BUSINESS SNAPSHOT
GTL Infrastructure Limited ("GTL Infra" or "the Company")
is an IP-1 registered entity with the Department of
Telecommunications, Government of India. The Company
provides passive telecom infrastructure on a shared basis to
telecommunications service providers ("Telcos") for hosting
their active network components.
Its business model is centred around the ownership, operation,
and maintenance of passive telecom sites designed to host
active equipment across multiple technologies for various
Telcos. This shared infrastructure approach enables telecom
operators to shift resources from capital expenditure to an
operating expenditure model, thereby freeing capital for core
business operations. GTL Infra has been a pioneer in shaping
Indias telecom infrastructure sharing industry and was the first
independent tower company in the country to be listed on the
stock exchanges.
• Capable of supporting multiple technologies, including
2G, 3G, 4G, 5G, IOT and enterprise data systems
• Growth driven by wireless network expansion and
technology upgrades
• Predictable, annuity-based revenue streams
• Medium- to long-term renewable contracts with
Telcos, featuring built-in annual price escalations
• Energy management services provided under
agreements with Telcos
• Relatively fixed cost base and low maintenance
requirements
• High predictability of free cash flows
• I ncremental tenancies (beyond the anchor tenant)
deliver higher EBITDA margins and stronger cash
conversion
• Additional loadings on base technology by operators
generate supplementary revenue and EBITDA
Key Developments in Indias Telecom Sector:
In 2024-2025, Indias telecommunications sector saw
transformative growth, driven by 5G expansion, Fixed Wireless
Access adoption, infrastructure upgrades, and progressive
regulatory reforms, with rising data usage and ARPU reflecting
its resilience and maturity.
Wireless Telecom Subscriber Base Expansion
Indias telecom subscriber base reached 1,200.80
million total subscribers by March 2025, growing 0.91%
from December 2024. The wireless base, including 5G Fixed
Wireless Access, was 1,163.76 million by March 2025. Rural
subscriptions increased from 527.20 million to 534.69 million,
achieving rural teledensity of 59.06%. Urban teledensity
stood at 131.45%. The active wireless subscriber base
neared 1.08 billion in May 2025, the highest in 29 months.
(Source: TRAI Quarterly Performance Indicators, May 2025)
Internet Subscribers Achieving New Milestones
India had 969.10 million internet subscribers by March 2025,
up 1.54% from 954.40 million in March 2024. Broadband
subscribers climbed to 944.12 million (2.17% growth), while
narrowband users declined 17.66% to 24.98 million. 886
million active internet users for 2024, projected to exceed
900 million by 2025, with 488 million (55%) from rural areas.
Telecom operators—Reliance Jio and Bharti Airtel—have
rapidly expanded their next-generation AirFiber services
through 2024 and 2025
(Source: TRAI & IAMAI-Kantar Report, June 2025)
Rural Connectivity Revolution
Rural internet penetration rose from 59% in 2021 to 78% by
December 2024, while metropolitan areas hit 90%. The rural
share is projected to reach 82% by FY2026. Data usage in
telecom circles B and C witnessed CAGR of 19-22% vs. 17-
19% in metros. It is estimated that 55-60% of incremental
ARPU growth will come from rural users. The government
fiber rollout, especially through BharatNet and related digital
inclusion programs, has been foundational in empowering
rural India with reliable, high-speed internet.
(Source: CRISIL Ratings & IAMAI, December 2024)
5G Network Deployment Leadership
India deployed 470,000+ 5G base stations nationwide within
two years of launch, reaching 80% population coverage.
Airtel covers 5,000 towns and 20,000 villages; Reliance Jio
operates in 7,764 cities. Projection of 5G subscriptions to
reach 270 million by end-2024 and 970 million by 2030 (74%
of all mobile connections).
(Source: Invest India, Ericsson Mobility Report, June 2025)
Tariff Optimization and ARPU Enhancement
With tariff rationalization, wireless ARPU jumped 16.89% from
149.25 in 2023-24 to 174.46 in 2024-25. Airtels ARPU hit
245; Jios reached 203 as of Q4 FY 2025. Vodafone Idea ARPU
reached 175 as of 31 March 2025 & BSNL ARPU estimated
at 90. Analysts anticipate another hike of 10-12% for mid/
high-tier users by late 2025.
(Source: Economic Times, CRISIL, July 2025)
Policy Support and Investment Framework
The Union Budget 2025-26 allocated 81,005 crores to
the Department of Telecommunications, representing a
35% decrease from the 2024-25 revised estimate of
1,24,409 crores. This reduction is primarily due to lower
allocation towards capital infusion in BSNL. Key allocations
include 35,189 crores for support to BSNL and MTNL
(43% of total budget), 22,000 crores for BharatNet project
(238% increase), and 1,965 crores for the PLI scheme (9%
increase). July 2025 saw the release of the Draft National
Telecom Policy 2025, targeting to double the sectors GDP
contribution, drive annual investment to 1 trillion, and
create 1 million jobs, with emphasis on innovation, security,
and universal connectivity.
(Source: PRS Legislative Research, Union Budget 2025-26,
March 2025)
Production Linked Incentive (PLI) Scheme Success
The PLI scheme delivered notable results as of January 2025:
beneficiaries invested 4,081 crores, generating sales of
78,672 crores (including 14,963 crores exports) and
creating 26,351 direct jobs. 33 telecom products now
qualify, with an extra 1% incentive for indigenous products.
(Source: Ministry of Communications, January 2025)
Global Leadership through WTSA 2024
India hosted the World Telecommunication Standardization
Assembly (WTSA) 2024 in New Delhi from October 15-24,
2024, with 3,700+ participants from 164 countries—the
highest ever. India led 8 new resolutions, including those
on Digital Public Infrastructure, telecom AI, and sustainable
digital transformation, highlighting Indias influence in
shaping global standards.
(Source: ITU, October 2024)
Enhanced Cybersecurity Infrastructure
The DoT notified the Telecommunications (Telecom Cyber
Security) Rules, 2024 on November 21, 2024, creating
robust network security norms. In June 2025, draft rules
proposed Telecommunication Identifier User Entities (TIUEs)
and a Mobile Number Validation (MNV) platform. Initiatives
like the Digital Intelligence Platform led to disconnection of
2.67 crore fraudulent numbers and blocking of 90% of
spoofed calls.
(Source: Department of Telecommunications, June 2025)
Industry Trends in Indias Telecom Sector:
Indias telecommunications sector continues to experience
transformative growth through 2024-2025, driven by
technological innovation, strategic policy initiatives, and
evolving market dynamics. The emerging industry trends
are:
Market Size & Growth Trajectory
Indias telecom market reached US$ 35.1 billion in 2024,
with projections indicating growth to US$ 71.3-76.16
billion by 2029-2033, representing a robust CAGR of
7.79-9.40%. India has established itself as the second-
largest telecommunications market globally, with over 1.18
billion telephone subscribers and 941 million broadband
connections as of October 2024. This remarkable expansion
positions India as a key driver of global telecom growth,
fuelled by 5G rollout, rural connectivity expansion, and
favourable government initiatives.
(Source: MARC Group, Maximize Market Research, 2024-2025)
Operationalizing AI & Automation Revolution
Artificial Intelligence has emerged as the most
transformative technology in telecommunications since
5G deployment. 55% of Indian telecom companies have
successfully implemented AI at scale, with another 37%
actively scaling their AI solutions. Remarkably, 67% of these
companies are generating returns exceeding 10% on their
AI investments. Leading operators like Reliance Jio have
developed comprehensive AI platforms utilizing digital twin
technology to manage over 500 million customers across
5+ million cells. AI applications span network optimization,
predictive maintenance, fraud detection, and enhanced
customer service through intelligent chatbots and automated
priority routing systems.
(Source: KPMG India Report2024, Telecom Review Asia April2025)
Rapid IoT Ecosystem Expansion
The Internet of Things landscape in India is experiencing
unprecedented growth, with 18.8 billion IoT devices deployed
globally by end of 2024, reflecting 13% annual growth.
India specifically targets 38.6 billion IoT devices by 2025.
The convergence of 5G technology with IoT is enabling
transformative applications across smart cities, Industry
4.0, healthcare, and precision agriculture. 5G-powered IoT
solutions provide ultra-reliable low-latency communication
(URLLC), facilitating real-time data exchange for
autonomous systems, remote patient monitoring, and
intelligent traffic management. Indias 100 Smart Cities
initiative is leveraging IoT-enabled command-and-control
centres in cities like Pune, Bhopal, and Hyderabad for
streamlined urban management.
(Source: IoT Analytics, Voice & Data April 2025)
6G Vision & Research Leadership
Indias Bharat 6G Vision will accelerate in 2025-26 with a
5,000 crore R&D investment via the Bharat 6G Alliance and
DoT innovation fund, funding three national 6G test beds at
premier institutes for THz and holographic trials, and two
green basestation demonstrators powered by hybrid solar—
fuelcell systems. The initiative aims for 250 new India-origin
6G patents, five AI-native network pilots with zero-touch
automation, and leadership in three ITU IMT-2030 study
groups on spectrum harmonization (140-300 GHz) and
energy-efficiency standards.
(Source: Bharat 6G Alliance roadmap & DoT innovation brief,
July 2025)
Drone Technology for Emergency Connectivity
The Department of Telecommunications is pioneering
innovative emergency response solutions through drone
and tethered balloon technology for 5G connectivity
restoration. DoT trials, concluding by June 2025, will
evaluate the feasibility of rapid deployment systems during
natural disasters and emergencies. These aerial platforms
offer significant advantages over traditional mobile site
establishment, enabling quick deployment with existing
spectrum utilization and solar/backup power integration. The
initiative enhances DoTs disaster management capabilities,
ensuring uninterrupted communication during critical
situations while providing automated priority call routing and
early warning message distribution.
(Source: Economic Times, Business Standard June 2024)
Notable Technology Integration Trends
Additional transformative trends shaping the industry
include:
• Cloud-Native Network Architecture: Integration of
cloud computing with 5G infrastructure for enhanced
scalability and service delivery.
• Edge Computing Deployment: Edge computing is
advancing rapidly, placing computing power close
to users via 5G base stations and micro data centres
to enable ultra-low latency (as low as 2ms) for
applications like IoT, AR/VR, autonomous vehicles,
and smart manufacturing. By processing data locally,
it reduces network congestion, strengthens security,
and optimizes performance. Major operators and tech
firms are driving growth, with the market projected to
expand at over 40% CAGR, making edge computing a
cornerstone of next-gen telecom infrastructure
• Private Network Growth: 40% anticipated growth
in private 5G networks driven by enterprise adoption
across manufacturing and smart cities.
• Cybersecurity Enhancement: Advanced Al-powered
threat detection systems addressing sophisticated
cyber threats in increasingly complex network
architectures.
• Sustainable Technology Focus: Energy-efficient chip
designs and green network technologies supporting
environmental sustainability goals.
These comprehensive trends demonstrate Indias leadership
in telecommunications innovation, positioning the country
as a global technology powerhouse while addressing
sustainability, connectivity, and digital transformation
challenges through strategic investments and policy
initiatives.
