As recently as a month ago, the future of two of India’s three remaining private telecom players—Vodafone Idea Limited (VIL) and Bharti Airtel—was in doubt. Slapped with retrospective payments of Rs 53,000 crore (~$7.3 billion) and Rs 35,500 crore (~$4.8 billion), respectively, by the Supreme Court—in line with a broader definition of what constituted taxable revenues—VIL and Airtel were living on borrowed time.
Reliance Jio travels first-class on the tariff hike gravy train
Tariff hikes were a lifeline for telcos Airtel and Vodafone Idea. For Mukesh Ambani-owned Jio, though, it’s a ticket to a successful public listing
After years of a bruising tariff war, India's private telcos recently announced they would all be hiking tariffs
The proposed hikes will increase the industry’s annual revenue and EBITDA by Rs 53,000 crore and Rs 42,000 crore, respectively
While it's good news for VIL and Airtel, it takes Reliance Jio a step closer to an initial public offering
Beside assuring a positive cash flow, tariff hikes over the next few years would give Jio a return on capital of 12%