According to India Ratings and Research (Ind-Ra), the four-year moratorium for both the adjusted gross revenue (AGR) and spectrum liabilities can potentially provide telecom operators with a medium-term liquidity buffer without affecting the actual liabilities to be paid.
According to industry analysts, Vodafone Idea (Vi) has accepted the four-year spectrum payment moratorium that could offer it a cash-flow relief of up to Rs 600 billion. the operator has until October 29 to decide whether to opt for the AGR moratorium, which runs through FY22-23 to FY25-26. Further, Vi has 90 days to exercise a one-time option to convert the interest that accrues due to deferred payments into equity.
According to Ind-Ra, the telecom reforms introduced by the Union Cabinet will reduce and ease regulatory burdens for telecom operators in the medium and long term.
The report noted that the sector showed signs of continued improvement, and that average revenue per user (ARPU) could increase without a tariff hike.
According to the rating agency, the number of wireless subscribers, which increased by 6 million on a monthly basis in July 2021, decreased by 0.1 million subscribers in August 2021 to 1,187 million subscribers.
According to Ind-Ra, broadband subscribers increased to 66.5 per cent of the overall wireless subscriber base in August 2021 from 66.1 per cent in July 2021. The number of broadband subscribers increased by 4.6 million in August 2021, and broadband penetration as a percentage of the overall subscriber base increased.
