Brickwork Ratings downgrades Vodafone Idea NCD

Vodafone Idea Ltd on Friday said Brickwork Ratings has downgraded the firm's rating on non-convertible debentures (NCDs) citing recent court ruling on adjusted gross revenue and extension of timeline with regard to the sale of stake in Indus Tower to Bharti Infratel.

The rating agency has downgraded Vodafone Idea Ltd (VIL) from 'A+' (with negative outlook) to 'A-' rating, which says "watch with negative implications".

"It is hereby informed that Brickwork Ratings has downgraded its rating on non-convertible debentures as per the rating rationale uploaded on its website today (Friday)," VIL said in a regulatory filing.

Last month, VIL had faced a similar downgrade from Care Rating on its long-term bank facilities and NCDs.

Airtel, Vodafone Idea and other telecom operators may have to pay the government a whopping Rs 1.4 lakh crore following the recent Supreme Court order that sent shock waves through an industry already grappling with billions of dollars in debt and an intense tariff war to retain customers.

The Supreme Court, last month, upheld the government's position on including revenue from non-telecommunication businesses in calculating the annual AGR of telecom companies, a share of which is paid as licence and spectrum fee to the exchequer.

According to the telecom department's calculations, Bharti Airtel faces a liability of around Rs 42,000 crore after including licence fees and spectrum usage charges, while Vodafone Idea may have to pay about Rs 40,000 crore. Jio may have to pay around Rs 14 crore.