Firms to dominate telecom business in 2020. Stock Market News.


Only two firms will dominate the telecom business in the year 2020.

Kumar Mangalam Birla, chairman of Vodafone-Idea, the flagship company of the telecom business, recently said that he expected relief from the central government on the AGR issue. The chairman of Vodafone-Idea had said that if they did not get relief from the central government, the company could shut down the business. After increasing the scope of the definition of AGR, the Supreme Court verdict has suffered the most on Idea. Due to this, a liability of Rs 53,000 crore is being created on Vodafone-Idea.

Now only a month is left to pay this amount of AGR. It seems that the consolidation phase in the telecom business could begin in the new year. If this happens, the telecom sector in India will remain a business dominated by two companies. If Vodafone is not relieved to pay the AGR amount, then the same can happen. For the expansion of 4G network, both the customer and market share of the company may remain low among the lower capex compared to other companies.

Airtel will be the biggest beneficiary of this, even though AGR has been killed. If Jio and Airtel remain in the telecom market of India, then the telecom tariff may increase. Experts do not think that only two telecom companies will do business in the country. The government also believes that there should be at least three companies in the country. The government also cannot accept the collapse of Vodafone-Idea because it will tarnish India's image among foreign investors.

The order of the Supreme Court regarding the Adjusted Gross Revenue (AGR) will apply to all companies seeking licenses. It also includes GAIL, RailTel and PowerGrid. The power grid has national long distance as well as internet license.

Powergrid says that its adjusted income from the year 2006-07 is Rs 3,566 crore and after adding the penalty it comes to Rs 22,168 crore.

In response to the notice of the Ministry of Telecommunications, GAIL has said that there is nothing outstanding on it except what it has paid to the government. Non-telecom companies such as those providing internet services have said that the department has unnecessarily imposed orders on them.


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