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Monday, September 26, 2016

Jet Plans Joint Venture with Air France-KLM

Jet Airways isn't a member of any airline alliance but has code share agreements with several airlines including Air France-KLM

Jet Airways, which is co-owned by Etihad Airways, is not a member of any aviation alliance but it has code share agreements with several airlines, including Air France-KLM.
Jet Airways is negotiating a joint venture (JV) agreement with Air France-KLM to expand its commercial co-operation with the European airline network.


If the deal fructifies, it would be Jet Airways’ first large-scale commercial agreement outside of Etihad and Etihad-owned airlines. Etihad also has strong commercial and technical support agreements with Air France-KLM.

According to airline sources, Jet signed a memorandum of understanding with Air France-KLM about two weeks ago to form a JV. The proposed JV will cover routes in India, Europe, and North America but finer details are still to be worked out, sources added.

In March, Jet shifted its European gateway from Brussels to Amsterdam (which is KLM’s hub), indicating its closeness with the two European airlines. And last week, Jet changed its schedule of Mumbai-Paris flight to provide more onward connections over Paris.

A JV mostly involves a far greater cooperation between airlines and participating airlines usually share costs, revenue and profits on routes.  Air France-KLM, Delta and Alitalia have an extensive JV, covering routes between Europe and North America and offering about 25 per cent of capacity on transatlantic routes.

On Monday, French and Dutch media reported about the signing of an in-principle agreement between Jet Airways and Air France-KLM for a JV. French newspaper La Tribune went on to say after the Rafale fighter deal, Air France is making a big impact in India. Responding to a query on proposed JV, a Jet spokesperson said “As a policy, Jet doesn’t comment on speculations.”

At present, Jet flies to Paris and Amsterdam and is now planning to resume its US service. Air France flies to three cities in India (Delhi, Mumbai and Bengaluru) and KLM flies to Delhi. The French and Dutch media reports said  network in India would be expanded next year with plans to connect Hyderabad, Chennai or Bengaluru with Amsterdam and Paris.

NORMS OF JV BETWEEN AIRLINES
  • It is an advanced commercial deal between airlines
  • Under the deal, airlines collaborate on network, schedules, sales and pricing, and also share costs, revenue or profits on routes
  • It requires anti-trust approvals from regulators
  • The logic behind a JV is normally referred to as “metal neutrality” achieved via close co-operation in capacity and pricing as well as revenue management
  • Northwest & KLM signed first JV amongst airlines in 1997
  • Important JVs include Air France-KLM,  Delta and Alitalia JV; and Lufthansa group, Air Canada, and United pacts
  • Last week, Lufthansa signed a JV with Air China and the former has similar deals with SIA & Nippon Airways

“A JV agreement could help Jet deploy its wide-body planes profitably on Europe or North America routes. At the same time, this would help Air France-KLM expand its presence in India and counter Lufthansa-led Star alliance,” said an industry observer.

“Amsterdam Airport Schiphol was very pleased to see Mumbai being reconnected to our network with Jet arriving to Amsterdam. We have understood that the performance of the operation is going very well and as proof for that Jet will operate a B777-300ER on the Mumbai-Amsterdam route, instead of the A330 aircraft. Next year, the B777 aircraft could also be used on the Delhi-Amsterdam-Toronto route,” a spokesperson of the Amsterdam airport said.

“With the arrival of Jet Airways to Amsterdam, there is also a close cooperation between KLM and Delta Air Lines. The flights of Jet Airways to Amsterdam connect to 30 European destinations and 11 North American destinations. Of course, the vast network of Jet Airways in India is used to feed passengers to each other’s flights,” the spokesperson added.

Reference : http://www.business-standard.com/article/companies/jet-plans-joint-venture-with-air-france-klm-116092601118_1.html

Reliance Jio in Fresh Battle with COAI

Calls the industry body biased and accuses it of serving the interests of the top three telcos

The industry body hit back by evening and termed Jio as a back door operator (BDO) in the telecom sector, as it was never an applicant for UASL or UL license but bought broadband wireless spectrum through a front entity and then had it converted into a full-blown UASL license. The war of words began on Sunday as Jio called the leading three telcos as incumbent dominant operators (IDOs) and accused COAI to be serving their interests, while reducing the other core members to nullity.
The ongoing tussle between Cellular Operators Association of India (COAI) and Reliance Jio got murkier on Sunday, with Jio calling the industry body biased and accused it of serving the interests of the top three telcos, namely Bharti Airtel, Vodafone and Idea.


