2.16 Provisions

General

Provisions are recognised when the Company has a
present obligation (legal or constructive) as a result of
a past event, it is probable that an outflow of resources
will be required to settle the said obligation, and the
amounts of the said obligation can be reliably estimated.

Provisions are measured at the present value of the
expenditures expected to be required to settle the
relevant obligation (if the impact of discounting is
significant), using a pre-tax rate that reflects current
market assessments of the time value of money and
the risks specific to the obligation. The increase in the
provision due to unwinding of interest over passage of
time is recognised within finance costs.

The Company is involved in various legal and
taxation matters, and the matter are in legal course.
Management, in consultation with legal, tax and other
advisers, assesses the likelihood that a pending claim
will succeed. The Company recognises a provision in
cases where it is probable that an outflow of resources
embodying economic benefits will be required to settle
the obligations arising from such claims.

2.17 Contingencies

A disclosure for a contingent liability is made when there
is a possible obligation or a present obligation that may,
but probably will not, require an outflow of resources.
When there is a possible obligation or a present
obligation in respect of which the likelihood of outflow of
resources is remote, no provision or disclosure is made.
Contingent asset is not recognised and is disclosed only
where an inflow of economic benefits are probable.

2.18 Revenue recognition

Revenue is recognised upon transfer of control of
promised products or services to the customer at
the amount of transaction price which the Company
has received or expects to receive in exchange of
those products or services, net of any taxes/duties,
discounts and process waivers. When determining
the consideration to which the Company is entitled
for providing promised products or services via
intermediaries, the Company assesses whether it is
primarily responsible for fulfilling the performance
obligation and whether it controls the promised service
before transfer to customers. To the extent that the
intermediary is considered a principal, the consideration
to which the Company is entitled is determined to be
that received from the intermediary.

Revenue is recognised when, or as, each distinct
performance obligation is satisfied. The main categories
of revenue and the basis of recognition are as follows:

a. Service revenue

Service revenues mainly pertain to pack subscription
for voice, data, messaging, value added services and
internet protocol television (‘IPTV’) services. It also
includes revenue from interconnection/roaming charges
for usage of the Company’s network by other operators
for voice, data, messaging and signaling services.

Telecommunication services (comprising voice, data and
SMS) are considered to represent a single performance
obligation as all are provided over the Company’s
network and transmitted as data representing a digital
signal on the network. The transmission consumes
network bandwidth and therefore, irrespective of the
nature of the communication, the customer ultimately
receives access to the network and the right to consume
network bandwidth.

Revenue is recognized upon transfer of control of
promised services to the customers. Pack subscription
charges are recognized over the subscription pack
validity period and where there is no uncertainty as
to collection of consideration. Revenues in excess
of invoicing are classified as unbilled revenue while
invoicing/collection in excess of revenue are classified
as deferred revenue/advance from customers.

Revenues from long distance operations comprise
of voice services and bandwidth services (including
installation), which are recognised on provision of
services over the period of respective arrangements.

b. Multiple element arrangements

The Company has entered into certain multiple-element
revenue arrangements which involve the delivery or
performance of multiple products, services or rights to
use assets. At the inception of the arrangement, all the
deliverables therein are evaluated to determine whether
they represent distinct performance obligations, and if
so, they are accounted for separately. Total consideration
related to the multiple element arrangements is
allocated to each performance obligation based
on their standalone selling prices. The stand-alone
selling prices are determined based on the list prices
at which the Company sells equipment and network
services separately.

c. Equipment sales

Equipment sales mainly pertain to sale of
telecommunication equipment and related accessories
for which revenue is recognised when the control of

equipment is transferred to the customer, i.e. transferred
at a point in time. However, in case of equipment sale
forming part of multiple-element revenue arrangements
which is not a distinct performance obligation, revenue
is recognised over the customer relationship agreement.

d. Interest income

The interest income is recognised using the EIR method.
For further details, refer note 2.10.

e. Costs to obtain or fulfill a contract with a
customer

The Company incurs certain costs to obtain or fulfill
contracts with customers viz. intermediary commission,
etc. The Company has estimated that the average
customer life derived from customer churn rate is longer
than 12 months and, thus, such costs are recognised
over the average expected customer life.

f. Dividend income

Dividend income is recognised when the Company’s
right to receive the payment is established. For futher
details, refer note 2.10.

2.19 Government grants

Grants from the government are recognised where
there is a reasonable assurance that the grant will
be received and the Company will comply with all
attached conditions.

Government grants relating to income are deferred and
recognised in the Statement of Profit and Loss over the
period necessary to match them with the costs that they
are intended to compensate.

Government grants relating to the purchase of PPE are
included in non-current liabilities as deferred income
and are credited to Statement of Profit and Loss on
a straight-line basis over the expected lives of the
related assets.

2.20 Borrowing costs

Borrowing costs consist of interest and other ancillary
costs that the Company incurs in connection with
the borrowing of funds. The borrowing costs directly
attributable to the acquisition or construction of any
asset that takes a substantial period of time to get
ready for its intended use or sale (qualifying asset) are
capitalised. All other borrowing costs are recognised in
the Statement of Profit and Loss within finance costs in
the period in which they are incurred.

2.21 Exceptional items

Exceptional items refer to items of income or expense
within the Statement of Profit and Loss from ordinary
activities which are non-recurring and are of such size,
nature or incidence that their separate disclosure is
considered necessary to explain the performance of
the Company.

2.22 Dividends paid

Dividend to shareholders is recognised as a liability
on the date of approval by the shareholders. However,
interim dividend is recorded as a liability on the date of
declaration by the Company’s Board of Directors.

2.23 Earnings per share (‘EPS’)

The Company presents the Basic and Diluted EPS.