OPPORTUNITIES & THREATS
OPPORTUNITIES
A complex landscape of significant growth opportunities
balanced against intensifying operational and competitive
challenges. They are briefly described as under:
Rural Network Densification Drive
Independent tower companies are positioned to capture
21,000 crore capex investment over FY 2025-26, driven
by telecom operators focus on rural network densification.
With rural teledensity at only 59% compared to 134% in
urban areas, there exists substantial scope for tower
expansion in underserved regions. As per projections 58,000
new towers will be added, with rural areas contributing the
majority of growth as operators seek competitive coverage
advantages. (Source: CRISIL Ratings, Financial Express,
November2024)
BSNL 4G/5G Infrastructure Rollout
BSNLs aggressive 100,000 4G tower rollout by 2025
presents substantial co-location opportunities for
independent tower companies. With 84,000+ sites already
installed using indigenous technology, BSNLs expansion
creates demand for additional passive infrastructure and
shared tenancies. This opportunity is particularly valuable
as BSNL targets 25% market share by end-2025, requiring
extensive infrastructure support across all 22 telecom
circles.
VIL Network Revival Infrastructure Demand
Vodafone Ideas 50,000-55,000 crore investment over
three years for network expansion creates significant
tenancy opportunities. VILs plan to deploy 25,000+
new 4G sites and 20,000 5G sites to achieve 1.2
billion population coverage (90%) requires extensive
infrastructure partnership. Benefit from VILs strategic
shift toward infrastructure sharing to optimize capex
utilization.
THREATS
Market Consolidation and Pricing Pressure
The ongoing telecommunications infrastructure
consolidation, highlighted by Brookfields creation of Altius
with 257,000 sites—now the largest tower company
globally outside China—poses a significant threat to GTL
Infrastructure. This consolidation drives pricing pressure,
with average rental realizations declining by 3-5% due to
aggressive renewal discounts and increasing demand for
leaner, more cost-efficient tower infrastructure. Company
faces intensified competition from these larger, financially
stronger entities that benefit from enhanced bargaining
power, operational scale, and deeper strategic investments
by major telecom operators like Airtel and Reliance Jio.
Airtel has demonstrated strategic interest in Indus Towers
and Jio expands through Altius, company must contend
with diminished pricing power and the challenge of
sustaining competitiveness without comparable scale or
strategic backing, threatening its market share and long-
term viability.
Counterparty Credit Risk Management
Company faces significant counterparty risk from
weaker telecom operators. While financial recovery has
improved payment cycles, the risk of delayed payments
and receivables provisioning remains a critical concern.
Company must navigate the challenge of optimizing
returns while managing counterparty risk, particularly with
additional tenancies coming from operators with relatively
weaker credit profiles.
Technology Evolution and Investment Requirements
Company must continuously invest in technology upgrades
to remain competitive. The transition from 4G to 5G
infrastructure requires significant capital expenditure for
power system upgrades, and structural modifications to
support heavier 5G equipment loads. Company faces
pressure to adopt green technology solutions, including
hybrid renewable energy systems and AI-powered energy
management, requiring substantial upfront investments with
uncertain payback periods.
Market Saturation and Growth Deceleration
With 800000+ towers already deployed across India, the
market is approaching maturity in urban areas. Tower
growth rate is expected to moderate to 1.60% CAGR
(2025-2033), significantly lower than historical growth
rates. challenges in identifying high-growth locations as
prime urban sites become saturated. The industrys shift
toward network optimization rather than capacity expansion
reduces demand for new tower sites, forcing to compete
more intensively for limited growth opportunities.
(Source: IMARC Group, TowerXchange, 2024)
Company Operations
Since 2011-12, fourteen telecom operators exited or shut
down services, resulting in abandonment of approximately
14,000 towers—over 50% of companys portfolio. These
operators ceased all pass-through payments (land rents,
taxes, utilities), saddling Company with outlays on unoccupied
sites without offsetting revenue. As of June 30, 2025,
Company continues litigation to recover 154,685 million in
contractual dues from discontinuing operators.
Site Access Disruptions and Asset Protection
During FY 2024-25, non-payment of landlord rents led to site
access blocks and the dismantling of 363 unoccupied towers
(down from 903 in FY 2023-24). Company responded by
filing FIRs and insurance claims for each incident, conducting
additional site surveys with direct landlord engagement,
and expanding its Tower Vigilance Team (TVT) in high-
risk regions—efforts that resulted in 12 arrests and a 35%
reduction in material theft.
Tenant Base and Tenancy Metrics
Despite sector consolidation, company stabilized
occupancy. As of March 31, 2025; 22,262 tenants
occupied GTL INFRAs active towers, marginally up from
22,018 the prior year, sustaining an average tenancy of
2.1 tenants/tower. This underscores companys success
in retaining anchor customers and securing incremental
loadings.
Customer Engagement and Service Excellence
GTL INFRA delivered >99.8% network uptime across leased
sites, meeting or exceeding SLAs for 2G/3G/4G services
and supporting rapid 5G rollouts for leading operators.
Companys prompt site readiness and flexible upgrade
scheduling earned formal appreciation from Bharti Airtel and
Reliance Jio during FY 2024-25.
Company will prioritize operational cost optimization in
FY 2025-26 by deploying advanced Li-Ion power systems
to cut diesel consumption and lower OPEX. It will also
aggressively pursue multi-year tenancy additions and
incremental loadings to bolster recurring revenue. The
company will also capitalize on nationwide 5G densification
and BSNLs pan-India 4G rollout to secure the highest
possible number of new co-location tenancies. Concurrently,
company is collaborating closely with the EARC, Monitoring
Institution to expedite the release of rental dues owed to
landlords of unoccupied sites however, the same is not
released by lenders.
By driving enhanced operational efficiency, strengthening
financial structure, and deepening customer partnerships,
company aims to restore tower utilization, safeguard its asset
base, and capitalize on the imminent nationwide expansions
of 4G and 5G networks.
FUTURE OUTLOOK:
Despite the headwinds of recent tenant attrition driven by
industry consolidation, company is committed to reinforcing
operational stability through strategic cost optimization,
securing multi-year tenancy extensions, and capitalizing on
incremental tenancy additions to maximize tower utilization.
The company remains bullish on capturing substantial
co-location opportunities arising from the nationwide 5G
densification led by major operators and the imminent
pan-India 4G rollout by BSNL. Concurrently, company
continues its legal pursuit of approximately 154,685 Mn
in contractual claims against operators that prematurely
exited their lock-in obligations, even as many have entered
insolvency or wound down operations.
Looking ahead, the Companys immediate priority is to restore
financial resilience by successfully concluding discussions
with its lenders for a one-time settlement (OTS) / debt
restructuring. The focus will remain on reducing the debt
burden to levels that are sustainable in line with projected
cash flows and operational requirements. Addressing lender
uncertainties and advancing a clear debt-restructuring
roadmap will be critical to unlocking liquidity, preserving
stakeholder confidence, and fuelling the next phase of
growth in Indias dynamic telecom infrastructure landscape.
DISCUSSIONS ON FINANCIAL PERFORMANCE WITH
RESPECT TO OPERATIONS
The discussion and analysis of Results of Operations
and Balance Sheet that follows are based upon the
financial statements, which have been prepared in
accordance with the Accounting Standards notified under
the relevant provisions of the Companies Act, 2013 as
amended from time to time and adopted consistently by
the Company and further based on guidelines issued by
the Securities and Exchange Board of India (SEBI), to the
extent applicable.
Segment wise reporting
The Company is in the business of providing Telecom
Towers on shared basis and as such there are no
separate reportable segments. The Companys operations
are only in India.
Summary of Financials (In Mn)
Particulars |
FY 24-25 | FY23-24 | ||
| US$ | US$ | |||
Revenue from operations |
13,441 | 157 | 13,720 | 160 |
Less: |
||||
Infrastructure Operation & Maintenance Cost |
8,089 | 95 | 7,952 | 93 |
Employee benefits expense |
855 | 10 | 718 | 8 |
Other expenses |
967 | 11 | 943 | 11 |
Ind AS and other Adjustments (net) [Refer Note 1& 2] |
1,728 | 20 | 2,125 | 25 |
Total Costs |
11,639 | 136 | 11,737 | 137 |
Normalized EBITDA [Refer Note 1] |
1,802 | 21 | 1,983 | 23 |
Normalized EBITDA % |
13% | 13% | 14% | 14% |
1. Normalized EBITDA is calculated after considering all income and costs related to operations but excludes Ind AS impact on P&L items,foreign exchange
difference, Loss on Dismantling/Sale/Retirement of Fixed Assets (Net) other one-time
expenses/revenue, non-operational expenses / other income,
etc Figures for the previous financial year have been regrouped / rearranged wherever
necessary to make them comparable with that of FY 24-25
2.lnd AS 116 impacts on Rentals: The nature of expenses in respect of
non-cancellable lease has changed from lease rent to depreciation and
finance costs for the Right of Use assets and lease liabilities respectively. This has
resulted in increase in depreciation and amortization expense of
1,066 Mn (US$ Mn 12) (PY 1,116 Mn, (US$ 13 Mn), finance costs of 546 Mn (US$ 6 Mn)
(PY 594 Mn, US$ 7 Mn) decrease in infrastructure
operations and maintenance cost of 1,520 Mn (US$ 18 Mn) (IP/ 1,579 Mn, US$ 18 Mn)and
decrease in other expenses of 53 Mn (US$ 1 Mn)
(PY 25 Mn, US$ 0.29 Mn)) for the Year ended March 31,2025. Please refer Note no. 3 and
37 in the financial statements for further details.
Tower Count Vs Financial & Operational Performance
Impact of Industry Consolidation and Exits:
The Company has from time to time communicated about
various developments in Indian Telecom Sector, which were
beyond the control of the Company and the management. These
developments continued to impact tenancies and revenue of the
Company. On one hand, reduction in tenancies due to closure
of operators resulted in making more than 14,000 tower sites
unoccupied and on other hand, the Company was saddled with
substantial costs and liabilities including rental to landlords, taxes
and other dues on such unoccupied towers without any revenue.
Additionally, lenders inaction to reduce debt to sustainable level
further impacted the Companys efforts to tide over this situation.
The Company believes that, the new telecom policy, Department
of Telecom (DoT)s support by dispensing with the requirement
of bank guarantee for spectrum, conversion of outstanding
spectrum dues of VI into equity shares, hike in data tariffs,
rollout of 5G services in Mumbai etc. are positive developments
which are expected to increase demand and thereby EBITDA
subject to restructuring of debt by the lenders.
Revenue from Operations
The Companys revenue from operations has reduced from
13,720 Mn (US$ 160 Mn) in FY 23-24 to 13,441 Mn
(US$ 157 Mn) in FY 24-25. Reduction in revenue mainly due to
exits from out of lock-in tenancies, provision towards dispute
arising on account of revision of fixed energy management
contract to actuals and sites transferred under (Maintenance
Take Over) MTO contracts with one of its customers. Under
the MTO contract, though there will be reduction in revenue
due to reimbursement and energy related capex being
directly incurred by customers, cash flow on net basis will
not be impacted. This contract assures 7 years of revenue for
the Company and mitigates financial risk, ensuring revenue
stability over the period of next 7 years.
