rediff.com

NewsApp (Free)

Read news as it happens
Download NewsApp

Available on  

Rediff News  All News 
Rediff.com  » Business » RIL's grand plans in telecom: Will it win or lose the battle?

RIL's grand plans in telecom: Will it win or lose the battle?

April 22, 2014 11:51 IST

RIL's grand plans in telecom: Will it win or lose the battle?

     Next

Next
Dev Chatterjee

Brokerages have suggested RIL to go slow on investing in telecom space.

The annual results of Reliance Industries (RIL) have failed to enthuse analysts.

They are worried about the company’s plan to invest Rs 60,000 crore (Rs 600 billion) on rolling out its telecom venture in the next five years.

Analysts complain there is no clarity on the returns on the Rs 33,000 crore (Rs 330 billion) already invested by Reliance in its telecom company, Reliance Jio Infocomm.

Click NEXT to read more...


Image: RIL has lined up huge investment in its telecom venture.
Photographs: Courtesy, Sony

     Next

RIL's grand plans in telecom: Will it win or lose the battle?

Prev     Next
Prev

Next
Dev Chatterjee

Though Reliance Jio continues to sign infrastructure-sharing deals — adopting an asset-light model and ensuring faster service rollout — till date it has not given any time line on how and when these massive investments would start yielding returns.

Click NEXT to read more..


Image: RIL has signed many deals to share telecom infra.
Photographs: Courtesy, Nokia

Prev     Next

RIL's grand plans in telecom: Will it win or lose the battle?

Prev     Next
Prev

Next

Nilesh Banerjee in a Monday report said,“We estimate its telecom venture to turn Ebitda (earnings before interest, taxes, depreciation and amortisation) break-even in four-five years and remain a drag on returns until then.”

Click NEXT to read more...


Image: Bollywood actress Katrina Kaif with a Sony Xperia phone.
Photographs: Courtesy, Sony

Prev     Next

RIL's grand plans in telecom: Will it win or lose the battle?

Prev     Next
Prev

Next

On Monday, RIL closed flat at Rs 959.45 a share (up 0.07 per cent) on the BSE. It announced its results on Friday after the markets closed for trading. Bankers say RIL has raised Rs 14,000 crore in debt for its telecom venture and is planning to invest another Rs 6,000 crore a year till 2018-19.  

Click NEXT to read more...


Photographs: Reuters
Tags: RIL , BSE

Prev     Next

RIL's grand plans in telecom: Will it win or lose the battle?

Prev     Next
Prev

Next

In a post-results briefing on Friday, RIL Chief Financial Officer Alok Agarwal did not comment on when the company was planning to launch telecom services or when it saw the venture breaking even. Insiders, however, said they were targeting a rollout by October this year.

Click NEXT to read more...


Photographs: Courtesy, Apple
Tags: RIL

Prev     Next

RIL's grand plans in telecom: Will it win or lose the battle?

Prev     Next
Prev

Next

Interestingly, while RIL is still grappling with its telecom plan, another Indian conglomerate, the Tata group, has still not been able to make money from its telecom company, Tata Teleservices, after spending a massive Rs 26,000 crore (Rs 260 billion) on the wireless telephony service since its inception.

Like Tata Teleservices, many other telecom players, such as Aircel and Norway’s Telenor, are losing money at their India business, forcing them to hunt for equity partners.

Click NEXT to read more...


Photographs: Reuters

Prev     Next

RIL's grand plans in telecom: Will it win or lose the battle?

Prev     Next
Prev

Next

Analysts say for Reliance Jio to break even, the company would have to come out with a “disrupter” idea that would take on the incumbents, such as Vodafone, Bharti Airtel and Idea.

Even then, they add, the impact on the established players would only be temporary.

Click NEXT to read more..


Image: Bollywood actor Ranbir Kapoor with a Blackberry phone.
Photographs: Courtesy, BlackBerry

Prev     Next

RIL's grand plans in telecom: Will it win or lose the battle?

Prev     Next
Prev

Next

The entry of Reliance in the telecom sector comes when the big players are straining to increase the single-digit growth in revenues and the flat margins.

The sector will improve structurally only after the share of data revenues rises substantially in overall earnings. As competition slows and companies regain pricing power, players such as Bharti and Idea are expected to perform well. 

Click NEXT to read more...


Photographs: Shannon Stapleton/Reuters
Tags: RIL , Reliance

Prev     Next

RIL's grand plans in telecom: Will it win or lose the battle?

Prev     Next
Prev

Next

Says  analyst Rethish Varma of HDFC Securities in an April 10 report,  “Some of the silver linings include lower competition due to cancellation of licences by the Supreme Court, positive regulatory policies and improvement in the ecosystem to drive adoption of data services. In fact, telecom companies have started reducing discounts and raising prices.

Higher advertisement and other marketing expenses could partly offset the savings accrued on the back of lower discounts.” 

Click NEXT to read more...


Photographs: Rupak De Chowdhuri/Reuters

Prev     Next

RIL's grand plans in telecom: Will it win or lose the battle?

Prev     Next
Prev

Next

Analysts say as a large part of the spectrum won by companies such as Vodafone and Bharti in the February auctions was aimed at protecting their current revenues against grabbing new sources of earnings, there will be increased financial pressure on these players, pushing up the voice rates.

Click NEXT to read more...


Photographs: Reuters
Tags: RIL , Vodafone

Prev     Next

RIL's grand plans in telecom: Will it win or lose the battle?

Prev     More
Prev

More

RIL gets analysts thumbs down

* No clarity on the return on the Rs 33,000 crore already invested by Reliance in the telecom business

*The Tata group is still unable to make money out of its telecom company, Tata Teleservices, after spending Rs 26,000 crore on wireless telephony 

* The entry of Reliance in the sector coincides with single-digit revenue growth and flat margins for big players


Photographs: Reuters

Prev     More
Source: