Voda Idea looking to sell data centers to raise funds: MD Ravinder Takkar
Takkar's comments came on a Voda Idea earnings call Friday, a day after the beleaguered telco reported an unprecedented net loss of Rs 50,921.9 crore, weighed down by provisions for statutory liabilities following the top court’s recent AGR ruling.
Providing relief from this (SC) judgement, he said, is “very much in the hands of the government as they are winners of this (AGR) case”, adding that given “the stress and criticality of the sector, Vodafone Idea “does not see any conflict in the government being able to act in the overall interest of the economy and consumers”.
Takkar’s comments came on a Voda Idea earnings call Friday, a day after the beleaguered telco reported an unprecedented net loss of Rs 50,921.9 crore, weighed down by provisions for statutory liabilities following the top court’s recent AGR ruling.
Vodafone Idea, he said, had multiple available legal remedies, in that, it would shortly file a review petition, and, if required, also “a curative petition before a 5-judge Supreme Court bench, which can be different” from the one that delivered the October 24 judgement.
Takkar said the telco is also exploring ways to monetise “its data centre assets and 1,60,000 kms of intra/inter-city fibre to gain financial flexibility” amid the delay in its the Indus-Bharti Infratel merger closure, which has also held up monetisation of Voda Idea’s 11.15% stake in Indus.
The Voda Idea CEO is hopeful that the government may extend AGR-specific relief “on the (quantum) of interest, penalties and interest on penalties as well as the principal amount after adjustment for errors,” adding that “a payment plan spread over a larger period of time would be very helpful”.
Voda Idea’s recent discussions, he said, suggest the government is taking these requests “very seriously,” and is looking at “a comprehensive solution very shortly” for the industry that it views as “strategic and too important” for India. He also expected the panel of secretaries - exploring relief measures for the ailing sector - to come up with positive recommendations shortly.
The government, Takkar said, wants the telecom sector to be healthy, and is keen on a market comprising three private players and one public sector operator.
Voda Idea is also hopeful that the government will also help in freeing up a whopping Rs 7,000 crore of blocked GST input credits for the company.
Takkar’s comments came a day after both Vodafone Idea and Bharti Airtel raised doubts over their ability to continue as going concerns while posting massive losses for the July-September quarter.
Vodafone Idea is also hopeful that the government and the telecom regulator will address the issue of predatory pricing that is causing financial stress, and consider a floor price for voice tariffs for helping the ailing sector.
“Our discussions with the government suggest the regulator may start a review of floor pricing…there are significant opportunities to reduce the predatory pricing position that we have been in for several years, which has impacted not just us (VIL), but the overall industry,” the Voda Idea MD said.
Takkar said Reliance Jio’s recent decision to recover interconnect charges for voice calls to other networks had reduced “the number of port-outs from Vodafone Idea to Jio”.
Vodafone Idea’s leadership said the company’s recently launched Rs 45 prepaid all-rounder tariff pack is seeing decent market traction among 2G device users while its recently launched RedX postpaid plan, priced at Rs 999 and offering 50% higher speeds, has received strong response from high-ARPU customers.
The company expects to conclude its ongoing network integration exercise by March 2020 - having already consolidated 78% of the 681 districts.
Takkar also reiterated that Voda Idea has “no intentions” of exiting any service areas to improve financial health.