"None of the half a dozen new operators who have entered in the last five years have ever accused COAI or in fact labelled the leading operators as IDO's. Despite repeated and grave provocations from Reliance Jio, COAI wishes to state that Reliance Jio which entered the sector as a BDO was welcomed by COAI as a full member," COAI Director General Rajan Mathews said.

Jio has also sought a thorough overhaul of COAI regulations by appointing three retired judges of the Supreme Court so that the industry body falls in line with democratic principles of fairness, accountability and transparency. Jio has been a core member of COAI since July 2014.

Regarding the issues raised by Jio, COAI said these are private, internal matters of the association and hence will be dealt with internally among its members. Jio is a member and this is a matter, that can easily be discussed at the association. Questioning the rules and regulations of COAI, Jio said as the three IDOs command 68 per cent of votes and any decision, including those relating to grievance of a core member are subject to simple majority which is under simple control of IDOs.

"COAI regulations are overwhelmingly biased and lopsided and have been framed to sub-serve the vested interests of three IDOs," Jio said in the letter dated September 23 to its Chairman Gopal Vittal and Director General Rajan Mathews.

However, COAI said Jio was presented with the constitution and by-laws of the Association, pursuant to their application for membership and was well aware of the governance structure and practices of the association.

"No issues were raised at this time and they agreed to abide by these rules and regulations. It is surprising that Reliance Jio now raises certain issues as something new," COAI said.

COAI further said it believes these are now motivated by a desire to tarnish the reputation and credibility of COAI in the light of certain representations made by COAI to various government agencies

COAI also wishes to state that any representation made is done after following all due processes of the association and with transparency on whether any member operator agrees or disagrees with the COAI position.

"The members of COAI will review the letter submitted by Reliance Jio and do what they believe is in the best interest of the country, the customers and the association," it added

Jio in the letter said three IDOs have 60.84 per cent market share based on revenues and command seven votes each, totaling 21 votes whereby the remaining four core members have a total of 10 votes amongst them.

"The entire decision-making power and authority rests only with the IDOs. The other core members have been reduced to a nullity and their presence or not will always be inconsequential," the letter said.

"One vote - One member" is the basic tenet for good governance of any association such as COAI, Jio added.

Citing a few instances, Jio said COAI had sent important communications such as views on interconnect usage charges (IUC) without having any debate and consensus amongst core members just by recording views of IDOs.

"This is a clear case where COAI as a body purportedly representing the interest of all the members sending out a view which will benefit only the IDOs," Jio said.

The company further said as a matter of fact, on a specific occasion, COAI had the audacity to send a mail (containing a draft letter purportedly supposed to be sent to the Government) to it to seek its views whereas the letter had already been sent to the Government even before the mail was sent to Jio.

"The COAI, in utter disregard of its charter and the mandate and powers conferred by the charter on the members and its officials went out of its way and command to take up the issue of provision of points of interconnection from the IDOs to Reliance Jio, espousing the IDOs' views as that of COAI's views, and in effect supporting the illegal acts of IDOs against one of its own core member," Jio added.

Jio sought that if there's no consensus, the communication should be voted upon and finally when the communication is sent, it should contain clearly the views of the dissenters along with that of the majority views.

"In all fairness, any dissenting views, even if it is in minority, should be recorded with the full reasons given by the dissenter. The dissenting views should also form part of the communication to the Government and Regulatory Authorities," Jio added.

It further suggested that COAI's rules and regulations should be overhauled so that its processes and procedures to fall in line with Public Law and to follow democratic principles of reasonableness, fairness, accountability and transparency.

Reference - http://www.business-standard.com/article/companies/reliance-jio-in-fresh-battle-with-coai-116092500803_1.html

Saturday, September 24, 2016

Marriott-Starwood Beats Taj Group

Becomes India's largest hotel chain with nearly 18,000 rooms



The Tata-promoted Indian Hotels Company has a room inventory of 16,640, but has more hotels than anyone else in the country at 125 in four brands.
Marriott, after the buyout of  Starwood, has surpassed the Taj group to become India’s largest hotel chain with nearly 18,000 rooms.


Marriott and Starwood, with seven brands each in India, have 79 hotels in the country.

Indian hospitality companies will feel the heat of the Marriott-Starwood merger as another 79 hotels with 16,000 rooms from both chains are set to open in India over the next three years. Forty of these will be under Marriott and 39 under Starwood.

