Telecom stocks trade flat ahead of today's SC hearing on AGR payments

In its last hearing, the SC had asked the Centre to prepare a plan for recovering AGR dues from bankrupt telecom operators

Telecom stocks were little changed on Friday as investors remained cautious ahead of the Supreme Court hearing in the adjusted gross revenue (AGR) case later in the day.

Among individual stocks, Bharti Airtel was trading almost flat -- 0.08 per cent higher -- at Rs 536.10 on the BSE, at 1 PM. The stock hit an intra-day high and low of Rs 542.55 and Rs 534.75, respectively. Vodafone Idea was trading 1.33 per cent higher at Rs 9.16 and had hit an intra-day high of Rs 9.33 and an intra-day low of Rs 8.91. Reliance Industries, meanwhile, rose as high as Rs 2,156.50 ( up 1.6 per cent). Bharti Infratel was last trading 0.55 per cent lower at Rs 200.35.

The S&P BSE Telecom index advanced 0.2 per cent as compared to the benchmark S&P BSE Sensex's 0.32 per cent gain. Tata Communications, Optiemus Infracom Ltd (both up 5%) and Reliance Communication (up 4%) were the top index gainers. 

In its last hearing on August 10, the Supreme Court had adjourned its hearing in the AGR matter and had asked the Centre to prepare a plan for recovering AGR dues from bankrupt telecom operators -- Reliance Communications (RCom), Aircel, and Videocon Telecommunications.

The amount recoverable from RCom is Rs 31,000 crore, while that from Aircel is Rs 12,389 crore. Insolvency proceedings had begun following claims made by operational creditors Ericsson and China Development Bank.

In an affidavit filed with the Supreme Court, Sistema Shyam Teleservices (SSTL) had said RCom was liable to pay its AGR dues.

The Department of Telecommunications has arrived at a combined AGR liability of Rs 25,195 crore for RCom and SSTL as on March 6, 2020. RCom had filed for insolvency back in February 2019.

Meanwhile, on July 20, the apex court had reserved its order allowing a staggered payment schedule to telcos for paying up their AGR dues. It had further made it clear it will not hear "even for a second" the arguments on reassessment or re-calculation of the AGR related dues of telecom companies which run into about Rs 1.6 lakh crore.

According to the DoT’s calculations, Bharti Airtel owes Rs 43,780 crore in AGR dues, of which the company has paid Rs 18,004 crore, with the balance at Rs 25,776 crore.

Vodafone Idea has so far paid Rs 7,854 crore of its total Rs 50,399 crore in dues, while Tata Teleservices has paid Rs 4,197 crore with the balance at Rs 12,601 crore.

The apex court had asked Bharti Airtel and Vodafone Idea to come out with a “reasonable payment plan”, make some payment to “show their bona fide”, and also file their books of accounts for the last 10 years.