Cash strapped Vodafone Idea has reportedly cleared its statutory dues amounting to Rs 818 crore. The payment from the telco has been made to the Department of Telecommunications (DoT) with respect to pending License Fees (LF) and Spectrum Usage Charges (SUC) for the second quarter of FY22. The help from the government’s relief package is evident as the telco has been able to make on-time back to back payments to the non-convertible debenture (NCD) holders, which are clear signs of easing cash flow.
Vodafone Idea Paid Rs 818 Crore to DoT on December 31, 2021
As per ET Telecom, DoT received Rs 818 crore from Vodafone Idea on December 31, 2021. But the payments don’t stop here for the third-largest telco in India. Vodafone Idea has to shell out another Rs 4500 crore by February to complete the payment to NCD holders. A senior official told ET that Vodafone Idea wanted this payment to be deferred to next year, but the telco was explained that it has already received a lot of help from the government and more was in the way, so it would be better if it made the payment right away. The telco has received a very big cash flow relief with the government’s help; it should be able to clear LF and SUC dues comfortably every quarter. Vodafone Idea is going to further see an improvement in its revenues with the recent prepaid tariff hikes, which would add to the cash flow ease of the company. There’s no doubt that the telco requires a fundraise before the 5G spectrum auctions, or else it would add to the debt burden of the company. 5G spectrum and network deployment would require telcos to spend several thousand crores, and for that, the industry debt is expected to rise. Vi is in a much better position to raise funds than it has ever been in, and the telco has repeatedly said that it is talking with potential prospects for raising funds.
