Data Upside Yet to be Monetised; Investments Continue

Capital Market 

Key highlights of the report include Ind-Ra's views that (RJio; IND AAA/Stable) may continue to disrupt the market till it achieves its critical mass of subscribers. RJio's quest for incremental market share could likely slowdown at around 30% market share (currently subscriber market share at 14.6%; revenue market share at 15%).

Negative Subscriber Growth: Subscriber growth was negative in January 2018, led by closure of services by and scaling down of services by RJio added 8.3 million new subscribers; while Bharti Airtel Limited, Limited (Vodafone), and added 4.3 million subscribers on an aggregate basis.

Circle-wise Market Position: RJio was at third place by subscribers' position in four out of eight top circles in February 2018. maintains the leadership position in six out of the top eight circles, whereas Vodafone maintained the number one position in and circles in February 2018.

Vodafone and on a combined basis would be at first place in Uttar Pradesh East, Maharashtra, and circles in February 2018.

Average Revenue Per User Outlook: believes the unlimited pricing plans will lead to erosion of long-term profitability and accelerated consolidation, the benefits of which may take time to materialise.

Road to 5G: As it stands today, Indian telcos are not in a position to spend large capex required for 5G in 2018. The already high debt levels, pressure on EBITDA, currently low level of 4G penetration and focus on completing consolidation will defer the 5G investment in beyond 2020. Pricing for the 5G spectrum will remain a deciding factor for telcos to make further investments such as in Massive MIMO (multiple input multiple output) - 5G plug-in technology, cloud radio access network, network virtualisation, to evolve its existing to 5G which significantly improves spectrum efficiency.

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First Published: Mon, April 30 2018. 10:23 IST