Mumbai: Shares of Vodafone India plunged to their lowest in three weeks by falling over 5%, while Bharti Airtel shares declined over 1% after data released by Trai showed the two telecom operators losing subscribers to Reliance Jio Infocomm. Vodafone Idea shares fell as much as 5.17% to Rs 34.85 per share on NSE. Bharti Airtel shares declined 1.5% to Rs 307.95 per share. At 11.35am, Bharti Airtel was down 0.6% and Vodafone Idea traded 3.13% lower, while the broader Nifty 50 index fell 0.5%.
Vodafone Idea , Bharti Airtel shares dip on weak subscriber data
Reliance Jio added 10.5 million users in October while Vodafone Idea and Airtel lost 7.3 million and 1.8 million users, respectively, according to data released by the Telecom Regulatory Authority of India (Trai) on Wednesday. India’s overall wireless user base grew by just 724,725 subscribers during the month.
Shares of Reliance Industries, parent of Reliance Jio, traded 0.3% down at Rs 1,102.35 per share.
“The top three operators have benefited from the ongoing consolidation within smaller operators in the past,” brokerage Morgan Stanley wrote in a note.
“Most smaller operators are now left with no subscribers, so it will be interesting to see market share shifts within the top players, particularly when Jio continues with an aggressive subscriber acquisition strategy compared to Airtel and Vodafone Idea, which are looking to optimize their low-end customer base,” Morgan Stanley said.
So far, the growth of Reliance Jio was largely attributed to smaller companies exiting the market because of the brutal tariff war triggered by its entry in late 2016. Reliance Jio had added close to 10 million users almost every month in 2018 implies that the pressure on Vodafone Idea and Airtel in unlikely to abate.
Vodafone Idea reported a ₹4,970 crore loss in the September quarter, while Airtel posted a meagre profit of ₹118 crore. In contrast, Reliance Jio made a profit of ₹681 crore during the same period.