Vodafone Idea Board of Directors has approved the deferment of its spectrum auction instalments for four years (October 2021 to September 2025) as per the Department of Telecommunications (DoT) notification on November 14. The company said other options offered by DoT in the said notification will be considered by its board in the stipulated timeframe.
"...we wish to inform you that the Board of Directors of the Company has approved the exercise of the option of deferment of the Company’s spectrum auction instalments for a period of 4 years (October 2021 to September 2025)," the company said in a statement to stock exchanges.
The decision by the baord led to an increase in Vodafone Idea share price. Vodafone Idea share closed at Rs 10.70, which is up Rs 0.70 or 7 per cent, as compared to the previous session close of Rs 10 on the NSE.
The government recently wrote to telcos, including Bharti Airtel, Vodafone Idea and Reliance Jio, asking them to convey by October 29 if they would be opting for a four-year dues moratorium, news agency PTI had reported.
It also gave 90 days' time to the operators to indicate if they want to opt for converting the interest amount pertaining to the moratorium period into equity.
Recently, the government approved a blockbuster relief package for the telecom sector that includes a four-year break for companies from paying statutory dues, permission to share scarce airwaves, change in the definition of revenue on which levies are paid and 100 per cent foreign investment through the automatic route.
The measures, aimed at providing relief to companies such as Vodafone Idea that have to pay thousands of crores in unprovisioned past statutory dues, also include the scrapping of Spectrum Usage Charge (SUC) for airwaves acquired in future spectrum auctions.
For the past dues, the government has allowed a moratorium or deferment of up to four years in annual payments. But the telecom companies will have to pay interest during the moratorium period. Also, the government will have an option to convert the due amount pertaining to the deferred payment into equity at the end of the moratorium/deferment period.
With inputs from PTI
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