Decade of relief ahead for Vodafone Idea to recuperate

Core Viewpoint - Vodafone Idea (Vi) has received a significant relief package from the government, allowing it a technical 10-year period to pay over 95% of its adjusted gross revenue (AGR) dues, which are currently frozen at ₹87,695 crore as of December 31 [8][9]. Group 1: Financial Relief and Payment Structure - The company has been granted a five-year moratorium on frozen dues, which will be reassessed, while it is required to pay AGR dues for FY18 and FY19 amounting to ₹700-800 crore, to be paid in annual installments of ₹114 crore by FY31 [5][9]. - Starting from FY32, Vi will pay ₹100 crore annually for four years until FY35, with the majority of AGR dues repayment commencing between FY36 and FY41 [9]. - The government has effectively provided the necessary time for Vi to recover financially, as the company had previously sought an extension until FY41 for its AGR dues [7][9]. Group 2: Market Reaction and Stock Performance - Following the announcement of the relief package, Vi's shares closed at ₹11.62, reflecting an increase of approximately 8% on the BSE, recovering from a previous decline when the relief package was initially reported [6][9]. - The stock price rebound indicates market optimism regarding the potential benefits of the relief package for the company [6][9]. Group 3: Stakeholder Implications - The government holds a 49% stake in Vodafone Idea, making it the largest stakeholder, and would face significant losses if the company were to fail [7][9]. - Other stakeholders include the Aditya Birla Group and Vodafone Group Plc, holding 9.50% and 16.07% stakes, respectively [7].