Idea Cellular continues to heavily invest in 3G – currently spending ~1/3rd of capex on 3G (network equipment + backhaul). It Expect mass market adoption of data (500m + data subs users) over next 3-5 yrs, with the mkt size expanding to Rs500-700bn.
Idea continues to gain both VLR (reflects active subs) sub share (+0.6% qoq in 4Q13 qtr) and rev mkt share (+0.9%qoq). Moreover,
its incremental share for both these metrics is 40-50%. Driven by (a) Increase in mobile penetration – Physical penetration is still only ~ 50%; (b) Increase in MoU per sub in part helped by lower incidence of multi-SIMs and (c) Improvement in voice rev/min (Idea is more positive on this compared to the last 3-4 qtrs) .
There is already “virtual consolidation” with the top 3 operators controlling ~70% of the market. Financial constraint has forced partial/full exits by several marginal players. Lastly, stringent sub verification norms have also helped reduce sub churn.