Telecom Stocks Outlook for the week – 01 to 05.02.2016
Bharti,
RComm, Idea seen negative next week
( www.rupeedesk.in )
Stocks
of India's top three telecom companies--Bharti Airtel Ltd, Reliance
Communications
Ltd and Idea Cellular Ltd--are expected to continue their bearish run
on
account of lack of any sector-specific triggers. The impact of weak Oct-Dec
earnings
may also spill over to the upcoming week. Bharti Airtel reported an over
22%
fall in its Oct-Dec consolidated net profit to 11.2 bln rupees. Net sales rose
marginally
to 240.6 bln rupees during the quarter. The company also signed a deal
with
Axiata Group Bhd to merge their respective arms in Bangladesh, with an aim to
strengthen
the network coverage across the South Asian country.
Idea
Cellular's Oct-Dec net profit was down 5.6% from a quarter ago at 7.64 bln
rupees,
while Anil Ambani-led Reliance Communications' consolidated net profit for
the
December quarter fell 14.9% year-on-year to 1.71 bln rupees. Ratings agency
Fitch
has said Bharti Airtel, Idea and Reliance Communications may give the
expensive
700 MHz spectrum band a miss, as they may preserve cash for the
impending
launch of Reliance Jio Infocomm Ltd.
Telecom
Regulatory Authority of India has suggested a base price of 11.48 bln rupees
as
reserve price for one block of spectrum in all circles. The regulator
recommended
15.95
bln rupees as reserve price for 700 MHz Delhi band, and 11.92 bln rupees base
price
for 700 MHz Mumbai band. Expects Bharti Airtel and Idea to selectively
acquire
spectrum in the 2100 MHz band, to fill the gaps in their 3G support.