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Vodafone Idea shares decline 6%, Airtel down 3%; Why telco stocks are down

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Vodafone Idea and Bharti Airtel shares trade weaker on Friday amid a broader sell-off in the stock markets as concerns over a fresh covid-19 variant spooked investors across global markets.

Vodafone Idea shares decline 6%, Airtel down 3%; Why telco stocks are down
Vodafone Idea and Bharti Airtel shares declined over 6 and 3 percent, respectively, on Friday as Indian shares registered their biggest meltdown since early April. The benchmark 30-share BSE Sensex tumbled over 1,300 points as wary investors resorted to selling amid mounting fears over the discovery of a new coronavirus variant in South Africa that threatens to stall fragile global recovery.
Vodafone Idea shares declined 6.4 percent, falling as low as Rs 10.90. It was trading at Rs 11 at 10:40 am. Bharti Airtel shares declined 2.8 percent, falling as low as Rs 743.90. The stock was trading at Rs 748.05.
Earlier this week, Trai data showed that Vodafone Idea lost 10.77 lakh subscribers during September, while Bharti Airtel added 2.74 lakh subscribers. Compared to Airtel's subscriber base of 35.44 crore in September, Vodafone Idea's subscriber base has come down to 26.99 crore.
Vodafone Idea had recently raised entry-level tariffs by up to 25 percent as the debt-laden telco battles liquidity issues. Vodafone Ideas' basic plan which costs Rs 79 earlier with a validity of 28 days will now cost Rs 99.
Nifty and Sensex are down over 2 percent Friday after the World Health Organisation flagged a new COVID variant — B.1.1.529 — indicating a large number of mutations in the new variant with an unusually large number of mutations. South Africa has already detected 22 cases of the new variant, the National Institute for Communicable Diseases said.
On Thursday, the Indian government asked all states and union territories to conduct rigorous screening and testing of all international travellers from South Africa, Hong Kong and Botswana where multiple cases of a COVID-19 variant B.1.1529 have been reported.
At 10:40 am, Sensex was down over 1,372 points to 57,422 and Nifty had weakened 411 points to 17,124. Broader markets have also declined with midcaps falling over 796 points or 2.30 percent to 30,129.
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