Update on AGR issue of Vodafone
I take this opportunity to update you on the AGR matter of Vodafone, in light of recent developments and also set a context to the recent statutory announcements that have been made by VIL.
Update on AGR
At the outset, please note that AGR is a larger industry issue.
The Hon’ble Supreme Court passed its final judgment in the AGR matter on 24th October 2019 and also passed a supplementary order on the same day, directing the telecom operators to pay the AGR dues within 3 months.
Vodafone has filed an application for modification of the said supplementary order. While the said application is pending, it was taken up on 14th February 2020 and Hon’ble Supreme Court directed compliance of its judgment. However, an oral plea made by the Company before the Hon’ble Supreme Court on the 17th of this month for directing the DoT to not invoke bank guarantees was not entertained.
VIL’s Board of Directors took stock of the matter and following their directions, on 17th February 2020, Vodafone Idea Limited has paid to the DoT a portion of the dues aggregating to a sum of 2,500 crores and made a commitment to pay a further 1,000 crore within this week.
It is important to note that as per DoT direction all the telecom service providers are carrying out self-assessments and Vodafone Idea Limited expects to complete the process shortly.
The next hearing on this matter is on 17th March. Meanwhile, Vodafone continues to actively engage with the government to seek relief on the AGR and other matters relating to the health of the industry.
Vodafone Idea Limited is a joint venture company formed in August 2018 by the merger of Vodafone India Limited and Vodafone Mobile Services Limited with Idea Cellular Limited. The parent shareholders of the company are The Aditya Birla Group (27.7%) and Vodafone Group plc (44.4%).
The management of VIL continues to enjoy the strong support of both the promoter groups. And believe that both groups will remain invested in India’s telecom growth story.
As recently as May 2019, the parent shareholders along with other shareholders participated in the Rights Issue and the company successfully raised 25,000 crores.
Following are the key highlights of our latest set of financial results for Q3FY20, announced on February 13th, 2020:
• Revenue grew by 2.3% QoQ supported by strong growth in 4G additions which accelerated to 8.3 million during the quarter.
• Announced reaching 104.2 million 4G subscriber base
• After several quarters of pressure on the top line, we witnessed consistent revenue turnaround from September onwards i.e. before the recent price hikes.
• The tariff increases effective December should further improve revenue performance going forward
• The synergy realization is on track with 85% of the guided synergy achieved by Q3FY20
• We have consolidated 86% of districts as of December 2019, driving a significant improvement in network speeds, leading to enhanced customer experience
• Vodafone have consolidated 3 more circles namely, UP (E), Gujarat and Delhi in January 2020 taking the total count of integrated circles to 17
• Vodafone has the fastest 4G network in the three metros – Delhi, Mumbai, and Kolkata, along with West Bengal, Uttar Pradesh, Madhya Pradesh and Rajasthan in Q3 FY 2020, as measured by Ookla
So in summary, we would like to mention that Vodafone have been improving their top line and this will be further assisted by the combined effect of an industry repair on pricing and merger synergies being delivered two years ahead of plan in June 2020. Regarding the AGR judgment, we are working with all stakeholders including the Government and hope to resolve the issue.
Vodafone was recognized at the recently held CIO Choice Awards, 2020. Vodafone emerged as the preferred provider of choice for Mobility, IoT, Managed WiFi, SIP Trunking and Cloud Telephony products and services. Vodafone’s recent launch of My Vodafone for Business (MVB) is also testimony to our continued commitment to providing trans-formative digital experiences.
The Information of Above articles are being gather from different sources and the writer is not responsible for any false information submitted by the sourcing companies.