Reliance Jio Infocomm, the telecom arm of Mukesh Ambani-controlled Reliance Industries Ltd. (RIL) is hitting rivals Idea Cellular and Bharti Airtel hard for the second day running. Shares of Aditya Group firm Idea Cellular hit a fresh 52-week low on Friday while Bharti Airtel saw its stock falling marginally after crashing over 9 percent on Thursday.
On Friday, Idea Cellular shares hit a new 52-week low of Rs. 81 in early trade but recovered losses to trade at Rs. 81.45, a loss of 2.69 percent, at around 11.26 a.m.
Bharti Airtel shares fell almost 1.50 percent on Friday to touch a low of Rs. 306.50 before recovering to trade with minor gains at Rs. 311.50.
RIL shares were trading with losses of 1.93 percent at Rs. 1,009.30.
The telecom services launch by Reliance Jio with deep discounts and freebies to subscribers is bound to hit rivals Idea Cellular and Bharti Airtel, who may have to re-calibrate their plans, potentially impacting their revenues.
"In our view, this is an attractive offering and might entice customers of competing telecom players to switch to Reliance Jio. The competition is likely to face intense pressure on their bottom-lines in the quarters to come, given the value proposition in the offerings of Reliance Jio," brokerage Angel Broking said in telecom sector update.
RIL's subsidiary Reliance Jio's formal foray into telecom services was announced by Mukesh Ambani at RIL's 42nd annual general meeting on Thursday.
Reliance Jio is offering unlimited voice calling and data download free of cost to customers from Sept. 5 to Dec. 31, 2016.
The company's network will encompass 18,000 cities and towns and there are plans to cover almost 90 percent of the country's population by March next year.
Highlighting some of the key aspects of Reliance Jio's plans at the meeting, Ambani said, "We have price points starting from Rs. 19 for the occasional data user, to a monthly Rs. 149 plan for the light data user, all the way up to a monthly Rs. 4,999 plan for the heaviest data user."
"Jio is rolling out Wi-Fi hotspots across India. By the middle of next year, we plan to deploy nearly 1 million Wi-Fi hotspots," he added.
