Top two telecom conglomorate Jio and Bharti Airtel are consolidating market share moving the industry possibly towards a "near 2-player structure", with Vodafone Idea facing the prospects of losing revenue market share (RMS) as it struggles financially, according to a report by IIFL Securities.
The latest note by IIFL Securities also indicated that tariff increase may not be immediate and instead sees a "high likelihood of price hike in 12-18 months". "The industry shake-up that ensued post Jio's entry has resulted in a 3+1 market configuration. In our view, the industry is moving to a near 2-player structure - Jio and Bharti - with Vi (Vodafone Idea) likely to lose RMS as it struggles financially," it said.
It expected Voda Idea to witness "accelerated RMS loss" due to the tight timeline on statutory payments and "significant tariff hikes looking at least 12 months away". Bharti, it added, remains well-placed to benefit from improved industry structure, likely expansion in 'share of wallet' and falling spectrum and equipment capex intensity. "We expect Bharti's revenue market share (RMS) in India mobile to rise, from 33 per cent in 2QFY21 to 37 per cent. India non-mobile and Africa businesses remain strong," IIFL Securities said.