The December quarter usually sees seasonal rebound QoQ for Indian telcos. However, this time, the numbers could remain subdued due to the impact of Jio and, to a smaller extent, demonetisation.
Our tariff studies revealed significant changes in price points and tariff bundles indicative of widespread impact from Jio. While this could show up as pressure in realisations, it would be interesting to see if there is ARPU erosion from the same (elasticity). Overall, we do not believe the worst from Jio is over.
Furthermore, the government's 15-day window to use old currency for mobile recharges should have helped. However, from our discussion with the company, we understand there was some impact on data revenues (considered 'discretionary' by many
subscribers), which could prevent this quarter from seeing the usual seasonal uplift.