Airtel prepays ₹15,519 crore towards deferred spectrum liabilities
Premium- Airtel had acquired 128.4 MHz spectrum for ₹19,051 crore in the 2014 auction, which included spectrum belonging to Telenor
NEW DELHI : Bharti Airtel has paid up ₹15,519 crore to the government as pre-payment of the entire liability of spectrum it acquired in 2014 auctions, the company said in a statement Friday.
Airtel had acquired 128.4 MHz spectrum for ₹19,051 crore in the 2014 auction, which included a spectrum belonging to Telenor.
"These liabilities were due in annual instalments from FY 2026-2027 to 2031-2032 and carried an interest rate of 10% (the highest rate amongst the deferred liabilities and borrowings) and an average residual life of 7+ years," Airtel said in the statement.
The company estimates that the prepayment will likely result in interest cost savings of at least ₹3,400 crore over the residual life for fully substituted capital. This saving will aid the company's capex and cash flows at a time when it is channelling investments towards expanding its 4G and 5G footprints.
Airtel continues to exercise flexibilities towards a stronger and efficient capital structure, the company added.
It added that the government's decision to give industry the flexibility to prepay their deferred liabilities anytime at their net present value basis the interest rates specified for the respective auction.
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"This allows the licensees to efficiently plan and use their cash flows," it added.
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