CHENNAI: A day after Bharti Airtel’s board approved a proposal to raise Rs 21,000 crore through a rights issue, its chairman Sunil Bharti Mittal said that its debt level was extraordinary and that the company would not shy away from tariff hikes.
Speaking on an investors’ call on Monday, Mittal also reiterated that taxation on the industry remained high and certain factors were “inhibiting continued investment” into the sector, since returns remained low or negative.
The approved fundraise, Mittal noted, would help accelerate investments across several of the company’s verticals, including 5G, but without further loading the company with any additional debt. “It will allow the company to have better leverage ratio... Stronger and earlier access to new market opprtunities across 5G, fiber and homes. And most importantly, it gives us the needed elbow room and fuel to fearlessly accelerate its mission,” Mittal said.
The past few quarters have also seen a steady stream of 5G handsets entering the Indian market, and Mittal observed that 5G is likely to become a reality sometime in the second half of next year. “We hope the spectrum prices will be attractive,” he noted.
The telecom industry has repeatedly highlighted that reserve prices for spectrum auctions set by the authorities have remained high, with successive spectrum auctions having been unable to sell most of the spectrum assets on offer. He also noted that the industry has been urging the government to attend to “pressing issues inhibiting continued investments”.
“For every Rs 100 of revenue, Rs 35 goes in various forms of levies. We hope that as we step up and do our part, the government will also favourably look at some of the genuine demands of the industry,” Mittal said.