Vodafone Idea surges 30% in last 2 sessions; here's why

VIL shares have surged over 12 percent since morning. On Thursday, the shares had rallied as high as 17 percent to close at Rs 7.14 percent. At the time of writing, VIL shares were trading 8 percent higher at Rs 7.42 percent on the Bombay Stock Exchange (BSE).

Sources told CNBC-TV18, Birla spoke with Vaishnaw about the ailing health of the telecom sector and discussed an urgent need for government intervention. The meeting took place a month after Birla stepped down as the chairman of the cash-strapped telco.

The shares seem to have taken off after the news that the government is mulling over some relief measures, not just for the company, but the entire sector.

Vodafone Idea Ltd, which is a joint venture between Aditya Birla Group and Vodafone Group is the country's third-largest telecom operator. But due to cash crunch, it might have to shut its shop, Birla said.

VIL is to pay dues worth Rs 51,400 crore after the Supreme Court dismissed its plea to recalculate the supposed arithmetic errors in the dues. The company is not trying to wriggle out of paying the dues, but the company will no longer be a going concern if it receives no support, Birla had said earlier.

Vodafone Group has also refused to put liquidity into its telco intermediary. And while the government has said it wants to see "healthy competition" in the telecom industry, so far it has not issued any official statement about the relief measures.

Reports suggest the government is considering the possibility of a push in the floor price for the services provided by the telcos. Another option is an interest-free moratorium on the spectrum payment and enchantment of bank guarantees. Such discussions have gathered pace ever since Birla wrote to the government in June, offering to hand over his stake in the company to any government entity that can bring the telco out of the crisis.