Reliance JIO – much awaited AGM
finally concluded revealing the tariff plan for its JIO customers.
It is indeed a revolution within
the telecom space and it is going to redefine the way telecom industry exists
as of now. Free voice call is going to drastically hit the profit margins of
other telecom operators and they will have the redefine their business model.
This will help India get digitally connected but at the cost shareholders
profitability over medium term. In the long run I do not rule out the
possibility of converting the Datagiri in profitability but for now it is a
nervous sign for telecom sector as a whole and glorious step towards connecting
India digitally!
Now let us look at the charts of
a few telecom stocks – Bharti, Idea along with Reliance Industries (though it
does not represent Jio separately)
The above clearly shows that the
telecom stocks have been in sideways action for many years now. The
consolidation is going on since the top was formed in 2008. Reliance Industries
has been one of a major dragger on index for many years even when Crude prices
have been all over the places during this period.
Let us see if the disruptive
method of entering into the much awaited telecom foray, results into a huge
change the way industry functions or it simply fads away! These are surely
interesting times and the shareholders might be anxious to see what happens by
March 2017!
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