Investors stare at ₹1.8 lakh crore loss if Vodafone Idea collapses

The Centre is holding a series of meetings to minimise stress in the telecom sectors and find ways, including cash infusion, to keep Vodafone Idea afloat. The finance ministry has asked banks to submit data on debt exposure to the company and the telecom sector.

The Centre is discussing ways to keep Vodafone Idea Ltd (VIL) afloat, including cash infusion, to minimise stress in the telecom sector. The lenders, both public and private, stare at a loss of ₹1.8 lakh crore in case VIL collapses.

Vodafone idea’s survival hinges on a potential rescue deal from the government. (Mint File Photo)

News agency PTI reported that Department of Telecommunications (DoT) officials and senior bankers held a meeting on the issue on Friday. Officials of State Bank of India and Bank of Baroda were part of the meeting, according to PTI.

The finance ministry has asked public sector banks to collate and submit data related to their debt exposure to the telecom sector in general and VIL in particular.

A large part of the loans to the lender is in the form of guarantees with public sector banks having a lion's share of the debt. Among the private sector lenders, Yes Bank and IDFC First Bank may be impacted the most.

According to official data, VIL had an adjusted gross revenue (AGR) liability of ₹58,254 crore out of which the company has paid ₹7,854.37 crore and ₹50,399.63 crore is outstanding.

Last week, billionaire Kumar Mangalam Birla stepped down as VIL's executive chairman and non-executive director. The company did not state any reason for Birla's exit, but the development saw its stocks crashing over 24 per cent to a 52-week low .

The Supreme Court, last month, had rejected petitions by telecom companies, including VIL and Bharti Airtel, for rectification of alleged errors in calculation of AGR related dues payable by them.