It has been a few days that Reliance Jio has become the talk of the
town and people are highly excited to enjoy the services that Reliance
Jio SIM cards are going to provide. No doubt that users are going to be
highly benefited from the 4G LTE services, but the India business news
depicts that Reliance Jio is going to give a big hiccup to the telecom
industry.
A sharp dip in the margins of other telecom companies is expected in FY17 which is going to bring a big loss to them. The telecom lenders are going to feel the heat most as the companies will find it much harder to repay debt.
Crisil, the rating agency, stated that the Reliance Jio’s heat will not only force the current telecom operators to look at their tariff structures and build more effective customer retention strategies, but will also be forced to bid assertively in the coming spectrum auctions. And all this will definitely lead to the betterment of the 4G services. According to the research done by Crisil, the mid to high-end subscribers can reduce their monthly mobile bill by 50-60%, by opting for Reliance Jio.
Furthermore, the total loan that the telecom industry has taken rounds up to 72 lakh crore, out of which Rs 91000 crore has been contributed by the banks. IndusInd Bank and Yes Bank are the largest contributors to the telecom industry, in the private sector. And the Reliance Jio’s tariff plans are going to affect these banks potentially. According to the Kotak Research report, the stress will only be chunky but the timing for which it will remain are just uncertain.
According to the India Business News, Reliance Jio’s entry into the telecom industry has caused stress not only for other telecom companies, but also for their lenders. So, let’s see that how much it is going to affect them.
A sharp dip in the margins of other telecom companies is expected in FY17 which is going to bring a big loss to them. The telecom lenders are going to feel the heat most as the companies will find it much harder to repay debt.
Crisil, the rating agency, stated that the Reliance Jio’s heat will not only force the current telecom operators to look at their tariff structures and build more effective customer retention strategies, but will also be forced to bid assertively in the coming spectrum auctions. And all this will definitely lead to the betterment of the 4G services. According to the research done by Crisil, the mid to high-end subscribers can reduce their monthly mobile bill by 50-60%, by opting for Reliance Jio.
Furthermore, the total loan that the telecom industry has taken rounds up to 72 lakh crore, out of which Rs 91000 crore has been contributed by the banks. IndusInd Bank and Yes Bank are the largest contributors to the telecom industry, in the private sector. And the Reliance Jio’s tariff plans are going to affect these banks potentially. According to the Kotak Research report, the stress will only be chunky but the timing for which it will remain are just uncertain.
According to the India Business News, Reliance Jio’s entry into the telecom industry has caused stress not only for other telecom companies, but also for their lenders. So, let’s see that how much it is going to affect them.
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