Basic EPS is computed by dividing the profit for the
period attributable to the shareholders of the Company
by the weighted average number of shares outstanding
during the period.

Diluted EPS is computed by adjusting, the profit for the
year attributable to the shareholders and the weighted
average number of shares considered for deriving Basic
EPS, for the effects of all the shares that could have
been issued upon conversion of all dilutive potential
shares. The dilutive potential shares are adjusted for
the proceeds receivable had the shares been actually
issued at fair value. Further, the dilutive potential shares
are deemed converted as at beginning of the period,
unless issued at a later date during the period.

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The estimates and judgements used in the preparation
of the said Financial Statements are continuously
evaluated by the Company, and are based on historical
experience and various other assumptions and factors
(including expectations of future events), that the
Company believes to be reasonable under the existing
circumstances. The said estimates and judgements
are based on the facts and events, that existed as at
the reporting date, or that occurred after that date but
provide additional evidence about conditions existing as
at the reporting date.

Although the Company regularly assesses these
estimates, actual results could differ materially from
these estimates - even if the assumptions underlying
such estimates were reasonable when made, if these

results differ from historical experience or other
assumptions do not turn out to be substantially accurate.
The changes in estimates are recognised in the Financial
Statements in the year in which they become known.

3.1 Key sources of estimation uncertainties

The estimates and assumptions that have a significant
risk of causing a material adjustment to the carrying
values of assets and liabilities are discussed below:

a. Useful lives of PPE

As described at note 2.7 above, the Company reviews
the estimated useful lives of PPE at the end of each
reporting period. After considering market conditions,
industry practice, technological developments and other
factors, the Company determined that the current useful
lives of its PPE remain appropriate. However, changes in
economic conditions of the markets, competition and
technology, among others, are unpredictable and they may
significantly impact the useful lives of PPE and therefore
the depreciation charges. Refer note 2.7 and 5 for the
estimated useful life and carrying value of PPE respectively.

b. Impairment reviews

PPE (including CWIP) and intangible assets with
definite lives, are reviewed for impairment, whenever
events or changes in circumstances indicate that their
carrying values may not be recoverable. Goodwill
and IAUD are tested for impairment, at least annually
and whenever circumstances indicate that it may be
impaired. For details as to the impairment policy, refer
note 2.9. Further, the Company conducts impairment
reviews of investments in subsidiaries/associates/
joint arrangements whenever events or changes in
circumstances indicate that their carrying amounts may
not be recoverable.

In calculating the value in use, the Company is
required to make significant judgements, estimates
and assumptions inter-alia concerning the growth
in earnings before interest, taxes, depreciation and
amortisation (‘EBITDA’) margins, capital expenditure,
long-term growth rates and discount rates to reflect the
risks involved. Also, judgement is involved in determining
the CGU/grouping of CGUs for allocation of the goodwill.

c. Taxes

Deferred tax assets are recognised for the unused
tax losses credits for which there is probability of
utilisation against the future taxable profit. Significant
management judgement is required to determine the
amount of deferred tax assets that can be recognised,
based upon the likely timing and the level of future
taxable profits, future tax planning strategies and recent
business performances and developments.

d. Allowance for impairment of trade receivables

The ECL is mainly based on the ageing of the receivable
balances and historical experience. The receivables
are assessed on an individual basis or grouped into
homogeneous groups and assessed for impairment
collectively, depending on their significance. Moreover,
trade receivables are written off on a case-to-case basis
if deemed not to be collectible on the assessment of the
underlying facts and circumstances.

e. Contingent liabilities and provisions

The Company is involved in various legal, tax and
regulatory matters, the outcome of which may not be
favourable to the Company. Management in consultation
with the legal, tax and other advisers assess the likelihood
that a pending claim will succeed. The Company has
applied its judgement and has recognised liabilities
based on whether additional amounts will be payable
and has included contingent liabilities where economic
outflows are considered possible but not probable.

3.2 Critical judgements in applying the
Company’s accounting policies

The critical judgements, which the management
has made in the process of applying the Company’s
accounting policies and have the most significant
impact on the amounts recognised in the said Financial
Statements, are discussed below:

a. Separating lease and non-lease components

The consideration paid by the Company in
telecommunication towers lease contracts include
the use of land and passive infrastructure as well as
maintenance, security, provision of energy services etc.
Therefore, in determining the allocation of consideration
between lease and non-lease components, for the
additional services that are not separately priced, the
Company performs analysis of cost split to arrive at
relative stand-alone prices of each of the components.
The bifurcation of the consideration paid (excluding
energy) between lease versus non-lease component
across the Company has been accordingly considered
at 60% as lease component on an overall basis.

b. Determining the lease term

Under Ind AS 116, if it is reasonably certain that a lease will
be extended/will not be early terminated, the Company
is required to estimate the expected lease period which
may be different from the contractual tenure. The
Company has various tower lease agreements with a
right to extend/renew/terminate wherein it considers
the nature of the contractual terms and economic
factors to determine the lease term. After assessing
such factors, the lease liability has been calculated using

the remaining lease period until which significant exit
penalties are payable.

c. Determining the incremental borrowing rate for
lease contracts

The initial recognition of lease liabilities at present
value requires the identification of an appropriate
discount rate. The Company has determined the
incremental borrowing rate based on considerations
specific to the leases by taking consideration
of the risk free borrowing rates as adjusted for
country/Company specific risk premiums (basis the
readily available data points).

d. Revenue recognition and presentation

The Company assesses its revenue arrangements
in order to determine if it is acting as a principal or
as an agent by determining whether it has primary
obligation basis pricing latitude and exposure to
credit/inventory risks associated with the sale of goods/
rendering of services. In the said assessment, both the
legal form and substance of the agreement are reviewed
to determine each party’s role in the transaction.

