Reliance Jio could slash telcos' FY18 operating profit

Falling revenues, increased capex, and first full year of spectrum debt may make things worse

Ram Prasad Sahu 

The telecom sector may not have enough money to pay off interest on their loans, if the worst-case scenario painted by brokerages is anything to go by. According to Rohit Chordia of Kotak Institutional Equities, disruptive pricing and offers could spark a 60 per cent year-on-year fall in India wireless operating profit (excluding Reliance Jio) in FY18 to under Rs 20,000 crore. Given the industry's debt of Rs 4 lakh crore, including deferred spectrum obligations, the operating profit will not be enough to service interest obligations, he adds. CLSA, too, in a recent report ...

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Read our full coverage on Reliance Jio

Reliance Jio could slash telcos' FY18 operating profit

Falling revenues, increased capex, and first full year of spectrum debt may make things worse

Falling revenues, increased capex, and first full year of spectrum debt may make things worse The telecom sector may not have enough money to pay off interest on their loans, if the worst-case scenario painted by brokerages is anything to go by. According to Rohit Chordia of Kotak Institutional Equities, disruptive pricing and offers could spark a 60 per cent year-on-year fall in India wireless operating profit (excluding Reliance Jio) in FY18 to under Rs 20,000 crore. Given the industry's debt of Rs 4 lakh crore, including deferred spectrum obligations, the operating profit will not be enough to service interest obligations, he adds. CLSA, too, in a recent report ... image
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