Telecom Stocks
Outlook for the week – 18 to 22.07.2016
(Seen mixed, spectrum
charge decision eyed)
( www.rupeedesk.in )
The stocks of telecom companies are seen mixed next week,
but focus will be decision over the
spectrum usage charge that is likely to be finalised soon.
On Tuesday, Telecom Regulatory Authority
of India recommended a uniform spectrum usage charge, but
said it is "constrained" to examine the
weighted average solution as suggested by Attorney General
Mukul Rohatgi and proposed by the
Department of Telecommunications.
The authority suggested its own weighted average formula
that takes into account the final bid value
of a spectrum band and technical efficiency of those
airwaves. Currently, the charge is calculated
through a weighted average formula factoring different usage
charge rates for spectrum acquired
at different points in time.
If accepted by the government, TRAI's formula will result in
a higher payout by the industry compared to what had been proposed by the telecom department. Over
the next week, telecom stocks are seen mixed with Idea Cellular Ltd expected to outperform Bharti
Airtel Ltd.
Idea is looking better. The stock is trading around 100
rupees range, from where it has rebounded
many a times in the past. Bharti Airtel, which has displayed
an oscillating trend over the past several
weeks, may gain next week. While Bharti Airtel slashed data
rates by half for browsing between 3 am
and 5 am for pre-paid customers, Idea Cellular increased
data quantum by 45% for all packs below 1
GB.