Supreme Court on Thursday allowed the Centre’s plea to recover AGR of about ₹92,000 crore from them.
Shares of Vodafone Idea crashed over 27% during the day on Thursday after the Supreme Court allowed the Centre’s plea to recover adjusted gross revenue (AGR) of about ₹92,000 crore from telecom service providers.
Vodafone Idea plummeted 23.36% to close at ₹4.33 on the BSE. During the day, it tanked 27.43% to ₹4.10 — its 52-week low.
Led by the sharp fall in its shares, Vodafone Idea witnessed an erosion of ₹3,792.58 crore from its market valuation which is now at ₹12,442.42 crore.
Bharti Airtel also tumbled 9.68% to ₹325.60 during the trade. But, later it bounced back and closed 3.31% higher at ₹372.45.
In a setback to telecom service providers, the Supreme Court on Thursday allowed the Centre’s plea to recover AGR of about ₹92,000 crore from them.
Industry body COAI said the ruling will deal a “disastrous blow” to the industry, given its precarious financial condition.
The decision will have a big impact on the sector as it is already in the state of huge financial distress, Prashant Singhal, Emerging Markets TMT Leader, EY, said.
Bharti Airtel on Thursday said the Supreme Court verdict on adjusted gross revenue will weaken viability of telecom sector, and the government must review its impact and find ways to mitigate financial burden on the already stressed industry.