Vi currently faces over $10 billion in adjusted gross revenue (AGR) dues, and the government, which now owns nearly 49% of the company following earlier debt-to-equity conversions, is considering further intervention to ensure its survival.
Proposed measures include extending Vi’s AGR repayment timeline from six to 20 years and converting interest calculations from compound to simple interest, easing Vi’s repayment burden.
A temporary token-payment model is also under consideration, where Vi may be allowed to pay just $12–18 million annually until a more permanent solution is finalised.
Following the news, Vodafone Idea’s stock jumped by 5–7%, reflecting investor optimism. However, analysts remain cautious, noting that even under improved terms, the company’s projected cash flow may not cover its obligations, raising questions about its long-term sustainability.
Vodafone Idea CEO Akshaya Moondra has previously warned that without urgent government support, the company may become insolvent by the 2025–26 fiscal year.
He noted that recent Supreme Court rulings have provided the legal basis for the government to proceed with AGR-related concessions.
Despite this, Communications Minister Jyotiraditya Scindia clarified that there would be no additional government equity infusion.
He emphasised that Vi must find its own path to profitability, even as the government seeks to maintain a competitive three-player telecom market and prevent a duopoly.
With Vi facing AGR payments of approximately $2.2 billion by March 2026, and holding just $1.2 billion in cash reserves, analysts say urgent action is required to stabilise India’s telecom sector and keep Vi viable.
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