Like Voda Idea, now Airtel looks to convert govt’s statutory debt with equity swap

New Delhi: In an important development, Bharti Airtel is understood to have approached the government to swap his legal dues with equity, something that has been done in terms of Vodafone idea.It is believed that the company owes outstanding government’s payment of more than Rs 70,000 crore, including Rs 40,000 crore Agri dues.
Sources said that Airtel believes that this measure will help it to conserve cash, while the government enables the government to be part of the rapidly growing enterprise that carries the share price and the possibilities of increasing the resulting assessment. A source said, “A proposal to this effect has been submitted to the Department of Telecom.”
Airtel has not yet officially commented on the matter.
The formula for swaping the outstanding statutory payment dues with equity was started by the Telecom Department to help the industry, especially on financial challenges to damage the Vodafone Idea Tide and continue as a concern.
According to the details of the Bombay Stock Exchange, Airtel’s current market cap is about Rs 10.5 lakh crore. The company will need to transfer about 6% equity to the government to clean its statutory arrears. Airtel’s shares shut down the day of Rs 1,845 down on BSE at Rs 1,845.
Market analysts believe that Govt has “a chance to feel positive returns” from Airtel Equity, given that the company is increasing in profitability. This will be contrary to the Vodafone idea where the value of its share value has so far received negative returns with the company’s scrip, which is less than Rs 10 for most of the government’s holding period.
The government had changed the Voda Idea statutory loan in equity at a price of Rs 10 per share, which is an inscribed price. The current price of the company’s share is Rs 8, which is one percent lower on Thursday.