The Indian telecom sector is again witnessing headwinds with mounting losses and huge statutory dues. The development has triggered panic among the employees working in the sector. Thousands of workforce employed with Vodafone Idea and Bharti Airtel are now looking for opportunities outside the company amid uncertainty over the functioning of the companies.
Last month, the Supreme Court allowed the inclusion of non-core items in the definition of AGR, leaving Vodafone-Idea with dues of more than Rs.28,000 crore in the additional license fee. Moreover, the company is also liable to pay over Rs.11,000 crore in spectrum usage charge dues, plus interest and penalties on both heads.
With a ballooning debt of Rs. 99,000 crore, it registered a loss of Rs. 5,000 crore and revenues of Rs. 11,300 crore in the first quarter of the running financial year. Moreover, the company also registered the highest ever loss in the history of India Inc. with around Rs. 51,000 crore loss in the quarter ending in September. Bharti Airtel is also incurring huge losses due to AGR ruling. Airtel is also facing AGR dues of over Rs 35,500 crore.
As reported by the Economic Times, Kamal Karanth, co-founder of specialist staffing company Xpheno said that the recruiting consulting firm has received around 7,000 profiles of Vodafone Idea and around 5,000 at rival Bharti Airtel. The company collated the data from candidate CVs that were uploaded on job portals, social media sites and sent directly to the recruiting agencies.
The numbers mean around 70% of Vodafone Idea's roughly 10,000 employees and more than 30% of Airtel's nearly 16,000 employees are seeking opportunities outside their current organization. The major verticals from where the employees are looking to move out include sales, marketing, accounts, administration, and HR.
Signs of desperation for a job change
The desperation of the workforce is palpable with the fact that they are ready to take a minimal hike just to switch their jobs. One of the sales managers of a leading telecom company said, "I have to leave because I was not sure what the future of the company and sector will be in the coming years. I was advised to take a 25% raise at the very minimum but am so eager to leave that I can (go) for a 10-12% hike." The situation of the industry is so grim the Aditya Birla Group has refused to inject fresh equity into the Vodafone-Idea joint venture. Further, the group may also opt for insolvency in the worst-case scenario if the government does not offer major relief.