Vodafone Idea Surges 6 Per Cent In Early Trade; Market Eyes Next Move

The central government — which now holds the largest equity stake in Vodafone Idea — is reportedly reviewing various strategies to address the company’s outstanding dues totalling Rs 84,000 crore.

The Department of Telecommunications has raised concerns that if Vodafone Idea is required to pay the full Rs 18,064 crore due by the end of FY26, the company may not have sufficient funds to meet its obligations in FY27.

Source : VI

Shares of Vodafone Idea surged over 6 percent in early trading on June 24 following reports that the Indian government is exploring relief measures to assist the struggling telecom operator with its substantial regulatory dues.

As of 12:15 PM, the company's shares traded at Rs 6.96 apiece on the BSE, clocking a gain of 6.26 per cent, while on NSE, the stock stood at Rs 6.95 apiece, climbing 6.11 per cent. This rally was driven by renewed optimism among investors.

Government Evaluates Multiple Relief Proposals

According to a report by the Economic Times, the central government — which now holds the largest equity stake in Vodafone Idea — is reviewing various strategies to address the company’s outstanding dues totalling Rs 84,000 crore. Citing individuals familiar with the matter, the report stated that authorities are assessing several alternatives aimed at preventing the company from slipping into insolvency.

Among the options being considered is extending the current repayment term from six years to twenty years, coupled with the application of simple interest instead of compound interest on the dues, stated Moneycontrol citing the report.

Another possible measure involves allowing Vodafone Idea to make a token payment of Rs 1,000 to Rs 1,500 crore annually until a conclusive resolution is reached regarding the broader adjusted gross revenue (AGR) matter. The report highlighted that the final relief plan may involve one or a combination of these options.

The latest developments come in the backdrop of Vodafone Idea reportedly warning the government that without financial support, its operations may not be sustainable beyond the 2025-26 fiscal year, potentially forcing it into bankruptcy.

Minister Backs Competition in Telecom Sector

Adding to the positive sentiment, Telecom Minister Jyotiraditya Scindia emphasised the importance of competition in India’s telecom industry. Speaking at an event in Delhi, Scindia said, "It’s not good enough having a duopoly or one carrier or two carriers. India must have competition in every sector. India today is probably the only country in the world for competition in ISP domain."

Earlier this year, Vodafone Idea announced that the central government would convert its outstanding spectrum dues into equity. Following this move, the government's shareholding in the company rose significantly from 22.6 percent to 48.99 percent. In a stock exchange filing, Vodafone Idea clarified, "The promoters will continue to have operational control of the company."

Despite this previous relief, reports earlier this month suggested that the government has no plans to convert any additional arrears into equity. The Department of Telecommunications has raised concerns that if Vodafone Idea is required to pay the full Rs 18,064 crore due by the end of FY26, the company may not have sufficient funds to meet its obligations in FY27.

Meanwhile, Vodafone Idea’s financial struggles continue. The company's shares have fallen nearly 60 per cent over the past year and are down more than 13 per cent so far in 2025. The Supreme Court has consistently dismissed telecom companies' petitions seeking waivers on a portion of their AGR dues.