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i. During the year ended March 31, 2025, the Company
had, in accordance with the terms of the offering
circular dated January 14, 2020 w.r.t. USD 1,000 million
1.50% Convertible Bonds due 2025 (‘FCCBs’), allotted
47,018,242 equity shares of the face value of C5 each
fully paid up, against the conversion request of FCCBs
of USD 337.77 million. The Company redeemed the
outstanding FCCBs aggregating to USD 0.2 million
together with accrued interest thereon, in accordance
with the terms and conditions of FCCBs. No FCCBs are
outstanding as at March 31, 2025.

During the year ended March 31, 2024, the Company
had allotted 79,952,427 equity shares of the face value
of C5 each fully paid up, against the conversion request
of FCCBs of USD 575.73 million.

ii. During the year ended March 31, 2025, the Company
has paid C251,244 to the DoT towards full prepayment
of deferred liabilities pertaining to spectrum acquired in
2012, 2015, 2016, 2021 and 2024.

During the year ended March 31, 2024, the Company
has paid C163,502 to the DoT towards part prepayment
of deferred liabilities pertaining to spectrum acquired in
auction of year 2015.

iii. During the year ended March 31, 2025, the Company has
participated in the latest spectrum auction conducted
by DoT and has been declared successful bidder for
total of 82 MHz spectrum in 900 MHz, 1800 MHz and

2100 MHz frequency bands. This entire spectrum bank
has been secured for a total consideration of C58,557
payable over 20 years, for which the allocation has
been received upon the payment of the dues as per the
demand note received.

iv. During the year ended March 31, 2024, the Hon’ble
Supreme Court of India pronounced a judgement
regarding the tax treatment of adjusted revenue linked
Variable License Fee (‘VLF’) payable to DOT since
July 1999 and held that it is capital in nature and not
revenue expenditure for the purpose of computation
of taxable income. This decision does not alter the total
amount of VLF allowed as deduction over the license
period but creates a timing difference wherein later
years would have a higher deduction. This had resulted
in an additional tax provision of C1,209 primarily due to
change in effective tax rate on account of adoption of
new tax regime. The interest charge of C9,713 on the
above matter had been presented as an exceptional
item. The above financial assessment was based on the
Company’s best estimate.

During the year ended March 31, 2025, the Hon’ble
Supreme Court of India passed a judgement waiving off
the interest levy on adjusted revenue linked VLF payable
to DoT arising from October, 2023 given the matter for
sub-judice. The Company has reversed interest charge
aggregating to C9,887, as an exceptional item.

v. During the year ended March 31, 2025, the transaction
between Bharti Airtel Limited, Dialog Axiata PLC
(‘Dialog’) and Axiata Group, Berhad for the share swap
of Bharti Airtel Lanka (Private) Limited (‘Airtel Lanka’)
with Dialog has been consummated. Upon completion
of the transaction, Dialog holds 100% shareholding of
Airtel Lanka and Bharti Airtel Limited holds 10.355%
shareholding of Dialog. Investment in Dialog has been
irrevocably treated as investment held at fair value
through other comprehensive income as the Company
considers this investment to be strategic in nature.

vi. During the year ended March 31, 2025, the Company
has sold certain digital assets for C6,179 comprising
of Hardware and software’s (‘specified assets’) with a
view to consolidate the digital offering under one entity
being Xtelify Limited (a subsidiary of the Company)
having net carrying of C6,063. Difference between
sales consideration (net of tax) and carrying value has
been recognised in common control reserve amounting
to C84.

vii. During the year ended March 31, 2025, Bharti Hexacom
Limited, a subsidiary of the Company, completed its
Initial Public Offering comprising of an offer for sale by
Telecommunications Consultants India Limited (selling
shareholder) of 75,000,000 equity shares of C5 each at
a premium of C565 per share aggregating to C42,750.

The equity shares were listed and started trading on
BSE Limited and National Stock Exchange of India
Limited with effect from April 12, 2024.

viii. During the year ended March 31, 2025, Bharti Airtel
Services Limited, a wholly owned subsidiary of the
Company has converted its outstanding loans taken
from the Company amounting to C13,105 into 320,449
equity shares amounting to C6,500 and 325,369
optionally convertible debentures amounting to C6,605.

ix. During the year ended March 31, 2025, OneWeb India
Communications Limited (“OneWeb”), a wholly owned
subsidiary of the Company has issued 27,066,923
equity shares to OneWeb Holdings Limited (“Investor”)
on preferential allotment basis. Upon completion of
the transaction, Investor holds 74% shareholding of
OneWeb and the Company holds 26% shareholding of
OneWeb. Investment in OneWeb has been treated as
Investment in associate.

x. Consequent to the change in composition of Board of
Directors of Indus Towers Limited (‘Indus’) with effect
from closure of business hours on November 18,
2024, Indus is controlled by the Company in terms of
section 2(27) of the Companies Act, 2013 and Ind AS
110, ‘Consolidated Financial Statements’. Accordingly,
classification of Indus investment has changed from
Joint Venture to Subsidiary. Additionally, the impairment
recognized in earlier periods has been reassessed
and reversed. The same is recognized as a reversal in
exceptional item (refer note 31(i)(c)).

xi. During the year ended March 31, 2025, the Company
has transferred its 69.94% equity stake in Airtel
Payments Bank Limited, an associate of the Company
to Airtel Limited, a subsidiary of the Company, against
a consideration of C86,654. Airtel Limited discharged
the consideration through issuance of 0.01% optionally
convertible debentures. The transaction was recorded
as a common control transaction and the difference
between consideration received and the carrying value
of investment transferred, amounting to C69,400 has
been recognised in common control reserve.

