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Indus Towers shares hit a 10% lower circuit following Vodafone Idea’s AGR setback. Discover how this ruling impacts the telecom infrastructure company
Shares of Indus Towers Ltd. tumbled by 12% on Thursday, marking their biggest single-day loss since June 4. The stock hit a lower circuit at ₹384.80 on the BSE, reflecting investor concerns following a Supreme Court ruling related to the Adjusted Gross Revenue (AGR) case.
Impact of Vodafone Idea AGR Setback
The decline comes on the heels of the apex court upholding the AGR ruling against telecom companies, including Vodafone Idea, a major customer of Indus Towers. The ruling further cements the financial burden on Vodafone Idea, raising concerns about its ability to meet payment obligations, including those to infrastructure providers like Indus Towers.
Financial Concerns for Towers
The AGR setback has heightened fears that Vodafone Idea may struggle to clear dues, potentially leading to payment defaults or delayed payments to Towers. This situation puts the company’s revenue streams under pressure, especially considering Vodafone Idea’s significant contribution to its overall earnings.
Market Reaction to AGR Ruling
The market responded swiftly to the AGR case ruling, with Towers’ shares plunging as investors weighed the potential risks associated with Vodafone Idea’s financial instability. The AGR demand could have far-reaching consequences on the telecom infrastructure sector, further affecting Indus Towers’ future growth prospects.