Rajiv Sharma, head, institutional equity research, SBICAP Securities, on Tuesday recommended 'BUY' on Reliance Jio, Bharti Airtel and 'SELL' on Vodafone Idea.
This comes after Vodafone Idea moved first among the telecom companies to increase prices starting with Rs 50 hike for its premium family plan.
According to Sharma, the increase is in the family plans, "It is very difficult for existing users to really churn out of this plan for a mere Rs 50 price increase to another plan and switch to another operator. I think tariff hikes in these plans will get absorbed."
"We may not see Airtel wining from the customer side. The company may match on the pricing side as well. But it is unlikely to have any meaningful impact and this is not a pocket where Jio is really contesting with Vodafone or Airtel at this moment."
On Airtel, Sharma said, "We are building for a longer term average revenue per user (ARPUs) of Rs 230-240 over the next 3-4 years and that we believe can take it to Rs 690 which is our target price. So you have to take a little longer term view here, in the near term gains are already reflecting."
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