xii. During the year ended March 31, 2025, the Company
has transferred its Internet of Things (‘IOT’) undertaking
to Xtelify Limited, a subsidiary of the Company, under
slump sale arrangement on going concern basis. The
transfer was completed on February 28, 2025 against a
consideration of C102,260. Xtelify Limited has discharged
the consideration through issuance of 0.01% optionally
convertible debentures. The transaction is recorded
as a common control transaction and the difference
between consideration received and the carrying value
of net assets transferred, amounting to C100,420 has
been recognised in common control reserve.

xiii. The Company has entered into a Business Transfer
Agreement (‘BTA’) on February 07, 2025 for transfer
of the passive infrastructure business undertaking by
way of a slump sale to Indus Towers Limited (‘Indus’),
a subsidiary of the Company. The transfer of business
undertaking was completed on March 24, 2025 with
receipt of sale consideration as per terms of BTA. The
Company has received C18,288 on March 24, 2025
and C2,032 is deposited by Indus into Escrow Account
as per terms of BTA. The aforesaid sales consideration
in Escrow Account is provisional and is subject to
adjustments for site count and category of sites as per
BTA and the reconciliation is to be completed within
4 months from March 24, 2025. The Company has
availed passive infrastructure services for the assets
transferred and the same has been accounted for as per
the requirement of Ind AS. During the reporting period,
no payment has been made with respect to availed
passive infrastructure services.

xiv. During the year ended March 31, 2024, the Company
has transferred its 75.96% equity stake in Nxtra Data
Limited, a subsidiary of the Company to Airtel Limited,
a subsidiary of the Company, against a consideration of
C144,424. The transaction was recorded as a common
control transaction and accordingly, the difference
between consideration received and the carrying value
of investment, amounting to C144,054 was recognised
in common control reserve.

b. Rights, preferences and restrictions attached to Shares

The Company has only one class of equity shares having par value of C5 each. The holder of the equity share is entitled
to dividend right and voting right in the same proportion as the capital paid-up on such equity share bears to the
total paid-up equity share capital of the Company. The declaration of dividend by the Company is associated with the
fulfilment of interest obligation, if any, on the perpetual securities issued by one of its wholly-owned subsidiaries. In
the event of liquidation of the Company, the holders of equity shares will be entitled to receive the remaining assets
of the Company, after distribution of all preferential amounts, in proportion to the number of equity shares held by
the shareholders.

c. Terms of conversion/redemption of FCCBs

The Company had outstanding FCCBs of USD 337.97 million as of March 31, 2024, bearing coupon rate of 1.50% issued
at par, listed on the Singapore Exchange Securities Trading Limited. As per Offering Circular issued by the Company,
FCCBs are convertible into Company’s fully paid-up equity shares of C5 each at initial conversion price (as adjusted
from time to time), at any time on or after February 27, 2020 and up to the close of business on February 7, 2025, at the
option of the FCCB holders. The conversion price is subject to adjustment w.r.t events as mentioned in Offering Circular,
but cannot be below the floor price which is C 452.09. FCCBs, which were not converted to fully paid-up equity shares
redeemed at 102.66% of their principal amount on February 17, 2025.

f. Aggregate number of shares issued for consideration other than cash during the period of five
years immediately preceding the reporting date:

• During the year ended March 31, 2025, 47,018,242 equity shares of C5 each were issued to the FCCB holders pursuant
to option exercised in accordance with Offering Circular (refer note 4 (i)).

• During the year ended March 31, 2024, 79,952,427 equity shares of C5 each were issued to the FCCB holders
pursuant to option exercised in accordance with Offering Circular (refer note 4 (i)).

• During the year ended March 31, 2023, 11,930,543 equity shares of C5 each were issued to the FCCB holders
pursuant to option exercised in accordance with Offering Circular.

• During the year ended March 31, 2021, 36,469,913 equity shares of C5 each were issued on preferential basis to
Lion Meadow Investment Limited, an affiliate to Warburg Pincus LLC as partial consideration for acquisition of equity
shares of Bharti Telemedia Limited.

a) Retained earnings: Retained earnings represent the amount of accumulated earnings of the Company, re-measurement
differences on defined benefits plans, gains/(losses) on common control transactions and any transfer from
general reserve.

b) Securities premium: Securities premium is used to record the premium on issue of equity shares. The same is utilised
in accordance with the provisions of the Act.

c) General reserve: The Company had transferred a portion of its profit before declaring dividend in respective prior years
to general reserve, as stipulated under the erstwhile Companies Act, 1956. Mandatory transfer to general reserve is not
required under the Act.

Further, on exercise of the stock options, the difference between the consideration (i.e. the exercise price and the related
amount of share-based payment reserve) and the cost (viz. related amount of loan provided to Bharti Airtel Welfare
Trust) of the corresponding stock options, is transferred to general reserve.

d) Share-based payment reserve: The Share based payment reserve is used to record the fair value of equity-settled
share based payment transactions with employees.

e) Capital reserve: It pertains to capital reserve acquired pursuant to the scheme of arrangements accounted under
pooling of interest method and excess of fair value of net assets acquired over consideration paid in a business
combination. This reserve is not available for distribution as dividend.

f) FVTOCI reserve: The Company has elected to recognise changes in the fair value of a certain investment in equity
securities in OCI. These changes are accumulated within the FVTOCI reserve within equity.

g) Equity component of FCCBs: The equity component is the residual amount after deducting the fair value of the financial
liability component from the net proceeds of the FCCBs.

h) Common control reserve: The transaction arising out of transfer of investments between entities that are under
common control are accounted at their carrying amounts. The difference between the consideration paid and the
carrying amount is recorded in common control reserve. The common control reserve will be transferred to retained
earnings when the underlying investment is sold to a third party (entity outside the scope of common control).

a) Sales Tax, Service Tax and GST

The claims for sales tax comprised of cases relating to the
appropriateness of declarations made by the Company
under relevant sales tax legislations, which were primarily
procedural in nature and the applicable sales tax on
disposals of certain property and equipment items, ITC
eligibility and VAT on value added services. Pending final
decisions, the Company has deposited amounts under
protest with statutory authorities for certain cases.

