AGR dues: Here's how telecom stocks are faring after SC plea rejection

Telecom stocks on Monday witnessed a knee-jerk reaction to the Supreme Court's dismissal of the writ petition by telecom operators including Tata Teleservices Ltd seeking exemption of interest on Adjusted Gross Revenue (AGR) dues. That said the stocks staged some recovery as the session progressed. 

Shares of Bharti Airtel, India’s largest integrated communications solutions provider, hit a low of Rs 1,808.65, before erasing losses. The stock was up 0.17 per cent at Rs 1,817.50.  

Tata Teleservices (Maharashtra) Ltd was trading 0.48 per cent lower at Rs 60.34. The top court refused to come in the way of the government wanting to help the telecom companies.

Petitions were filed by telecom majors such as Tata Teleservices and Vodafone Idea. These telecom operators had sought a waiver of interest, penalty, and interest on penalty related to their adjusted gross revenue (AGR) dues. But a bench headed by Justice JB Pardiwala reportedly termed the petitions "misconceived".

Following others, Bharti Airtel and its subsidiary, Bharti Hexacom, had also filed a petition seeking a waiver of Rs 34,745 crore in dues stemming from interest and penalties. They argued that the Supreme Court’s AGR ruling on September 1, 2020, had imposed severe financial stress on the telecom sector. The companies emphasised that they were not challenging the verdict itself, but were appealing for relief from the associated financial burden, the ET reported.

The Bharti Airtel management indicated that the telecom operator had written to DoT for the option to convert AGR dues into equity to ensure a non-discriminatory playing field, MOFSL reported earlier this week. The decision on whether to ultimately convert GoI dues to equity would be taken by Bharti’s board, it suggested.

The BSE Telecommunication edged 0.24 per cent lower at 2,907.68. Vodafone Idea Ltd shares declined 8.82 per cent to Rs 6.72 apiece. This stock was off day's low of 6.47 per cent. Bharti Hexacom shares were up 1.34 per cent at Rs 1,687.65.