Shares of Bharti Airtel and Vodafone Idea climbed up to 16 per cent in Monday’s session after the Supreme Court agreed to hear the modification applications of telecom players including Tata Teleservices on AGR dues next week.
This implies that the telcos do not have to pay their statuary dues by January 23, till the apex court’s further directions, granting them some relief.
Vodafone Idea was up nearly 16 per cent at Rs 5.63 at around 11.50 am (IST), while the benchmark BSE Sensex was down 115 points, or 0.28 per cent, at 41,413 at around the same time.
On the other hand, Bharti Airtel pared its initial losses and was up 0.10 per cent at Rs 509.75.
The three telcos wanted to be allowed to negotiate conditions and schedules for payment of statutory dues with the Department of Telecommunications (DoT), according to their petitions.
The bench headed by Chief Justice of India S A Bobde said a bench headed by justice Arun Mishra will hear the matter next week.
In his recent interaction with ETNow, Hemang Jani, Senior Vice President, Sharekhan said, “Telcos, particularly Bharti and Reliance, are in a sweet spot and they are performing extremely well despite the challenges and the news flow around AGR. These two large players would be able to show remarkable growth in 2020 and 2021 with reasonable price hikes and a good amount of volume growth on the data side.”
Following the Supreme Court order of October last year, the DoT earlier estimated that the total liability of 15 telecom companies, including penalties and interest, would be Rs 1.47 lakh crore.
These AGR liabilities arose after the Supreme Court in October last year upheld the government’s position on including revenue from non-telecommunication businesses for calculating the annual AGR of telecom companies, a share of which is paid as licence and spectrum fees to the exchequer.
Source: Economic Times
