Vodafone Idea begins fresh talks with govt on AGR dues: CEO Akshaya Moondra

Vodafone Idea (Vi) has begun a “fresh dialogue” with Centre to resolve the Adjusted Gross Revenue (AGR) dues issue, CEO of the telecom major Akshaya Moondra told analysts on Monday, asserting that the long-term business plans and revival strategy of the company remain “unaffected” from the curative petition outcome.

He also said the telco expected its ongoing efforts to raise debt funding to be completed in the next 2 months, as an independent third party has completed the techno-economic evaluation.

The telecom company announced an urgent conference call with analysts and investors after the Supreme Court last week rejected a batch of curative petitions from telcos, including Vi, seeking a review of the massive Rs 1.43 trillion cumulative AGR.

"While a positive outcome would have no doubt eased the liability, and enabled faster deleveraging, we would like to reassure you that the long-term business plans and revival strategy remain unaffected. The curative petition outcome does not create any impact or modification on cash flows, as already considered in our business plans," Moondra said.

The long-term plan did not factor in any potential benefit in the AGR matter, he insisted.

With a 23 per cent equity stake in Vi, the government is the largest stakeholder in the company, Moondra said. While Vi had estimated its AGR dues at Rs 21,533 crore, the Department of Telecommunications (DoT) pegged it at a whopping Rs 58,254 crore. The telco has paid only Rs 7,900 crore, so far.

Vi's total debt stood at Rs 2.09 trillion at the end of the first quarter (April-June) of FY25. This includes deferred spectrum payment obligations of Rs 1.39 trillion and AGR liability of Rs 70,320 crore to the government. After the payment moratorium ends in October 2025, Vi has to pay Rs 12,000 crore to the government, including both principal and interest by March 2026. It also needs to pay Rs 43,000 crore annually to the government for five years, or from FY27 till FY31.

"The techno-economic evaluation report has been submitted to all the banks and financial institutions which will now allow them to progress with their internal evaluation and approval processes. We expect the bank funding to conclude in the next 7-8 weeks," Moondra said.

Despite the telco raising Rs 24,000 crore of equity so far, three senior bank officials from as many banks had told Business Standard earlier this month that they remain doubtful over the company's multiple payment liabilities to the government, vendors, and tower companies. The telco is confident of clearing existing bank debt, down to Rs 4,800 crore in Q from Rs 9,200 crore a year ago.

Moondra said the latest $3.6 billion or Rs 30,000 crore deal with global vendors Nokia, Ericsson, and Samsung has covered the entirety of the radio equipment needed for the company's planned expansion of 4G coverage to 1.2 billion Indians, up from 1.03 billion.