Telecom stocks skyrocket up to 19% today after Govt likely to waive spectrum usage charges which is mainly after the news came out that the government may forgive spectrum usage charges (SUC) for airwaves bought before September 2021. This sudden rise in the stock market shows how administrative comfort can bring new hope to heavily indebted telecom companies.
If accepted, then this step will help boost India’s digital infrastructure, support their 5G expansion, and allow these companies to access additional cash.
Why is SUC Waiver Is a Game-Changer
What are spectrum usage charges (SUC)?
Telecommunication companies pay a regular fee known as spectrum usage charge (SUC), which is generally about 3% to 4% of their adjusted gross revenue (AGR) for using the government-licensed radio spectrum. Along with that, they also pay an 8% license fee, which comes with a 5% contribution to the Universal Service Obligation Fund, which is used to improve telecom services in the rural areas (DoT – USOF).
Current SUC Policy
Since June 2022, telecom companies don’t need to pay SUC on spectrum bought after September 15, 2021. But for spectrum bought before that date, the charges still remain in effect.
What’s changing now?
The government is now thinking about removing SUC including for spectrum bought before September 15, 2021 and if it is approved, then this SUC exemption could save telecom companies thousands of crores, which can help them improve profitability and reduce costs.
Immediate Impact on Stocks
Here’s how big telecom companies like Reliance Jio, Bharti Airtel, Vodafone Idea, and MTNL reacted in the market:
- Mahanagar Telephone Nigam Ltd (MTNL)
Shares jumped by nearly 19.5% in Mumbai after the news and trading around ₹58. The company’s market cap is now about ₹3,352 crore.
- Vodafone Idea Ltd
Stock increased by around 6%, reaching ₹7.27 on the BSE. With a 17.66% wireless subscriber share, Vi is likely to gain big, which can save nearly ₹8,000 crore due to SUC exemption, which could help reduce its massive debt of over ₹2 lakh crore.
- Bharti Airtel Ltd
Recovery by about 2%, ending the day near ₹1,970. Airtel has a 33.65% share in wireless subscribers, which is showing its solid position in the market.
- Reliance Jio
It gained about 1.5% and traded around ₹1,472. Jio leads the market with a 40.76% wireless subscriber share.
These gains show that investors are hopeful about administrative support, mainly for telecom companies who are dealing with high interest debt and legacy debt.
Ramification for the Telecom Sector
The recent SUC exemption brings major changes to India’s telecom environment. It is expected to increase the 5G launch, which can reshape spectrum policies and improve telecom finances:
- Boost to 5G rollout:
The SUC waiver (Spectrum Usage Charge waiver) will help telecom companies to save money, which means they can now spend more on speeding the 5G rollout and building better 5G infrastructure, which is a major part of India’s digital growth plans.
- Strengthening financials:
Vodafone Idea is considered as one of the biggest companies here and the company could get around ₹8,000 crore as a support. This might help with improving its financial health and lower its AGR dues (Adjusted Gross Revenue dues).
- Level playing field with satellite entrants:
Indian telecom companies are getting the exemption on SUC, but satellite companies like Starlink won’t be able to get the same benefit. This keeps things fair by making sure there is healthy competition between new satellite companies and traditional telcos.
- Regulatory follow-through:
The Government of India is also thinking about cancelling interest and penalties on spectrum dues for departments like Prasar Bharti, railways, space, and defense (SEBI Market Updates). However, this relief is not for private telecom companies, only for government bodies.
- Spectrum refarming:
Work is in progress to take back unused spectrum from departments like space and defence, mainly in the mid-band range. This extra spectrum will help in expanding both the future 6G rollouts and 5G rollout efforts, which gives telcos more bandwidth to work with.
Investor and User Takeaways
Investor Takeaways
- Short-term gains: Stocks like MTNL, Vodafone Idea, Airtel, and Jio might stay strong for now because investors are helpful about the SUC exemption news.
- Long-term prospects: If telecom companies save money through SUC relief, then they can easily attract more subscriptions and invest more in 5G network expansion over time.
- Cautions on implementation: The SUC relief is not confirmed yet, because it still needs surety from the Cabinet. So, investors should stay calm with the investments until there’s an official announcement from the government.
User Takeaways
- Improved service quality: With increased investments, telecom companies may increase their network even faster. This could mean better service, faster internet service, smoother connection, and more 5G coverage even in rural areas.
- Competitive tariffs: If companies started to save money, then they might provide more service at cheaper prices or offer better recharge plans to their users.
- More innovation in services: With extra savings from the SUC exemption, telecom companies might invest in smart services, new features, apps, which gives users more convenience and value.
Contextual Timeline
| Date | Event |
| Oct 2019 | SC orders telcos to pay ₹1.47 lakh crore in AGE dues, from where talk of relief begin |
| June 2022 | Govt waivers SUC for spectrum bought after Sept 2021 |
| March 2025 | Cabinet considers SUC waiver for pre-2021 spectrum |
| June 25, 2025 | Telecom stocks rally on reports of extended SUC waver |
| June 27, 2025 | Govt waives penalties on spectrum dues for govt departments |
Conclusion
The SUC waiver could be a next big thing for the Indian telecom sectors. It may help speed up infrastructure growth, give users a better experience, and remove major financial roadblocks. Just keep a close eye on the official announcement from the government, because it could really change the telecom scene in India for a long time.
FAQs
What exactly is the SUC waiver and who benefits from it?
The SUC waiver removes the 3–4% spectrum usage charge on airwaves brought before September 2021, helping telcos like Vodafone Idea, Airtel, and Jio save money.
How much could Vodafone Idea save?
It may save around ₹8,000 crore, easing its ₹2 lakh crore debt and improving cash flows.
Will new companies like Startlink get the waiver too?
No. Starlink gets spectrum directly from the government and will continue paying SUC.
When will the waiver take effect?
Though discussed since March 2025 and backed in June, the SUC waiver will start once officially notified, likely very soon.
How does this affect India’s 5G rollout?
It releases funds for faster 5G rollout, mainly with more mid-band spectrum becoming available.