AGR curative plea dismissal: Sans relief VIL may face financial crisis in coming yrs, experts say
AGR front is «crucial» for Vodafone Idea and in its absence, the telco could be staring at financial crisis in coming years once the annual spectrum and AGR payments of USD 4-5 billion per annum fall due, CLSA said on Thursday. The brokerage's views come at a time when the Supreme Court has dismissed a batch of pleas filed by companies, including Vodafone Idea and Bharti Airtel, seeking correction of alleged computational errors in the Adjusted Gross Revenue (AGR).
«AGR relief is crucial for VIdea (VIL) and we await industry's next steps. In absence of AGR relief, VIdea could face financial crisis in 2HFY26/FY27CL, when annual spectrum and AGR payments to government of USD 4-5 billion per annum become due,» CLSA said in a note on Thursday.
Macquarie's report titled «No AGR waivers; VI needs waivers and a white knight?» observed that Vodafone-Idea's net debt was USD 28 billion in 1QFY25, including AGR liability of USD 8.5 billion (of which about 20 per cent is principal and the rest represents interest and penalties).
According to Macquarie's estimates, Bharti Airtel had AGR dues of about USD 5.3 billion (versus company's initial self assessment at USD 1.6 billion), out of which it paid USD 2.2 billion.
Both Vodafone Idea and Bharti Airtel had opted for four-year moratorium on AGR and spectrum dues as part of the government's relief package in September 2021.
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