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Informist, Friday, Jun. 12, 2025

MUMBAI – Stocks of telecom companies are likely to keep consolidating next week amid a lack of sector-specific triggers, analysts said. Movement of these stocks would be dependent on specific news, they said.

The major news for the sector this week was the Telecom Regulatory Authority of India data of the adjusted gross revenues of telecom companies for the March quarter. The industry's AGR grew 1.3% sequentially to INR 717 billion. This was led by upside due to the residual tariff-hike flow-through for Reliance Jio Infocomm and aided by the continued premiumisation efforts and subscriber growth for telecom companies, JM Financial said in a report.

In a separate report, the brokerage said it expects the average revenue per user of these companies to grow at a compounded annual growth rate of 12% in the next 3-5 years due to the consolidated nature of the industry. "...We expect the industry ARPU to grow at 12% CAGR to INR 290-320 by FY28 (via tariff hikes, MBB (Mobile Broadband) upgrades, post-paid additions and data monetisation)," the report said. While the next tariff hike, which is expected to be around 15%, is likely in 2026, the brokerage said "a near-term tariff hike can't be ruled out given Jio's potential listing plans and the central government's intent to ensure a 3+1 player market."

With the capital expenditure of industry leaders Bharti Airtel and Jio expected to moderate in 2025-26 (Apr-Mar) and sees future capex to stabilise at 15-20% of revenues. "Thus, we estimate that Bharti's India business FCF (free cash flow) will rise to INR 421 bln/INR 474 bln in FY26/FY27 (vs. INR 316 bln in FY25) and Jio's FCF could rise to INR 388 bln/INR 457 bln in FY26/FY27 (from ~INR 247 bln in FY25)," the brokerage said.

For the next week, Bharti Airtel is expected to move in a range of INR 1,800-INR 1,900 amid a lack of triggers despite the company's fundamentals looking strong, a technical analyst at a domestic brokerage said. On the other hand, Vodafone India looks fundamentally weak and investors should stay away from the stock, the analyst said. The stock is seen moving in a range of INR 6.00-INR 7.50 next week. On Friday, Bharti Airtel ended 0.25 lower at INR 1,840.40 on the National Stock Exchange, and Vodafone Idea closed at INR 6.67, down 1.6%.

TOP HEADLINES

* Sterlite Tech gets INR 26-bln order from BSNL via demerged arm STL Networks
* RailTel Corp gets INR 119.5-mln order from South Eastern Coalfields
* Vodafone Idea announces launch of 5G services in Bengaluru from Wed
* Bharti Airtel awards multi-year managed svcs deal to Sweden-based Ericsson
* RailTel Corp gets INR-2.43-bln order from Bihar Education Project Council
* Bombay HC allows Indus Towers to install mobile tower in Maharashtra village

Following are the resistance and support levels for the stocks for next week as per calculations by Informist based on their prices on the National Stock Exchange:

End

Reported by Akash Mandal

Edited by Deepshikha Bhardwaj

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