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Rs 21,533 crore: Voda Idea AGR estimate less than half of DoT’s calculation

In a written reply, the government had informed the Lok Sabha on March 4 that Vodafone Idea owed it Rs 28,309 crore in licence fees, while the company had to pay nearly Rs 24,729.60 crore in spectrum usage charges.

Vodafone-Idea, adjusted gross revenue, AGR dues, economy news, indian express news Vodafone Group CEO Nick Read at Parliament House after meeting with the Finance Minister, in New Delhi. (Photo: Anil Sharma)

Vodafone Idea on Friday said that total adjusted gross revenue (AGR) dues payable by the company between financial year 2006-07 and 2018-19, according to its internal self-assessment, stood at Rs 21,553 crore. This amount includes a principal AGR amount of Rs 6,854 crore, and the interest on AGR up to February 2020, the company said in an update with the exchanges.

The self-assessed AGR dues of the telecom operator are less than half the AGR dues calculated by the government.

The Centre had estimated that the combined entity of Vodafone Idea owed it as much as Rs 53,038 crore. Vodafone Idea has so far deposited Rs 3500 crore with the Department of Telecommunications (DoT) in two tranches of Rs 2,500 crore and Rs 1,000 crore, respectively.

In a written reply, the government had informed the Lok Sabha on March 4 that Vodafone Idea owed it Rs 28,309 crore in licence fees, while the company had to pay nearly Rs 24,729.60 crore in spectrum usage charges.

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The telco is under the lens of rating agencies which believe that it does not have the ability to pay the required AGR dues by March 17, 2020. Ind-Ra believes that Vodafone Idea does not have the ability to pay the dues by March 17, given the lack of clarity on promoter equity infusion, severe erosion in refinancing flexibility and insufficient cash balance (Rs 12,500 crore as of December 2019). The ruling has elevated the risk of acceleration in the payment of financial liabilities, the rating agency had said earlier last month.

On Friday, Vodafone Group’s chief executive officer Nick Read met Finance Minister Nirmala Sitharaman and Telecom Minister Ravi Shankar Prasad over the course of the day in two separate meetings. Both Read and Prasad refused to comment on the discussions between them.

Read’s meeting on Friday with government authorities comes close on the heels of hectic meetings by Vodafone Idea chairman Kumar Mangalam Birla, who had also, over the last fortnight, met both Sitharaman and Prasad multiple times.

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Following the Supreme Court’s judgment on October 24 last year, Read had — in a earnings conference call of the global telco — said that the situation in India was critical and that the company, which holds 49 per cent stake in Vodafone Idea, would not commit any more equity in India as the “country effectively contributed zero value to the company’s share price”.

Read’s views were later reiterated by Birla, who said that Vodafone Idea might have to shut shop if there was no relief from the government on the AGR front, as it did not make sense to “put good money after bad”.

First published on: 07-03-2020 at 05:08:08 am
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