Shares of Vodafone Idea decline as the carrier opposes turning deferred AGR stake into stock

For the fiscal years 2017–2018 and 2018–2019, telecom company Vodafone Idea has opted not to convert deferred adjusted gross revenue (AGR) interest into equity.

Following the progress, intraday trading of Vodafone Idea shares saw a decrease of about 4%. At 11:15 a.m., the stock’s BSE value was Rs 9.36, a decrease of 2.9 percent.

The government has not yet decided whether to transform the company’s Rs 16,130 crore interest on the postponed amounts due up to fiscal 2016–2017 into stock, making the debt-ridden telecom operator’s choice significant.

Vodafone Idea Ltd made the decision to postpone for four years paying additional AGR obligations of Rs. 8,837 crores earlier in June. However, the Supreme Court’s ruling on the statutory dues did not apply to these fees.

In the statement, Vodafone Idea stated that its board of directors “according to the aforementioned DoT Letter, has authorized the use of the option to defer paying AGR-related debts for 4 years with effect immediately. The value of the AGR-related debt, as stated in the aforementioned DoT Letter, is Rs 8,837 crores, however, this figure is susceptible to change due to the resolution of various representations “.

Based on their AGR, which is taken into account to have been obtained by them through the sale of services, telcos’ revenue is used by the government to compute their portion.