India Telecom GSM SIM adds remain steady in December:: Anand Rathi

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India Telecom
GSM SIM adds remain steady in December
Total SIM card additions of GSM telcos (ex RCom, Tata Tele)
were steady at 17.1m in Dec ’10 vs. 17.2m in Nov ’10. Net adds of
leading telcos (Bharti, Vodafone, Idea Cellular, BSNL) were by
& large unchanged m-o-m. In ’10, GSM telcos recorded 162m
net adds (13.5m/month) vs. 117m (9.7m/month) in ’09. The 45m
increase in net-adds was largely driven by new telcos (26m) and
BSNL (8m). Net adds of Bharti and Vodafone were flat yoy in
’10, while those of Idea and Aircel increased ~25%, due to
expansion in new circles.

 Idea continues to impress. Idea’s net-adds rose 5% mom in Dec-
10, after a jump of 55% in Nov-10. Net-adds of Idea are now
almost on par with pan-India operators Bharti and Vodafone.
Notably, TRAI data on ‘active’ subscriber base reveals that ~90%
of Idea’s base is active vs. ~70% of industry. In light of this, we
see the robust net adds for Idea in Nov-Dec ’10 as an indication
of a strong trend in underlying business (traffic, revenue).
 Other telcos fare well. Net-adds of Bharti and Vodafone were
flat at 3.1m each. Aircel’s net-adds were up 17%; however, unlike
other leading telcos, Aircel’s net-adds have not fully recovered
from the industry-wide slump in net-adds in Sep ’10 (caused by
subscriber verification exercise). BSNL net-adds were flat at 3.1m.
 New telcos. Net-adds of Uninor were down 6% mom at 2.3m,
while those of S Tel were up 23%. Net adds of Etisalat jumped
117% on a low base; this may have possibly been driven by a need
to meet the roll-out obligations. Net-adds of Videocon dipped a
sharp 49%, possibly on account of de-recognition of inactive
subscriber base.