Vodafone Idea Soars on Cabinet's Landmark Spectrum Decision

Vodafone Idea's shares jumped nearly 8% after reports indicated the Union Cabinet waived bank guarantees for spectrum bought before 2022. This decision alleviates financial strain on telecom operators like Vodafone Idea, Bharti Airtel, and Reliance Jio, enabling better cash flow and investment in technology upgrades.

On Tuesday, shares of Vodafone Idea surged almost 8% following reports that suggested a significant policy shift by the Union Cabinet. The government has waived the requirement for telecom companies to submit bank guarantees for spectrum purchased through auctions held before 2022.

Vodafone Idea's stock climbed 7.88% to close at Rs 7.53 on the BSE, peaking at a towering 18.62% during intraday trading. Sources indicated that the move comes as a relief for the debt-laden company, particularly regarding the Rs 24,746.9 crore bank guarantee deadline for spectrum payments due between October 2025 and September 2026.

This decision is also beneficial to major players like Bharti Airtel and Reliance Jio, who have similar obligations from past auctions. Industry body COAI hailed the Cabinet's nod as a 'landmark decision,' projecting it will alleviate financial burdens, improve cash flow, and stimulate capital investments, ensuring a robust future rollout of telecom networks.

(With inputs from agencies.)