafone Idea declined by 12% in intraday trading on Thursday, October 30, amid concerns that the Supreme Court's order offers only partial relief to the company.

The telecom stock hit the day's low of ₹8.21 on the BSE, as against its last closing price of ₹9.37.

According to the Supreme Court's written order, the claim is restricted only to the additional adjusted gross revenue (AGR) demand raised for the period up to the financial year 2016-17. According to certain media reports, citing analysts, the relief, if provided, will be limited to the new AGR demand of ₹9,450 crore.

“It is further to be noted that the prayer in the petition itself restricts its claim only to the additional AGR demand raised by the respondent for the period up to the Financial Year 2016-17,” the Supreme Court order read.

The Supreme Court order further specified that it applies only to Vodafone Idea, dealing a blow to rival Bharti Airtel, whose shares also declined nearly 1.5% in trade today.

We further clarify that this order is passed only with regard to the petitioner-Vodafone Idea Ltd., taking into consideration the peculiar facts and circumstances of the case as put up by the Union of India, said the apex court in its order.

The financially stressed telecom company — facing ₹83,400 crore in AGR dues and total government liabilities of nearly ₹2 trillion — has repeatedly cautioned that such a burden poses risks to its viability and the livelihoods of its workforce.

Vodafone Idea employs over 18,000 people and serves approximately 198 million subscribers across India.

Emkay Global said that even excluding AGR dues, VI’s debt of ~ ₹1.18 trillion (largely on spectrum payment) is high, considering the current EBITDA ( ₹92 billion in FY25, excluding IndAS-116 impact).

Hence, the brokerage expects the GoI to take a holistic view on the solvency of the company and, accordingly, structure the relief. While the permission by the SC improves VI’s chances of revival, given high leverage, high valuations, and lack of clarity on the GoI stance on spectrum debt, the brokerage continued to retain SELL on Vodafone Idea stock and a target price of ₹6.

Vodafone Idea Case

In its petition filed on September 8, Vodafone Idea contested the Department of Telecommunications’ (DoT) fresh demand of ₹9,450 crore for the period up to 2018–19. This included ₹2,774 crore attributed to Vodafone Idea (post-merger) and ₹6,675 crore linked to the former Vodafone Group entities.

The company stated that out of the total ₹9,450 crore demand, around ₹5,606 crore (as of March 31, 2025) pertains to the period up to 2016–17, which it said had already been finalised (“crystallised”) by the Supreme Court.

In an amended petition, the telecom operator also requested a waiver of penalties and interest on the AGR dues, asserting that several components of the demand remain unresolved or disputed.

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