India’s Telecom Sector On The Ropes as latest Supreme Court if India Ruling means $13B Levy is due from Vodafone Idea and Bharti Airtel.
Vodafone Idea, Reliance Jio and Bharti Airtel each now have 30% to 33% market share. After Reliance Jio neatened the market in 2016 and offered free phone calls and cheap data plans ARPU fell for Rs 400 to Rs 80 which is not sustainable in the long run.
Indian Govt needs to bail out the Telecom Sector for the 3 players to survive. Jio is well positioned after having sold Telecom Towers to Brookfield and deleveraged but Vodafone Idea and Bharti Airtel will struggle with debt and may be forced to sell their Telecom Towers to raise cash. The future is bright for survivors as 1.2 Billion customers await to be serviced for the next decades in India.
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