Airtel, Vodafone Idea shares spike after government announces deadline for AGR dues moratorium

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Airtel, Vodafone Idea shares spike after government announces deadline for AGR dues moratorium
Kumar Mangalam Birla and Sunil Bharti Mittal.BCCL
  • Airtel and Vodafone Idea shares have spiked after the government announced a deadline for opting for the adjusted gross revenue (AGR) dues moratorium.
  • Vodafone Idea share price has decreased by nearly 8% this month.
  • Airtel’s share price reached a new high for the month today.
Airtel and Vodafone Idea share prices spiked on Wednesday after the government announced a deadline for opting for the four-year adjusted gross revenue (AGR) dues moratorium.

The telecom relief package gives Airtel and Vodafone Idea a time-freeze of four years from making payments towards their respective adjusted gross revenue (AGR) dues. The government has announced that telcos have been given a deadline of October 29 to decide if they wish to opt for the payment moratorium.

Update: As per a report, Vodafone Idea has informed the government that it will accept the four-year moratorium on the AGR dues.

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Additionally, the telcos have been given 90 days to respond whether they wish to convert the accrued interest into equity.

Airtel is currently trading around ₹708.7 and reached this month’s high of ₹713 on October 20. Vodafone Idea on the other hand, increased by over 4% and is currently trading at ₹10.53, as of 11:15 a.m., on Wednesday.

Airtel, Vodafone Idea shares spike after government announces deadline for AGR dues moratorium
Airtel share price reached it's month-high today.BSE/Business Insider India/Flourish

Airtel will benefit from the four-year moratorium on AGR dues, freeing up its cash reserves to invest in the upcoming 5G spectrum auctions.
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Airtel, Vodafone Idea shares spike after government announces deadline for AGR dues moratorium
Vodafone Idea shares are up by over 4% today.BSE/Business Insider India/Flourish

The cash-strapped Vodafone Idea will also benefit from the AGR dues moratorium.

Here’s how much Vodafone Idea and Airtel owe the government in the form of AGR dues:

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CompanyTotal AGR demand (in crore)AGR dues paid (in crore)Balance AGR dues (in crore)
Vodafone Idea₹58,254₹7,854₹50,339
Airtel₹43,980₹18,004₹25,976

Source: AGR dues case in the Supreme Court

SEE ALSO:

Airtel, Vodafone Idea and Reliance Jio have till October 29 to opt for the AGR dues moratorium

Indian government dials M for moratorium – Airtel, Vodafone Idea get a four-year relief on AGR dues

Airtel, Vodafone Idea shares jump after government proposes to withdraw ₹13,000 crore demand for spectrum usage charges
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