GAIL India, Oil India, Gujarat Narmada Valley Fertilizers and Chemicals, and Powergrid Corporation of India saw sudden spike share price as the Supreme Court asked the Department of Telecommunications (DoT) to reconsider the demand for adjusted gross revenue (AGR) dues from public sector enterprises. The apex court also granted telecommunication companies including Bharti Airtel and Vodafone Idea a week to file an affidavit on how they plan to pay the dues. Following the 2019 order of the Supreme Court, the DoT had asked PSU for spectrum dues totalling to nearly Rs 4 lakh crore.
While GAIL India shares 7.25% from the day’s low, stock price of Oil India surged 3.65% on Thursday. A 13% rise was seen in the stock price of Gujarat Narmada Valley Fertilizers and Chemicals, on the other hand, Power Grid Corporation shares jumped 4%. The bench expressed its unhappiness against the DoT asking PSU firms for spectrum dues saying that the verdict read out last year by the court was only for telecommunication firms and not PSU companies. “This is wholly and totally impermissible,” the bench said, while referring to the demand raised against the PSUs. Solicitor General Tushar Mehta, appearing for DoT, told the bench that it would file the affidavit explaining as to why the AGR demands were raised against the PSUs.
“It has hinted that there appears to be a concerted attempt at creating panic by issuing notices for recovery of lakhs of crores of rupees against non-telecom PSUs,” Ajay Bodke, CEO & Chief Portfolio Manager (PMS) Prabhudas Lilladher said. Earlier in March, the government had informed the Lok Sabha that they had detached GAIL India, explorer Oil India, and other PSUs from a Supreme Court order that had led to Rs 1.47 lakh crore being sought from telecom firms such as Bharti Airtel and Vodafone Idea in past dues.
The bench also asked private telecom operators to file affidavits giving details as to how they will pay the AGR dues as it questioned the government’s 20-year staggered payment plan. The bench questioned the Solicitor General on how the 20-year payment plan would be completed if a telecom files for bankruptcy during the time-frame. “Any hopes that the Honourable Supreme Court would reconsider its judgment and reduce the amount of AGR dues for telecom operators looks to have been dashed completely,” Bodke added. Bharti Airtel shares jumped 2% after the hearing only to fall 3% post that. Vodafone Idea stock on the other hand surged 13% and tanked 15% from there.