AGR payments: Vodafone Idea's next instalment due on March 31, 2022, says, "have reclassified the requisite amount"

As per the latest AGR judgement, the apex court allowed telcos payments in 10 annual instalments commencing from April 01, 2021, to March 31, 2031.

Oct 30, 2020 05:10 IST India Infoline News Service

Vodafone Idea Limited
While announcing the financial performance for September 2020 (Q2FY21) quarter, Vodafone Idea (VIL) also highlighted about adjusted gross revenue (AGR) payments. VIL said, as the next instalment payable by the Company is due by March 31, 2022, we have reclassified the requisite amount to other non-current liabilities.

As per the latest judgement of the Supreme Court on AGR case, the apex allowed telcos payments in 10 annual instalments commencing from April 01, 2021, to March 31, 2031.

VIL in its financial audit report said, "We, till the previous quarter, without prejudice and on prudence, had recognized a total estimated liability of Rs65,440cr billion including the amount of Rs58,250cr billion as per preliminary assessments up to FY2016-17 filed by DoT in the Hon’ble Supreme Court and estimates made by us for the periods thereafter computed based on the terms of the License Agreement, AGR Judgment, etc. together with interest, penalty and interest on penalty up to June 30, 2020."

Further, VIL added, "Against the above, we have made payments of Rs6,850cr in three instalments up to March 31, 2020, and have made a further payment of Rs1,000cr during the quarter. The cumulative amount paid by us till date exceeds 10% of the total liability and accordingly, we believe, the next instalment would be payable only by March 31, 2022."

Accordingly, during the quarter, VIL added saying, "we continued to recognize its AGR obligations based on the judgment of the Hon’ble Supreme Court, License Agreement, etc. As the next instalment payable by the Company is due by March 31, 2022, we have reclassified the requisite amount to other non-current liabilities."

Also, VIL said they have classified Rs14,280cr from ‘non-current’ to ‘current maturities of long term debt’ for not meeting certain covenant clauses under the financial agreements for specified financial ratios as of March 31, 2020.

"We had exchanged correspondences/been in discussions with these lenders for the next steps/waivers. Of the above, during the previous quarter, we have received waivers for borrowings amounting to Rs4,500cr," said VIL.

VIL also adds, "It is to be noted that our ability to continue as going concern is essentially dependent on successful negotiations with lenders and its ability to generate the cash flow that it needs to settle/refinance its liabilities and guarantees as they fall due."

Additionally, VIL has bagged approval for fundraising plan to the tune of Rs25,000cr. 

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