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Defined: Why Vodafone Thought shares plunged over 10% immediately

NEW DELHI: Shares of cash-strapped telecom main Vodafone Thought on Tuesday nosedived over 10 per cent throughout the day after studies that the group’s chairman has supplied at hand over his shares within the firm.
Through the day, the inventory plunged about 13.09 per cent to hit its 52-week low at Rs 7.17 on the BSE. It then rebounded a bit to shut 10.3 per cent decrease at Rs 7.4 on each the indices.
Unable to work out a revival for the ailing telecom firm, chairman Kumar Mangalam Birla has supplied to surrender his stake to the federal government or another entity that it deems match.
As per studies, in a written letter to cupboard secretary Rajiv Gauba on June 7, Birla had made the supply as a last-ditch effort by the group to salvage the corporate forward of doable defaults on statutory funds and financial institution dues.
In response to official knowledge, VIL had an adjusted gross income (AGR) legal responsibility of Rs 58,254 crore out of which the corporate has paid Rs 7,854.37 crore and Rs 50,399.63 crore is excellent.
Birla, who holds round 27 per cent stake in VIL, mentioned within the letter that traders are usually not keen to spend money on the corporate within the absence of readability on AGR legal responsibility, an satisfactory moratorium on spectrum funds and most significantly flooring pricing regime above the price of service.
He additionally highlighted that with out rapid assist from the Centre the corporate’s monetary scenario will come to an “irretrievable level of collapse”.
(With inputs from companies)

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