Airtel will not convert interest earned during moratorium on AGR, spectrum charges into equity

Airtel AGR and Spectrum dues: Under the relief package, telecom companies were given a moratorium of 4 years to pay AGR dues and spectrum charges.

Option was given to convert the interest into equity.

Airtel on equity conversion: In a communication to the stock exchange, telecom operator Airtel said that it will not convert the delayed AGR dues and interest levied on spectrum charges into equity under the reform package. The company has also informed the Telecom Department about its decision. “We would like to inform you that the company has confirmed to DoT that it will not avail the option of converting interest on pending spectrum and AGR dues into equity,” Airtel said.

Airtel is the second largest telecom service provider in the country. The company has an AGR dues of 43980 crores in which it has paid 18004 crores. This decision of the company shows that its financial position is improving. If the company does not take advantage of this facility, then the company will have to pay a huge amount every year for that. However, the company’s revenue is expected to rise rapidly in the user on APRU i.e. Average Revenue. Telecom customers are moving very fast from 2G to 4G, which is benefiting the companies.

Moratorium of 4 years has been given

Last year, the government had made many important announcements to give relief to the telecom sector. Under the relief package, telecom companies were given a moratorium of 4 years to pay AGR dues and spectrum charges. Interest will have to be paid during the moratorium. In October 2021, the Department of Telecom gave 90 days to these companies to decide whether to take advantage of the moratorium.

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