New Delhi, April 1 – Shares of telecom company Vodafone Idea Limited (VIL) jumped over 19 percent on Tuesday following the government's decision to convert spectrum auction dues worth Rs 36,950 crore into equity. The move will significantly increase the government's stake in the financially struggling telecom operator, more than doubling it to 48.99 percent.
As per agency report, the company’s stock closed 18.94 percent higher at Rs 8.10 on the BSE, after touching an intraday high of Rs 8.57, up 25.84 percent. On the NSE, the share ended 19.11 percent higher at Rs 8.10, with an intraday peak of Rs 8.56, marking a similar surge of 25.88 percent.
This sharp rally boosted Vodafone Idea’s market capitalization by Rs 9,209.71 crore, bringing the total valuation to Rs 57,828.36 crore. Trading volumes also saw a significant increase, with 352.1 million shares exchanged on the BSE and 2.3 billion shares on the NSE.
Prior to this move, the government already held a 22.6 percent stake in the debt-ridden telecom firm, making it the largest shareholder. With the new equity conversion, the government's shareholding will exceed that of the company’s promoter groups – Vodafone and the Aditya Birla Group – who currently hold 14.76 percent and 22.56 percent, respectively.
In a regulatory filing on Monday, Vodafone Idea confirmed that the Ministry of Communications has approved the conversion of spectrum auction dues into equity shares, in line with the telecom relief package announced in September 2021. The total amount being converted into equity stands at Rs 36,950 crore, providing the company with crucial support to stabilize its operations.
