Tariff Hikes Should Come Anytime: ICICI Securities

ICICI Securities, a subsidiary of ICICI Bank on Tuesday said in a report that 2021 “could be a year of significant industry repair” as the firm expects “another round of large tariff hikes.” The firm said that upcoming tariff hikes “may drive higher revenue growth” for the telecom operators than the previous tariff hikes. ICICI Securities in its 2021 Telecom Sector Outlook also highlighted that the upcoming year “could be decisive year” for Vodafone Idea. The firm said that the third largest wireless operator in India would be occupied with “big events such as fund raising, translation of tariff hikes, and reducing cash losses.”

• Make Telecom Talk My Trusted Source
• 
• 

Multiple Events Including COVID Delayed Tariff Hikes to 2021

ICICI Securities highlighted that the telecom operators unveiled 25% to 40% tariff hikes in the prepaid segment in December, 2019, while further hikes were expected in the current year. However, multiple events including the COVID pandemic along with the “pending clarity on floor prices” is said to have delayed the tariff hikes to the upcoming year.

It has to be noted that the Telecom Regulatory Authority of India (Trai) in late December, 2019, floated a consultation paper to evaluate the floor prices on the telecom services. ICICI Securities said that the operators in response to Trai have asked for up to nine times increase in the data prices.

“Outcome of the consultation is awaited,” the firm said in its report. “VIL has said it would be the first to take tariff hikes and is probably waiting for clarity on floor prices. Regardless of floor prices, tariff hikes to come latest by Mar’21 and peers to follow.”