Bharti Airtel and its subsidiaries have undertaken several financial actions aimed at reducing debt and optimizing capital structure, according to recent company disclosures.
Specifically, Airtel and its subsidiary, Bharti Hexacom Ltd., have prepaid Rs. 5,985 crores to the Department of Telecom. This prepayment addresses the remaining high-cost interest liabilities, carrying an interest rate of 8.65%, related to the 2024 spectrum auctions.
Furthermore, Network i2i Ltd., another Airtel subsidiary, has redeemed $1 billion in Perpetual Notes. These notes, issued in FY 2020, carried a 5.65% interest rate and had no defined maturity.
These actions align with Airtel’s stated focus on financial prudence and operational efficiency. The company has emphasized its commitment to strengthening its capital position by prepaying high-cost spectrum liabilities, thereby lowering its overall debt and cost of debt.
The current prepayment brings Airtel’s total high-cost spectrum liability prepayments for the 2025 fiscal year to Rs. 25,981 crores. Cumulatively, as of the reported date, Airtel has prepaid Rs. 66,665 crores of such liabilities.
The average interest rate on these prepaid liabilities was approximately 9.74%. These prepayments have been made roughly seven years ahead of their original scheduled maturities.
These prepayments have resulted in Airtel effectively clearing Rs. 116,405 crores of scheduled instalments that would have been due over the original terms of the liabilities.
Following these payments, Airtel’s cost of debt on its remaining spectrum liabilities has decreased to approximately 7.22% on the residual Rs. 52,000 crores (excluding AGR liabilities). These remaining spectrum liabilities are structured with annual instalment payments extending to FY 2042.
Regarding the Perpetual Notes, the $1 billion redemption leaves approximately $479 million of similar notes outstanding, issued in FY 2021. These remaining notes are callable in FY 2026.