Voda Idea, Airtel recover from day's low as SC defers AGR hearing to July

Shares of telecom service providers Bharti Airtel and Vodafone Idea were trading in the green at 12:26 pm, after the Supreme Court (SC) asked the telcos to file their financial statements before it and fixed adjusted gross revenue (AGR) related dues case against them for hearing in the first week of July. READ MORE

Bharti Airtel was trading 0.27 per cent higher at Rs 563.50, after hitting a high of Rs 572.85 during the SC hearing.  However, Vodafone Idea was up 5 per cent at Rs 10.31, recovering nearly 14 per cent from the intraday's low of Rs 9.07 on the BSE. In comparison, the S&P BSE Sensex was up 0.69 per cent at 33,738 points. According to analysts, anything less than 15 years would significantly curtail the ability of Vodafone Idea to meet AGR obligations.

The Supreme Court has given the Department of Telecommunication (DoT) time until July third week to consider the proposals by telecom companies, reports said. The SC was today hearing the petition from DoT petition to allow telecom companies to make staggered payment for their AGR dues.

Mukul Rohatgi, Counsel of Vodafone Idea said it is an extremely precarious situation for the company and it is not in a position to give any fresh bank guarantees, the report said.

"Bharti Airtel is in a much better position given that they have already paid Rs 18,004 crore out of their total dues of Rs 43,980 crore and has a relatively stronger balance sheet as compared to Vodafone Idea and therefore better placed to provide guarantees, said Jyoti Roy, DVP Equity Strategist at Angel Broking. 

Meanwhile, shares of state-owned companies like Oil India, Power Grid Corporation of India, Gail (India) and Gujarat Narmada Valley Fertilizers & Chemicals (GNFC) were up 2 per cent to 4 per cent after the DoT said it has withdrawn AGR demand from the PSUs since they are not in the business of providing telecom services to the general public.