Bharti Airtel (Airtel) on Wednesday said that the recent average gross revenue (AGR) judgement of the Supreme Court (SC) was disappointing, and the company is taking legal advice on the next steps,
“Our request was to permit correction of computational errors in the AGR demands by DoT. These apparent errors have a significant implication on the overall AGR demand,” Gopal Vittal, Managing Director and Chief Executive Officer (India and South Asia, Airtel said in the post results earnings call.
In January, the company had moved the apex court seeking a modification, clarification or recall of ‘mistaken orders’, which have allowed the Department of Telecommunications (DoT) to demand a total of ₹ 43,980 crore as AGR dues.
SC: Telecos tried to recalculate AGR under guise of correcting ‘arithmetical errors’
However, as per Airtel’s own calculations, it owes the DoT ₹ 13,004 crore in AGR dues.
But, the SC had recently rejected the self-estimates of the company and confirmed the government’s calculations.
“While we are disappointed with the recent outcome, the company has provisioned for the onerous pay out and already paid over ₹18,000 crore covering its obligations for the first few years as per the directions of the Supreme Court. On the next steps relating to any review petition, we will be guided by legal advice and no decision has been taken on this yet,” Vittal said.
Meanwhile, on the company’s recent hike in the tariff plans, Vittal said that he expects average revenue per user (ARPU) to rise to ₹ 200 and eventually to ₹ 300.
“Our retail postpaid plans have been further simplified. We now have just four plans and one add on family plan. As we have always said, ARPU in India is extremely low and at this level, our return on capital is in the low single digit. ARPU must rise first to ₹ 200 and eventually to ₹ 300. This is a small step in that direction even as it plays to our strategy of focusing on quality customers,” he added.