AGR verdict to pose a grave challenge for Vodafone Idea; telcos may hike tariff by Rs 20-30: Analysts

NEW DELHI: The Supreme Court’s order for telcos to clear outstanding AGR dues in a 10-year time-frame will pose as a grave challenge for the debt-ridden Vodafone Idea and may also force telcos to hike tariff by Rs 20-30 per month to recover the additional liabilities, analysts said after the verdict.

The proposed payment pattern will add to the burden of the industry which was already saddled with elevated debt levels. This will also exert pressure on the cash-flows and leaves limited room for network capex and expansion, especially for the relatively weaker player, analysts said, adding this relatively shorter payment timeframe exerts additional pressure on the cash flows and necessitates sizeable ARPU increase and can have an impact on the industry structure.