Explained: Why Vodafone Idea shares surged 9% today

Vodafone Idea shares rallied over 9% to touch their 52-week high on Monday after the Supreme Court permitted the Central government to reconsider the reassessment of the telecom operator’s adjusted gross revenue (AGR) dues.

Reacting to the court’s ruling, Vi share price rose as much as 9.45% to hit a new 52-week high of ₹10.53 apiece on the BSE. Earlier today, the telecom stock opened marginally higher at ₹9.63 against Friday’s closing level of ₹9.62 apiece.

At the time of reporting, Vodafone Idea share price was up 8.63% at ₹10.45, with a market capitalisation of ₹1.13 lakh crore. The large-cap stock witnessed strong volume as 11.79 crore shares changed hands on the counter compared to a two-week average of 6.21 crore shares.

Shares of Vodafone Idea, a joint venture formed by the merger of Vodafone India and Idea Cellular, have risen 72% in the last two months, rebounding from their 52-week low of ₹6.12, touched on August 14, 2025. The stock has gained 32% year-to-date (YTD), while it climbed over 41% in the past six months and 28% in a month. In the past one year, the telecom share has surged 28%.

What fuelled the rally in Vi shares?

The strong buying in Vodafone Idea shares was fuelled by the Supreme Court’s decision on Monday, allowing the Centre to reconsider the reassessment of the cash-strapped telecom operator’s adjusted gross revenue (AGR) dues. Notably, the Indian government is the company’s single largest shareholder, having increased its stake from 22% to 48.99% in April this year by converting spectrum payment dues into equity.

The Supreme Court observed that the issue lies within the Centre’s policy domain, stating that it saw no impediment to the government reviewing the matter and making an appropriate decision.

Earlier, on October 13, the court had postponed the hearing in Vodafone Idea’s AGR case to October 27. The debt-ridden telecom company has challenged the Department of Telecommunications’ (DoT) additional demand of ₹5,606 crore for the period up to FY16–17, seeking its annulment.

The matter has seen multiple adjournments in the past at the request of both Vodafone Idea and Solicitor General Tushar Mehta, who is representing the Centre.

Vodafone Idea has urged the court to direct the DoT to “reassess and reconcile all AGR dues for the period up to FY2016–17” in accordance with the Deduction Verification Guidelines dated February 3, 2020.

Earlier this year, the Supreme Court declined to revisit its 2021 order, which had rejected telecom operators’ requests to correct alleged calculation errors in AGR dues.

What is the AGR case?

The AGR dispute traces back to the court’s landmark judgment in October 2019, after which the DoT had sought permission to stagger repayments over 20 years.

The AGR case pertains to a long-standing dispute between telecom operators and the DoT over the calculation of revenue on which licence and spectrum usage fees are levied. Under the revenue-sharing framework, telecom companies pay a percentage of their Applicable Gross Revenue (ApGR) to the government as licence and spectrum fees. However, disagreements arose over whether non-core income—such as interest, dividends, and asset sales—should be included in the AGR calculation.

In October 2019, the Supreme Court upheld the DoT’s interpretation that AGR must encompass both core and non-core revenues, effectively ending a 14-year legal battle. This decision significantly increased the financial burden on telecom operators, as it led to higher interest, penalties, and total dues payable to the government.

To ease the strain on the sector, the Supreme Court in September 2020 granted a 10-year repayment window for the outstanding liabilities, which were estimated at about ₹93,520 crore. The court required operators to pay 10% of the dues by March 31, 2021, with the remainder to be cleared in annual installments up to FY30–31.