has informed the telecom department that it will not opt for conversion of interest on deferred spectrum and adjusted gross revenue (AGR) dues into equity.
“In furtherance to the earlier communication dated October 25, 2021 and in reference to the notification dated October 14, 2021 issued by the Department of Telecommunications (DoT) to the Company, we wish to inform you that the Company has confirmed to DoT that it will not avail the option of conversion of the interest on deferred spectrum and AGR dues into equity,” said the telco in a regulatory exchange on Friday.
The second largest telco is expected to pay dues worth Rs 43,980 crore AGR dues of which it has paid Rs 18,004 cr
Airtel’s latest move is a surprise since the telco like rival Vodafone Idea (Vi) was expected to opt for both moratorium and equity conversion.
The telco in October, had accepted government’s four-year moratorium on spectrum and AGR dues. Analysts estimated that it would help India’s second largest telco save Rs 11,000 crore-Rs 11,500 crore in annual cash flows which can be used for network expansion and to buy 5G spectrum.
Bharti Airtel chief Sunil Mittal had earlier said the the company will opt for the four-year moratorium on spectrum and AGR payments, which will help it conserve a cash outgo of Rs 35,000-40,000 crore that would be used for network and other capital expansion programmes.
Airtel’s call comes on the back of a relief package announced by the government last September. It included the four-year moratorium on AGR and spectrum payments, sharply reduced BGs and the option to convert statutory dues to government equity.
Vi, has accepted government’s offer of a four-year moratorium on spectrum payments, which may give the cash-strapped telco cash-flow relief of around Rs60,000 crore.
The cash-strapped telco had past AGR dues worth Rs 58,254 crore, of which it has paid Rs 7,854 crore.