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Vodafone Clears License Fee; Stock Still Continues To Plunge: Here's Why

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In line with the steep cut of over 0.75% on the Nifty, Vodafone Idea plunges by again on the D-Street in Friday's session (August 20, 2021). This is even as the company cleared its license fee due.

 
Vodafone Clears License Fee; Stock Still Continues To Plunge: Here's Why

What is weighing on the stock of cash ridden Vodafone Idea?

Clearly the cash-out or the financial position of the company is weighing hugely and in light of that brokerages across the board have reduced their target price on the scrip of Vodafone Idea. Last at around 1:08 pm, the stock was down by over 5% at Rs. 6.10 per share on the NSE. Just on the previous trading session, the stock saw a breather and has been following for the last 7 seven sessions before that. Meanwhile, sectoral index that track or is indicative of how the telecom pack is performing, BSE Telecom.

The company on Thursday made a clarification that has cleared the license fee due for April-June period. This was after there came up news that the company has fallen short of funds to clear the license fee dues by Rs. 150 crore.

The joint venture company of the Aditya Birla Group and the UK's Vodafone is caught between high competition and low tariffs and is barely able to overcome its tough financial standing now for long. The company's debt as at the end of June quarter were at a whopping Rs. 1.91 trillion and the company made a statement that talks are underway with the bondholders for refinancing total debt of Rs. 6000 crore that is due in the upcoming six months time.

Lately Kumar Managlam Birla in order to avoid crisis at the firm offered its stake in the company to the government of India for the possible bail-out relief. Before that in an earnings call, the company's CEO Takkar said that it is hoping that the government will likely extend its support to address structural issues confronting the sector. The company also filed a review petition with the apex court after it dismissed its plea to recompute the adjusted gross revenue-related dues.

 

GoodReturns.in

Read more about: vodafone idea agr
Story first published: Friday, August 20, 2021, 13:54 [IST]
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