InvestorQ : What exactly is the problem with Vodafone Idea?
vidhya Laxmi made post

What exactly is the problem with Vodafone Idea?

sarah Leo answered.
1 year ago

In the last few months there have increasingly been questions about the sustenance of the Vodafone Idea business model. Firstly, the AGR verdict is bad news for Vodafone Idea as the Supreme Court dismissed the plea seeking review of AGR calculations. Of course, Vodafone and Bharti still have 10 years to pay up the full sum, but it is a huge burden. There is already a concern that Vodafone may default on its next tranche of AGR dues to DOT in Mar-22.

The problem is much bigger for Vodafone than for Bharti Airtel. In the case of Bharti Airtel the gap is just Rs.13,000 crore while in the case of Vodafone, the gap is over Rs.31,000 crore. Also, Bharti is solvent enough to pay the dues but Vodafone will find it tough to service this kind of requirements unless fresh capital is raised. Vodafone is in no financial position to even honour part of that commitment.