Occupied Towers, Tenants and Tenancy Ratio
The Company owns 21,582 towers out of which 10,381 were
occupied with 22,262 radiating tenants having a tenancy ratio
of 2.1 on occupied towers as of March 31,2025. As on March
31,2024; 10, 491 towers were occupied with 22,018 radiating
tenants having a tenancy ratio of 2.1 on occupied towers.
The Company lost substantial number of tenancies in the
last few years, due to various events which were beyond
management control, such as shut down/exit of 14 telecom
customers including Aircel Group, Reliance Communications,
Shyam Sistema and Tata Tele, Business combination of Vodafone
- Idea and Telenor - Airtel, etc. These developments resulted
in abandonment of towers by the customers and consequent
reduction in the revenue and earnings. As a result, rentals to
landlords, electricity, employee costs, security costs taxes and
other dues of unoccupied sites remained unpaid. The Company
requested EARC, the Monitoring Institution, to allow payment of
rentals to landlords of unoccupied sites for which approval is
still pending with lenders. Due to unpaid rents, some landlords
have blocked access to sites and unauthorized dismantling/
theft by unknown miscreants/landlords has occurred. 363 sites
got dismantled during year ended March 31, 2025 (903 sites
during the year ended March31,2024). The Company continues
to pursue insurance claims & appropriate actions against the
unknown miscreants/landlords including filing of FIR, wherever
applicable. The Company continues to put in efforts to protect
its assets.
Other Income of the Company decreased from 512 Mn (US$ 6
Mn) in FY 23-24 to 216 Mn (US$ 3 Mn) in FY24-25 mainly due
to decrease in extinguishment of liability pursuant to conversion
of series B2 FCCBs during FY 23-24. Other income includes
extinguishment of liability, interest income, profit on sale / fair
value gain on current investments, miscellaneous income etc.
Operating Expenses
Infrastructure Operations & Maintenance Cost (net of
recovery)-(Infra O&M cost)
The Infra O&M cost consists of expenses related to cell sites
such as rentals for premises, security, power & fuel, operations
& maintenance, annual maintenance charges for network
assets such as diesel generators, air conditioners, battery
banks etc. Among these, major costs such as rent, power and
fuel are substantially recoverable from customers according to
the respective contractual terms.
Mn
Infra O&M cost |
FY 24-25 | FY23-24 |
Site rental (net) |
2,082 | 2,166 |
Power, fuel & maintenance charges (net) |
1,732 | 1,667 |
Repairs & maintenance to plant and |
99 | 100 |
Stores & spares consumption |
3 | 1 |
Other operating expenditure |
326 | 220 |
Total |
4,242 | 4,154 |
The figures mentioned above for site rental and power, fuel & maintenance
charges are net of recovery from customers and excluding Ind AS impact.
The Infra O&M cost (net of recovery) of the Company is 4,242
Mn (US$ 50 Mn) for FY 24-25 as compared to 4,154 Mn (US$
49 Mn) for FY 23-24.
1. Site Rental: Decrease in site rental cost from 2,166 Mn
(US$ 25 Mn) for FY 23-24 to 2,082 Mn (US$ 25 Mn)
for FY 24-25 is mainly attributable to the unauthorized
dismantling of towers.
2. Power, Fuel & Maintenance (net): Changes in fuel rates,
Occupied tower count Tenancy escalations and arrears as
per agreements have resulted in increase in Power,fuel
and maintenance cost for FY 24- 25 compared to FY 23-
24. Power, Fuel & Maintenance cost for FY 24-25 stood
at 1,732 Mn (US$ 20 Mn) against 1,667 Mn (US$ 20
Mn) for FY 23-24.
3. Repairs & Maintenance: Repairs & Maintenance
decreased to 99 Mn (US $ 1 Mn) during FY 24-25 against
100 Mn (US$1 Mn) during FY 23-24.The decrease is a
result of cost optimization initiatives of the company.
4. Other operating expenditure: Other operating expenses
mainly consist of site security cost. Site security cost
were increased to 326 Mn (US$ 4 Mn) during FY 24-25
from 220 Mn (US$ 3 Mn) for FY 23-24. The company
initiated tower vigilance in FY 23-24, expanding the
coverage during the last 6 months of FY 23-24. This
coverage continued through the entire FY 24-25
resulting in increased cost compared to FY 23-24.
Network Uptime & SLA:
The Company continues to offer best possible services to its
customers and it has been able to maintain network uptime
at around 99.90% as per SLAs under normal conditions in
certain circles. The Company undertook several initiatives to
further improve the network uptime under difficult terrains and
situations & continues to invest in capex and Opex for desired
results
CAPEX
During the year, the Company continued to judiciously invest
capex for the up gradation of its network. This resulted in
maintaining network uptime and reduced SLA penalties on
substantial number of sites. Various projects were undertaken
by deploying CAPEX not only at chronic SLA challenged sites
but also at business-critical customers sites. As a part
of Companys going forward priorities of being committed
towards supporting our customers and governments efforts
as an essential service provider, the Company plans to invest
750 Mn during FY 25-26 towards network up gradation &
revenue protection subject to approval from lenders.
In addition to the above,the Company needs following capex
investment subject to approval from lenders & availability of
required cash flows
1. Approximately 2,315 Mn (US$ 27.05 Mn) towards
replacement capex related to end of life equipment for
revenue protection
2. Approximately 750 Mn (US$ 8.76 Mn) with regard
to network up-gradation & capacity building for
accommodating expected 5G technology tenancies
mapped till date.
Electrification & Diesel Free Sites
Total EB connected occupied site count stood at 99% as of
March 31,2025.
The number of operational Green Sites on the entire portfolio
are 3,555 as of March 31,2025.
Employee Benefits Expense
The Employee Benefits Expense includes salaries and
allowances, contribution to provident fund, gratuity fund
and other funds besides employee welfare and related
expenses
Employee Benefit Expenses |
FY 24-25 | FY 23-24 |
In Mn |
855 | 718 |
In US$ Mn |
10 | 8 |
Expenses as % of Revenue |
6% | 5% |
The Companys employee benefits expenses stood at 855 Mn
(US$ 10 Mn) for FY 24-25.
Other Expenses
This mainly comprises of Property tax on towers, legal &
professional fees, insurance premium, rentals of office/
warehouse, travel and conveyance, Loss on/due to Sale, theft
of fixed assets by Landlords/Unknown miscreants (net), audit
fees etc.
Other Expenses |
FY 24 | -25 | FY 23 | -24 |
| Mn | US$ | Mn | US$ | |
Total Other Expenses |
967 | 11 | 943 | 11 |
One Time & Other Adjustments |
(25) | (1) | 15 | 1 |
Total Other Expenses (Normalised) |
942 | 11 | 958 | 11 |
Other Expenses (Normalised) as |
7% | 7% | 7% | 7% |
The above figure of One-time and Other Adjustments comprises of Loss on
Dismantling/Sale/Retirement of Fixed Assets (Net), Ind AS impact and bank
charges etc.
The Government of India enacted the Telecommunication
Act, 2023 (the said Act), with certain provisions taking effect
from June 26, 2024 of particular relevance is Section 14(3),
which clarifies that telecommunication networks installed
on any property will not be treated as part of that property.
Consequently, these networks are exempt from property
tax, levies, cess, fees, or duties that may otherwise apply to
the property. Despite the enactment of this provision, some
authorities continue to demand property tax. In order to prevent
sealing of operational sites, the Company has had to make such
payments under protest. Further, as per the said act, section
14(4) which states that local authorities do not have jurisdiction
to take any coercive action against the said towers without due
authority from the Central Government.
At this moment, the Company has accounted for the liability
towards Property taxes in its financial statements on the basis
of best estimates considering the demand notices received/
receivable in various circles wherever it is applicable. However,
the Company continues to challenge before various judicial
forums, the various components and retrospective levy of
Property Tax demands raised by the respective local statutory
authority.
As explained in the above paras, 363 sites got dismantled
during the year ended March 31, 2025 (903 sites during the
year ended March 31, 2024). As a result, the Company has
recognised a Loss (net) of 24 Mn (US$ 0.28 Mn) for the year
ended March 31,2025 (Loss (net) 64 Mn (US$ 1 Mn) for year
ended March 31,2024) which is included in other expenses. The
Company continues to pursue insurance claims & appropriate
actions against the unknown miscreants/ landlords including
filing of FIR, wherever applicable. The Company continues to
put in efforts to protect its assets.
Earnings before Interest, Taxes, Depreciation and
Amortization (Normalized EBITDA)
Financial Year |
FY 24-25 | FY 23-24 |
In Mn |
1,802 | 1,983 |
In US$ Mn |
21 | 23 |
The Companys normalized EBITDA for FY 24-25 at 1,802
Mn decreased as compared to FY 23-24 at 1,983 Mn mainly
on account of exits from out of lock in tenancies, provision
towards dispute arising on account of revision of fixed energy
management contract to actuals, payment of escalations and
arrears as per agreements.
Depreciation and Amortization expenses
Depreciation and Amortization for FY 2024-25 stood at 2,440 Mn
(US$ 29 Mn) vis-a-vis 2,780 Mn (US$ 32 Mn) for FY 2023-24.
Exceptional Items
The Company, in accordance with the Indian Accounting
Standard (Ind AS 36) Impairment of Assets, performed an
impairment test based on current expectations of the impact
of recent developments in telecom Sector on projected cash
flows in tower business. The Company is predominantly in the
business of providing telecom towers on shared basis and
as such there is no separate segments. Accordingly, all these
tower assets were reassessed as a single Cash Generating
Unit (CGU), the CGU consists of Property, Plant and Equipment.
The recoverable amount of the CGU is determined based on
a value in use calculation using 10.75% as discount rate.
Based on this assessment, the management has concluded
that Carrying value of these assets continue to be supported
by their recoverable amounts, determined on a value-in-use
basis. Accordingly, no impairment loss has been recognized for
the financial year ended March 31,2025 (Previous year 154
Mn (US$ 2 Mn).
Balances written off (Net), Provision for Trade Receivables&
Energy Recoverable
Balances written off (net) and Provision for Trade Receivables
for FY 24-25 stood at 679 Mn (US$ 8 Mn) vis-a-vis 405
Mn (US$ 5 Mn) for FY 23-24. The Increase is mainly due to
customer disputes arising on account of revision of fixed energy
management contract.
Exchange Differences (Net)
Exchange difference for FY 24-25 stood at a loss of 93 Mn
(US$ 1.1 Mn) vis-a-vis loss of 44 Mn (US$ 0.51 Mn) for
FY 23-24 mainly represented by measurement of FCCBs &
foreign currency borrowings on reporting date at the prevailing
exchange rates.
Finance Costs
Finance costs comprises of interest expenses, finance cost
on Lease Liability as per Ind AS 116 and Exchange difference
considered as an adjustment to borrowing cost. Finance costs
for FY 24-25 stood at 9,285 Mn (US$ 108 Mn) vis-a-vis
8,051 Mn (US$ 94 Mn) for FY 23-24.
