Idea Cellular got it completely wrong on the 4G front. They started late on the CAPEX with Network cost increased qoq due to higher electricity charges and general expansion. Access charges increased due to higher adoption of unlimited plans which lead to higher IUC cost.
Idea has no intention to subsidise handset cost but will partner with handset vendors to bring down the cost of material and match JIO's price point. VoLTE should be launched by early CY18.
As per management data rates have bottomed out but realisation will fall further due to higher adoption of unlimited plans which currently stands at high single digit; data price to stabilise at Rs 30-40/GB. With current capex outlook, Idea can support more than 10x increase in data traffic. Management indicated that data subscribers have started growing from the month of June and this trend is likely to sustain as the company has significantly augmented its data network.
