Devesh
Core Member
India’s telecom industry won’t be raising a toast to 2017. Instead, it will be gearing up for a tough 12 months with Bharti Airtel, Vodafone India and Idea Cellular — the top three — embroiled in a war with newcomer Reliance Jio Infocomm.
Telcos are bracing for further pressure on both voice and data rates, and the resultant threat to revenue growth and narrowing margins and profit, amid increased finance costs due to burgeoning debt and spending on expanding 3G and 4G networks, analysts said. Efficiency, effectiveness and cost control will be the focus areas for telcos in the New Year, when the number of data users is likely to surge.
“The sector is staring at almost Rs 3 lakh crore of debt and the profit margins at a sector level would be wafer-thin. Servicing of such debt would be difficult with falling revenue,” said Prashant Singhal, global telecommunications leader at consultancy firm EY. He added that at current debt levels, the sector needs some stimulus from the government to fuel growth in networks and drive digital adoption. Singhal expects some semblance of normalcy to return only in 2018.
Airtel, Vodafone and Idea Cellular gearing up for a tough 2017, Telecom News, ET Telecom
Telcos are bracing for further pressure on both voice and data rates, and the resultant threat to revenue growth and narrowing margins and profit, amid increased finance costs due to burgeoning debt and spending on expanding 3G and 4G networks, analysts said. Efficiency, effectiveness and cost control will be the focus areas for telcos in the New Year, when the number of data users is likely to surge.
“The sector is staring at almost Rs 3 lakh crore of debt and the profit margins at a sector level would be wafer-thin. Servicing of such debt would be difficult with falling revenue,” said Prashant Singhal, global telecommunications leader at consultancy firm EY. He added that at current debt levels, the sector needs some stimulus from the government to fuel growth in networks and drive digital adoption. Singhal expects some semblance of normalcy to return only in 2018.
Airtel, Vodafone and Idea Cellular gearing up for a tough 2017, Telecom News, ET Telecom
