Vodafone Idea shares jumped over 5% after the Union Cabinet has approved a relief package for Vodafone Idea (Vi) on its long-pending adjusted gross revenue (AGR) dues, providing a significant breather to the debt-laden telecom operator. The decision follows a Cabinet meeting held on Wednesday, where the government considered the company’s request for relief on interest, penalties, and interest on penalties that form a large part of its AGR liabilities.
According to earlier brokerage estimates, Vodafone Idea’s aggregate AGR dues stood at around Rs 78,000 crore as of Q2 FY26, with interest and penalties accounting for the majority of the outstanding amount. Analysts had expected the government to consider a partial or full waiver of interest-related components, which could translate into relief of nearly $8 billion for the telecom operator.
Vodafone Idea has been under severe financial stress, with AGR dues of about Rs 83,400 crore and annual payments of nearly Rs 18,000 crore scheduled from March 2025. The company has repeatedly warned that its survival depends on external funding support, as lenders remain cautious due to its weak balance sheet. Vi employs over 18,000 people and serves close to 198 million subscribers across India.
The Cabinet decision comes weeks after the Supreme Court allowed the government to comprehensively reassess and reconcile Vodafone Idea’s dues, including interest and penalties, up to FY17. This ruling was widely viewed as a turning point for the company’s AGR dispute.
Earlier, in September, Vodafone Idea had sought a waiver on Rs 9,450 crore of AGR demand raised by the Department of Telecommunications, arguing that a substantial portion related to pre-FY17 liabilities already settled by the apex court in 2020.
The government is already the largest shareholder in Vodafone Idea, holding nearly 49 percent stake after converting Rs 36,950 crore of dues into equity in March this year. Prior to this, the Centre had acquired a 33 percent stake in 2023 by converting statutory dues exceeding Rs 16,000 crore.
The approved AGR relief package is expected to significantly ease Vodafone Idea’s cash flow pressure and provide short-term stability, even as the company continues to seek long-term funding solutions.
