Reposted 11.26 AM Sep 24th by RT_KD
Price when posted : NSE: Rs. 9.70
Part 2 of my response: reason why 2G folks wont move to Pio is not having adequate coverage in many rural/tier 3 towns....in rural areas may 2G phones are used to monitor water pumps that are used to irrigate fields (yes it is used extensively in Hindi Heartland states)......ARPU of Vi is low this is primarily 49 and 79 recharge of 2G.....nearly 50 percent or nearly 8 Cr customers recharge only to the extent of 49/79 and use phone only for limited purpose....this price point was kept when Pio was offering freebies and lower tariff….3 months ago Pio removed sub 100 recharges….with that there is no incentive for 2G folks to migrate to Pio….what essentially I am saying….if at all Vi s and Hawatel s 2G customers willing to upgrade their devise then due to unavailability of spectrum they have to upgrade with Vi or Hawatel itself…..coming onto the ARPU….if I provide broader break-up by buckets for Q1 post GST is….Premium bucket of Vi (RedX) 130K x 932 = 12 Cr per month…….4G bucket @ 250 average billing per month post GST it gives nearly 212 per customer giving 2118 Cr per month……2G @ 49 recharge with 8 Cr customer base gives nearly 41.5 per customer resulting 332 Cr per month….lastly other 2G customers are coming at 90 rupee spend giving post GST ARPU @ 73.72 this resulted into 737 Cr per month…..at the ground level many of the 2G customers are now moving to unlimited talktime recharge which is priced at 149…this recharge offer alone will be giving post GST at 126 ARPU….assuming nearly 10 Cr 2G customer will move into this range also 4G recharges inching upto 300 will easily take the ARPU (post GST) at 148-150 level….to sum-up what I am saying…there is very less chances that remaining 2G customers would switch to Pio s 4G offer even if Pio comes-up with low cost handset….this is coming at the backdrop huge CAPEX of Pio to renew its 800 Mhz spectrum (Bcom s shared one)….followed by CAPEX in procuring 4G handset….also when Pio bought airwaves back in 2014-16 auction….like every other telco`s it too got 2 years moratorium…so why Pio could sustained freebies until 2018….Pio can t sustain margin with upcoming CAPEX (annual spectrum spend of Pio is easily 23K Cr)…effectively it is Pio also has to raise the price making all three providers to raise the price…this should happen as early as Dec of current year or Jan of next year....end of part 2
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Part 2 of my response: reason why 2G folks wont move to Pio is not having adequate coverage in many rural/tier 3 towns....in rural areas may 2G phones are used to monitor water pumps that are used to irrigate fields (yes it is used extensiv...
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