Shares of Indus Towers and Vodafone Idea plummeted by 10.03% to 21.30% on Thursday following the Supreme Court’s rejection of a plea to re-compute adjusted gross revenue (AGR) dues.
Vodafone Idea (down 21.30%) and Indus Towers (down 10.03%) slumped.
However, Bharti Airtel was up 1% to hit a record high of Rs 1711 today.
The court decision has dealt a significant blow to the struggling telecom sector. Vodafone Idea, which had previously reported an AGR liability of approximately Rs 70,300 crore, including accumulated interest, had argued for a reassessment of the amount and a reduction or waiver of the penalty. However, the Supreme Court, in its verdict, found no merit in the telecom companies’ claims and dismissed their petitions.
The apex court’s ruling has put immense pressure on Vodafone Idea, which is already grappling with a gross debt of Rs 2.1 lakh crore. Of this, only a small portion is owed to banks and financial institutions, while the majority is payable to the government. The government dues, currently under moratorium until October 2025, will pose a substantial challenge to the telecom operator once the moratorium expires.
The decision has also impacted the shares of Indus Towers, which offers passive infrastructure services to mobile network operators and other wireless services providers.
The Supreme Court’s rejection of the telecom companies’ plea further exacerbates the challenges faced by the Indian telecom sector, which has been struggling with intense competition and high spectrum costs.
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First Published: Sep 19 2024 | 3:06 PM IST
