Dear All,
Forwarding you the Telecom Sector Update.
Telecom sector - GSM subscriber analysis
Cellular Operators Association of India (COAI) reported GSM subscriber data for April 2011, which was the lowest since the last one year and weak across all operators (except Uninor). The net addition number stood at 11.1mn, down 23.4% mom, taking the total GSM subscriber base to 580.7mn.
Broad-based weakness
In April 2011, net addition run rate mom for all operators dropped off steeply (Refer Exhibit: 7). Among the incumbents, BSNL reported the highest drop off in net additions to merely 0.7mn, down 49.3% mom, which led to a 20bp decline in its market share to 15.0%. Bharti and Vodafone, which were adding over 3.0mn subscribers since the last five months, added just ~2.4mn each, declining by 24.8% and 34.0% mom, respectively. Net subscriber addition of Aircel also declined by 17.5% mom to 1.1mn. On the other hand, Idea maintained its spree of subscriber addition by adding over 2.5mn in April 2011, which led to higher market share of subscriber net additions to 22.1% from 18.6% in March 2011 (Refer Exhibit: 8). Subscriber net addition market share of other incumbents such as Bharti and Vodafone declined to 21.7% each from 22.1% and 25.2%, respectively.
Idea’s total subscriber market share inched up by 10bp to 15.8%, whereas Bharti lost its market share by 20bp to 28.3%. The subscriber market share of Vodafone and Aircel was maintained mom at 23.6% and 9.6%, respectively.
Among the new operators, Uninor emerged as a dark horse by adding 1.5mn subscribers in April 2011, up 19.5% mom. The subscriber net addition market share of Uninor also increased to 13.1% from 8.4% in March 2011. Other players such as Videocon and DB Etisalat recorded a dismal subscriber net addition of 0.1 and 0.2mn, down 75.2% and 24.9% mom, respectively.
Circle-wise highlights
In April 2011, Metro and A circle gained a share in subscriber net additions vis-à-vis B and C circle (Refer Exhibit 10 and 11). The net addition run rate significantly rebounded for Metro to 0.9mn vs. 0.3mn in March 2011. Among the incumbents, Vodafone had the highest net additions at 0.35mn, followed by Bharti and Idea at 0.25mn and 0.12mn, respectively; whereas, BSNL lost 0.12mn subscribers in the Metro circle. Net subscriber addition in A circle was almost steady mom and stood at 3.9mn, primarily led by Idea, which added 1.05mn subscribers, followed by Bharti and Vodafone, which added 0.74mn and 0.62mn subscribers in this circle, respectively.
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