The additions will increase the number of cities Marriott and Starwood cater to from 19 to 33. Properties in the pipeline were signed deals and construction of many had begun, said a Marriott executive.

Marriott-Starwood beats Taj group
“India is the second most important market for us after China,” said  Rajeev Menon, chief operating officer, Asia-Pacific, Marriott International.

What will hurt India hospitality companies more is the Marriott-Starwood worldwide membership base of 85 million. Of these 1.5 million are in India.

Loyalty members form a major chunk of business for hotel companies, a trend catching on in India as well. “Business through loyalty memberships forms 50 per cent of our business in India and globally,” Menon added.

The combined entity has a bouquet of 30 brands. Half of them are present in India but  Marriott is open to bringing in more. Marriott’s 15th brand, W, is set to debut in Goa next month.

In the mid-market and upscale segments the combined entity has Four Points by Sheraton and Courtyard by Marriott. Indian companies in this segment have brands like Gateway and Vivanta by Taj and Welcome by ITC.

During the last two quarters Marriott and Starwood reported occupancy of 70 per cent against an industry average of 60 per cent.

“Occupancy is at the highest in the last few years. Revenue per available room in also on an upswing. The country as just 160,000 branded hotel rooms and there is need for many more,” Menon added.

Reference - http://www.business-standard.com/article/companies/marriott-starwood-beats-taj-group-116092400003_1.html

Friday, September 23, 2016

Jio Effect: Vodafone Gets Rs 48,000cr Infusion

MUMBAI: In the largest foreign direct investment in the country since the Narendra Modi-led BJP government was voted in in 2014, Vodafone Plc, Europe's biggest mobile service provider, has infused $7.5 billion (Rs 47,700 crore) in its Indian arm, giving the company more ammunition to defend its turf in the world's second largest telecom market where competition has intensified with the entry of Reliance Jio.

Vodafone India, the No. 2 player with 200 million subscribers behind Airtel, will use the funds to ramp up its network and participate in the radio airwaves auction. The announcement came eight days ahead of the the biggest-ever spectrum auction and 17 days after the launch of Reliance Jio.

"This equity infusion will be used for right-sizing our spectrum portfolio, expansion of network and deployment of next-gen 4G and 5G technologies," said Sunil Sood, MD & CEO, Vodafone India.

Reliance Jio, controlled by billionaire Mukesh Ambani, has stormed the market with free calls and rock-bottom data tariffs, pressuring existing telecom operators to rethink their strategies to protect their market share. Vodafone India is expected to be the most aggressive bidder at the ensuing spectrum auction with analysts predicting that it could spend as much as Rs 16,300 crore on buying airwaves.


The new telecom war and the fresh equity injection in Vodafone India has raised speculation that the Newbury, England-based parent may delay taking its local arm public.

Declining to give a timeline for its debut in the primary market, the company's India management merely said that it "continues to prepare" for a potential listing. Analysts said that Vodafone has pushed the timeline further into the future on concerns over the local arm's valuations in the wake of Reliance Jio's disruptive pricing and its impact on the industry's business model. And so, the parent has injected funds in the interim period, they added.

Already, telecom stocks including Bharti Airtel and Idea Cellular, the No. 3 player, have taken a beating after Reliance Jio's entry. Vodafone Plc entered the country in 2007 by acquiring a 67% stake in Hutchison Essar for $10.9 billion and the latest fund infusion is its second biggest investment in India, which today is its third largest revenue generating market globally. So far, it has invested about Rs 1.15 lakh crore in India.

Vodafone India, said Sood, also plans to use the money it recently received from its parent to retire high-cost debt, which currently stands at Rs 34,500 crore and improve its quality of service.

Tuesday, September 20, 2016

BP Sells 8.5% stake in Castrol India

The former now holds a 51% stake in the Indian subsidiary

Castrol, a wholly-owned subsidiary of BP, on Tuesday, sold an 8.5-per cent equity stake in Castrol India in a block deal on Tuesday. With this, the second tranche of equity divestment in Castrol India, BP will now hold a 51-per cent stake in the Indian lubricant maker.

“Castrol sold 8.5 per cent shareholding held in Castrol India to a range of domestic and international investors,” UK-based energy giant BP said on Tuesday.


This is the second time Castrol has sold its stake in the Indian arm. In May, it sold an 11.5-per cent stake in the Indian subsidiary for Rs 2,100 crore.