BALANCE SHEET ITEMS
Fixed Assets
The carrying amount of these assets comprising of Property,
Plant and Equipment, Intangible Assets, Right of Use Assets and
Investment Property as of March 31,2025, stood at 28,453
Mn (US$ 332 Mn) compared to 30,072 Mn (US$ 351 Mn) as
of March 31,2024.
The Company, in accordance with the Indian Accounting
Standard (Ind AS 36) Impairment of Assets, carried out an
impairment test. Based on this assessment, it is concluded that
the carrying amounts of these assets continue to be supportable
by their recoverable amounts, determined on a value-in-use
basis. Accordingly, no impairment loss has been recognized for
the financial year ended March 31,2025 (Previous Year: 154
Mn, US$ 2 Mn). The Company continues to pursue contractual
claims of approximately 154,165 Mn (US$ 1,801 Mn) arising
out of these developments.
Other Non-Current Assets
Other non-current assets of the Company stood at 1,167
Mn (US$ 14 Mn) as of March 31,2025, as compared to
2,347 Mn (US$ 27 Mn) as of March 31, 2024. The non-
current assets primarily consist of site related electricity
and rent deposits, tax assets, amounts paid under protest to
government authorities etc.
Equity
Equity Share Capital
The paid-up equity share capital of the Company stood at
128,091 Mn (US$ 1,497 Mn) as of March 31,2025, compared
to 128,070 Mn (US$ 1,496 Mn)as of March 31,2024.
Other Equity
Particulars |
Mn | US$ Mn |
Other Equity as on March 31,2024 |
(178,936) | (2,091) |
Add: Total Comprehensive Income for the |
(8,756) | (102) |
Transferred to Equity Capital on Conversion |
(12) | (0) |
Other Equity as on March 31,2025 |
(187,704) | (2,193) |
Borrowings:
Particulars |
March 31,2025 |
March 31,2024 |
||
| Mn | US$ Mn | Mn | US$ Mn | |
Secured debt |
||||
Rupee term loans: |
||||
Banks, Financial Institutions & Asset Reconstruction Trust |
40,645 | 475 | 40,662 | 475 |
Less: Amount debited/paid by IDBI Trusteeship* |
(12,416) | (145) | (11,110) | (130) |
Less: Amount realised by Lenders by invoking Pledge* |
(340) | (4) | (340) | (4) |
Total |
27,889 | 326 | 29,212 | 341 |
Foreign currency loans: |
||||
Financial institutions |
692 | 8 | 677 | 8 |
Total Secured loans |
28,581 | 334 | 29,889 | 349 |
Unsecured loans: |
||||
FCCBA |
3,207 | 37 | 3,136 | 37 |
Interest accrued- due and not due |
46,220 | 540 | 37,321 | 436 |
Total Borrowings |
78,008 | 911 | 70,346 | 822 |
Ind AS Impact# |
146 | 2 | 370 | 4 |
Total |
78,154 | 913 | 70,716 | 826 |
Note:
* Includes amounts debited by IDBI trusteeship/upfront amount paid by the Company to
lenders for considering the OTS/Restructuring proposal. Interest on
borrowings is calculated after adjusting these amounts from principal.
a Movement in FCCB liability is primarily on account of conversion of 142 series B2 bonds into Equity Shares during the year and exchange difference.
# The Ind AS impact on borrowing is separately shown in the table above for better
under standing. However, these line items are reported along with the
Ind AS impact in the financial statements within the respective note.
The borrowings (including current maturities and interests) of the
Company as on March 31,2025 stood at 78,154 Mn (US$ 913
Mn) as against 70,716 Mn (US$ 826 Mn) as at March 31,2024.
It comprises of rupee term loans,foreign currency term loans and
FCCBs. These borrowings are measured at amortized costs on
the reporting date in terms of relevant Ind AS requirements.
As of March 31,2025, 79.34% of Indian Rupee Debt of 32,263
Mn (US$ 377 Mn) have been assigned in favour of EARC acting
in its capacity as Trustee of EARC Trust - SC338 vide assignment
agreement executed in favour of EARC
The Honble National Company Law Tribunal, Mumbai Bench
("NCLT") vide its order dated November 18, 2022 dismissed
petition filed by Canara Bank for initiation of Corporate Insolvency
Resolution Process ("CIRP") under Section 7 of the Insolvency
& Bankruptcy Code,2016 ("IBC").The Honble Tribunal held that
the business of the Company is sustainable, it is a viable going
concern under its current management and the overall financial
health of the Company is not bad enough to be admitted under
CIRP Thus, in view of aforementioned, the petition was dismissed,
against which Canara Bank filed an appeal before National
Company Law Appellate Tribunal, at Delhi ("NCLAT"). The Honble
NCLAT, vide order dated October 25, 2024, has, while allowing
the said appeal, set aside the order passed by the Honble NCLT
and remanded the case to the Honble NCLT for fresh hearing
of the original petition filed by Canara Bank, taking all relevant
facts into account. Accordingly matter is pending for final hearing
before the Honble NCLT, Mumbai bench.
IDBI Trusteeship Company Limited ("ITSL") at the behest of
lenders has, during the year ended March 31, 2025 debited
1,306 Mn (US$ 15 Mn) which includes upfront amount paid by
the Company for considering the OTS/Restructuring proposal to
lenders. Thus, since May 2020 to June 2025, overall amount of
12,416 Mn (US$ 145 Mn) including above have been debited/
paid from TRA Account. Interest on borrowings is calculated
after adjusting these amounts from the principal.
Additionally, ITSL, on the instruction of lenders of the Company,
has realised 340 Mn (US$ 4 Mn) by way of sale of pledged
equity shares. The said amount is reduced from the Lenders
outstanding amount and considered as other equity towards
contribution of promoter group company considering invocation
of their pledged shares by the lenders.
As per the arrangements with the Lenders, the Company
is required to comply with certain covenants and non-
compliance with these covenants may give rights to the lenders
to demand Repayment of the loans. Considering alleged claims
of lenders and to comply with the requirement of Ind AS -1
"Presentation of Financial Statement", the Company has, as
an abundant precaution, classified Non-Current borrowings as
Current Borrowings. This classification was made for the first
time in the Balance Sheet as at March 31,2019.
The Company received notices of recall of loans from the lenders
claiming alleged default in terms of Master Restructuring
Agreement dated December 31,2011. The Company has strongly
refuted the claims and responded to said notices appropriately.
Thus, in absence of directions from lenders as stated above, the
Company continues to mention terms of repayment (Refer note
No 18.3) and amount of Overdue (Refer note no. 18.4) as on
March 31,2025 in terms of and in accordance with the payment
schedule, terms and conditions of Strategic Debt Restructuring
Scheme as approved by then lenders.
Other Non-Current Liabilities
The non-current Liabilities of the Company stood at 5,031 Mn
(US$ 59 Mn) as of March 31,2025, as compared to 5,494 Mn
(US$ 64 Mn) as of March 31,2024. The non-current Liabilities
primarily consist of lease liabilities, provisions related to assets
retirement obligation, provision for compensated absences and
deposits received from customers etc.
Current Assets
The current assets of the Company stood at 11,548 Mn (US$
135 Mn) as of March 31,2025, compared to 9,642 Mn (US$
113 Mn) as of March 31, 2024. The current assets primarily
consist of cash and cash equivalents, trade receivables,
investments, unbilled income, Opex advances, deposits,
balance with government authorities, tax assets etc.
Current Assets |
March 31,2025 |
March 31,2024 |
||
| Mn | US$ Mn | Mn | US$ Mn | |
Inventories |
40 | 0 | 40 | 0 |
Investments |
258 | 3 | 737 | 9 |
Trade receivables |
819 | 10 | 3,164 | 37 |
Cash & cash equivalents(note) |
8,290 | 97 | 4,117 | 49 |
Other bank balances |
10 | 0 | 12 | 0 |
Security Deposits |
373 | 4 | 358 | 4 |
Unbilled Income |
641 | 8 | 548 | 6 |
Others |
1,117 | 13 | 666 | 8 |
Total |
11,548 | 135 | 9,642 | 113 |
? — ?
Note: Pursuant to the Honble Supreme Court order dated May 13,2024 an amount of 4,400 Mn (US$ 51 Mn) is to be earmarked.
Current Liabilities
The current liabilities of the Company stood at 17,596 Mn (US$ 206 Mn) as of March
31,2025, as compared to 16,716 Mn
(US$ 195 Mn) as of March 31,2024. These Liabilities primarily consist of operational
provisions towards site rent, provision towards
arbitration claim raised by GTL (net), lease liabilities, statutory dues, provision
towards Assets Retirement Obligation (ARO), trade
payables and operational provisions towards energy management, security etc.
Current Liabilities |
March 31,2025 |
March 31,2024 |
||
| Mn | US$ Mn | Mn | US$ Mn | |
Trade payables & creditors for capital goods |
252 | 3 | 327 | 4 |
Lease liabilities |
1,001 | 12 | 972 | 11 |
Deposits from customers |
1,003 | 12 | 960 | 11 |
Advance Revenue |
16 | 0 | 18 | 0 |
Operational incl. long term provisions etc. |
14,416 | 168 | 13,460 | 158 |
Others incl. statutory dues etc. |
908 | 11 | 979 | 11 |
Total |
17,596 | 206 | 16,716 | 195 |
Borrowings, although disclosed under Other Current Financial Liabilities in the Balance
Sheet for the reasons specified therein, are not considered in the
aforementioned analysis but are duly covered under the heading ‘Borrowings above
Significant Changes in Key Financial Ratios
Particulars |
March 31,2025 | March 31,2024 | % Variance | Reason for variance |
a) Current ratio |
0.12 | 0.11 | 9% | NA |
b) Debt-Equity ratio |
(1.31) | (1.39) | 6% | NA |
c) Debt service coverage ratio |
0.05 | 0.06 | (14%) | NA |
d) Return on equity ratio* |
NA | NA | NA | NA |
e) Inventory turnover ratio |
NA | NA | NA | NA |
f) Trade receivables turnover ratio |
5.20 | 4.89 | 6% | NA |
g) Trade payables turnover ratio |
0.61 | 0.62 | (2%) | NA |
h) Net capital turnover ratio |
(0.17) | (0.18) | 8% | NA |
i) Net profit ratio |
(65%) | (50%) | (31%) | Fall in Revenue, rise in cost compared to previous year. |
j) Return on capital employed |
3% | 6% | 54% | Lower profit before interest and tax compared to previous year. |
k) Return on investment |
5% | 7% | (23%) | NA |
* This ratio is Not Applicable (NA) as the net worth as on March 31,2025 and March 31,2024 is negative.
