Indian telcos seeking financial assistance

3Q 2017 | IN-4736

The Indian telecom sector has experienced severe disruption since the entry of Reliance Jio, whose access to financial markets and internal financial muscle (being part of a diversified conglomerate) have allowed it to undercut incumbents’ pricing and offer 4G feature phones at very low prices to acquire subscribers and boost market share. This has triggered a wave of consolidation as incumbents attempt to strengthen their market positions. Telcos are saddled with debts, declining revenues, and high levies as well as the need for significant CAPEX/OPEX over the coming years to install, upgrade, and maintain network infrastructure. Therefore, realizing their current business models are becoming unsustainable, several operators have requested financial assistance from the government.

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