India Telecoms GSM net adds continue declining trend in August:: JPMorgan

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


 India’s GSM net adds continued to decline in August to 5.3m, a
staggering decline of 30% from 7.6m in July, according to data from COAI.
August compares worse than the 9.7m monthly net add rate in the quarter to
June, which for the GSM market was 32% lower vs. Q4. August net adds
were merely 55% of the average monthly net adds in the quarter ending
June.
 Large GSM telcos, except Idea, see continued net add declines: Bharti
and Vodafone saw their monthly net adds decline 24% each following
29%M/M (each) decline in July and 28%/33% decrease in the quarter to
June vs. the previous quarter. Idea was an interesting winner in August as it
accounted for 44% of the total net adds for the month. BSNL, another large
player, experienced 78% decline in net adds.
 Overall, net add activity has been rather weak in the first two months
of Q2. We believe the weakness has linkages to dealer commission declines
seen recently. We think it is still early to draw conclusions regarding links
with tariff increases given that Idea net adds were strong (while Airtel and
Vodafone were weak), but we don't completely dismiss it.
 Smaller telcos witnessed decline in subscribers: Grouping Uninor,
Videocon, S Tel and Etisalat as the “new” players, their cumulative net adds
were negative at 0.3m due to decline of 0.6m subscribers for Videocon.
They accounted for -6% of GSM net adds (16% in July, 14% June, 13%
May), contributing 6.4% of the GSM sub base (6.5% in July). Uninor’s net
adds decreased 67.0% to 6.4m after the 12.1% increase in July.
 VLR update for June: Idea, Bharti and Vodafone continue to have the
highest ratio of “active” subs at 93%, 89%, 81%, vs. 70% for the market.