Focus on the share price of Vodafone Idea: A letter from the Department of Telecommunications offers relief on bank guarantees.

Today's stock market: Vodafone Idea's share price is still under scrutiny after the Department of Telecommunications (DoT) issued a letter waiving bank guarantees.

Stock Market Today: Due to the Department of Telecommunications' (DoT) letter waiving bank guarantees, Vodafone Idea's share price is still a topic of discussion on Monday.

Vodafone Idea stated in a release on the exchanges that, subject to specific terms and conditions, the Department of Telecommunications (DoT) has waived the need for Financial Bank Guarantees for the spectrum purchased in the 2012, 2014, 2015, 2016, and 2021 Spectrum Auctions. This decision was made in a communication dated December 27, 2024.

The price of Vodafone's stock went down 1.32% on Friday, closing at ₹7.47 on the BSE. Over the past two months, Vodafone Idea's share price has dropped by about 58% and by nearly 10% in a single month.

The updates from Vodafone Idea may therefore help to bolster the opinions of investors.

In a press statement, Vodafone Idea said that the government's bank guarantee assistance to the telecom sector would increase investments in 4G and 5G in India.

The Department of Telecommunication, Government of India, recently further extended its support for the telecom industry by eliminating the need for a bank guarantee to be submitted for spectrum auctions held prior to the reform package, i.e., for spectrum auctions of 2012, 2014, 2015, 2016, and 2021, according to a press release from Vodafone Idea on the exchanges. This is provided that the prorated value of spectrum used from the date of allocation until the end of three (3) months after the next installment's due date is less than the telecom operator's payment on an NPV basis.

Before this change, Vodafone Idea had to submit a bank guarantee totaling Rs. 24,800 crore against each spectrum installment, 13 months before the installment was due for the aforementioned auctions. According to Vodadone India, "Based on our comprehension of the terms and conditions, VIL will not be required to provide a bank guarantee for the 2012, 2014, 2016, and 2021 auctions out of the five auctions mentioned above."

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