The service tax demands relate to levy of service tax
on SMS termination and Cenvat credit disallowed for
procedural lapses.

The GST demand relates to miscellaneous interest,
differences between ITC claimed and as available
over portal.

b) Income Tax demand

Income tax demands mainly include the appeals filed
by the Company before various appellate authorities
against the disallowance by income tax authorities
of certain expenses being claimed. During the year,
the Company has reassessed the existing possible
obligations and accordingly disclosed for such amounts.

c) Customs Duty

There are certain demands related to non-submission
of export obligation discharge certificate, classification
issue, valuation of goods imported and levy of anti¬
dumping duty on certain products.

d) Entry Tax

I n certain states, an entry tax is levied on receipt of
material from outside the state. This position has been
challenged by the Company in the respective states, on
the grounds that the specific entry tax is ultra vires the
Constitution. Classification issues have also been raised,
whereby, in view of the Company, the material proposed
to be taxed is not covered under the specific category.

During the year ended March 31, 2017, the Hon’ble
Supreme Court upheld the constitutional validity of
entry tax levied by few States. However, Supreme Court
did not conclude on certain aspects such as whether the
levy of entry tax in States is discriminatory etc., and such
question was left open for the respective jurisdictional
High Courts.

e) DoT demands/assessments includes

i. DoT had enhanced the microwave rates by
introducing slab-wise rates based on the number
of carriers vide circulars issued in 2006 and 2008
from erstwhile basis being allocated frequency. The
Company had challenged the matter in Telecom
Disputes Settlement and Appellate Tribunal
(‘TDSAT’) and it has set aside the respective
circulars of DoT vide its Judgement dated April 22,
2010. Thereafter, DoT has challenged the order
of TDSAT before the Hon’ble Supreme Court,
which is pending for adjudication. An amount of
C28,796 which pertains to pre-migration to Unified
License (‘UL’)/Unified Access Service License
(‘UASL’) is disclosed as contingent liability as of
March 31, 2025.

ii. In 2013, DoT introduced UL Regime and notified
guidelines which mandates migration to new
UL regime upon expiry of existing licenses.
Accordingly, the Company migrated to UL regime
in 2014. The Company and Internet Service
Provider (‘ISP’) Association challenged the
Guidelines and provisions of UL on the ground that
DoT has discriminated amongst ISP Licensees in
violation of principle of level playing field amongst
ISPs. TDSAT stayed the payment of license fee on
revenue from Pure Internet Service. In October
2019, TDSAT delivered its judgement in the ISP
Association case (ISPAI Judgement) and set aside
the provision to pay license fee on the revenue from
pure internet service under UL. TDSAT, following
ISPAI judgement, allowed the petition filed by the
Company and set aside the demand notices.

DoT has filed appeal against ISPAI judgement
before Hon’ble Supreme Court. On January
5, 2021, the Hon’ble Supreme Court admitted
DoT’s appeal, and also allowed the Company’s
intervention application, with a direction that
DoT shall not be required to refund any amounts
pursuant to TDSAT judgement and parties shall be
bound by the final directions as may be passed by
the Hon’ble Supreme Court.

On March 31, 2021, DoT issued amendment to
the ISP Licenses granted under the old regime
i.e. under 2002 and 2007 with immediate effect
(April 1, 2021). Amongst others, DoT included
the revenue from pure internet services in the
AGR for the purposes of license fees in such
contracts (which was earlier allowed as permissible
deduction under old regime). Accordingly, demand
up to March 31, 2021 has been assessed to be a
contingent liability (March 31, 2025: C42,424 and
March 31, 2024: C42,424).

iii. Demands for the contentious matters in respect
of subscriber verification norms and regulations
including validity of certain documents allowed as
proof of address/identity. TDSAT and High Courts
have granted interim reliefs to the Company and
the matters are pending for adjudication.

iv. Penalty for alleged failure to meet certain
procedural requirements for EMF radiation self¬
certification compliance.

v. Additional demand received for the period already
covered by the AGR judgement which mainly
pertains to spectrum usage charges.

The matters stated above are being contested by the
Company and based on legal advice, the Company
believes that it has complied with all license related
regulations and does not expect any financial impact
due to these matters.

In addition to the amounts disclosed in the table
above, the contingent liability on DoT matters includes
the following:

1) I n respect of levy of one time spectrum charge
(‘OTSC’), the DoT has raised demand on the
Company in January 2013. The Company
challenged the OTSC demand and the High Court
of Bombay vide its order dated January 28, 2013
stayed enforcement of the demand and directed
DoT not to take any coercive action. The DoT has
filed its reply and this matter is currently pending
before High Court of Bombay. The DoT had issued
revised demands on the Company aggregating
C79,403 in June 2018, including a retrospective
charge and a prospective charge till the expiry
of the initial terms of the respective licenses. The
said revised demand has subsequently also been
brought within the ambit of the earlier order of
no coercive action by the High Court of Bombay.
The Company intends to continue to pursue its
legal remedies.

