Anand Rathi,:: India Telecoms -GSM SIM net-adds fall in Jan ’11; leading telcos fare well

Please Share:: India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��


India Telecoms
GSM SIM net-adds fall in Jan ’11; leading telcos fare well
Total SIM card additions of GSM telcos (excl. RCom, Tata Tele)
fell to 13.7m in Jan ’11, down 20% mom vs. 17.1m in Dec ’10. The
mom decline in industry net-adds of 3.4m was mainly driven by
Videocon (net-adds down 1.9m mom), BSNL (1m) and Uninor
(0.5m). Net adds of Bharti increased to an all-time high of 3.3m
(up 6% mom). Net-adds of Vodafone were steady mom (at
3.1m), while those of Idea declined to 2.5m (down 15% mom).

 Bharti sees buoyancy in net-adds. Bharti’s monthly net-adds
finally broke out of the 2.7-3m net-adds range they were stuck in for
the last 2.5 years. This might suggest more aggression in subscriber
acquisition by the company than in the past. In recent quarters, Idea
and, to some extent, Vodafone, have managed to outperform Bharti
on the traffic growth front. This can be partly attributed to more
aggressive subscriber acquisition by the former two.
 Idea’s net-adds fall mom, but still strong. While Idea’s netadds
dipped 15% mom, they are still higher than average monthly
additions for the preceding six months. Idea’s net-adds have
generally been more volatile than Bharti/Vodafone in the past.
Even at the current monthly net-adds run rate, Idea is on track to
exceed our FY11 subscriber base forecast.
 Lower net-adds by new entrants, BSNL. Combined net-adds
of Videocon, Uninor and BSNL have fallen by 3.4m mom. This
might be because of the de-recognition of inactive subscribers.
Notably, all three companies have very low active-to-total
subscribers’ ratio (30-60%), as per TRAI data.