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Vodafone Idea has said it may be compelled to approach the National Company Law Tribunal (NCLT) for insolvency proceedings if additional help is not extended, says a report.
Vodafone Idea also flagged the potential risk to the government’s 49% equity stake in the company. (Reuters File Image)
Struggling telecom operator Vodafone Idea (Vi) has issued a fresh warning to the Indian government, stating it will be unable to continue operations beyond FY2025-26 without further state support, CNBC-TV18 has reported. The company has said it may be compelled to approach the National Company Law Tribunal (NCLT) for insolvency proceedings if additional help is not extended.
Despite a Rs 26,000 crore equity infusion and the conversion of the government’s dues into equity, the telco said it has failed to secure any support from banks. Vi told the government that without its intervention, the company will not be able to raise bank funding and “will not be in a position to continue operations beyond FY26″.
Vodafone Idea also flagged the potential risk to the government’s 49 per cent equity stake in the company. It said the value of that stake could fall to zero if it is forced into insolvency, leading to no recovery on the Rs 1.18 lakh crore of spectrum dues already converted into equity.
The telco said, “In the absence of government support and with the company unable to pay its AGR dues, we would be left with no option but to approach the NCLT.” Vi also highlighted the wider impact on over 200 million subscribers, and warned that a potential collapse could have a cascading effect on other sectors and India’s broader digital ambitions.
Even after the government converted a portion of spectrum and AGR dues into equity, Vodafone Idea still owes a massive Rs 1.95 lakh crore in dues.
Vi has also moved the Supreme Court, seeking additional relief on its Adjusted Gross Revenue (AGR) liabilities. It is asking for a waiver of over Rs 30,000 crore, particularly the penalty and interest on the penalty component of the AGR levy. In its plea, the company said the government is “handicapped” in granting further relief because of constraints imposed by the court’s earlier judgment on AGR.
Calling the Centre a de facto stakeholder, the company argued that with the government now holding 49 per cent stake, it has become a “partner” in the business.
Vi has requested an urgent hearing on the matter, which is scheduled for May 19.
As per the latest shareholding data, Foreign Portfolio Investors (FPIs) own 6.56 per cent of the company, though none hold a stake large enough to be named individually. The telco also has over 59 lakh small shareholders, those with share capital up to Rs 2 lakh.
Despite the uncertainty, shares of Vodafone Idea rose 3.87 per cent to Rs 7.51 apiece on the BSE on Friday. However, the stock remains down 7 per cent in 2025 so far.
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