Bangalore, India – May 10, 2012: Motorcycles of customers are parked outside a Vodafone store in Bangalore, India. Vodafone is a leading mobile services operator in India. The Vodafone Group is one of the world’s largest mobile communications companies by revenue with over 398 million customers as of December 31, 2011.
Vodafone Idea made a payment of Rs 1,000 crore to the Department of Telecommunications (DoT) towards statutory dues, news agency Press Trust of India reported citing a senior official. That followed a payment of Rs 2,500 crore by the beleaguered telecom service provider on Monday and formed only a portion of the total amount of Rs 53,000 crore it owes the government in dues, interest and penalties. Vodafone Idea’s part-payment to the government came after the telecom department sent notices to telecom companies over the weekend, asking them to clear dues immediately or face “necessary action“.
Last week, the government ordered mobile carriers including Vodafone Idea to immediately pay thousands of crores of rupees in dues after the Supreme Court threatened the companies and officials with contempt proceedings for failing to implement an earlier ruling.
Analysts covering the country’s telecoms sector say Vodafone Idea is the most fragile of its three major wireless carriers and if it shuts shop, the market would shape up as a duopoly of rivals Bharti Airtel and Reliance Industries’ Jio.
On Monday, Bharti Airtel said it had made a payment of Rs 10,000 crore towards the dues.
The DoT source said that notices will also be sent to Tata Teleservices for recovery of full dues in a day or two, according to Press Trust of India. The Tata Group company had paid Rs 2,197 crore to the government on Monday, and the telecom department has pegged its outstanding amount at more than Rs 14,000 crore.
Vodafone Idea has previously said its ability to continue as a business was contingent on the Supreme Court allowing it to modify issues such as payment timelines with the government.
Shares in Vodafone Idea jumped as much as 18.85 per cent to touch Rs 4.98 apiece on the BSE in the first half of the session.
At 1:56 pm, Vodafone Idea shares traded 4.30 per cent higher at Rs 4.37 on the stock exchange, underperforming the benchmark Sensex index which was down 0.06 per cent amid lacklustre trade.
The S&P BSE Telecom index – comprising 13 stocks including Bharti Airtel – was up 1.20 per cent at the time, trimming some of the gains after rising as much as 1.56 per cent during the session.
