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Airtel reports Rs 23,045 cr Q2 loss on Rs 28,450 cr provisions towards AGR dues

Revenue of the telecom firm increased by 4.79 per cent to Rs 21,199 crore in Q2FY20.|
Updated: Nov 14, 2019, 10.48 PM IST
Airtel posts Rs 23,045 crore Q2 loss on AGR provisioning
Airtel posts Rs 23,045 crore Q2 loss on AGR provisioning
Telecom major Bharti Airtel on Thursday posted a net loss of Rs 23,044 crore for the quarter ended September 30, on Rs 28,450 crore provisions towards adjusted gross revenue (AGR) dues.

The company has provided Rs 28,450 crore as a charge for the quarter (principal Rs 6,164 crore, interest Rs 12,219 crore, penalty Rs 3,760 crore and interest on penalty Rs 6,307 crore) with respect to the licence fee as estimated based on Supreme Court’s judgement and spectrum usage charges (SUC) as estimated based on the definition of AGR.

The group will require significant additional financing to discharge its obligations under the Court Judgement. This represents a material uncertainty whereby, it may be unable to realize its assets and discharge its liabilities in the normal course of business, and accordingly may cast significant doubt on the group's ability to continue as a going concern

-Gopal Vittal, MD & CEO, Airtel India

Analysts in an ETNow poll had projected a loss of Rs 1,425 crore. The company had posted a profit of Rs 118.80 crore in the same period last year.

Revenue of the telecom firm, however, increased by 4.90 per cent to Rs 21,131 crore in the September quarter.

Thanks to corporate tax cut, deferred tax gain came in at Rs 8,932 crore for the quarter under review against a gain of Rs 2,632.60 crore in the same period last year.


Consolidated Ebitda increased by 40.90 per cent to Rs 8,936 crore. Net loss before exceptional items for the quarter stood at Rs 1,123 crore.

Gopal Vittal, MD and CEO of India & South Asia, Bharti Airtel said: “Despite being a seasonally weak quarter, we witnessed positive revenue growth in Q2 on the back of various initiatives aimed at providing superior differential services through our Thanks platform. We continue to witness strong data traffic growth of around 81 per cent YoY and added 8 million 4G customers on our network during the quarter.”


On the AGR verdict, Vittal said the company continues to engage with the government and is evaluating various options. “We are hopeful that the government will take a considerate view in this matter given the fragile state of the industry,” he said.

On October 24, the Supreme Court had delivered a judgement in relation to a long outstanding industry-wide case upholding the view considered by the Department of Telecommunications (DoT) in respect of the definition of adjusted gross revenue (AGR).

“This Judgement has significant financial implications on the company,” Airtel said in a release.

Before this, homegrown auto major Tata Motors for the quarter ending December 30, 2018, had posted India Inc’s biggest quarterly loss of Rs 26,993 crore on an exceptional item of Rs 27,703 crore.

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AGR impact: S&P keeps Airtel rating on negative watch

Order on AGR applies to all telecom licensees: Ravi Shankar Prasad

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