Shares of Vodafone Idea surged for the second time in a row a day after the struggling telecom company moved the Supreme Court seeking reassessment of additional adjusted gross revenue (AGR) dues. Today the shares surged 1% after witnessing a jump of more than 3 percent yesterday to close at 7.54. Vodafone Idea shares have now been higher in five out of six straight sessions, rising more than 15 percent in September so far. The stock has recovered nearly 23 percent after hitting a 52-week low of Rs 6.12 apiece in August this year, however it is still down around 45.5 percent from its 52-week high of Rs 13.77 per share hit a year ago.
Vodafone Idea urged Supreme Court to quash an additional Rs 9,450 crore AGR demand by the Department of Telecommunications (DoT), alleging that the fresh dues exceed the scope of the Court's earlier ruling on AGR liabilities.The telecom operator's petition challenged DoT's revised calculations which covered dues up to FY17 and the updated licence fee obligations for both the Idea Cellular group and Vodafone Idea Limited through FY19. These revised dues fall under the government's moratorium on AGR payments, which ends on March 31 next year, after which, Vodafone Idea will have to begin making instalments.
As part of its latest assessment, the DoT has raised an extra demand of Rs 2,774 crore for FY18-19. Vodafone Idea claimed that certain amounts have been added twice and need reconciliation. The company has asked for a recalculation of dues, starting from the pre-FY17 period. According to the petition, out of the total Re 9,450 crore demand, Rs 2,774 crore pertains to the post-merger entity — Idea Group and Vodafone Idea — following their August 2018 consolidation, while Rs 5,675 crore relates to the pre-merger Vodafone Group's liabilities. The Supreme Court in March, 2020 locked Vodafone Idea's AGR dues till 2016-17 based on calculations by the department of telecommunications (DoT), adding that no self-assessment or re-assessment of the dues would be permitted. However, DoT had sought additional payments for up to 2018-19, Vodafone Idea said in its petition dated September 8. The telecom operator owes about Rs 83,400 crore in AGR dues to the government, with annual payments of Rs 18,000 crore beginning in March. Overall, Vodafone Idea’s total dues to the government stand at around Rs 2 trillion, including penalty and interest.