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    Telecom stocks trade mixed after July subscription data; Airtel up 2.7%, Vodafone down 2.5%

    Telecom stocks trade mixed after July subscription data; Airtel up 2.7%, Vodafone down 2.5%

    Telecom stocks trade mixed after July subscription data; Airtel up 2.7%, Vodafone down 2.5%
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    By Pranati Deva   IST (Published)

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    Telecom stocks traded mixed after the Telecom Regulatory Authority of India (Trai) released subscription data for July.

    Telecom stocks traded mixed after the Telecom Regulatory Authority of India (Trai) released subscription data for July. Reliance Jio became the first mobile service provider to cross the 40 crore customers mark in India with a net addition of over 35 lakh subscribers in July. The rebranded Vodafone Idea or Vi, continued to report a sharp fall in subscribers, losing 37 lakh users in the month. Meanwhile, Bharti Airtel added 32.6 lakh mobile customers.
    Following Trai announcement, Bharti Airtel rose as much as 2.7 percent to trade at Rs 426.30 per share, while Reliance Industries was mostly flat, up 0.7 percent to Rs 2,254 apiece. Vodafone Idea fell 2.5 percent to Rs 8.48 per share.
    The overall telecom subscriber base increased marginally to 116.4 crore in July from 116 crore in June, added Trai.
    Reliance Jio now dominates India's mobile market with 35.03 percent share against Airtel and Vodafone Idea's 27.9 percent and 26.3 percent share, respectively.
    "Top five service providers constituted 98.91 percent market share of the total broadband subscribers at the end of July," the Trai report said.
    BSNL added 3.88 lakh mobile customers in July whereas MTNL lost 5,457 users.
    Going ahead, analysts believe that revenues for mobile operators are expected to improve sequentially in the September quarter on increased recharges as lockdown restrictions eased. This will help overcome what is otherwise a seasonally weak quarter.
    "Subscriber addition expected for RJio/Bharti Airtel (though at muted levels), while Vodafone Idea to continue losing subscribers," Axis Capital said in a report, adding that margin improvement from revenue increase is likely to be partially offset by higher commissions, and sales and marketing cost.
    The report said that Jio will benefit from higher subscriber addition than competitors, as well as per user realisation improvement from the addition of higher ARPU Jio Fiber customers.
    "Bharti Airtel's and Vodafone Idea's revenue also to improve quarter on quarter in seasonally weak Q2, as recharges improve on easing of lockdown restrictions," it said but added that margin expansion will be "muted" in Q2.
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