Adjusted gross revenue

The revenue base on which Indian telecom operators pay licence fees and spectrum charges to the government.

Its definition was litigated for many years, and the eventual resolution imposed very large historical liabilities on the sector, reshaping its structure and its balance sheets.

For an analyst the point is not the history but the principle: in a regulated sector, the definition of the revenue base is itself a valuation variable, and it can change by judgement rather than by market forces.

Regulatory risk is not a footnote in this sector. It is the sector.