Vodafone Idea Share Price in Focus as Telco Seeks DoT Nod for Equity Swap

Vodafone Idea Limited’s share price traded at ₹7.59 at 10:25 AM on the NSE, reflecting a marginal decline of 0.39% (₹0.03) from its previous close of ₹7.62. The stock opened at ₹7.72, reached an intraday high of ₹7.74, and touched a low of ₹7.55.

Vi’s Appeal to DoT

Vodafone Idea, a joint venture between the UK’s Vodafone Plc and India’s Aditya Birla Group, has informed the DoT that its financial position prevents it from furnishing a bank guarantee of ₹6,091 crore or making a cash payment of ₹5,493 crore to cover outstanding payments from the 2015 spectrum auction, as per Economic Times report.

Given this, the company has requested that the DoT refrain from taking any “coercive action” against it.

In a letter addressed to DoT Secretary Neeraj Mittal, Vi’s CEO Akshaya Moondra emphasised the urgent need for financial relief, particularly in meeting AGR and spectrum instalment obligations from past auctions held in 2012, 2014, 2015, and 2016.

The company has requested that these outstanding dues be converted into equity under the provisions of the Telecom Reform Package 2021 to ensure continued operations.

Potential Government Stake Increase

If the DoT agrees to Vi’s proposal, the government’s holding in the company could rise significantly—from 22.6% to 49%. This move would further dilute existing shareholders but provide the much-needed financial cushion for Vi to sustain its business, as per the news report.

According to Vi’s letter, total equity conversions would amount to ₹36,950 crore on a net present value (NPV) basis.

Conclusion

Vodafone Idea’s appeal to the DoT for an equity conversion highlights the financial strain the telecom company faces as it struggles to meet its AGR and spectrum dues. If approved, the move could significantly increase the government’s stake in Vi, providing much-needed liquidity but also leading to shareholder dilution.

Investors will closely monitor regulatory decisions, as the outcome could shape Vi’s financial stability and long-term viability in the competitive telecom sector.

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