DEBT RESOLUTION PLAN
Telecom Sector Developments post CDR
As reported from time to time, due to slowdown in telecom
sector since 2010-11 coupled with constant increase in
interest rates affecting profitability of entire telecom sector,
the Company had undertaken Corporate Debt Restructuring
(CDR) exercise under the aegis of CDR mechanism in
July 2011. Post implementation of the CDR package, the
telecom sector continued to be under relentless stress,
which had material adverse impact on the achievement
of the Companys CDR projections. Some of the adverse
developments, which were beyond the management control
have been enumerated below:
a. Decision of cancellation of 122 2G licenses upheld by the
Honble Supreme Court;
b. Aircel default on commitment of additional 20,000
tenancies to the Company;
c. Vodafone Tax Litigation;
d. Slower 3G & BWA growth;
e. Freeze on substantial expansion by telecom operators;
f. Lack of deployment of capex for modernization and
replacement.
As a result, in 2016 the lenders of the Company invoked
Scheme of Strategic Debt Restructuring (SDR) as per
guidelines issued by the Reserve Bank of India. The Company
fully cooperated with the lenders in SDR implementation.
The Company also complied with the stipulations under SDR
including that of merger of Chennai Network Infrastructure
Limited with the Company and steps taken towards induction
of new investor and serviced outstanding debt in terms of CDR
and SDR during that period.
Telecom Sector Development post SDR
However, various extraneous developments in telecom sector
subsequently such as (i) aggressive pricing by Telcos; (ii)
reduction in interconnect usage charges and (iii) increasing
unsustainable levels of debts of existing Telcos, impacted the
profitability / cash flow of all participants in the sector making
it unsustainable to remain viable and / or continue operations
as evidenced through series of events / announcements listed
below:
(i) Aircel Groups admission to National Company Law
Tribunal ("NCLT") under Insolvency & Bankruptcy Code,
2016 ("IBC") in 2018;
(ii) Sale of Sistema Shyam Teleservices Limited to Reliance
Communication Limited ("RCom") and consequent
merger of both in 2017;
(iii) RCom decision to shut down wireless business and
subsequent filing of insolvency petition with NCLT under
IBC in 2017;
(iv) Tata Groups decision to exit telecom business and
consequent merger Bharti Airtel Limited ("Bharti Airtel")
and Tata Teleservices Limited in 2017;
(v) Bharti Airtel and Telenor (India) Communication Private
Limited ("Telenor") merger in 2017
(vi) Vodafone India Limited ("Vodafone") and Idea Cellular
Limited ("Idea") merger in 2018.
All of these factors, which were beyond the control of the
management, have had a material adverse effect on the
Company and its business prospects. The following table
depicts number of tenancy loss faced by the Company over the
last 14-15 years, despite having long term binding contracts
with Telcos:
^. Events of Tenancy Loss |
No. of Tenancy |
Period | Comments |
1. Cancellation of 2G licenses |
4,319 | Upto December 2017 | Supreme Court Judgement on cancellation of 122 2G telecom licenses |
2. Slower 3G/BWA growth |
4,750 | Since FY 2012-2013 |
Industry slowdown following the Supreme |
3. Operator scale back due to auction |
3,500 | ||
4. Aircel default of commitment of additional |
15,200 | May 2014 | Legal and financial issues |
5. RCom shutdown of wireless business |
1,386 | August & September 2017 | Unsustainable business due to competition |
6. TATA exit from wireless business |
2,910 | Since May 2017 | |
7. Merger of Vodafone - Idea (VIL) |
3,275 | Since April 2018 | Forced industry consolidation due to |
8. Consolidation of Telenor with Bharti Airtel |
1,395 | During 2018-19 | |
9. Aircel filing of bankruptcy |
23,727 | January 2018 | Unsustainable business due to competition |
10. BSNL exits due to uncertainty of collection |
1,767 | Since FY 2018-19 | Unsustainable business due to competition |
11 Exit during business course with various |
6,047 | Since April 2013 | |
Aggregate tenancy loss from 2012 to 2025 |
68,276 |
Further these developments resulting in Company pursuing for
its contractual claims of more than 150,000 Mn from such
telecom operators (majority of claims against Aircel) in respect
of premature exits by them in lock-in period.
Thus, these extraneous developments in telecom sector especially
during the last 8-9 years, once again unavoidably pushed the
Company to a position from where it will require to again rebuild
itself and also to realign its overall debt (including unsecured foreign
currency bonds) to sustainable level with revised cash flows.
Assignment of Debt to ARC
By its circular dated February 12, 2018, the Reserve Bank of
India withdrew and repealed the CDR and SDR guidelines.
Although the Company was regular and current in its interest
and principal payments to lenders as per SDR terms, purely
on technical grounds as per RBIs circular dated February 12,
2018, certain lenders downgraded the account.
Post these various adverse developments in telecom sector, the
Company had proactively presented a resolution plan on April 27,
2018 (with an intent to maximize recovery of dues and to protect
the equity exposure of the lenders) to the lenders who constituted
a significant majority of the outstanding debt of the Company.
However, the lenders had elected to pursue sale of their debt
to an Asset Reconstruction Company (ARC). Edelweiss Asset
Reconstruction Company Limited, acting as a trustee on behalf
of EARC - Trust SC 338 ("EARC"), emerged as the highest bidder
in July, 2018 under a Swiss auction process independently run
by the lenders. Till date 79.34% of the Indian Rupee Lenders
have assigned their respective rights, title and interest in the
financial assistance granted to the Company in favour of EARC.
In the meantime, one of the secured lenders viz. Canara Bank, filed
petition before the NCLT, Mumbai Bench under IBC for initiation of
Corporate Insolvency Resolution Process. The Honble NCLT vide its
order dated November 18, 2022 dismissed the said petition. The
said lender had filed an appeal against this order before the Honble
National Company Law Appellate Tribunal ("NCLAT"). The NCLAT
in its final order October 25, 2024, has, while allowing the said
appeal, set aside the order passed the Honble NCLT and remanded
the case to the Honble NCLT for fresh hearing of the original
petition filed by Canara Bank, taking all relevant facts into account.
Accordingly, the matter is pending for final hearing before the NCLT.
Resolution Plan under Prudential Framework
In accordance with the revised guidelines, post assignment of
79.34% of the secured rupee debt to EARC, the Company also
presented multiple Resolution Plans, starting from July 2019 for
consideration of lenders consortium updating such plans from
time to time after taking into account various developments in
telecom sector.
In the absence of restructuring, the Company is compelled to
account for the outstanding amount and amount overdue in its
books of accounts as per the terms and conditions of Strategic
Debt Restructuring Scheme as approved by the then lenders.
However, outstanding principal amount of secured rupee term
loan as on June 30, 2024 (after adjusting 12,772.98 Mn.
appropriated by IDBI Trusteeship Trusteeship Service Limited and
payments made by the Company) stands at 27,889.04 Mn.
Recovery for lenders
Despite aforementioned extraneous development in telecom
sector, adversely impacting the Company, since 2010 the Company
has repaid to its lenders towards debt servicing in cash and equity
conversion to its lenders, details of which are as follows:
Financial Year |
Principal Repayment |
Interest Repayment |
Conversation of debt in to Equity to PSU Lenders |
Conversation of debt in to Equity to bondholders |
Repayment by way of Sale of Pledged Shares |
Paid by ARC to PSU Lenders under Assignment Agreement* |
Total Repayment |
2010-11 |
3,611 | 11,131 | - | 14,742 | |||
2011-12 |
2,332 | 5,689 | - | 8,021 | |||
2012-13 |
369 | 2,058 | 26,591 | 3,978 | 32,996 | ||
2013-14 |
1,201 | 7,983 | 2,507 | 11,690 | |||
2014-15 |
1,337 | 8,758 | 183 | 10,279 | |||
2015-16 |
1,953 | 8,558 | 112 | 10,624 | |||
2016-17 |
591 | 8,827 | 1,237 | 10,655 | |||
2017-18 |
41 | 4,522 | 45,012 | 3,842 | 53,416 | ||
2018-19 |
750 | 1,993 | 1,938 | 18,680 | 23,362 | ||
2019-20 |
- | 2 | 2 | ||||
2020-21 |
3,560 | 13 | 1,775 | 5,348 | |||
2021-22 |
2,800 | - | 1,267 | 139 | 4,206 | ||
2022-23 |
3,350 | - | 478 | 201 | 4,029 | ||
2023-24 |
1,400 | - | 1,359 | 2,759 | |||
2024-25 |
1,323 | - | 21 | 1,344 | |||
Total |
24,617 | 59,535 | 74,110 | 16,192 | 340 | 18,680 | 193,475 |
nt.
At the Company, Risk Management is at the core of the
operating structure of the Company and functions in parallel
with the development and execution of management strategies.
The Companys senior management and core functional
officers, being Whole Time Director, Chief Financial Officer,
Chief Internal Auditor and the Legal and Secretarial teams, as
a matter of routine, assess potential operating and strategic risks
informally in order to ensure that the Company at all times has a
mitigation plan in place. The Company believes that by combining
these two functions, it is better positioned to accomplish its
business objectives and to increase its value.
The Company seeks to achieve an appropriate balance between
risk and reward, and Continues to build and enhance the risk
management capabilities that assist in delivering the growth
plans in a controlled environment. Thereby, the Company seeks
to limit adverse variations in earnings and capital by managing
risk exposures within agreed levels of risk appetite.
Market Risks
Revenue from existing business lines is dependent on the
sustainability of the Telecom sector which in turn is dependent
on several macro-economic factors, such as the growth
of the Indian economy, favourable interest rates, increased
transparency and certainty in the regulatory environment, the
cost of spectrum and the overall stability of the Indian Telecom
sector. Thus, the Company believes that these factors have a
significant direct impact on Companys business, results of
operations and financial positions.
Based upon the spectrum auctions, the license charges
paid by the Telecom Operators will continue to impact the
* 18,680 Mn were paid by ARC to PSU lenders under Assignment Agreeme
Based on payments made in the immediately preceding
financial years, the Company believes that if debt capital
is correctly sized based on a TEV study (requested by the
Company from time to time), the Company would be able to
continue operations despite challenges in telecom sector. This
could also help in restoring equity value for the lenders.
Accordingly, the Company is in discussion with its lenders
for One-time Settlement (OTS) / Restructuring of debts. The
Company has received sanction from Canara Bank towards
One-time Settlement, which has been accepted by the
Company. Currently, the Company is in process of complying
with the terms and conditions of the said sanction, which is
subject to the requisite approvals.
RISK MANAGEMENT
This report, prepared in accordance with Regulation 34(3) of SEBI
(Listing Obligations and Disclosure Requirements) Regulations,
2015, provides an overview of key strategic risks, the Companys
risk control framework and its approach to risk management.
Shareholders and other readers are cautioned that the risks outlined
here are not exhaustive and are given for information purpose
only. New risks and uncertainties arise from time to time and it is
impossible for us to predict these events or how they affect us.
Introduction - Objectives & Approach
The Company conducts Risk Management activities covering
all of its operations with the aim of taking pre-emptive actions
to mitigate sources of risk, that is, any factors that could
potentially impede the accomplishment of business objectives.
net margins of the Telecom Operators. Hence, the increased
capital charges (the interest outgo on account of debt raised
for 3G, 4G and 5G network rollout, and the amortization of
spectrum charges) would place additional pressure on
Telecom Operators bottom lines
In March 2025, Vodafone Idea Limited ("VIL") announced
that the Government of India has decided to convert a
part of their outstanding spectrum auction dues, including
deferred dues repayable after expiry of the moratorium
period into equity shares to be issued to the Government.
