Jio pours cold water on tariff hike hopes

While investors in telecom stocks have been waiting for months for the next round of tariff hikes, market leader Reliance Jio Infocomm Ltd has taken a step in the opposite direction.

It has announced a “New JioPhone 2021″ offer, which targets both new and existing users. “Reliance Jio’s new plans lower JioPhone’s usage costs by 23-25%. While we expected delays in tariff hikes, Jio’s move has surprised negatively and indicates that Jio’s primary focus is still on subscriber gains,” analysts at Jefferies India Pvt. Ltd said in a note to clients.

Shares of Bharti Airtel Ltd fell over 4% on Monday. “Our analysis suggests that this offer may be attractive for feature phone users looking to change devices,” analysts at Jefferies added.