Vodafone Idea Shares Jump 9% as SC Allows Centre to Reconsider AGR Case

Shares of Vodafone Idea Ltd (VIL) surged nearly 9% on October 27, after the Supreme Court allowed the Centre to reconsider the company’s plea related to Adjusted Gross Revenue (AGR) dues. The move signals a potential policy-level review of one of the telecom sector’s most crucial financial disputes.

“No reason why the Centre should be prevented from reconsidering the issue,” said the Supreme Court bench headed by Chief Justice B.R. Gavai, along with Justices K. Vinod Chandran and Vipul M. Pancholi.

At 11:48 am, Vodafone Idea shares were up 9% at ₹10.47 apiece on the NSE, reflecting positive investor sentiment after the court’s statement.

Centre to Review AGR Dues Issue

The Union Government informed the court that it is open to re-examining Vodafone Idea’s request in the AGR case. The Solicitor General, Tushar Mehta, representing the Centre, highlighted that the government holds nearly 50% equity in Vodafone Idea, making it a direct stakeholder in the company’s survival and revival.

He stated, “Some solution may have to be found out, subject to your lordship’s approval…” indicating possible relief or reassessment.

Vodafone Idea has filed a fresh plea against the Department of Telecommunications (DoT)’s demand of ₹5,606 crore relating to the 2016–17 financial year, seeking a comprehensive reassessment of dues under the Deduction Verification Guidelines issued on February 3, 2020.

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Background of AGR Dispute

The AGR dispute determines how telecom operators calculate their revenues to pay licence fees and spectrum usage charges to the government.

The Supreme Court’s 2019 ruling upheld the DoT’s definition of AGR, which included both telecom and non-telecom income (like interest or asset sales). This significantly increased the dues owed by telecom companies.

In 2020, the top court allowed 10 years for telcos to clear their AGR dues, with 10% payable upfront by March 2021, and the rest in annual instalments till 2031.

The DoT’s total AGR demand from telecom operators was estimated at ₹93,520 crore, creating major financial pressure on companies like Vodafone Idea and Bharti Airtel.

However, in 2021, the rules were relaxed to exclude non-telecom income from AGR calculations — providing some relief to operators.

What does this mean for Vodafone Idea?

This latest development comes as a positive step for Vodafone Idea, which has long been burdened by high AGR dues. The company’s management and investors are hopeful that a reconsideration by the Centre could ease the financial stress.

Analysts believe that if the government agrees to reassess or rationalise AGR calculations, it could improve Vodafone Idea’s balance sheet and boost confidence in the broader telecom sector.

Shares of Vodafone Idea have gained momentum, as investors interpret the Supreme Court’s direction as a possible start to a policy-level resolution in favour of the struggling telecom operator.

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