Reiterating its interest in the Indian lubricant maker, BP said it intends to continue as a majority shareholder in Castrol India through Castrol.

Castrol India shares closed 8.79 per cent higher than the previous day at Rs 459.60 per share. Details of the investors who bought the stake were not readily available.

BP remains the majority shareholder in Castrol India and we remain committed to long-term investment in India, including both progressing natural gas developments with our partners as well as growing our downstream businesses, which include both fuels marketing and lubricants,” said Bob Dudley, chief executive for BP Group.

The company said it does not expect this transaction to impact staff or customers of Castrol India or its existing contracts.

The latter manufactures and markets automotive, industrial and marine lubricants, distributed from over 80,000 retail outlets, and has three manufacturing plants in India.

BP Group is on a divestment drive as it looks to unlock value in some of its global assets. For the quarter ended June, it suffered a loss of $1.4 billion. In the first half of 2016, BP has globally divested assets worth $1.9 billion, including the partial sale of its interest in Castrol India.

“While a promoter selling a stake is usually a negative signal to the market, in this case, it may not necessarily be a red flag. BP has been cutting capital expenditure as well as selling assets with a target of $3-5 Billion in asset sales for 2016 to raise more cash after the oil crash,” Pranoy Kurian, analyst with IDBI Capital wrote in a report on Castrol India, issued on September 1.

Reference - http://www.business-standard.com/article/companies/bp-sells-8-5-stake-in-castrol-india-116092000756_1.html

Monday, September 19, 2016

Telcos Deposit Rs 14,653 cr For Largest Ever Spectrum Auction

Leading telecom operators have deposited Rs 14,653 crore as earnest money for the country's largest ever spectrum auction from October 1, with Reliance Jio alone submitting Rs 6,500 crore.
As per the information released by the Department of Telecom today, with Rs 6,500, the Mukesh Ambani-led firm is eligible for placing bids in any of the 22 telecom circles in the country and in any spectrum band. Vodafone India has submitted EMD of Rs 2,740 crore, Idea Cellular Rs 2,000 crore and Bharti Airtel Rs 1,980 crore. These companies too are eligible for bidding in any circle.
Representative picture. Reuters
Representative picture. Reuters
Earnest Money Deposit (EMD) is indicative of a company's strategy to bid in specific circles and spectrum bands. It gives them eligibility points with regard to those circles. Reliance Jio, as per the information, is only company which has potential to buy spectrum in premium 700 Mhz at floor price in most of the circles as a pan-India bidder for 700 Mhz spectrum needs to have EMD of Rs 5,610 crore.
This is the first time that government will auction the 700 Mhz band, considered to be the most premium as the estimated cost of providing service through it is about one-third of 3G under the 2100 Mhz band. A firm opting to buy spectrum in 700 Mhz band will need to shell out a minimum of Rs 57,425 crore. Total spectrum worth Rs 4,01,975 crore in 700 Mhz band is being put up for auction.
Tata Teleservices has submitted EMD of Rs 1,000 crore, Reliance Communications Rs 313 crore, and Aircel Rs 120 crore. Mobile frequencies in all bands -- 700 Mhz, 800 Mhz, 900 Mhz, 1800 Mhz, 2100 Mhz and 2300 Mhz -- will be put on the block in the upcoming auction. All the radiowaves being put up for auction can be used for providing high-speed 4G services.
The Finance Ministry in the Budget pegged the revenue target at Rs 98,995 crore from the telecom space, which includes Rs 64,000 crore from the auction of about 2,354.55 Mhz of spectrum and the rest from various levies and services this financial year.
As per DoT, Tata Teleservices can bid for spectrum in all bands in Mumbai and Maharashtra circles, and 800 Mhz band (known as CDMA service band) across all circles except Assam and North East (NE), and 900 Mhz in all circles barring Assam, NE and Delhi. It can bid for 3G spectrum in Gujarat, Haryana, Karnataka, Kerala, MP, Maharashtra, Mumbai, Punjab, Rajasthan and UP (West). It is not eligible to bid for premium 700 Mhz band spectrum except in Mumbai and Maharashtra.
Similarly, there are host of restriction on bidding eligibility of Aircel. It cannot bid for spectrum in premium 700 Mhz, 800 Mhz, and 2500 Mhz in any of the circle. The company has been found to be ineligible for bidding in 13 out of 22 circles for 3G spectrum which include Tamil Nadu, Uttar Pradesh (East), Andhra Pradesh, Bihar, Karnataka etc. It can only bid for spectrum in 900 and 1800 Mhz band across all circles. Anil Ambani-led Reliance Communications is eligible to bid for spectrum across country except North East and Assam.
Reference - http://www.firstpost.com/business/telcos-deposit-rs-14653-cr-for-largest-ever-spectrum-auction-3011774.html

Teva Pharma Leases 5 Floors in Mumbai Complex

To pay Rs 20-cr rent for 150,000 sq ft in Goregaon; may be made India headquarters

Teva Pharma has leased 150,000 sq ft across five floors in an office complex in Mumbai, making it one of the major leasing deals here this year.

