Vodafone Idea will shut if no govt relief, Kumar Mangalam Birla tells CNBC-TV18
Shares of Vodafone Idea plunged over 6 percent after its chairman Kumar Mangalam Birla said that the company will have to be closed down if the government doesn't provide relief that the company has sought.
The stock touched an intraday low of Rs 6.66 as against the previous close of Rs 7.31 on the BSE.
"We will have to shut shop," Birla told CNBC-TV18 at the Hindustan Times leadership summit when asked about the course of action for the company going ahead in the absence of government relief.
Birla indicated that his group will not invest any money in the company in the absence of relief from the government.
"Don’t think I can call telecom business a failure," Birla added.
"There is no sense that good money should follow bad money," he said.
Birla said the company will have to opt for insolvency route in the absence of relief.
Vodafone Idea had reported a record loss of Rs 50,921 crore for the September quarter after making a provision for the Supreme Court’s ruling on payment of average gross revenue (AGR) dues.
Company’s revenue from operations during the quarter plunged to Rs 10,844 crore from Rs 22,114 crore YoY.
Vodafone Idea hiked tariffs for its pre-paid plans effective from December 3, a first in past four years, under which call and data charges will be dearer by up to 42 percent.