Citi has reiterated its buy/high-risk rating on Vodafone Idea (VI) with a target price of ₹10, citing potential relief after the Supreme Court admitted the company’s latest adjusted gross revenue (AGR) plea, with government support adding weight to the case.
The company has filed a fresh petition challenging additional government demands for pre-FY17 AGR dues, arguing that the original demand should be considered final and, if subject to revision, then the entire dues up to FY17 should be reassessed and reconciled. The government, which holds a 49% stake in VI, told the court it had no objection to the petition and highlighted the importance of finding a resolution in the broader public interest, subject to Supreme Court approval.
The court observed the need for finality in these proceedings and scheduled the next hearing for September 26. Citi said the supportive stance of the government improves the likelihood of relief, though it maintained the high-risk tag given VI’s balance sheet challenges.
Disclaimer: The views and recommendations made in this article are those of Citi. This article does not constitute investment advice. Investors should consult their financial advisors before making any investment decisions.
