Vodafone Idea Share Price Hits 10% Upper Circuit Amid AGR Waiver Buzz

The stock market was abuzz on Monday, January 20, 2025, as Vodafone Idea’s share price surged by 10%, hitting its upper circuit on the BSE. The stock opened at ₹10.03, a significant jump from its previous close of ₹9.12, and remained locked at this level around 9:35 AM. The rally was driven by reports suggesting that the Indian government is considering waiving a substantial portion of adjusted gross revenue (AGR) dues for telecom companies.

What’s Driving the Surge?

According to an Economic Times report, the Union government is mulling over a proposal to waive 50% of the interest and 100% of the penalties and interest on penalties associated with AGR dues. This comes as a relief to telecom giants like Vodafone Idea and Bharti Airtel, who have been struggling with hefty payments since the 2019 Supreme Court ruling.

AGR, which refers to revenue earned by telecom operators from their core services, is the basis on which the government levies charges on telecom companies. As per a Trai report, the telecom sector has witnessed growth, with gross revenue increasing by 10.5% year-on-year to ₹91,426 crore in the July-September 2024 quarter. Vodafone Idea’s AGR, in particular, saw a 4.39% rise to ₹7,836.98 crore compared to ₹7,507.65 crore in the same period last year.

A Look at Vodafone Idea’s Share Performance

Vodafone Idea’s shares have been on an upward trend for the last five trading sessions, gaining nearly 30% since January 14. The stock had earlier hit a 52-week high of ₹19.15 on June 28, 2024, and a 52-week low of ₹6.60 on November 22, 2024.

The recent surge is further supported by significant investments from Omega Telecom Holdings Private Limited and Usha Martin Telematics Limited (UMTL), who have acquired additional equity shares through preferential issues. Omega Telecom Holdings now holds a significant chunk of the company’s equity, boosting investor confidence.

What Does This Mean for Investors?

The potential AGR waiver could be a game-changer for the Indian telecom sector, providing much-needed relief to companies like Vodafone Idea, which have been under financial stress. While the market sentiment is positive, experts advise investors to proceed cautiously and consult certified professionals before making any investment decisions.

Final Thoughts

The buzz around AGR relief has given Vodafone Idea a much-needed push, reflecting optimism in the market. If the government finalizes the waiver, it could pave the way for a stronger telecom sector in India. With the stock gaining momentum, all eyes are now on the official announcement regarding AGR dues.

Stay tuned for more updates on the stock market and telecom sector trends!

Reference from:-https://www.livemint.com/market/stock-market-news/vodafone-idea-share-price-hits-10-upper-circuit-on-potential-agr-waiver-buzz-11737345740432.html