|
|
|
'More litigation likely in AGR, Vodafone Idea vulnerability highest'
|
|
|
|
Top Stories |
|
|
|
|
SME Times News Bureau | 19 Feb, 2020
There is likely to be further litigation due to AGR payment in the
Indian telecom sector but Airtel will overcome the storm whereas
Vodafone Idea vulnerability is highest in the given industry dynamics,
analyst firm Credit Suisse said.
Bharti Airtel's Rs 100 billion
payment is on an ad-hoc basis and it is in process of self-assessment of
AGR dues and will make balance payments before next hearing in court
slated for March 17, CS said.
"Bharti Airtel recently raised US$3
billion for funding of AGR payments. Even as the AGR litigation dates
back to 2003, Bharti Airtel provisioned for 73 per cent of total US$5
billion AGR dues in 9MFY20. Further of these US$1.2 billion is for
principal liabilities, US$2.3 billion is for interest and US$1.4 billion
is penalty and interest on penalties. As per industry, with 75 per cent
of AGR dues in interest and penalties, further litigation is still
likely including for staggering of payments," the report said.
"Amid
AGR risks Bharti Airtel's 3QFY20 4G subs additions at 21 m were highest
ever and data traffic was up 15 per cent quarter on quarter. In 9MFY20
it has gained 3 ppt data traffic share. Given changing industry
dynamics and Vodafone Idea's vulnerability with out-of-control gearing
and lag in 4G besides higher spectrum and AGR burden we raise our Bharti
Airtel total/4G subs forecasts by 7-14 per cent to 325m/250m by March
2022."
"We await Bharti Airtel's self-assessment of AGR dues, the
next steps in industry litigation and Supreme Court's further hearing
of AGR case on 17 March. Meanwhile, following the upgrade of our Bharti
Airtel's 4G and total subscriber estimates, India mobile Arpu will
reach Rs 186 in FY22 (from 3QFY20 exit of Rs140) and FY21/22CL
consolidated Ebitda forecasts are higher by 2-7 per cent," CS said.
Bharti
Airtel, following the Supreme Court's adverse verdict on the AGR
(adjusted gross revenue) case, has paid Rs 100 billion on an ad-hoc
basis. Further, it is in the process of self-assessment of AGR dues
before the next hearing on March 17.
"Bharti Airtel has
provisioned for Rs353bn of AGR dues, 75 per cent of which are interest
and penalties. We now factor in 50 per cent of Bharti Airtel's AGR dues
risk (vs 25 per cent earlier) in our valuations but given changing
industry dynamics, also raise 4G and total subscriber forecasts by 7-14
per cent, the analyst firm said.
|
|
|
|
|
|
|
|
|
|
|
|
|
Customs Exchange Rates |
Currency |
Import |
Export |
US Dollar
|
66.20
|
64.50 |
UK Pound
|
87.50
|
84.65 |
Euro
|
78.25
|
75.65 |
Japanese
Yen |
58.85 |
56.85 |
As on 13 Aug, 2022 |
|
|
Daily Poll |
|
|
PM Modi's recent US visit to redefine India-US bilateral relations |
|
|
|
|
|
Commented Stories |
|
|
|
|
|
|
|
|