Please Share:: 
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
S u b s c r i b e r a d d i t i o n r i s e s …
Subscriber addition rises …
After falling last month, the subscriber addition in the telecom industry
rose in December 2011. The industry added 7.6 million GSM subscribers
in December 2011 as against 6.7 million in November 2011. The total
GSM subscribers for the industry stood at 639.6 million.
Idea & Uninor – lead the way
Idea and Uninor added 2.4 million and 2.1 million subscribers,
respectively, in December 2011 as against 2.2 million and 1.9 million
subscribers, respectively, in November 2011. While Idea had a share in
net adds of 31.6%, Uninor managed 28.1%. Idea and Uninor have been
sharing the top 2 spots since September. While the former has added 7.9
million subscribers since September with a share in net adds of 28.5%,
the latter has added 8.6 million with a share in net adds of 30.7%.
Top 2 stagnant!
Bharti Airtel and Vodafone reported flat net adds in December 2011. They
added 1.0 million and 0.9 million, respectively, in December 2011. Due to
higher industry additions this time, their share in net adds decreased from
14.4% and 13.9% to 12.7% and 12.0%.
Others
While net adds for BSNL decreased from 0.6 million to 0.4 million in
December, Aircel’s net adds remained flat at 0.7 million subscribers.
Other operators cumulatively broke their losing streak and added 0.1
million subscribers in December 2011.
Subscribers growing fastest in A and B circles…
While the net adds in ‘A’ circles grew from 2.0 million in November 2011
to 2.9 million in December 2011 representing a 46.0% increase, the net
adds in Metros, B Circles and C circles remained flat at 0.7, 2.9 and 2.1
million subscribers, respectively. Both A circles and B circles commanded
the highest share in net adds of 38%.
Industry Outlook
The telecom industry is coming out of the intense competition phase
highlighted in significantly lower net adds than those in CY10, withdrawal
of unviable customer acquisition offers, emerging regulatory stability,
price hikes by incumbents and upward tick in ARPMs. The telecom
operators are set for a rapid jump in profitability over the next two years,
led by growth in revenue yielding traffic. Also, all telcos will witness
declining capex intensity, debt repayment and reduced interest costs.
With more clarity on NTP expected in a few months, the regulatory
scenario seems to be more stable now than what it seemed about a year
ago. Airtel would benefit from huge FCF to repay majority of its debt and
improving margins in the African business. It remains our top pick in the
sector with a target price of | 450. We expect Idea’s EBITDA to grow 1.9x
by FY14E led by increasing revenue share and lower network operating
costs. However, spectrum pricing may remain an overhang on the stock.
We reiterate HOLD with a target price of | 99. We rate RCom as SELL due
to its huge debt levels. However, our view may change if some of the
several positive developments like higher external tenancy, monetisation
of tower assets and possible listing of undersea cable business fructify.
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
S u b s c r i b e r a d d i t i o n r i s e s …
Subscriber addition rises …
After falling last month, the subscriber addition in the telecom industry
rose in December 2011. The industry added 7.6 million GSM subscribers
in December 2011 as against 6.7 million in November 2011. The total
GSM subscribers for the industry stood at 639.6 million.
Idea & Uninor – lead the way
Idea and Uninor added 2.4 million and 2.1 million subscribers,
respectively, in December 2011 as against 2.2 million and 1.9 million
subscribers, respectively, in November 2011. While Idea had a share in
net adds of 31.6%, Uninor managed 28.1%. Idea and Uninor have been
sharing the top 2 spots since September. While the former has added 7.9
million subscribers since September with a share in net adds of 28.5%,
the latter has added 8.6 million with a share in net adds of 30.7%.
Top 2 stagnant!
Bharti Airtel and Vodafone reported flat net adds in December 2011. They
added 1.0 million and 0.9 million, respectively, in December 2011. Due to
higher industry additions this time, their share in net adds decreased from
14.4% and 13.9% to 12.7% and 12.0%.
Others
While net adds for BSNL decreased from 0.6 million to 0.4 million in
December, Aircel’s net adds remained flat at 0.7 million subscribers.
Other operators cumulatively broke their losing streak and added 0.1
million subscribers in December 2011.
Subscribers growing fastest in A and B circles…
While the net adds in ‘A’ circles grew from 2.0 million in November 2011
to 2.9 million in December 2011 representing a 46.0% increase, the net
adds in Metros, B Circles and C circles remained flat at 0.7, 2.9 and 2.1
million subscribers, respectively. Both A circles and B circles commanded
the highest share in net adds of 38%.
Industry Outlook
The telecom industry is coming out of the intense competition phase
highlighted in significantly lower net adds than those in CY10, withdrawal
of unviable customer acquisition offers, emerging regulatory stability,
price hikes by incumbents and upward tick in ARPMs. The telecom
operators are set for a rapid jump in profitability over the next two years,
led by growth in revenue yielding traffic. Also, all telcos will witness
declining capex intensity, debt repayment and reduced interest costs.
With more clarity on NTP expected in a few months, the regulatory
scenario seems to be more stable now than what it seemed about a year
ago. Airtel would benefit from huge FCF to repay majority of its debt and
improving margins in the African business. It remains our top pick in the
sector with a target price of | 450. We expect Idea’s EBITDA to grow 1.9x
by FY14E led by increasing revenue share and lower network operating
costs. However, spectrum pricing may remain an overhang on the stock.
We reiterate HOLD with a target price of | 99. We rate RCom as SELL due
to its huge debt levels. However, our view may change if some of the
several positive developments like higher external tenancy, monetisation
of tower assets and possible listing of undersea cable business fructify.
No comments:
Post a Comment