The stock of telecom services provider tanked 10 per cent to Rs 326 in the intra-day trade after the SC rejected telecom companies’ appeal against the Union government’s definition of Adjusted Gross Revenue (AGR). The apex court will later decide on the timeframe for the operators to pay AGR. CLICK HERE TO READ FULL REPORT
"We are disappointed by the verdict of the Hon'ble Supreme Court. The definition of AGR has been a long standing dispute between the Department of Telecommunications (DoT) and the Telecom Service Providers (TSPs) dating to 2005. The issue of inclusion of revenue from non-telecom activities and interpretation of the heads included in the definition of AGR under the license conditions has been through several rounds of litigation, which have been in favour of the TSPs till now,” Bharti Airtel said in a statement.
The TSPs have invested billions of dollars in developing the telecom sector and providing world-class services to consumers. This decision has come at a time when the sector is facing severe financial stress and may further weaken the viability of the sector as a whole.
Of the 15 old operators impacted by the order, only two private sector operators remain in service today. The Government must review the impact of this decision and find suitable ways to mitigate the financial burden on the already stressed industry, it added.
At 02:48 pm, Bharti Airtel was trading 3 per cent higher at Rs 371 on the BSE, as compared to a 0.05 per cent rise in the S&P BSE Sensex. The trading volumes on the counter jumped 6-fold with a combined 68 million equity shares representing 1.3 per cent of total equity of the company changing hands on the NSE and BSE.