Well, the Indian telecom space is seeing some brisk activity of late, and customers may well be in for some pleasant surprises with regard to tariffs for mobile data services. May be, there may not be much to cheer about on the rate front once the euphoria over new launches and mergers subsides.
For now, it looks the battle to woo customers with attractive service rates will be in full throttle. Close on the heels of the Mukesh Ambani - led Reliance Industries announcing the launch of Reliance Jio Infocomm's data services at incredibly low rates, sibling Anil Ambani's Reliance Communications has signed a deal for the merger of RCom with Aircel. The move will create the country's fourth-largest phone company in terms of customers and revenue. The merged entity will rank amongst the top 3 operators by revenues in 12 important circles, said a statement from RCom. Also, the merged company will have the second-largest spectrum holding amongst all operators, aggregating 448 MHz across the 850, 900, 1800 and 2100 MHz bands. Once completed, the merged entity will reportedly bring in a third partner by diluting about 25% equity to raise around Rs 6000 crore, and it is said that talks are already on with Russia's Sistema, which currently holds 10% in RCom, to invest in the company. Subsequently, both RCom and Aircel will proportionally cut down their stakes in the entity. The RCom - Aircel deal will result in opex & capex synergies to the tune of Rs 20,000 crore to the two companies. The combined entity, which will have an asset base of Rs 65,000 crore, will come out with a new brand name and announce the appointment of a CEO sometime soon. According to the deal, Reliance Communications will transfer Rs 20,000 crore of its debt (including Rs 6000 crore it owes to DoT) to the new entity. Aircel will transfer Rs 14,000 crore of its debt. It may be recalled that Aircel had recently repaid a portion of its debt through the Rs 3500 crore it raised through the sale of its 4G spectrum to Bharti Airtel in eight circles. Anil Ambani expects this combination to create substantial long term value for shareholders of both, RCOM and MCB, given the benefits of the wide-ranging spectrum portfolio and significant revenue and cost synergies. Reliance Communications Limited shares rose to Rs 53.00 in early trades this morning, but retreated subsequently due to resistance at higher levels. At Rs 51.40, the stock is currently up 0.7% from its previous closing price. Reliance Communications announced today that it posted consolidated net profit of Rs 54 crore for the quarter ended June 2016, up 5.8% compared to the year-ago period. Consolidated total income from operations declined 4.7% to Rs 5259 crore in the April - June 2016 quarter. The company said that results for the quarter were impacted by migration of CDMA customers to 4G LTE.
For now, it looks the battle to woo customers with attractive service rates will be in full throttle. Close on the heels of the Mukesh Ambani - led Reliance Industries announcing the launch of Reliance Jio Infocomm's data services at incredibly low rates, sibling Anil Ambani's Reliance Communications has signed a deal for the merger of RCom with Aircel. The move will create the country's fourth-largest phone company in terms of customers and revenue. The merged entity will rank amongst the top 3 operators by revenues in 12 important circles, said a statement from RCom. Also, the merged company will have the second-largest spectrum holding amongst all operators, aggregating 448 MHz across the 850, 900, 1800 and 2100 MHz bands. Once completed, the merged entity will reportedly bring in a third partner by diluting about 25% equity to raise around Rs 6000 crore, and it is said that talks are already on with Russia's Sistema, which currently holds 10% in RCom, to invest in the company. Subsequently, both RCom and Aircel will proportionally cut down their stakes in the entity. The RCom - Aircel deal will result in opex & capex synergies to the tune of Rs 20,000 crore to the two companies. The combined entity, which will have an asset base of Rs 65,000 crore, will come out with a new brand name and announce the appointment of a CEO sometime soon. According to the deal, Reliance Communications will transfer Rs 20,000 crore of its debt (including Rs 6000 crore it owes to DoT) to the new entity. Aircel will transfer Rs 14,000 crore of its debt. It may be recalled that Aircel had recently repaid a portion of its debt through the Rs 3500 crore it raised through the sale of its 4G spectrum to Bharti Airtel in eight circles. Anil Ambani expects this combination to create substantial long term value for shareholders of both, RCOM and MCB, given the benefits of the wide-ranging spectrum portfolio and significant revenue and cost synergies. Reliance Communications Limited shares rose to Rs 53.00 in early trades this morning, but retreated subsequently due to resistance at higher levels. At Rs 51.40, the stock is currently up 0.7% from its previous closing price. Reliance Communications announced today that it posted consolidated net profit of Rs 54 crore for the quarter ended June 2016, up 5.8% compared to the year-ago period. Consolidated total income from operations declined 4.7% to Rs 5259 crore in the April - June 2016 quarter. The company said that results for the quarter were impacted by migration of CDMA customers to 4G LTE.
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