Further, in a similar matter on a petition filed by
another telecom service provider, the TDSAT, vide
its judgement dated July 4, 2019, has set aside
the DoT order for levy of OTSC with retrospective
effect. Accordingly, as per the said order of the
TDSAT; DoT can levy OTSC on the Spectrum
beyond 6.2 MHz allotted after July 1, 2008, only
from the date of allotment of such spectrum and
in case of Spectrum beyond 6.2 MHz allotted
before July 1, 2008, only prospectively i.e. w.e.f.
January 1, 2013.

Further, demand for OTSC on spectrum allotted
beyond start-up and up-to the limit of 6.2 MHz
has been set aside. The TDSAT has asked DoT to

issue revise demands, if any, in terms of the above
directions. The said telecom service provider filed
an appeal before the Hon’ble Supreme Court
against the judgement passed by TDSAT. On March
16, 2020, the Hon’ble Supreme Court dismissed
the appeal of the telecom service provider and
did not interfere with the TDSAT judgement.
Thereafter, the telecom service provider had filed a
review petition against the judgement dated March
16, 2020. The Hon’ble Supreme Court allowed
the review petition and restored the telecom
service providers’ appeal. The matter is pending
adjudication before the Hon’ble Supreme Court.

DoT’s appeal against the said TDSAT Order for
the levy on Spectrum below 6.2 MHz is pending.
The Hon’ble Supreme Court vide order dated
August 21, 2020, stayed the TDSAT judgement
July 4, 2019 in a case of another telecom service
provider. The Hon’ble Supreme Court, vide order
dated December 7, 2020, directed status quo
to be maintained in case of another telecom
service provider.

On account of prudence, out of the total demands
of C79,403, the Company had recorded a charge
of C17,914 during the year ended March 31, 2020
and interest thereon till March 31, 2025 amounting
C98,658. Balance demand of C61,489 (without
interest) has continued to be contingent liability.

2) DoT had issued notices to the Company (as well as
other telecom service providers) to stop provision
of 3G services to its customers (under 3G Intra
Circle Roaming (‘ICR’) arrangements executed

with other service providers) in such service
areas where the service provider has not been
allocated 3G spectrum, and levied a penalty of
C3,500 on the Company. The Company contested
the notices before TDSAT, which in 2014 held 3G
ICR arrangements between service providers
to be competent and compliant to the licensing
conditions and quashed the notice imposing
penalty. The DoT has challenged the order of
TDSAT before the Hon’ble Supreme Court which
is yet to be listed for hearing.

Considering the nature of above disputes/
litigations, it is difficult to reliably ascertain the
amount or timing of outflow on settlement.

Guarantees:

Corporate guarantees outstanding as of March
31, 2025 and March 31, 2024 amounting to
C64,291 and C354,446 respectively have been
issued by Company on behalf of its subsidiaries.
These guarantees primarily relate to loans and
bonds taken by these subsidiaries from banks
and financial institutions amounting to C40,656
and C168,415 as of March 31, 2025 and March 31,
2024 respectively.

(II) Commitments

Capital commitments

The Company has contractual commitments towards
capital expenditure (net of related advances) of C130,971
and C120,964 as of March 31, 2025 and March 31,
2024 respectively.

Exceptional items comprise of the following:

i. For the year ended March 31, 2025:

a. Gain of C9,887 on account of favorable judgement regarding waiver of interest on tax treatment of adjusted
revenue linked VLF payable to DoT as discussed in note 4(iv).

b. Charge of C1,116 pertaining to impairment of investment in Airtel Lanka, prior to share swap transaction as
discussed in note 4(v).

c. Gain of C105,744 on account of reversal of impairment of equity investment in Indus Towers Limited as discussed
in note 4(x).

d. Gain of C939 on account of reversal of provision created for input tax credit on passive infrastructure services.

e. Charge of C17,404 on account of impairment of intangible assets.

f. Charge of C950 is related to charge on account of impairment of equity investment in a subsidiary.

g. Charge of C62,185 on account of re-assessment of regulatory levies.

ii. For the year ended March 31, 2024:

a. Interest charge of C 9,713 pertaining to tax treatment of adjusted revenue linked VLF from revenue expenditure
to capital in nature for the purpose of computation of taxable income. (refer note 4 (iv))

b. Charge of C2,150 on account of re-assessment of regulatory levies.

c. Charge of C2,689 on account of impairment / charge of wholly owned subsidiary.

d. Gain on account of reversal of provision amounting to C1,789 due to favorable judgement regarding deduction of
TDS on discounts allowed to the prepaid distributors on sale of SIM/Recharge vouchers.

Tax expense include:

i. For the year ended March 31, 2025:

a. Charge of C236 on account of gain on reversal of provision created for input tax credit on passive infrastructure services.

b. Credit of C4,380 on account of impairment of intangible assets.

c. Credit of C3,720 on account of re-assessment of regulatory levies.

d. Net credit of C84,850 from the recognition of earlier unrecognised deferred tax assets on account of favourable
orders received by the Company with respect to tax losses.

ii. For the year ended March 31, 2024:

a. Credit of C1,209 on account of interest on tax treatment of adjusted revenue linked VLF payable to DoT.

b. Charge of C541 on account of re-assessment of regulatory levies.

• Bandwidth

The Company’s leases of bandwidth comprise of dark fiber.

• Plant and equipment

The Company leases passive infrastructure for providing telecommunication services under composite contracts that
include lease of passive infrastructure and land on which the passive infrastructure is built as well as maintenance, security,
provision of energy and other services.

• Building

The Company’s leases of building comprise of lease of offices, warehouses and shops.

• Land

The Company’s leases of land comprise of land taken on lease on passive infrastructure is built and offices.

