Signalling clarity on payment approach: Vi may give government more equity to clear its bills
Vodafone Idea (Vi) CEO Akshaya said the telco is looking at further conversions of government dues into equity as well as internal accruals to address payout obligations toward spectrum and adjusted gross revenue (AGR). The moratorium on these payments ends in September 2025.
The statement came during Vi’s FY24 fourth-quarter earnings call Friday. Moondra was responding to a query on Vi’s payment strategy on clearing government liabilities of more than Rs 2 lakh crore relating to spectrum payments and AGR dues.
Vi has to pay Rs 29,000 crore in March 2026 and Rs 43,000 crore in March 2027.
“We are looking at conversions as well as internal accruals via cash generation from operations,” he said.
In February 2023, the government had converted accrued interest of Rs 16,133.18 crore on AGR dues into equity at Rs 10 a share, giving it a 33% stake.
Users can easily absorb tariff hike, says CEO
Following Vi’s recent follow-on public offer (FPO), the government holding was reduced to 23.8%. Analysts said this gave the Centre room to extend the assistance package in FY26 when the moratorium period ends.
Moondra had told ET in April the Centre’s stake could rise back to 32-33% if it decided to convert some of the principal dues into more equity.
The Vi CEO said Friday that any significant tariff hike after the elections should be easily absorbed by users. Mobile services are essential and “not a discretionary spend”, he said.
Telecom tariff structures need to rapidly migrate to a pay-as you-go model with mobile users
