Telecom Stocks Outlook for the seek – 07 to 11.08.2017

Telecom Stocks Outlook for the seek – 07 to 11.08.2017

Free Intraday Tips : Join Our Whatsapp No : 9841986753
Free Commodity Tips : Join our Whatsapp No : 9094047040

Telecom Stocks Outlook for the seek – 07 to 11.08.2017 )

The shares of most telecommunication companies are seen falling further next week on the back of sustained pressure on revenue streams of operators due to intense competition from latest entrant Reliance Jio Infocomm Ltd. The recent launch of the "effectively free" fourth-generation mobile phone by the telecom arm of the cash-rich Reliance Industries Ltd for a refundable deposit of 1,500 rupees is expected to put pressure on operators to launch similar offerings to protect their subscriber
base. India's largest telecom service provider in terms of revenue and market share Bharti Airtel,
however, has no plans to launch subsidised phones, Chief Executive Officer Gopal Vittal
had said in a post-earnings conference call last week. With Reliance Jio's feature phone broadening its addressable market, competitive intensity may likely lead to weaker revenue and profitability for Bharti Airtel. Bharti Airtel posted a consolidated net profit of 3.67 bln rupees in Apr-Jun, down 1.6% on quarter, missing the estimate of 4.0 bln rupees. Consolidated net loss for the third largest operator Idea Cellular widened to 8.15 bln rupees in Apr-Jun from 3.28 bln rupees in the previous quarter,
missing the consensus estimate of a 7.20-bln-rupee loss. Vodafone India Ltd and Idea Cellular have announced a merger, which has received the Competition Commission of India's nod but other regulatory approvals are pending. Bharti Airtel, too, has announced two separate acquisitions, of Tikona Digital Networks Ltd and the Indian arm of Norway's Telenor ASA. ICRA, in a recent report, said it continues to hold a negative outlook for the sector, which will keep facing headwinds due to competition and the industry revenue is expected to come down to 2.4 trln rupees for 2017-18 (Apr-Mar). Taking cognisance of the pressure, the government has set up an inter-ministerial panel to
recommend ways to improve the financial health of the sector. The panel has met operators
and banks, and is expected to come out with its report soon.

Source : Cogencis Information Services Ltd.