Lenders hope govt steps in to prevent AGR from becoming Vodafone Idea’s breaking point

MUMBAI: Lenders to Vodafone Idea are factoring in some form of government intervention that will allow the company more time to repay its dues arising out of the Supreme Court’s order on adjusted gross revenue (AGR) liabilities.

Banks have no liability to telecom companies linked to the AGR order because these do not form a part of the guarantees they have given. However, any cash outflow due to these payments could severely dent debtheavy service providers such as Vodafone Idea.

“We are still in a wait and watch mode. AGR dues do not form a part of the guarantees given because these were new demands from the government. But there is clear stress for some companies such as Vodafone Idea, something we cannot deny. We are hopeful that the government will take note and act,” said the CEO of a public sector bank.