How airtel and idea will reap benefits from reliance jio's new rate plans

How Airtel and Idea will reap benefits from Reliance Jio's new rate plans

How Airtel and Idea will reap benefits from Reliance Jio's new rate plans .

Key challenge to come from the launch of 4G feature phones by the RIL subsidiary, say analysts

Education News The share prices of Bharti Airtel and Idea Cellular gained on Wednesday, on the expectation of the new rate plans announced by Reliance Industries’ (RIL) telecom subsidiary, Reliance Jio (Jio), leading to improvement in their operating metrics.

The price plan announced by Jio on Tuesday is estimated to be 30-57 per cent higher than earlier promotional offers. Brokerages say this is positive and a clear indication of rationalisation of pricing.

Analysts at UBS say the first Jio price increase in almost 12 months supports the brokerage view that sector revenues are close to bottoming out, with the top three operators and Jio expected to incrementally take share from smaller entities.

Credit Suisse in a note said the new Jio rates would start the process of normalising these from the current discounted levels. Also indicating that RIL is looking at monetising its investment in the telecom subsidiary.

Harsh Jagnani, vice-president of corporate ratings at ICRA, says the new plans point to improvement in average revenue per user (ARPU) and that Jio, after grossing 100 million subscribers, is focussing on pushing this up to improve its profitability.

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