Vodafone Idea Limited's (Vi) stock experienced a significant surge of 10% surge today, reaching the upper circuit limit of Rs.7.49 per share, figuring among the top three gainers on the BSE currently.

This rise was primarily driven by the Indian government's decision to convert Rs.36,950 crore of Vi's outstanding spectrum auction dues into equity shares, thereby increasing its stake in the company from 22.6% to 48.99%.

The Govt will convert Rs.36,950 crore of spectrum dues into equity at Rs.10 per share, a 47% premium over the previous closing price.

Post-conversion, the government's holding will rise to 48.99%, while promoters Vodafone Plc and Aditya Birla Group's stakes will dilute to 16.1% and 9.4%, respectively.

Despite the government's increased stake, Vodafone Plc and Aditya Birla Group will retain operational control of Vi.

This strategic move aims to alleviate Vi's financial challenges by reducing its debt burden, thereby enhancing its financial stability and operational prospects in the Indian telecom market.