According to industry sources, Bharti Airtel is planning to raise up to Rs 30 billion in short-term debt from the local money market. The decision comes in the backdrop of the requirement of funds to make the initial payment to the government for 5G airwaves that the operator bought in the recently concluded 5G spectrum auctions.
To this end, Airtel is reportedly selling commercial papers (CPs) with maturities of up to 12 months. Meanwhile, SBI Mutual Fund is said to have agreed to subscribe to more than Rs 10 billion of Airtel’s debt and would likely opt for CPs maturing in February 2023 at 6.53 per cent.
Besides, the Department of Telecommunications (DoT) has given the telcos an option to pay in 20 equal annual instalments. However, the telcos can also choose to pay the entire amount or pay part upfront payment (which can be a multiple of complete years with a minimum of two years). As per estimates, if Airtel opts to pay for 5G spectrum in 20 equal annual instalments, its first tranche would be around Rs 38.48 billion, which it will be obliged to pay to the DoT by August 17, 2022.