Further, VIL in its recent press release announced launch of
its 5G services in Mumbai, Chandigarh and Patna and their
plans to roll out in Delhi and Bangalore. During last year, VIL
raised equity of 260,000 Mn including 180,000 Mn from
the largest FPO in India, promoter infusion of 40,000 Mn
and conversion / equity issuance to key vendors of approx.
40,000 Mn. This will ease pressure on cash flows of VIL.
Government of India has introduced new telecom policy
that is expected to reform and simplify the regulatory and
licensing regime for telecommunications, even as it removes
bottlenecks in creating telecom infrastructure, protects
users, and provides a four-tiered structure for dispute
resolution. Additionally, in December 2024, the Department
of Telecommunication ("DOT") extended its support to the
telecom industry by dispensing with the requirement of bank
guarantee to be submitted for spectrum auctions held prior
to the Telecom Reform Package 2021 with certain conditions.
With the governments push for 5G expansion, rural India is
expected to drive internet growth, benefitting the Companys
strong rural portfolio.
The Company has entered into a maintenance takeover contract
(MTO) with one of its customers. As a result, though there will
be reduction in revenue due to reimbursement and energy
related capex being directly incurred by customers under
MTO contract, cash flow on net basis will not be impacted.
This contract assures 7 years of revenue for the Company and
mitigates financial risk, ensuring revenue stability over the next
7 years.
The Company is also optimistic about tapping the growth
opportunities available from 5G rollout by major Telcos and 4G
services launch from one of the key operators.
INDUSTRY RISKS
Medium-term Credit Risk
During the last few years, the Telecom Sector has been adversely
affected by the general economic slowdown and various other
factors, such as slower growth of 3G/4G technology, delayed
spectrum auctions and inflationary power and fuel costs,
resulting in a cash flow crunch. All Telecom operators are facing
increased pressure on earnings and debt servicing. During last
7-8 years free voice with cheap data services and aggressive
tariff structures have placed additional burden on the top-line
of the Telecom Operators. This may impact payment obligations
of the Telecom Operators in the short to medium term. As a
vendor to these Telecom Operators, the Company is currently
facing a Credit Risk in the medium term. On the positive side,
operators have gradually increased tariffs, thereby improving
ARPU, which is expected to benefit the Company.
High investment in spectrum, equipment and low 5G tariff may
further impact profitability / cash flow of Telecom Operators.
Recently, telecom operators have raised mobile service rates
across almost all plans. This move is expected to alleviate
liquidity pressure on customers, thereby benefiting the Company.
Operator Consolidation
The average revenue per user in India is amongst the lowest in
the world. Further, in recent years, the industry has been through
a phase of hyper-competition, resulting in consolidation
amongst operators, phasing out many of the incumbent players
leading to loss of tenancies. The consolidation wave has
reduced the number of players to about 4 from ~18 players. The
consolidation of operators has resulted in co- location churn
for tower companies due to consolidation and rationalization of
network. The Company has been a clear victim of the continued
consolidation. This consolidation has resulted in significant loss
of tenancies for the Company.
The Company proposes to leverage existing contracts with
operators to procure commitments for new tenancies to
replace those made redundant as a result of consolidation in
the telecom sector.
Liquidity Risk
Liquidity risk is that the company will not be able to settle or
meet its obligation on time or at reasonable price. Companys
principal sources of liquidity are cash flows generated from its
operations including deposits and as a part of its contractual
terms. In view of telecom sector developments affecting the
Company, various steps have been initiated by the Company to
ensure that liquidity risk remains at low level.
The Company lost substantial number of tenancies in last
decade, due to various events which were beyond management
control, such as shutdown / exit of major telecom customers
including Aircel Group, Reliance Communications and Tata
Tele, Business combination of Vodafone & Idea (VIL), Telenor &
Airtel, etc. The Company believes that it has binding long term
contractual lock in arrangements with Aircel/other operators
and accordingly, continues to pursue its claim of approximately
154,685 Mn arising out these developments. One of the
Customer, who was delaying the payment by 4-5 months has
shown improvement. However, it is still not paying its monthly
invoices raised by the Company on time and delaying the
same by Two/Three months. Even after continuous follow-up,
apart from making delayed payment, it is unilaterally making
deductions. Additionally, Other Customer has long pending
overdue and there is uncertainty in collection. The Company
has already initiated the arbitration and recovery proceedings
against the defaulting customers. Persistent efforts to resolve
various issues with operators have resulted in significant
improvement in collection during the year ended March 31,
2025 compared to last financial year.
The Company, in these circumstances, has proactively taken
various steps to ensure smooth operations and contracted
network uptime for its existing customers, namely VIL, Reliance
Jio, Bharti Airtel, BSNL etc. These steps include reduction in
fixed/semi variable costs including wages, electricity and
diesel charges, operations and maintenance charges, ground
rent, terminating non-paying site after following contractual
process, initiating arbitration for recovery of dues etc.
Further, the Company is in the process of re- negotiating its
arrangements with existing vendors. These steps are expected
to enable the Company to remain EBITDA positive.
One of the secured lenders had filed an appeal before the
National Company Law Appellate Tribunal (the "NCLAT")
against dismissal of its Corporate Insolvency Resolution Process
("CIRP")petition by National Company Law Tribunal("NCLT").
The NCLAT in its final order dated October 25, 2024, has
allowed the appeal and the impugned order has been set aside
and the case was remanded back to the adjudicating authority
to hear the original petition afresh, taking into consideration
all the relevant facts. Accordingly, matter is pending for final
hearing before the Honble NCLT, Mumbai. The Company has
taken note of this order and continues to pursue the resolution
with its lenders, which it believes will be in the best interest of
all the stakeholders of the Company.
The Company is optimistic that various resource optimization
initiatives undertaken by the Company along with positive
developments in telecom sector can lead to stabilization and
revival.
The Supreme Court ordered in December 2016 that mobile
towers are exigible to Property Tax. The said ruling means
significant additional costs for telecom tower operators,
resulting in a strain on liquidity. This issue affects all telecom
infrastructure providers. The Company has agreements with
some of its customers to obtain reimbursement of property tax
liability and is currently negotiating similar rights with all its
customers, so the Company may be in a position to recover
some of the additional costs on occupied towers for earlier
property tax dues.
The Government of India enacted the Telecommunication
Act, 2023 (the said Act), with certain provisions taking effect
from June 26, 2024 of particular relevance is Section 14(3),
which clarifies that telecommunication networks installed
on any property will not be treated as part of that property.
Consequently, these networks are exempted from property
tax, levies, cess, fees, or duties that may otherwise apply to
the property. Despite the enactment of this provision, some
authorities continue to demand property tax. In order to prevent
sealing of operational sites, the Company has had to make such
payments under protest. Further, as per the said Act, section
14(4) states that local authorities do not have jurisdiction to
take any coercive action against the said towers without due
authority from the Central Government.
As of March 31, 2025 the Company has accounted for the
liability towards Property taxes in its financial statements on
the basis of best estimates considering the demand notices
received/ receivable in various circles wherever it is applicable.
However, the Company continues to challenge before various
judicial forums, the various components and retrospective levy
of Property Tax demands raised by the respective local statutory
authority.
STRATEGIC RISKS
Concentration Risk
There is a high Concentration Risk to the Company for the
following reasons:
The Company operates primarily in one sector namely, the
Telecom Sector. The telecom sector moving towards an
oligopolistic structure, with three players accounting for more
than 90% of market share, is posing challenges for Tower
companies. This will put pressure on rent revenue per tower as
the number of tenants per tower would go down.
Further, the stressed financial condition of any debt-laden
telecom incumbents will restrain any material hike in rentals,
at least over the medium term.
RISK ON ACCOUNT OF CUSTOMERS OVERDUE RECOVERY
Insolvency of Customers
Aircel was the Companys single largest customer, contributing
around 45% of revenue. On March 1, 2018, Aircel Group
filed for insolvency proceedings under Section 10 of the IBC,
2016 before NCLT. The Company has filed its claims against
Aircel Group before Resolution Professional (RP) amounting to
143,940 Mn as Financial Creditor.
The Companys Misc. Application claiming Corporate Insolvency
Resolution Process (CIRP) Cost has been approved by the NCLT,
Mumbai vide order dated November 27, 2019 and December
06, 2019. Resolution Professional (RP) has preferred an appeal
against Para 33 of the Order dated November 27, 2019 where
CIRP Cost of the Company has been approved by NCLT and
second appeal has been filed by the Resolution Professional
against the order dated December 06, 2019 (which is
essentially clarified and extensions of earlier order stated at
Para 33 of order dated November 27, 2019). SBI and Committee
of Creditors ("COC") has also preferred an appeal opposing
CIRP payments to the Company. The accumulated CIRP cost to
the date is as on August, 20251,349.62 Cr.
Another Misc. Application filed by Company challenging
reclassification of the Company from Financial Creditor
to Operational Creditor and subsequent verification of the
Companys Claims as Financial Creditor has been disposed
of and the Companys claim has been rejected by the NCLT
on November 27, 2019. Against the said order, the Company
has also preferred an appeal before National Company Law
Appellate Tribunal, New Delhi ("NCLAT") challenging that
portion of the Order dated November 27, 2019 to the extent
it relates to NCLT Mumbai rejecting the Companys claim as
Financial Creditor.
The RP has filed an application under Section 31 before the
NCLT Mumbai for approval of the Resolution Plan of Aircel and
the same has been approved by the NCLT on June 9, 2020.
The Company has challenged the said NCLT order dated
June 9, 2020 by way of an appeal, before NCLAT New Delhi
as the Companys CIRP cost approved by NCLT has not been
considered in the Resolution Plan.
The Companys claim against Reliance Communication Limited
and Reliance Telecom Infratel Limited including that of Sistema
Shyam Teleservices Ltd. ("SSTL") to the tune of 1,502 Mn. as
Operational Creditor has been filed before Interim Resolution
Professional ("IRP") on May 21, 2019 and moratorium period
is effective. No invitation has been given to the Company for
Committee of Creditors meeting, as our claim does not meet
the criteria of 10% claim.
In April, 2018 State Bank of India had filed Insolvency Petition
against Videocon Telecommunications Limited and the Petition
was admitted by the NCLT Mumbai and IRP has been appointed.
The Company has filed claim to the tune of 654 Mn as an
operational creditor and moratorium period is effective. No
invitation has been given to the Company for Committee of
Creditors meeting, as our claim does not meet the criteria of
10% claim.