The business activities of the Company expose it to a variety of financial risks, namely market risks (that is, foreign
exchange risk, interest rate risk and price risk), credit risk and liquidity risk. The Company’s risk management strategies
focus on the unpredictability of these elements and seek to minimise the potential adverse effects on its financial
performance. Further, the Company uses certain derivative financial instruments to mitigate some of these risk exposures
(as discussed below in this note).

The financial risk management for the Company is driven by the Company’s senior management (‘CSM’), in close
co-ordination with the operating entities’ internal/external experts subject to necessary supervision. The Company
does not undertake any speculative transactions either through derivatives or otherwise. The CSM is accountable to the
Board of Directors and Audit Committee. They ensure that the Company’s financial risk-taking activities are governed by
appropriate financial risk governance framework, policies and procedures. The senior management/Board of Directors
of the respective operating entities periodically reviews the exposures to financial risks, the measures taken for risk
mitigation and the results thereof.

i. Foreign currency risk

Foreign exchange risk arises on all recognised monetary assets and liabilities and any highly probable forecasted
transactions, which are denominated in a currency other than the functional currency of the Company. The Company
has foreign currency trade payables, trade receivables and borrowings. However, foreign exchange exposure mainly
arises from borrowings and trade payables denominated in foreign currencies.

The foreign exchange risk management policy of the Company requires it to manage the foreign exchange risk by
transacting as far as possible in the functional currency. Moreover, the Company monitors the movements in currencies
in which the borrowings/capex vendors are payable and manage any related foreign exchange risk, which inter-alia
include entering into foreign exchange derivative contracts - as considered appropriate and whenever necessary. For
further details as to foreign currency borrowings, refer note 17. Further, for the details as to the fair value of various
outstanding derivative financial instruments, refer note 37.

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of
changes in market interest rates. The Company’s exposure to the risk of changes in market interest rates relates primarily
to the Company’s interest bearing debt obligations with floating interest rates. However, the short-term borrowings of
the Company do not have a significant fair value or cash flow interest rate risk due to their short tenure. Accordingly,
the components of the debt portfolio are determined by the CSM in a manner which enables the Company to achieve
an optimum debt-mix basis its overall objectives and future market expectations. The Company monitors the interest
rate movement and manages the interest rate risk based on its risk management policies, which inter-alia may include
entering into interest swaps contracts as considered appropriate and whenever necessary. The company also maintains
a portfolio mix of floating and fixed rate debt.

The sensitivity disclosed in the above table is attributable to floating-interest rate borrowings.

The above sensitivity analysis is based on a reasonably possible change in the underlying interest rate of the Company’s
borrowings in INR, USD (being the significant currencies in which it has borrowed funds), while assuming all other
variables (in particular foreign currency rates) to be constant as at the reporting date.

Based on the movements in the interest rates historically and the prevailing market conditions as at the reporting date, the
Company’s management has concluded that the above mentioned rates used for sensitivity are reasonable benchmarks.

iii. Price risk

The Company invests its surplus funds in various mutual funds (debt fund, equity fund, liquid schemes and income funds
etc.), short term debt funds, government securities and fixed deposits. In order to manage its price risk arising from
investments, the Company diversifies its portfolio in accordance with the limits set by the risk management policies.
The Company has exposure across mutual fund and money market instruments.

Due to the very short tenure of money market instruments and the underlying portfolio in liquid schemes, these do not
pose any significant price risk.

iv. Credit risk

Credit risk refers to the risk of default on its obligation by the counter-party, the risk of deterioration of credit-worthiness
of the counter-party as well as concentration risks of financial assets, and thereby exposing the Company to potential
financial losses.

The Company is exposed to credit risk mainly with respect to trade receivables, investment in bank deposits, debt
securities, mutual funds and derivative financial instruments.

Trade receivables

The Trade receivables of the Company are typically non-interest bearing unsecured and derived from sales made
to a large number of independent customers. As the customer base is widely distributed both economically and
geographically, there is no concentration of credit risk.

As there is no independent credit rating of the customers available with the Company, the management reviews the
credit-worthiness of its customers based on their financial position, past experience and other factors.

Credit risk related to the trade receivables is managed/mitigated by each business unit, basis the Company’s established
policy and procedures, by setting appropriate payment terms and credit period, and by setting and monitoring internal
limits on exposure to individual customers. The credit period provided by the Company to its customers generally ranges
from 14-30 days except Airtel business segment wherein it ranges from 7-90 days.

The Company uses a provision matrix to measure the ECL of trade receivables, which comprise a very large numbers
of small balances. Refer note 13 for details on the impairment of trade receivables.

Based on the industry practices and the business environment in which the entity operates, management considers that
the trade receivables are impaired if the payments are more than 90/120 days past due from due date/invoice date.

The ageing analysis of trade receivables as of the reporting date is as follows:

The Company performs ongoing credit evaluations of its customers’ financial condition and monitors the credit¬
worthiness of its customers to which it grants credit in its ordinary course of business. The gross carrying amount of a
financial asset is written off (either partially or in full) to the extent that there is no realistic prospect of recovery. This is
generally the case when the Company determines that the debtor does not have assets or sources of income that could
generate sufficient cash flows to repay the amount due. Where the financial asset has been written-off, the Company
continues to engage in enforcement activity to attempt to recover the receivable due. Where recoveries are made, these
are recognised in the Statement of Profit and Loss.

Financial instruments and cash deposits

The Company’s treasury, in accordance with the board approved policy, maintains its cash and cash equivalents, deposits
and investment in mutual funds & debt securities and enters into derivative financial instruments - with banks, financial
and other institutions, having good reputation and past track record, and high credit rating. Similarly, counter-parties of
the Company’s other receivables carry either no or very minimal credit risk. Further, the Company reviews the credit¬
worthiness of the counter-parties (on the basis of its ratings, credit spreads and financial strength) of all the above assets
on an ongoing basis, and if required, takes necessary mitigation measures.

