1. 4G launch: Which telecom stocks are best bets

4G launch: Which telecom stocks are best bets

With the launch of 4G services by Reliance Jio (RJio), it could likely mark the end of CDMA services, according to ICICI Securities.

By: | New Delhi | Updated: June 17, 2016 11:54 AM
telecom stocks bharti airtel idea cellular reliance communication ICICI Securities, 4G, Bharti Airtel, Reliance Communications, BSE Sensex, NSE Nifty, GSM, CDMA (IE)

With the launch of 4G services by Reliance Jio (RJio), it could likely mark the end of CDMA services, according to ICICI Securities.

The brokerage house believes, it is critical for RJio as completion of 850MHz spectrum refarming by RCom infers that RJio could use the spectrum (through sharing/trading route) for its 4G-850MHz pan-India launch. RCom has already vacated 850MHz in nine circles. Due to strong data card business, 55 per cent of CDMA revenues come from post-paid, which could be a low hanging target for RJio. Also, as CDMA subscribers migrate to less-efficient 1800MHz for voice service and no handset barrier, they could be poached by the top-3 operators, thus providing a cushion to their market share loss to RJio.

ICICI Securities believes Bharti Airtel is best positioned in this regard as around 70 per cent of CDMA subscribers are concentrated in its leadership circles. The brokerage house sees risk to RCom’s revenues / EBITDA from migrating its subscribers to GSM/4G. Though the company has offered lucrative tariffs to migrate for the first month, which subscribers could likely opt (through internal MNP), but post 90-days subscribers can choose to avail MNP again.

ICICI has ‘Buy’ on Bharti Airtel and Idea Cellular with target price of Rs 480 and Rs 180, respectively. However, the brokerage has ‘Reduce’ on Reliance Communications with target price of Rs 43.

On Thursday, Bharti Airtel, Idea Cellular and Reliance Communications were at Rs 346.25, Rs 99.90 and Rs 46.80, respectively

  1. राजेश
    Jun 18, 2016 at 7:11 pm
    BSNL has a rich CDMA 800 spectrum with nationwide coverage. Tata Indicom can merge with BSNL and make it a spectrum-tower sharing agreement that can continue CDMA for another decade or more. A UL MVO was the key requirement for the survival of disd cdma networks.
    Reply
    1. K
      Kaiser Patel
      Jun 18, 2016 at 8:53 am
      None of these CDMA companies did anything for network expansion and customer satisfaction. When TTSL failed to win license in NE, it did not provide intra circle roaming but instead asked it's cdma customers to port out. BSNL was not willing to sell cdma sim cards even if they were on table. BSNL never did anything on it's cdma network after ZTE installed it. Tata was not interested in cdma mobility though it is top cl even today. Though Reliance has 8 million customers till May 2016, they were always crying for profits because of their cheap tariff policy. 4G is only an eyewash. 4G is an excuse to cover up their past inabilities.
      Reply
      1. Rishabh Garg
        Jun 17, 2016 at 11:34 am
        Here is speed test video of Reliance 4g 16th June 20164s
        Reply
        1. Rishabh Garg
          Jun 17, 2016 at 11:35 am
          Here is speed test video of Reliance 4g 16th June 2016youtu.be/dQCI-Arj_4s
          Reply
          1. S
            shyam singj
            Jun 18, 2016 at 2:51 pm
            Good article
            Reply
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