Reliance Jio entry may pressurize RCom: Fitch

RCom may face challenges due to higher competition in the data market after the entry of Mukesh Ambani’s telecom venture Reliance Jio in the second half of 2016, according to Fitch Ratings. The firm however added that RCom’s ownership of a pan-India spectrum in 800MHz/850MHz and its ability to offer faster 4G data services could help it fend off the competition, to some extent.

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According to Fitch Ratings, RCom’s IDR is constrained by its weak market position as the fourth-largest telco in India with a revenue market share of around 8% and a subscriber base of mostly low-revenue customers.

Bharti Airtel, Vodafone India and Idea Cellular now account for about 70% of wireless revenue in India’s telecoms market.

“We forecast FCF will be limited in FY17 as Rcom needs to invest around Rs 40bn (FY16: Rs 34bn – excluding a one-off spectrum payment of Rs 11bn) on capex to support its fast-growing data traffic and to improve the quality of voice services,” the firm said.

The ratings firm said that Rcom’s capex/revenue of around 17%-18% will still be below than top-three telcos’ average of 19%-20% due to its infrastructure and spectrum-sharing arrangement with Reliance Jio.

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55 Comments on "Reliance Jio entry may pressurize RCom: Fitch"

 

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om
March 12, 2016 9:29 pm 9:29 PM

Today i had gone to a reliance digital store there i saw the man in store using lyf phone with jio sim but when i search networks in my galaxy j5 with airtel 4g sim havent found jio network……..why

Rishi Roy
March 8, 2016 12:09 am 12:09 AM

The executives are saying that their CDMA and LTE will go hand in hand. From today they have started promoting postpaid Mblaze.
On a diffent note, people are using Lyf Flame here.

raj
March 7, 2016 12:20 pm 12:20 PM

reliance ap circle removed
2g data denomination
282 rs which provide 6gb for 90 days. and reduced validity of 248 data voucher from unlimited to 3gb and validity 45days to 28days.

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