IUC rate cuts to dent Airtel EBIDTA by 4% and Idea by 10% in FY18

The slash in IUC rates could impact Bharti Airtel by Rs 1400 crore which is a 4% hit on consolidated EBIDTA in FY18 and dent its mobility unit’s EBIDTA by 8% said brokerage firm Philip Capital.

Hit on Idea Cellular will be more pronounced with 10% shock on EBIDTA of around Rs 900 crore said the analysts of the brokerage firm.

However, Jio on the other hand will gain the most since it pays the highest IUC with its free voice services and the loss of the big players will transfer on to Jio as gains, stated the report.

For smaller telcos like Aircel, Rcom and the Tatas, there will be respite but not paramount since they do not own 4G spectrum if much consequence said the firm.

The interconnectivity user charges was slashed by the telecom regulator to 6 paise a minute from the current 14 paise and the regulator said it would be brought down to zero paise from 2020.

The incumbents had asked for an increase in it and only Jio wanted the rates dropped.