However, since the above referred Telecom Operators are
undergoing the CIRP, it remains to be seen what residual
value would be left for distribution after appropriation by the
secured banks / lenders, especially post recent amendments
in Insolvency & Bankruptcy Code thereby bringing clarity on
preference to financial creditors over operational creditors
/ unsecured financial creditors. There is a significant risk
that there may not be any monies left after distributing
proceeds to the secured banks / lenders of these Telecom
Operators. Such unprecedented shutdown of operators has
led to frustration of various network improvisation measures
that the Company had undertaken and also led to shrinking
of cash flow
Recovery Proceedings
The Company has experienced delays and defaults in
recoveries of its dues for over six months or at times, in
respect of some sites, even up to a year from one of its
existing customers. The Company has invoked arbitration
proceedings against the said customer before Sole Arbitrator
appointed by Honble Delhi High Court. The Company has
filed claim of 3,651 Mn against the said customer whereas
the said Customer has filed a counter claim of 5,003 Mn.
The matter is posted for Cross examination of Customers
witnesses.
Through ATC Telecom Private Limited ("ATC"), Company
had provided Infrastructure Services to Telenor (India) Pvt.
Ltd. Since Telenor got merged into Bharti Airtel Limited,
consequently, exit notices were issued by ATC for its
tenancies with the Company taken for its customer Telenor.
ATC also owes several amounts to the Company under
multiple binding agreements and the Company believes that it
would be essential to proceed for recovery. As such Company
had invoked arbitration proceedings against ATC before Sole
Arbitrator Honble Retd. Justice Manmohan Singh the sole
arbitrator has passed an award dated December 18, 2024
and additional award dated February 5, 2025 in favour of the
Company. Against both the awards, ATC has filled an appeal
before Honble Delhi High Court. The Company has also filed
an execution petition for both the awards. As of July 2025, the
award amount is to the tune of 252.64 Mn.
Additionally, the Company has also filed a Commercial Suit
before Bombay High Court for remaining GIL Sites and the
matter is now posted for framing of the issues.
Further, initial term of the Master Service Agreement with few
customers has also expired. Few Customers are also opting
for exit from sites where lock-in has expired resulting in loss
of tenancies for the Company.
Following table depicts claims of the Company as on June 30,
2025 against telecom operators:
OPERATOR |
Amount of claim (in Mn.) |
Aircel - Exit Penalty |
143,940 |
RCOM |
1,334 |
MTNL Del + Mum |
312 |
Datatcom |
654 |
ATC Viom |
453 |
SSTL |
168 |
Others including existing operators / customers * |
7,824 |
Total |
1,54,685 |
r ~i
* Certain operators have disputed the claims of the Company
THEFT / UNAUTHORIZED DISMANTLING OF TOWERS
The Company lost substantial number of tenancies in the
last few years, due to various events which were beyond
management control, such as shutdown/exit of 14 telecom
customers including Aircel Group, Reliance Communications,
Shyam Sistema and Tata Tele, Business combination of
Vodafone-Idea and Telenor-Airtel, etc. These developments
have resulted in reduction in the revenue and earnings,
Cash losses, erosion of Companys net worth, provision for
impairment of property, plant and equipment. As a result,
rentals to landlords, taxes and other dues of unoccupied
sites remained unpaid. The Company requested Edelweiss
Asset Reconstruction Company Limited ("EARC"), the
Monitoring Institution, to allow payment of rentals to
landlords of unoccupied sites, but approval is still pending.
Due to unpaid rents, some landlords have blocked access to
sites. Consequently, unauthorized dismantling by unknown
miscreants and disgruntled landlords occurred on 363 sites
during the year ended March 31,2025 (903 sites during the
year ended March 31, 2024). Further, 90 sites were stolen /
dismantled as of June 2025.
The Company, on its part, are taking various mitigation
measures to protect its assets which include
1. Additional survey of its sites
2. Discussion with landowners for convincing them for not
resorting to such actions
3. Negotiating with customers / telecom operators for
getting new tenants on such unoccupied towers
4. Requesting lenders for making rent payments,
submission of proposal to lenders for unfeasible sites;
However, there was no co-operation from lenders
towards settlement of rent liability. The Company is
currently settling with landlords on case-by-case
basis
The Company has also initiated process of taking legal
actions and filing of FIR against such landowners/
miscreants who have resorted to unauthorized dismantling /
theft of towers.
Additionally, the Company has implemented round the
clock surveillance system in the form of a dedicated Tower
Vigilance Team (TVT) to effectively minimize and prevent
theft of tower assets. The Company has so far deployed TVT
on more than 50% of its unoccupied sites. Consequently,
reduction in theft/ unauthorized dismantling of towers is
observed on these sites.
The Company had also attempted to salvage unoccupied
tower sites and accordingly resolution plans submitted by
the Company to the lenders included payment of rent to
landowners, settlement to vendors and employees. However,
none of the resolution proposals were considered or even
responded to by the lenders.
Thus, there is a risk of further theft / unauthorised dismantling
of un-occupied / discontinued sites of the Company if the
said issue remains unresolved.
RISK RELATED TO DEBT
The various extraneous developments in telecom sector
as reported from time to time especially during the last
7-8 years, once again unavoidably pushed the Company
to realign its overall debt (including unsecured foreign
currency bonds) to sustainable level with revised cash
flows. In April 2018, the Company had proactively presented
a Resolution Plan (with an intent to maximize recovery
of dues) to the lenders who constituted a significant
majority of the outstanding debt of the Company. Instead,
the lenders had elected to pursue sale of their debt to an
Asset Reconstruction Company. As on date, 79.34% of the
Indian Rupee Lenders have assigned their respective rights,
title and interest in the financial assistance granted to the
Company in favour EARC, acting as a trustee on behalf of
EARC - Trust SC 338.
Few lenders didnt assign their respective debt. Instead,
one of the lenders chose to file insolvency application. The
said petition was dismissed by Honble NCLT, Mumbai on
November 18, 2022. The Honble NCLT held that the business
of the Company is sustainable, it is a viable going concern
under its current management and the overall financial
health of the Company is not bad enough to be admitted
under CIRP. Against the dismissal order of November 18,
2022, the said lender preferred an appeal before Honble
NCLAT at New Delhi. The Honble NCLAT, vide order dated
October 25, 2024, has while allowing the said appeal, set
aside the order passed by the Honble NCLT and remanded
the case to the Honble NCLT for fresh hearing of the original
petition filed by the said lender taking all relevant facts into
account. Accordingly, matter is pending for final hearing
before the Honble NCLT, Mumbai Bench.
Based on payments made in the immediately preceding
financial years, the Company believes that if debt capital
is correctly sized based on a TEV study (requested by
the Company from time to time), the Company would be
able to continue operations despite challenges in telecom
sector. This could also help in restoring equity value for
the lenders.
Further, Canara Bank, Indian Bank and Union Bank of India
have filed an application against the Company for recovery
of its debts before the Debt Recovery Tribunal, Chennai.
During the year ended March 31, 2025, the Company paid
13,059 Mn to its lenders including upfront amount for
considering the OTS/ Restructuring proposal to lenders.
Thus, any further delay in implementation of the Resolution
Plan / oTs will negatively impact the sustainability of the
Company. Further any attempt to pursue a resolution plan
under Insolvency and Bankruptcy Code 2016 ("IBC") will
lead to erosion of debt and equity value as there is a risk
of exits by customers from lock- in agreements if the
insolvency is admitted
FOREIGN CURRENCY CONVERTIBLE BONDS RISK
As stated in Risk Management Section of Annual Report
from time to time, the trustee of Series A FCCB has filed a
Commercial Suit before the Honble Bombay High Court for
recovery of US$ 27 Mn.
Thus, there is a risk that in case the Commercial Suit is
allowed, then, as claimed by the Trustee, the Company would
be liable to pay to the trustee the outstanding amounts of
US$ 27 Mn this is as per suit plaint. with further default
interest on the Redemption amount in terms of Acceleration
Notice.
Series B2 Bonds are redeemable and have matured on
October 27, 2022. The lead secured lender has, however,
informed the Company that till the time the entire
outstanding Secured debt of the Secured lenders is fully paid
off, no other creditor including Series B2 Bondholders, which
rank sub-ordinate to the secured creditors, can be paid in
priority. Hence, the Company could not redeem Series B2
Bonds on its maturity. .
Thus, in absence of restructuring by secured lenders there
is risk of action by the bondholders against the Company.
Competitive Risks
The competition is intense among the incumbent tower
companies. Similarly, Reliance Jio has business interests
in the Brookfield owned Summit Digital Infrastructure Pvt
Ltd. It is expected that these tower companies will get
preference of new sites from Bharti Airtel and Reliance Jio
respectively.
To mitigate this, the Company will continue to provide SLA
driven services and capitalise on its strategic foot print of
radiating and non-radiating towers to make them attractive
for the operators for new tenancies. However, if the debt
restructuring by EARC consortium is not completed in a
time bound manner, there will be limited Capex available
for network upgradation, which will result in a decline in
customer demand for our towers.
OPERATIONAL RISKS
Supply Chain Risk
The Company requires materials and services for tower
upgradation and preventive maintenance of passive
infrastructure. Delay in supplies of such materials and
services, may impact smooth functioning of business
operations resulting into penalties and claims for damages
by customers.
Additionally, suppliers may tighten credit and other
terms that they may be extending to the Company
thereby increasing the liquidity strain on the Company
and hampering its ability to deliver projects and running
operations on a timely basis.
The Company tries to diversify suppliers to avoid dependency
on single sources. Implementing robust inventory management
ensures proper stock availability, reducing the impact of possible
delays. Forecasting requirements helps align procurement with
demand, minimizing shortages.
The Company faces high operational level challenges for the
energy management like payment settlement issues, invoicing
and addressing of concerns. In order to streamline the energy
operations / assuring efficiency, the Company is focusing on
renewing its energy contracts with the customers.
Manpower Risks
Over the years, as a result of exit of tenants due to shut downs or
consolidation in telecom sector, the Company has implemented
various cost optimization measures. The Company may face
increased levels of attrition, due to inter-creditor disputes,
regulatory challenges and threat of NCLT proceedings, resulting
in challenges in project execution and service delivery, especially
considering 5G implementation by Telecom Operators.
Network Equipment Risks
The Company continues to judiciously invest capex for the up
gradation of network. This has resulted in maintaining network
uptime and reduced SLA penalties on substantial number of sites.
However, many network equipments such as diesel generators,
battery bank, power supply equipment ("SMPS") and air
conditioner are ageing towards end of life. Improper functioning
of these equipment may impact smooth functioning of business
operations resulting into penalties and claims for damages by
customers. Further this may also result in tenancy exits for
non-maintenance of contractual SLAs.
The Company has drawn up Capex plan for upgradation of its
site equipment, however cash flow constraints may restrict
implementation of capex plan.
Legal, Contractual and Compliance Risk
Legal, Contractual and Compliance risk may arise from
occasional non-adherence to timely deliverables and Service
Level Agreements ("SLA"), for the reasons mentioned above
and in some cases beyond Company and management control,
especially where certain operators default on their contractual
obligation to pay in a timely manner and the Company is
saddled with costs related to discontinued tenants.
Considering pending application before NCLT, in the event of
admission of the Company under IBC the Customers may exit from
sites, which may in turn result in loss of business for the Company.
The Company may also lose its right to claim lock in compensation.
The Company has made lenders aware of the same.
