Vodafone Idea (Vi), the third-largest telecom operator in India, received the get-go from the Ministry of Communications to convert the interest dues into equity for the government. Being a positive boost for the company's future, the development has propelled the stock of Vodafone Idea up by more than 25% on Monday morning. The previous close of Vi's stock price was Rs 6.85. At the time of writing, it is trading at Rs 8.35 (21.90% up). The high that the stock price of Vi already touched on Monday is Rs 8.55.
The telco can finally go ahead and convert the interest dues on deferred payments into equity for the government. This would make the government the largest stakeholder in the company. Vi received the confirmation from the government to do this on Friday after the Aditya Birla Group (ABG) promised the government to bring in investments for the company.
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The boost in the stock price of Vodafone Idea is a sign of the positive sentiment that the investors have for the company post the dues conversion into equity for the government. The shares of Vi had suffered a lot in the last few weeks due to not being able to raise funds and also roll out 5G to compete with Airtel and Jio. Vodafone Idea has been losing customers for almost two years now, and the telco's key performance metrics need to turn green as well, otherwise, this boost in stock price in Monday would be reversed sooner or later.