The global drug maker would pay about Rs 20 crore as rent for the office space in Oberoi Commerz II in Goregaon area, a source said. Teva is expected to move its India headquarters to the complex, the source said.


Oberoi Realty Chairman and Managing Director Vikas Oberoi was unavailable for comments. Teva could not be reached for comments either.

Ashok Kumar, managing director at Gennex Partners, said the deal was in line with the market as Oberoi properties command premium rates in the area.

Last year, pharma major Abbott had purchased 500,000 sq ft in Godrej BKC in Bandra-Kurla Complex for about Rs 1,400 crore, marking one of the biggest transactions in the space.

In recent years, pharma companies have been looking to monetise their land parcels or closed plants in the Mumbai Metropolitan Region.

Last year, US-based Cabot Corporation sold 30 acres Ghansoli area here to K Raheja Corp for Rs 210 crore. That year, Pfizer sold its plant in Thane for Rs 178 crore to Vidhi Research and Development. Pfizer had shut its manufacturing facility there. In another instance, Sandoz, the generic division of Novartis, announced it would discontinue operations at its Turbhe site by the end of December 2016. It is not clear whether Sandoz would sell the plant and the property.

The two plant closures were because of consolidation of manufacturing facilities, with older facilities being shut down and work moving to modern ones.

Sources said GSK Pharma was also selling its land parcel in Thane. It had earlier dropped plans to sell the plot due to legal hurdles.

According to Colliers International, about 1.8 million sq ft of new supply was added in Q2 2016. Rents would remain stable in the coming quarters, it said. Mumbai office absorption at 0.71 million sq ft has witnessed a downward spiral with a 23 per cent decrease in total absorption since Q1 2016, as mostly mid-sized transactions have occurred in Q2 2016, it said.
PHARMA’S REALTY MOVES
  • Abbott buys 500,000 sq ft office in Godrej BKC for Rs 1,400 crore
  • Pfizer sells Thane plant for Rs 178 crore to Vidhi Research and Development
  • Sandoz to discontinue operations at its Turbhe plant by end-December 2016
  • GSK Pharma may sell its Thane land parcel
Reference - http://www.business-standard.com/article/companies/teva-pharma-leases-5-floors-in-mumbai-complex-116091800707_1.html

Saturday, September 17, 2016

Launch Frenzy Awaits Car Buyers This Festive Season

Nearly two dozen new models set to make way into showrooms

Over the next ten weeks, car buyers will have the option of choosing from nearly two dozen new models, set to make their way into showrooms. From mass market hatchbacks to sports utility vehicles (SUVs) to luxury saloons.

Good rains, the pay commission and new military pensions implementation and lifting of the ban on sale of bigger diesel vehicles in the region around Delhi will give automobile demand a boost this festive season. Navratri begins the first week of October.


Launches lined up over the next few weeks far exceed the number in the previous festive season, when the industry saw 16 of new or facelifted models.

One of the most awaited this year is Maruti Suzuki's Ignis, a premium hatchback whose styling appears a fusion between a compact SUV and a hatchback. To be retailed from Maruti's premium chain of outlets called Nexa, it is expected launch before Diwali.

The Baleno RS, also from Maruti Suzuki, will make its way to all Nexa outlets over the coming weeks. Powered by a 1-litre BoosterJet engine, it will be the one of the most powerful hatchbacks on sale, targeting the performance-seeking buyer.   

Other mass market models include the Renault Kwid automated manual transmission (AMT), Tata Tiago AMT, Tata Hexa, Fiat Avventura Urban Cross, Volkswagen Polo GTI, Ameo diesel and the Hyundai Eon facelift.  

