Vodafone Idea shares tank 9% as government rules out AGR support

Shares of Vodafone Idea fell over 9 per cent after government clarified that no additional relief is being considered for its AGR dues

Vodafone Idea share price today: Shares of India's third largest telecom operator, Vodafone Idea, fell over 9 per cent to hit an intraday low of ₹6.6 on the NSE. 

 

At 12:00 PM on August 26, the stock was trading at ₹6.7, down 9 per cent from the previous session's close of ₹7.4 on the NSE. In comparison, the benchmark NSE Nifty50 index was down 166 points or 0.67 per cent at 24,802 levels. The company's market capitalisation stood at ₹71,914.86 crore. The stock has plunged over 60 per cent from its 52-week high of ₹16.55 touched on August 29, 2024.

Here's why Vodafone Idea shares are falling:

The selling in the stock came after the government clarified that no additional relief is being considered for the telecom operator regarding its adjusted gross revenue (AGR) dues. The statement comes amid continuous concerns about the company's financial stability and its ability to meet its obligations.

 

Minister of State of Communications Pemmasani Chandra Sekhar said on August 25 that there is no plan under consideration to provide additional relief beyond what has already been granted.

 

"We have recently converted a lot of their debt into equity. The government has done whatever we thought we could do. At this time, we do not have any discussion or plan to change anything other than what we have done," Pemmasani said.

 

The government became the largest shareholder in Vodafone Idea after acquiring shares valued at ₹36,950 crore in March this year, settling outstanding spectrum auction dues.

 

Previously, in 2023, it had secured around a 33 per cent stake in the company in exchange for statutory dues exceeding ₹16,000 crore.

 

As of June 2025, Vodafone Idea's AGR dues stood at around ₹75,000 crore. In its affidavit submitted to the Supreme Court, Vodafone stated it would not be able to survive without government support.

Emkay Global on Vodafone Idea

In a recent note, domestic brokerage Emkay Global said Vodafone Idea’s high leverage stems from AGR dues and spectrum liabilities owed to the government. This heavy debt burden has limited the company’s ability to invest in network, resulting in loss of market share and inadequate earnings before interest, tax, depreciation and amortisation (Ebitda) generation to repay the debt. As a result, the company’s future mainly depends on government decisions regarding the timing and scale of debt relief. 

 

Given the current financial strain and lack of clarity on potential government support, Emkay maintains a cautious outlook on Vodafone Idea. The brokerage has assigned a 'Sell' rating to a stock with a target price of ₹6. A substantial debt relief package from the government remains a key risk to this view, it added.