Vodafone Idea Gets Five-Year AGR Moratorium, But No Waiver; Shares Slide 11%

India has approved a partial moratorium on Vodafone Idea’s adjusted gross revenue (AGR) dues, freezing payments worth about $9.76 billion and deferring repayment into the 2030s, a government source told Reuters. The move halts further interest and penalties, with repayments set to begin in 2031-32 and continue through 2040-41, offering the debt-laden telecom operator short-term cash-flow relief without reducing the overall dues.

The decision disappointed investors who had hoped for a broader waiver after India’s top court in November asked the government to consider the company’s request for wider relief. Vodafone Idea’s shares fell 11% following the announcement. “The five-year moratorium gives the company recovery time. The Street anticipated a waiver of some sort, but that has not happened,” said Vinit Bolinjkar, head of research at Ventura Securities. Telecom operators, including Vodafone Idea, have long disputed the government’s AGR calculation formula, which influences license fees and other statutory dues.

The government, which holds a 49% stake in Vodafone Idea and earlier agreed to convert part of the firm’s spectrum dues into equity, confirmed that AGR liabilities for 2017-18 and 2018-19 — already finalised by a 2020 Supreme Court ruling — will continue to be paid as scheduled between 2025 and 2031. In a regulatory filing, the company said it has not yet received official communication on the moratorium decision.

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