Pravin Shah, chief of the automotive division at Mahindra & Mahindra, said: "Improved spread of the monsoon and new product launches have helped the industry perform positively. The uncertainty surrounding diesel vehicles has been lifted by the Supreme Court. At Mahindra, we are happy to have garnered an overall growth of 14 per cent and of 29 per cent in utility vehicles last month. We hope the festive season will give us a further boost.”

New product action will be higher in the luxury car segment. Market leader Mercedes-Benz, followed by Audi, BMW, Jaguar, and Volvo, have readied for nearly 10 new launches between now and the end of November.  

German giant Mercedes will launch the S-Class Cabriolet (retractable roof), its most awaited product of the year. A C-Class Cabriolet is under discussion but hasn't been finalised. A locally assembled GLC-Class SUV is to be launched on September 29.

Swedish car maker Volvo will bring in four new and facelifted models before end-November. The company will launch the S90, V40, V40 Cross Country and XC90 R-Design over the next few months. Another model, the S60, will probably debut in January.     

Launch frenzy awaits car buyers this festive season
The trend of new launches has been upbeat since the start of the year itself, with the Tata Tiago, Toyota Innova Crysta, Hyundai Elantra, Maruti Vitara Brezza, Jaguar XE and Skoda Superb.

“Volume growth on a year-on-year basis would likely remain strong over the next two months, due to the early festival season,” say analysts at Kotak institutional Equities.

Reference - http://www.business-standard.com/article/companies/launch-frenzy-awaits-car-buyers-this-festive-season-116091600823_1.html

Friday, September 16, 2016

Is More Consolidation Likely in Telecom Sector?

Given it is already an oligopolistic market with four players dominating, consolidation can happen with just one or two more players, say analysts

Events such as the merger of Reliance Communications (R-Com) and Aircel, entry of Reliance Industries via the launch of its telecom venture — Reliance Jio (RJio) — with its aggressive tariff structure, upcoming spectrum auction, issues related to call drops and points of interconnect have kept the sector buzzing over the past few months.

However, that has not been the case with stocks in this space. Since March, when the overall market sentiment started improving, stocks of the three major listed private players in the telecom service segment have remained laggards.


While Bharti Airtel and R-Com have slipped around two per cent each since March, Idea Cellular lost nearly 14 per cent (see chart). The benchmark Nifty 50 index, on the other hand, gained nearly 24 per cent.

Dialling up the future of telecom
Going ahead, analysts expect structural risks such as risk to voice revenues, steep correction in data realisations, capex spend and rise in churn and subsequent increase in costs to continue in the medium term. Moreover, it will be difficult to grow or retain the market shares for the exiting players due to RJio’s foray and its aggressive pricing.

“Since it is already an oligopolistic market with four players dominating, consolidation can happen with only one or two more players. This merged entity of R-Com itself can opt for another consolidation with any big player, as the mobile penetration has almost peaked in the country and hence, size alone can help significantly in this fierce competitive business,” said G Chokkalingam, managing director, Equinomics Research & Advisory.

“Margin contraction for the entire industry for the next two years, at least, is inevitable. While RJio has opted for aggressive pricing, let us not forget the fact that the remaining three players viz., IdeaBharti Airtel and Vodafone, together make about Rs 50,000 crore of annual operating profits. They would also join the competitive battle in an aggressive manner, pulling down the margin of the industry as a whole,” he added.

In a recent note, Fitch, too, suggested the Indian telecom industry should continue to consolidate and it expects five to six operators to emerge from the shake-out.

“Unprofitable telcos, such as Telenor and Tata, could exit, given that their businesses will struggle to compete and they are now able to monetise their most valuable assets — their under-utilised spectrum,” the note said.

Is more consolidation likely in telecom sector?
Taking stock
Analysts at Credit Lyonnais Securities Asia (CLSA) have lowered their FY17-18 earnings before interest, taxes, depreciation and amortisation and earnings estimates for Bharti Airtel and Idea Cellular by two to 19 per cent.

“However, key for RJio will be subscriber retention beyond free offers. In the new landscape of data capacity play, Bharti Airtel and RJio are better placed, given the lead in spectrum and network. Retain buy on Bharti Airtel (target price Rs 398 from Rs 440) and sell on Idea Cellular (target price Rs 79 from Rs 94),” CLSA had said in a recent note.

One may hold R-Com, analysts say, as it has potential to go for another consolidation and it is also likely to unlock significant cash from its assets like real estate and towers, going ahead.

Reference - http://www.business-standard.com/article/companies/is-more-consolidation-likely-in-telecom-sector-116091500221_1.html

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