Mumbai: Tata Sons, the parent company of the Tata Group, may have to provide fresh funds to its telecom unit, Tata Teleservices Ltd (TTSL). The company owes the Indian government a total of Rs 19,256 crore as adjusted gross revenue (AGR) and other dues.
Tata Teleservices is unable to pay this amount on its own. It has a negative net worth of Rs 17,876 crore and has suffered heavy losses over the years.
Supreme Court Dismisses Relief Plea
On Monday, the Supreme Court rejected the petitions of Tata Teleservices, Vodafone Idea, and Bharti Airtel. These companies had asked for a waiver on interest and penalties related to AGR dues.
The court said the pleas had no legal grounds. However, it allowed the government to provide some relief to the telecom companies if it wishes to.
Tata Sons Has Backed Tata Tele Before
Tata Sons has already supported Tata Teleservices many times in the past. By June 2019, it had put Rs 46,595 crore into the company. Tata Sons also gave a “letter of comfort” to back the company’s payments.
The telecom firm had earlier chosen to delay AGR payments under a government relief plan in 2021. That plan gave it time until March 2026 to pay the dues. But with the deadline coming closer, the pressure is mounting again.
Dues and Financial Condition
According to Care Ratings, as of March 2024, the AGR dues were Rs 17,830 crore. This includes Rs 3,367 crore under Tata Teleservices Maharashtra Ltd (TTML) and Rs 14,463 crore under TTSL.
Now, the dues have gone up to Rs 19,256 crore. Tata Teleservices reported a net loss of Rs 994 crore in FY25 on a revenue of Rs 3,626 crore.
Tata Sons’ Clean Track Record
Even though Tata Teleservices sold its wireless business to Bharti Airtel earlier, Tata Sons paid all the company's bank loans and also bought out its former partner NTT Docomo. This shows Tata Sons’ record of paying all dues on time.
