GOLDEN RULES FOR TRADING

Telecom Stocks Outlook for the week – 04 to 08.04.2016 Bharti, Idea seen down on spectrum sale doubts

Telecom Stocks Outlook for the week – 04 to 08.04.2016
Bharti, Idea seen down on spectrum sale doubts

Stocks of Bharti Airtel Ltd, Idea Cellular Ltd and Reliance Communications Ltd are seen trading
down next week over uncertainty around the spectrum auctions. The Telecom Commission, an interministerial panel, Monday asked the Telecom Regulatory Authority of India to reconsider its
recommendations for the quantum of spectrum to be sold, as well its reserve prices, for the upcoming
auctions. The panel wanted a review of the parameters adopted for deciding the reserve price--
currently at four times the base price of the 1800 MHz band-- of the most sought after 700 MHz
spectrum.

TRAI will respond to the apex body's comments in the next 15 days. Meanwhile, in another
development the Supreme Court Wednesday adjourned hearing on the call drop compensation matter, and will now hear telecom operators' petition, challenging TRAI's order, on Apr 5. Telecom service providers are challenging the Delhi High Court's decision to uphold a notification by TRAI mandating mobile companies pay their customers for call drops on their network. The companies' outlook on the fundamental side also looks weak mainly in anticipation of the impending launch of Reliance Jio Infocomm Ltd.