Bharti Airtel has paid Rs 8312 crore to the Department of Telecommunication (DoT) before the deadline to settle 5G spectrum charges. The company has taken this action to free up cash for future investment, the company stated on Wednesday.
Recently, the telecom service provider has gained 19,867 MHz of spectrum in numerous bands worth Rs 43,084 crore in the auction of 5G spectrum which includes spectrum in 3.5 GHz, 26 GHz, and specific low and mid-bands. The company is planning to roll out commercial 5G services this month.
As per the DoT’s rules, a company has an option to pay dues in 20 balanced annual installments. However, Airtel chose to pay the charges for the upcoming four years in advance.
Moreover, Airtel said this advance payment, coupled with the postponement of spectrum charges and adjusted gross revenue (AGR)-related payments, the action will help free up future cash flows and allow the company to use the money focused only on the 5G official launch.
In the last year also, Airtel has cleared its adjourned spectrum liabilities worth Rs 24,333.7 crore much ahead of time.
Managing Director and Chief Executive Officer of Bharti Airtel, Gopal Vittal said in a statement that this advance payment of 4 years would allow the company to focus on the official launch of the 5G services given the cash flow is operating freely. The company also has access to Rs 15,740.5 crore in capital from the rights issue, which is yet to be exclaimed. Airtel and the representatives of the company are excited to bring a world-class 5G experience to the country with adequate free cash flow and also an ideal spectrum bank with the best technology.
Last week, after the result conference call, Vittal said that the company plans to launch the 5G services starting in August and will extend the Pan India launch after that. He further added that By March 2024, the company believes that they will be able to cover every town and rural area with 5G services.
Furthermore, detailed network launch plans for 5,000 towns in India are completely ready. For the network agreements, Airtel has tied up with Nokia, Samsung, and Ericsson.
Vittal further said that their three-year CAPEX plan will remain there as it is but these rapid rollouts could see some advancement in CAPEX on an in-year basis.