INSUBCONTINENT EXCLUSIVE:
plunging below eight-year lows in the aftermath of Reliance Jio unleashing yet another wave of tariff disruption which is likely to cause
more financial misery and customer losses to incumbents in FY19.
Sector analysts said the Mukesh Ambani 4G newcomer is now well within
striking distance of poaching the sticky, high-ARPU (average revenue per user) customers of Bharti Airtel, Vodafone India and Idea Cellular,
with its new, ultra-low postpaid tariff plan
incumbents and 60% discount to postpaid ARPUs
We have been concerned on postpaid as it contributes 20%-plus of revenues," said a Jefferies report
385.7 on the BSE after dipping to an intra-day low of Rs
The Idea stock plummeted to as low as Rs
50.80 in early afternoon trade, which was well below its eightyear low of Rs
The scrip eventually closed nearly 12% down at Rs
even if they are "compelled to retaliate" to the 4G newcomer's latest postpaid offer
It said they could partly mitigate the risks of a postpaid ARPU fall through "segmented offers and others such as family plans, which would
moderate the cut in subscriber spending".
Nevertheless, CLSA said "Jio's new postpaid tariff is sector negative and would delay ARPU
recovery for the industry.
Goldman Sachs expects no
3 Idea to lose high-end customers if network quality worsens in near term, especially since its capex has been 60-70% lower than Bharti and
