AGR dues: Vodafone Thought opts for 4-yr spectrum cost moratorium; shares surge
Vodafone Thought on Wednesday stated that its board has opted for India’s telecom division’s four-year spectrum cost moratorium from October 2021 to September 2025. It’s the first telco to simply accept the portion underneath Division of Telecom’s just lately launched telecom aid package deal.
“…we want to inform you that the Board of Administrators of the Firm has permitted the train of the choice of deferment of the Firm’s spectrum public sale instalments for a interval of 4 years…” the debt-laden teleco stated in a regulatory submitting.
“The opposite choices supplied within the stated notification by DoT can be thought-about by the Board of Administrators of the Firm throughout the stipulated timeframe. The above is for data and dissemination to the members,” it additional added.
The telco nonetheless has time as the federal government has now written to telcos, together with Bharti Airtel, Vodafone Thought and Reliance Jio, asking them to convey by October 29 if they might be choosing four-year dues moratorium, reporter information company PTI citing sources.
Shares of Vodafone Thought rose over 5% to ₹10.57 apiece on BSE after the information broke.
Just lately, the federal government permitted a blockbuster aid package deal for the telecom sector that features a four-year break for firms from paying statutory dues, permission to share scarce airwaves, change within the definition of income on which levies are paid and 100 per cent international funding by means of the automated route.
The measures, geared toward offering aid to firms similar to Vodafone Concept that need to pay hundreds of crores in unprovisioned previous statutory dues, additionally embrace the scrapping of Spectrum Utilization Cost (SUC) for airwaves acquired in future spectrum auctions.
For the previous dues, the federal government has allowed a moratorium or deferment of as much as 4 years in annual funds. However the telecom firms should pay curiosity in the course of the moratorium interval.
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Additionally, the federal government may have an choice to convert the due quantity pertaining to the deferred cost into fairness on the finish of the moratorium/deferment interval.
It has additionally given an choice to the telcos to pay the curiosity quantity arising as a result of stated deferment of cost by means of fairness.
Final month, Bharti Airtel Chairman Sunil Mittal stated the corporate will go for cost moratorium, supplied in telecom aid package deal, and redirect the cashflow to aggressively construct networks.
With regard to curiosity dues on cost moratorium, Mittal had stated that Airtel will weigh, when the supply comes from the federal government, on whether or not to go for fairness conversion mechanism or pay money.
The corporate’s board will take a call at that time Mittal had stated including that with curiosity element figuring out to ₹7,500- 10,000 crore, the stake concerned may match out to 2-3 per cent, in case the corporate opted for it.
The moratorium will unencumber money stream to the extent of ₹40,000 crore and that quantity is ample to fulfill the market’s necessities, he had stated.
With inputs from PTI