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Telecom Shares Extend Slump On DoT Woes
Shares of Telecom operators in India fell for another day after news reports said that the Department of Telecommunications (DoT) has issued a notice to these companies, instructing them to pay their share of dues within the timeframe directed by the Supreme Court.
As per a PTI report citing industry sources, the notice asks the companies to pay the revenue share dues within 3 months (as per SC's directions). It also said that DoT has estimated the liability of Bharti Airtel Group to be Rs 62,187.73 crore, Vodafone Idea Rs 54,183.9 crore and for BSNL-MTNL at Rs 10,675.18 crore.
A Mint report, after assessing the said notice said that the operators have been asked to make a self-assessment of the license fees and other dues and make their payments within the stipulated timeframe with required documents.
Shares of Bharti Airtel fell by 3 percent to Rs 354.50, shares of Vodafone Idea declined significantly by 14 percent to Rs 2.85, Bharti Infratel shares dropped by over 6 percent to Rs 198.75 and Sterlite Technologies was down by 4 percent to Rs 124.25.
DoT's notice was issued on 13 November, three weeks after the Supreme Court ended a 14-year old legal dispute between the telecom companies and the department in which the apex court rejected the definition of adjusted gross revenue (AGR) as proposed by the mobile network operators that excluded revenue from non-core telecom operations like rent, dividend and interest income.
The order to pay dues to the government spells more trouble for these telecom operators who are struggling with mounting debt, weakening revenues and widening losses.
