The 20-25 percent hike in prepaid tariffs announced by Vodafone Idea (Vi) will help the telecom service provider considering it remained in a tight situation despite the government's efforts to support the sector, said Peter Milliken, Research Analyst, Deutsche Bank.
"It was a deep hole that Vodafone Idea was in. The government’s efforts provided a step ladder to help it get out of that hole. It wasn’t high enough though, they need more," said Milliken in an interview with CNBC-TV18.
"The 20 to 25 percent hike in prepaid tariffs helps Vi," he said.
After Bharti Airtel, Vodafone Idea on Tuesday announced a 20-25 percent hike in its prepaid tariffs.
According to Milliken, funding for 5G rollout will continue to be a challenge for Vodafone Idea.
“This gets Vi into a position where it is positive and still needs to pay off its interest and that would be the challenge they have of how do they do that while rolling out a 5G network,” said Milliken.
Milliken expects Jio to eventually hike tariffs. "It is of everyone’s interest to slowly move towards most standardized set of plans," he stated.
“We do need to wait for another 12 months or so and then perhaps push prices up another 15 percent and then we are at a much more economic stance for the industry,” he said.
For the full interview, watch the accompanying video.
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