Bharti Airtel Will Raise Funds to Prepare War Chest for Paying Off AGR Dues

Bharti Airtel and Vodafone Idea together have to pay more than Rs 90,000 crore under these dues. Airtel has decided to raise funds for the same

Highlights
  • Bharti Airtel will decide more on the matter in its board meeting on December 4
  • The telco has provisioned for Rs 28,000 crore already
  • The total dues on the industry are more than Rs 1.4 lakh crore

The two of the worst-hit telecom operators in the industry right now are the Sunil Bharti Mittal led telecom operator Bharti Airtel and Vodafone Idea. These two companies have taken the beating from the AGR decision, which was announced by the Supreme Court on October 24. Due to this, both of these companies have posted massive losses in the quarter ending September, and the total dues on both of these companies surpass Rs 90,000 crore. Bharti Airtel alone is looking towards paying somewhere close to Rs 40,000 crore in the dues which are composed of spectrum fees, license fees, interests, penalties and interest on those penalties. Now, as per an ET Telecom report, the telecom operator is looking towards different avenues to provision for the payment of these dues and to go about this, Airtel might raise funds. In a new stock exchange filing by the telecom operator, it has noted that it will discuss various fundraising options in a board meeting which is to be held on December 4. If the telco raises funds, then it would be to build a war chest to tackle the dues which have come up as the result of the new AGR decision.

bharti-airtel-fund-raising-agr

Bharti Airtel’s Board Meeting to Decide on Fund Raising

In its approach to raising funds, raising Bharti Airtel will look at all the options to raise funds which will include issuing equity shares, bonds or even rights issue and qualified institutional placements or even a combination of instruments. All of these would, of course, be subject to regulatory and shareholder approvals. The company told the Bombay Stock Exchange, “We wish to inform you that a meeting of the Board of Directors of the Company is scheduled to be held on Wednesday, December 04, 2019 to, inter-alia, consider and evaluate any and all proposals for raising of funds either by issuance of equity shares, and or bonds including foreign currency convertible bonds/ debentures/ non-convertible debt instruments.”

Bharti Airtel Provisions Rs 28,000 Crore

Now although Bharti Airtel has remarked about raising funds to account for the dues, it has not yet disclosed how much it plans to raise in the coming months. But as per the data reported by Bharti Airtel, it has already accounted for Rs 28,000 crore for the dues which it has to pay for the Spectrum Usage Charges (SUC) and the license fees combined with other dues.

Back in October, the Supreme Court ruled in favour of the government in the matter of the Adjusted Gross Revenue (AGR) which meant that the calculation of the AGR would also include the non-core activities of the telecom operators. This meant that the dues of the telecom operators skyrocketed and the industry came under the immense pressure of Rs 1.3 lakh crore. Out of all the telecom operators, the Bharti Airtel and Vodafone Idea duo were the worst hit. Even now, the Department of Telecommunications (DoT) is on the task of calculating the dues, which might be climbing higher as we speak.

No Futher Relief from the Government

However, the government also has provided some relief to the telecom operators by giving a two-year payment moratorium. The telcos had also expected that there would be some further relief in the form of reduction of license fees, or the SUC or some benefit in taxes, but that agenda has been crossed off the list and the committee of secretaries which was setup to decide the relief has also been disbanded.

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Arpit spends his day closely following the telecom and tech industry. A music connoisseur and a night owl, he also takes a deep interest in the Indian technology start-up scene and spends rest of his time spilling poetry and stories on paper.

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Girish Gowda | BengaLuruAvoid loverGirish Gowda | BengaLuruJio lover.. i can afford 6 paisa per minute..Nikhil Recent comment authors
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Avinav
Avinav

Postpaid segment also expected to raise tariff ?

Jio lover.. i can afford 6 paisa per minute..
Jio lover.. i can afford 6 paisa per minute..

Off topic
New realme x2 pro supports CA??
Any idea chakri or nikhil?

Kiran Fernandes | Goa
Kiran Fernandes | Goa

Yeah, but you will have to wait for it to arrive in India, so that it supports Jio(CA between 3, 5 and 40).

Nikhil
Nikhil

What do you mean by arrive in India?

Samrat
Samrat

Kindly see the specifications of x2 pro. It does support CA BUT FULL POTENTIAL OF SNAPDRAGON 855+ CA IS NOT USED. It clearly shows the cost cutting of flagship killers

Screenshot_20191130-211933.jpg
Nikhil
Nikhil

Snapdragon 855+ supports 5CA. But that won’t be achievable in India unless and until Jio buys everything available in band 28/3/40 in upcoming auction. Only Galaxy Note 10+ and One Plus 7/7Pro/7T. But ita effect can be seen in 2020 only. Speeds on Asus/One Plus 7T/7/6T are really good with Airtel. All support 4CA but with 3CA available in India speeds crossing 80Mbps-90Mbps easily.

Arena
Arena

Only 3CA is supported in India.

Nikhil
Nikhil

Once Airtel adds 10-20Mhz in band 40 and 10-15Mhz in band 1, 4CA is easily available and speeds will be between 100-120Mbps easily. Speeds on A70/One Plus 6T/One Plus 7 are 65-70Mbps with 3CA currently. One Plus 6T supports 4CA and One Plus 7 supports 5CA. Once Airtel adds spectrum, you will see these combinations on Airtel. I doubt on Jio though. Will be possible only on Samsung S series and Note series.

Krrish
Krrish

In comparison Asus 6Z is a steal right now with extra 4000 exchange and 1250 HDFC card discount and it support all bands CA

Only downside is No AMOLED screen

Nikhil
Nikhil

Yes at 27000 its steal now. Even after that exchange its great value for money only for stock android and battery life optimization. Redmi K20 Pro struggles to guve good battery life after MIUI 11 update. Redmi and Xiaomi has relased half baked early build of software on all devices.

Girish Gowda | BengaLuru
Girish Gowda | BengaLuru

Android 10 is the problem, not MiUI. A10 leeches battery like crazy even on Pixel phones.

Jio lover.. i can afford 6 paisa per minute..
Jio lover.. i can afford 6 paisa per minute..

Its there in india

Nikhil
Nikhil

It does some kind of CA. Nobody is yet unlocked bootloader of same.

dragonmonk
dragonmonk

@jioLover Yes. It supports 4-band (!!) carrier aggregation.

Nikhil
Nikhil

It doesn’t support 4CA for sure. Speeds are between 30-90Mbps on Airtel. Speeds should go above 100Mbps on 4CA.

dragonmonk
dragonmonk

FYI. Not a joke. Feel free to check the tech specs.

Girish Gowda | BengaLuru
Girish Gowda | BengaLuru

China monk, we not talking about China here.

Rupendra Singh
Rupendra Singh

I’m going to buy Samsung M40, is it support CA on airtel

Nikhil
Nikhil

All phones from Samsung released above 10000(last year and this year) support CA on both Airtel and Jio.

Jio lover.. i can afford 6 paisa per minute..
Jio lover.. i can afford 6 paisa per minute..

No nikhil none of phone by M series doesn’t support CA

Avoid lover
Avoid lover

Yes my mom m30 does not support CA.

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