New Delhi: Bharti Airtel and Vodafone Idea Ltd, whose self-assessed dues to the government are less than half of what the Department of Telecommunications (DoT) estimates, must disclose workings highlighting areas of difference as minority shareholders deserve to know, an analyst report said.
While Bharti Airtel has pegged its dues arising from a Supreme Court ruling that asked for non-telecom revenues to be included in calculating spectrum charges and licence fee at Rs 13,004 crore, the DoT puts the estimate at Rs 35,000 crore.
In case of Vodafone Idea Ltd (VIL), the DoT is seeking over Rs 53,000 crore, while the company estimates its dues are Rs 21,533 crore.
“While we appreciate the matter is still sub judice, once the legal chapter is over, Bharti and VIL could (and should) disclose their self-assessment workings highlighting the areas of difference versus the DOT math. Even as this isn't a statutorily mandated disclosure, we believe the minority shareholders deserve to know,” Kotak Institutional Equities said in a March 9 report.
Stating that there is a case for better disclosures on the math from both the DoT as well as the operators, it said a detailed explanation of the calculations post the closure of the legal proceedings is a must. “It would go a long way in inspiring confidence among the minority investors.”
VIL has so far paid Rs 3,500 crore out of its self-assessed liability of Rs 21,533 crore, while Bharti Airtel has paid Rs 13,004 crore to the government in two installments. It had also deposited an additional Rs 5,000 crore as an ad-hoc payment to cover any reconciliation differences.
Similarly, Tata Teleservices has paid Rs 2,197 crore in dues, and more recently an additional Rs 2,000 crore to cover reconciliation differences, while the DoT estimates the liabilities to be about Rs 14,000 crore.
Kotak said Bharti and VIL made higher provisions for the dues in their Q2 FY20 earnings as they many not have had enough time post the Supreme Court's October 24, 2019 order to complete their self-assessments and adopted a conservative stance.