(v) Liquidity risk

Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they become due. Accordingly,
as a prudent liquidity risk management measure, the Company closely monitors its liquidity position and deploys a robust
cash management system. It maintains adequate sources of financing including bilateral loans, debt, and overdraft from
both domestic and international banks at an optimised cost. It also enjoys strong access to domestic and international
capital markets across debt and equity.

Moreover, the CSM regularly monitors the rolling forecasts of the entity’s liquidity reserve (comprising of the amount of
available un-drawn credit facilities and cash and cash equivalents) and the related requirements, to ensure they have
sufficient cash on an on-going basis to meet operational needs while maintaining sufficient headroom at all times on its
available un-drawn committed credit facilities, so that there is no breach of borrowing limits or relevant covenants on
any of its borrowings. For details as to the borrowings, refer note 17.

Based on past performance and current expectations, the Company believes that the cash and cash equivalents,
cash generated from operations and available un-drawn credit facilities, will satisfy its working capital needs, capital
expenditure, investment requirements, commitments and other liquidity requirements associated with its existing
operations, through at least the next twelve months.

The following methods/assumptions were used to estimate the fair values:

i. The carrying value of other bank balances, trade receivables, trade payables, short-term borrowings, floating-rate long¬
term borrowings, other current financial assets and liabilities approximate their fair value mainly due to the short-term
maturities of these instruments/being subject to floating-rates.

ii. The fair value of quoted financial instruments is based on quoted market price at the reporting date.

iii. The fair value of non-current financial assets, other long-term borrowings and other financial liabilities is estimated by
discounting future cash flows using current rates applicable to instruments with similar terms, currency, credit risk and
remaining maturities.

iv. The fair values of derivatives are estimated by using pricing models, wherein the inputs to those models are based on
readily observable market parameters. The valuation models used by the Company reflect the contractual terms of the
derivatives (including the period to maturity), and market-based parameters such as interest rates, foreign exchange
rates, volatility etc. These models do not contain a high level of subjectivity as the valuation techniques used do not
require significant judgement and inputs thereto are readily observable.

The following table describes the key inputs used in the valuation (basis discounted cash flow technique) of the Level 2

financial assets/liabilities as of March 31, 2025 and March 31, 2024.

In 1996, the Company had obtained the permission from DoT to operate its Punjab license through one of its wholly owned
subsidiary. However, DoT cancelled the permission to operate in April 1996 and subsequently reinstated in March 1998. Accordingly,
for the period from April 1996 to March 1998 (’blackout period’) the license fee was disputed and not paid by the Company.

Subsequently, basis the demand from DoT in 2001, the Company paid the disputed license fee of C4,856 for blackout period
under protest. Consequently, the license was restored subject to arbitrator’s adjudication on the dispute. The arbitrator
adjudicated the matter in favour of DoT, which was challenged by the Company before Delhi High Court. In 2012, Delhi High
Court passed an order setting aside the arbitrator’s award, which was challenged by DoT and is pending before its division
bench. Meanwhile, the Company had filed a writ petition for recovery of the disputed license fee and interest thereto. However,
the single bench, despite taking the view that the Company is entitled to refund, dismissed the writ petition. The Company
therefore has filed appeal against the said order with division bench and is currently pending. DoT had also filed an appeal
against the single judge order. Both these appeals are tagged together and are listed for final hearing. ^

During the year ended March 31, 2025, no funds have been advanced / loaned / invested by the Company to any other
person(s) or entity(ies), including foreign entities (Intermediaries), with the understanding that the Intermediary shall (i)
directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the
Company (Ultimate Beneficiaries) or (ii) provide any guarantee, security on behalf of the Ultimate Beneficiaries.

Further, no funds have been received by the Company from any person(s) or entity(ies), including foreign entities (Funding
Parties), with the understanding that the Company shall (i) directly or indirectly, lend or invest in other persons or entities
identified in any manner whatsoever by or on behalf of the Funding Party (Ultimate Beneficiaries) or (ii) provide any guarantee,
security on behalf of the Ultimate Beneficiaries.

During the year ended March 31, 2024, the Company had given funds to Bharti Airtel Services Limited (‘first intermediary’)
and Airtel Limited (‘second intermediary’) with the understanding that the first intermediary shall invest those funds in Beetel
Teletech Limited and second intermediary shall invest those funds in Nxtra Data Limited, the details of which are as below:-

The Company had assessed all of its IT applications including supporting applications considering the guidance provided
in “Implementation guide on reporting on audit trail under rule 11(g) of the Companies (Audit and Auditors) Rules, 2014
(Revised 2024 edition)” and identified applications that are relevant for maintaining books of accounts. In the previous
Financial Year, the Company had enabled audit trail feature in certain critical applications including the ERP application which
maintain the general ledger for financial reporting purpose, accordingly the audit trail feature for these critical applications is
active through-out the current financial year. For the remaining applications the audit trail feature was enabled in a phased
manner during the current financial year. Audit trail feature has been enabled for all relevant IT applications at the end of the
current Financial Year. The audit trail feature has operated effectively during the year post implementation, and there were
no instances of audit trail feature being tampered with where it is implemented. For the retention of the data, the same is and
will be retained for the respective period of 8 years from the date of such audit trail implementation.

All the Schemes of Arrangements, approved by the Competent Authority under the relevant provisions of the Act, have been
accounted for in the books of account of the Company in accordance with the Scheme and accounting standards.