“A moratorium is not being asked for, only reassessment,” said a source privy to the submissions made by the telecom company (telco) to the department. Queries sent to Airtel did not elicit a response as of Sunday night. Executive Vice-Chairman Gopal Vittal said on Friday that the company was yet to hear back from the department despite multiple requests seeking parity in several areas, including computation errors, arithmetical errors, and errors of omission, in the assessment carried out for Vi.
VI’s dues were frozen at ₹87,695 crore by DoT in December last year following a Supreme Court order. The company has been directed to pay ₹1,144 crore over the next 10 years out of its total outstanding, after which its actual AGR payments will begin once the dues are reassessed by a DoT committee.
Airtel’s AGR dues are estimated to exceed ₹40,000 crore. The company has already paid about ₹18,000 crore, but the outstanding continues to rise as interest on principal, penalty, and interest on penalty are being levied by the government for non-payment.
“Even after assuming only a minor dip in capital expenditure (capex) from 2025-26 (FY26) levels, spectrum instalments, and no AGR benefit, we estimate ₹1.2 trillion of cumulative free cash flow (FCF) generation over 2026-27 and 2027-28,” analysts at IIFL Securities said, pointing to the carrier’s ability to meet its outstanding dues.
With FCF generation of ₹17,300 crore in the third quarter (October-December/Q3) FY26 and ₹45,500 crore in the nine months ended December 2025, Airtel’s net debt — excluding lease liabilities and government debt — stands below ₹20,000 crore. The rights issue call on partly paid shares is expected to yield ₹15,800 crore, driving further deleveraging, the analysts added.
The Sunil Bharti Mittal-promoted carrier plans to double its share of the data centre market to 25 per cent by 2030, expanding capacity nearly tenfold to 1 gigawatt. This will be among the company’s largest capex commitments. The expansion is expected to require an investment of $6 billion, which can be supported by strong FCF generation, IIFL analysts said in a note.
Vittal told analysts during the earnings call on Friday that the company could partner existing shareholder Singtel to speed up data centre rollout, following Singtel’s move to acquire STT Telemedia’s data centres globally as well as in India.
The telco is also stepping up efforts in DC-DC connectivity, enterprise offerings and digital services, including Cloud, cybersecurity, Internet of Things, and financial services. These segments contribute about 30 per cent of revenue and are growing at around 20 per cent annually. Airtel launched Cloud services last year and, with 16 deals signed and another 300 under discussion, is also seeking certification for sovereign Cloud services from the Ministry of Electronics and Information Technology, Vittal added.
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