Vodafone Idea, Tata Tele Shares Rally Following Reports on Positive Support from Govt

Vi's annual payouts towards AGR dues would come down significantly if the government decides to waive 50% interest and remove the penalties and interest on them. 

Highlights

  • Vodafone Idea (Vi) and Tata Teleservices saw their shares jump more than 10% on Monday morning.
  • The reason for this rally in shares are reports saying that the government is considering a major relief for the telcos related to the AGR (adjusted gross revenue) dues.
  • Vi's share price is currently Rs 9.98, up 9.55%, while Tata Teleservices is trading at Rs 81.90, up 15.29%.

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vodafone idea tata tele shares rally following

Vodafone Idea (Vi) and Tata Teleservices saw their shares jump more than 10% on Monday morning. The reason for this rally in shares are reports saying that the government is considering a major relief for the telcos related to the AGR (adjusted gross revenue) dues. As per an ET report, the government is considering letting go of up to 50% interest on the AGR dues, and up to 100% of the penalties and the interest on penalties. The AGR dues are the biggest burden on Vodafone Idea (Vi). Due to that, creditors and lenders have been cautious of exposing themselves further to Vi.




Vi's share price is currently Rs 9.98, up 9.55%, while Tata Teleservices is trading at Rs 81.90, up 15.29%.

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If this support thing turns out to be the reality, then it would become signficantly easier for Vi to raise funds through debt. The telco has already raised money through equity, and its three-year plan also includes a major chunk of money that would come from debt. Tata Teleservices also owes money to the government in the form of AGR dues, and interest on it.

Vi's annual payouts towards AGR dues would come down significantly if the government decides to waive 50% interest and remove the penalties and interest on them.

Reported By

Tanuja is a passionate technology and telecom buff who has been following the telecom industry for several years now.

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