Vodafone Idea rally: Shares lock in 10% upper circuit after SC clarity on AGR dues; is this the relief investors were waiting for?

Vodafone Idea shares surged nearly 10% on Monday to hit the upper circuit at Rs 9.60 on the BSE, after the Supreme Court provided crucial clarity on the long-pending issue of Adjusted Gross Revenue (AGR) dues. The development eased investor concerns over the telecom firm’s massive liabilities and lifted sentiment around the stock.The apex court clarified that the government has the authority to decide on both components of AGR dues –the additional dues and the total outstanding liability, according to media reports cited by ET. This comes after Vodafone Idea had approached the court seeking clarification on its October 27 ruling, which had sparked confusion over the scope of potential relief.Earlier, the relief sought by Vodafone Idea was understood to apply only to the additional AGR dues of Rs 9,500 crore. However, the Supreme Court’s latest observation confirmed that the government could consider the full dues — nearly Rs 80,000 crore — while taking a decision on relief measures.In its latest plea, Vodafone Idea had pointed out inconsistencies in the earlier order, which referred to total AGR dues even though the company’s original request was limited to the additional component. Acknowledging this, the apex court allowed the Centre to reconcile all dues and determine the appropriate course of action.While the Supreme Court had earlier dismissed Vodafone Idea’s plea for direct relief, it granted procedural flexibility to the government to review the entire matter at its discretion. The latest modification of the order broadens the scope of reconciliation to include both the principal dues and penalties — a move seen as critical for the company’s financial stability.It is expected that the clarification helps in reducing legal uncertainty surrounding Vodafone Idea’s AGR liabilities, which had long been a major overhang on its balance sheet and stock performance.