The Central Bureau of Investigation has filed a FIR dated August
16, 2023 against the Company, unknown public servants and
unknown persons as stated therein. Serious Fraud Investigation
Office has initiated investigation in the affairs of the Company.
The Company believes that (i) the decision to assign the lenders
debt to ARC, was entirely that of the lenders and the Company
was no way involved in the decision-making process. This was
based on lenders own commercial wisdom and on an independent
process followed by the lenders; (ii) the Company has complied
with all relevant sanctions, approvals and regulations of loan.
The Company continues to operate in normal course of
business and does not see any material impact on the
operations of the Company. The Company is taking appropriate
steps to defend and exonerate itself and currently, the matter
is sub-judice.
The Company consistently tracks shifts in tax, regulatory,
and statutory frameworks and adjusts the operations to stay
compliant with evolving market conditions.
The disputed liabilities in respect of claims against the Company
not acknowledged as debts, direct and indirect matters under
appeal etc. are duly disclosed in note no. 38 to the financial
statements.
The Company after the year end has received notices related to
direct and indirect taxes as a part of assessments. In terms of
SEBI Requirements, the Company is making disclosure to stock
exchanges from time to time about material notices of show
cause and demand received from any revenue authorities. The
Company is taking necessary steps to file appropriate reply and
defend.
Through proactive support, the Company tries to reduce the risk
of facing repeated demands or penalties. Strong governance
and well-established processes ensure that effective
monitoring systems are in place, allowing the Company to meet
all regulatory and statutory obligations.
The Company has a talented and committed legal and
compliance team however several external risks related to
legal, regulatory, contractual and compliance keep surfacing
given ever changing rules, regulations and laws.
The Company is not regulated by any regulatory agency and
faces the general regulatory environment that is prevalent in
the country. However, the customers in the telecom sector are
regulated by Telecom Regulatory Authority of India ("TRAI")
and the Company is IP-1 registered with Department of
Telecommunications India.
Environmental Risk
The Companys assets are subject to risk from natural
disasters like cyclone or external factors. The Company
maintains insurance for its assets which cover for damages
caused by fire, special perils and terrorist attacks. However,
disruption to the Companys network from natural calamities,
though temporary in nature, is always a possibility. There
are some environmental concerns from citizens groups
as well. Electromagnetic Field ("EMF") radiations are the
invisible electric and magnetic forces arising from the active
infrastructure installed at telecom towers. In the recent past
some citizens groups have raised concerns around the
radiations and its ill effects. Although the risk related to EMF
radiation if any, is completely attributed to the Companys
customers, any litigation concerning this and resultant
adverse orders, could affect tower business as well. It may
be noted that EMF radiation norms in India are more stringent
than in Europe and non-adherence can invite hefty fines
from regulator. Also, there has been no conclusive evidence
as such of the ill effect of radiations on human health. The
Department of Telecommunications ("DoT") has recognized
campaigns and media articles. Also, DoT has set up TERM
Cells to monitor the radiations and certify the locations.
Sr No Type of Risk |
Mitigation Plan |
1 Liquidity and Leverage |
The Company is ensuring that monthly Infrastructure Provisioning Fees
and other Revenue streams such as Energy, Rent etc. are realised in best possible way. Timely revisions in Energy Billing contracts with Telcos are attempted to improve liquidity flow. Reduction in various operating costs
as per Cost Optimisation Plan has ensured cost optimisation compared to The Company has been successful in finalising agreements with some of its
customers for reimbursing its |
2. Risk on account of |
The Company has already initiated the arbitration and recovery
proceedings against the defaulting customers. The Company has also submitted its claims to the respective Resolution Professionals where CIRP process has been initiated against our customers before NCLT. |
3. Operational Risk |
End of life equipment needs to be upgraded or replaced. The Company has
accordingly invested in certain projects and ensured its network is upgraded with the latest technology/ equipment. SLA penalties have been reduced by resolving both infra and non-Infra issues
promptly and additional CAPEX To effectively mitigate the risk associated with manpower attrition, the
company has implemented a robust and |
4. Risk related to debt |
In accordance with the revised Prudential Guidelines issued by the
Reserve Bank of India, the Company has presented a Resolution Plan for consideration of lender consortium. The Company is in discussion with lenders for OTS / restructuring of debt. During the year ended March 31, 2025, the Company paid 13,059 Mn to its lenders including upfront amount for considering the OTS / Restructuring proposal to lenders. |
5. Environmental Risk |
The Companys assets are subject to risk from natural disasters or
external factors. The Company maintains insurance for its assets which cover for damages caused by fire, special perils and terrorist attacks. However, disruption to the Companys network from natural calamities, though temporary in nature, is always a possibility. |
6. Legal, Contractual and |
Through proactive support, the Company tries to reduce the risk of
facing repeated demands or penalties. Strong governance and well-established processes ensure that effective monitoring systems are in place, allowing the Company to meet all regulatory and statutory obligations. The
Company has a talented and committed legal and compliance team however several external
risks related |
the effectiveness of the Companys internal control systems and
adherence to management policies and statutory requirements. It
maintains a regular surveillance over the entire operations.
The audit coverage in the internal audit function of the Company
is in line with the objectives of internal audit as prescribed by
the Institute of Chartered Accountants of India (ICAI). The role of
Internal Audit in the Company is as given below:
• Understanding and assessing risks and evaluating
adequacies of the prevalent internal controls.
• Identifying areas for system improvement and
strengthening controls.
• Ensuring optimum utilisation of the resources of the Company.
• Ensuring proper and timely identification of liabilities,
including contingent liabilities of the Company.
• Ensuring compliance with internal and external guidelines
and policies of the Company as well as the applicable
statutory and regulatory requirements.
• Safeguarding the assets of the Company by setting up a
process of every change record.
• Reviewing and ensuring adequacy of information
systems security control.
• Reviewing and ensuring adequacy, relevance, reliability
and timeliness of management information system.
The internal audit function is monitored by the Audit committee
of the Board which periodically reviews audit plans, audit
observations of both internal and external audits, audit coverage,
risk assessment and adequacy of internal controls. Thus effective
internal control structure has been set up in the Company to
enhance organizational performance and contribute towards
accomplishment of its objectives.
INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY
The Company is committed to ensure that its operations are
carried out within a well-defined internal control framework.
Good governance, robust systems and processes, a vigilant
finance function and an independent internal audit function are
the foundations of the internal control systems. The Company
believes that a strong internal controls framework is an
essential pre-requisite of growing its business.
The Company has an internal control system in place,
commensurate to its size and spread in order to achieve orderly
and efficient conduct of its business, including adherence to
management policies, safeguarding of assets, prevention and
detection of fraud and error, accuracy and completeness of the
accounting records and timely preparation of reliable financial
information. The internal control system encompasses financial
and operational controls and statutory compliances.
There are suitable controls with reference to policies and
procedures, risk assessment, ethics that are clearly established,
communicated and monitored. Moreover, there is a periodic
review and assessment of the relevant controls to improve
effectiveness, reduce cost and improve business performance.
The authority matrix, responsibility and accountability i.e., delegation
of authority and segregation of duties are clearly defined such that
decisions are made and actions taken at an appropriate level.
The control environment ensures commitment towards integrity
and ethical values and independence of the board of directors from
the management. The control activities incorporate, among others,
continuous monitoring, routine reporting, checks and balances,
purchase policies, authorization and delegation procedures.
The internal audit function performs audit to monitor and evaluate
Introduction
In the telecom tower industry, where infrastructure and
technology play a critical role, it is the people who drive
operations, innovation, and excellence. At GTL Infra, we consider
our employees our most valuable asset. This report outlines our
key HR initiatives and focus areas for the year 2024-2025,
highlighting our commitment to developing, supporting, and
retaining top talent to maintain our leadership in the sector.
Workforce Strategy & Culture
Our HR strategy centered around building a resilient, skilled,
and engaged workforce. We focused on maintaining a safe,
inclusive, and performance-driven culture while navigating
industry challenges and evolving technology landscapes. A
strong emphasis was placed on transparency, internal mobility,
and continuous dialogue across all levels.
Learning & Development
Capability building remained a core pillar of our HR agenda.
We introduced blended learning programs, cross-functional
exposure, and leadership readiness modules. Our focus was
on technical upskilling, safety awareness, compliance, and
future-focused skills such as digital operations and remote
infrastructure management.
Engagement & Retention
Employee engagement was strengthened through recognition
programs, wellness initiatives, and regular townhalls. We
fostered open communication and inclusive decision-making.
Despite industry pressures, we retained key talent through
internal growth opportunities, cross-functional roles, and
focused career conversations.
Diversity & Wellbeing
We continued to foster an inclusive environment with zero
tolerance for bias and discrimination. Programs focused on
mental wellness, emotional resilience, and physical safety were
prioritized, especially for field employees. Gender diversity,
even in field roles, improved through targeted hiring and
support programs.
HR Digitalization
We enhanced our HR technology landscape with automation
across Performance Management System, leave, attendance,
and payroll. A self-service HRMS portal empowered employees
and managers with real-time access to data, reducing
administrative workload and improving responsiveness.
Looking Forward
As the telecom tower industry evolves with 5G and smart
infrastructure, our HR priorities for FY 2025-2026 include
building a future-ready workforce, driving internal leadership
pipelines, leveraging people analytics, and deepening
employee engagement. Our people will remain the cornerstone
of our progress, and we are committed to nurturing a culture
of growth, resilience, and purpose.
Prevention of Sexual Harassment
The Company has zero tolerance for sexual harassment at
workplace and has adopted a Policy on Prevention, Prohibition
and Redressal of sexual harassment at workplace in line
with the provisions of the Sexual Harassment of Women at
Workplace (Prevention, Prohibition and Redressal) Act, 2013
and Rules framed thereunder. Internal Complaints Committee
is in place for all works and offices of the Company to redress
complaints received regarding sexual harassment. During
FY 2024-25, the Company had received no complaints on
sexual harassment.
Compliance with the Maternity Benefit Act
The Company is fully compliant with the provisions of
the Maternity Benefit Act, 1961 (as amended). All eligible
women employees are provided maternity leave and related
benefits in accordance with statutory requirements. The
Company also extends additional support through flexible
work arrangements, medical assistance, and a supportive
workplace environment to ensure the well-being of
employees during and after maternity.
IIFL Customer Care Number
(Gold/NCD/NBFC/Insurance/NPS)
1860-267-3000 / 7039-050-000
IIFL Capital Services Support WhatsApp Number
+91 9892691696
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IIFL Capital Services Limited - Stock Broker SEBI Regn. No: INZ000164132, PMS SEBI Regn. No: INP000002213,IA SEBI Regn. No: INA000000623, SEBI RA Regn. No: INH000000248, DP SEBI Reg. No. IN-DP-185-2016, BSE Enlistment Number (RA): 5016
ARN NO : 47791 (AMFI Registered Mutual Fund & Specialized Investment Fund Distributor), PFRDA Reg. No. PoP 20092018
This Certificate Demonstrates That IIFL As An Organization Has Defined And Put In Place Best-Practice Information Security Processes.
