On September 18, the shares of Vodafone Idea, which had witnessed a remarkable surge of around 50 percent in the past month, reversed their early gains and transitioned into a downward trend. Investors viewed the recent upswing in the stock as an opportunity to secure partial profits. During the trading session, the stock had surged by approximately 7 percent, reaching a 52-week high of Rs 12.50, following Vodafone Idea’s announcement of a payment amounting to Rs 1,701 crore to the Department of Telecommunications (DoT).
At 10:07 am, Vodafone Idea’s shares were observed trading 1.7 percent lower at Rs 11.50 on the National Stock Exchange.
This payment represents the annual installment for the spectrum acquired by the company in the 2022 auction. In the previous month, the company had expressed its intent to make this payment, which amounted to nearly Rs 1,680 crore to the DoT, utilizing a grace period of 30 days along with interest. Significantly, the company successfully fulfilled this obligation within the stipulated 30-day timeframe.
The delay in making the installment payment was attributed to financial constraints, and it appears to have been facilitated by financial support from a promoter group entity. The promoter group had committed to providing assistance of up to Rs 2,000 crore to Vodafone Idea in the event that the company required financial support to meet its impending payment obligations.
Presently, the telecom company faces outstanding dues of nearly Rs 700 crore to the DoT, encompassing spectrum usage charges, license fees, and various other statutory obligations. In addition to these financial challenges, Vodafone Idea is grappling with financial instability, primarily arising from significant losses and an enormous debt burden amounting to Rs 2.1 lakh crore.
