AGR Debt: Reliance Jio And Airtel Might Stay In Telecom Industry

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The Supreme Court has finally rejected the petition from the telecom operators and said that they have to pay the amount as estimated by the ministry. The new verdict has come as a shock for Vodafone-Idea, and now there are chances that Reliance Jio and Bharti Airtel will lead the industry.

AGR Debt: Reliance Jio And Airtel Might Stay In Telecom Industry

 

Both Airtel and the Vodafone-Idea had asked the court to pay the dues as per their assessment. But the petition was rejected by the apex court and said to them to pay the principal amount along with interest and penalties. Now, it has been reported that most of the brokerage firm believes that only two players will stay in the market.

"SC's rejection of self-assessment of AGR dues is particularly negative for Vodafone Idea and the company's sustenance would remain under cloud without significant liquidity infusion," Global brokerage firm Credit Suisse said in a statement. It said, "Bharti Airtel would emerge as a key beneficiary of further market consolidation in a two-player scenario."

Notably, Reliance Jio has paid all its dues, and both Airtel and Vodafone-Idea paid the amount as per their self-assessment, while the Department of Telecommunications wants them to Rs. 35,000 crore and Rs. 53,000 crore as their dues. However, so far Airtel has already paid Rs. 18,000 crore to the ministry, whereas, Vodafone is looking for a bailout package, and paid Rs. 6,854 crores so far.

"Bharti Airtel and Vodafone Idea will now have to pay the entire AGR liability toward license and SUC charges of Rs 44,000 crore and Rs Rs 58,000 crore instead of Rs 34,300 crore and Rs 44,200 crore, respectively, provisioned in Q2FY20 and the recent self-assessment figures of Rs 13,000 crore and Rs 21,000 crore," Motilal Oswal Financial Services said in a statement.

Meanwhile, a new report in Economic Times claims that the telcos will not 20 years to pay the dues for those circles where their licenses have lapsed.

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