INSTITUTIONALEQUITYRESEARCH

IndiaTelecom

Megaauction,tepiddemand

22September2016

INDIA|TELECOM|SectorUpdate
Indiasbiggest spectrum auction will begin from October 1st. The spectrum bandsput to
auctioninclude700MHz,800MHz,900MHz,1800MHz,2100MHz,2300MHz,and2500MHz,
constitutingatotalof2,355MHzofspectrum,withthelargestchunkinthe700MHzband.
Whiletheauctionsizeismassive,webelievethatinthecurrentenvironmentwheremost
operatorshavelimitedspectrumrequirements,themegaauctionislikelytobeafailure
700MHzwillelicitverylittleornointerestfromtheoperators,mostoftheactionshould
be visible in the 1800MHz band (where both Idea and Vodafone will look at plugging
spectrum gaps in key circles), and other bands will see limited interest these factor
wouldleadtoasignificantamountofspectrumremainingunsold.Barringfewcircles,we
expect most of the spectrum to be sold at current reserve prices and all of 700MHz to
remainunsold,unlessJiochangesitsstrategy.ThegovernmentshouldbeabletogarnerRs
400bnintheupcomingauctionaccordingtoourestimates,whichismuchbelowwhatthe
GoIhasbudgeted.
Idea:We believe that in theupcoming auction, Ideas priorities would be twofold (1) to
haveapresenceacrosstechnologiesinitseightleadershipcircles,and(2)eitherhave3Gor
4G presence in the remaining 14 circles. For 4G, it would want to have 5MHz contiguous
spectrum in the 1800MHz band for its leadership circles like UP (W) and Gujarat. Since
Bharti,Vodafone,andJIOalreadyhave5MHzspectruminthe1800MHzbandintheGujarat
circle,Ideaislikelytogetspectrumatthereserveprice.Similarly,fortheUP(W)circle,with
only two serious bidder (including JIO), Idea is likely to get spectrum at the reserve price
(assumingVodafonechalksoutaspectrumtradingdealwithUninorpostauction).Since3/4
carrierareavailableinthe2100MHzbandonapanIndiabasis,getting3Gairwavesatthe
reservepricelooksalmostcertain.WeseeIdeasauctionspendatRs64bn.

Bharti Airtel: Since Airtel already has panIndia 3G (excluding Kerala circle) and 4G
footprints,itislikelytoshoreupitsspectrumholdingsinitscirclesofimportance(whereits
marketshareishigherthan30%).Thecompanymightbidinthe1800MHzbandinAssam
andWestBengalcircles.In2300MHz,itmightbidforGujaratcircle.Itwillbidfor2100MHz
intheKeralacircletocompleteitspanIndia3Gfootprint.Basedonthesebids,weseeits
totalauctionexpenditurenotexceedingRs21bn.

Vodafone: With 4G presence only in nine circles, we foresee Vodafone being the most
aggressive bidder in the upcoming auction. However, recent news reports indicate that
VodafoneislookingtobuyoutTelenorsIndiaoperations.Assumingthisistrue,Vodafones
participation might be moderate and it might want to focus on plugging the gaps in its
missingpanIndia3Gand4Gfootprint.WebelieveVodafoneislikelytospendRs113bnin
theupcomingauction.

RelianceJIO:JIOstumpeduswiththehighestamountofearnestmoneydeposit(Rs65bn)
fortheupcomingauction.Giventhatthecompanyisfocusedonbuildinga100%IPenabled
4Gnetwork,itwouldliketohave5MHzcontiguousspectrumonapanIndiabasisinthesub
gigahertzband.JIOwillbidforoneblock(i.e.1.25MHz)inthe800MHzbandin10circlesto
haveapanIndia5MHzcontiguousspectrum.Similartoitsspectruminthe800MHzband,it
mightwanttohave5MHzpanIndiaspectruminthe1800MHzband.Hence,JIOmightbidin
the1800MHzbandinfourcircles(Bihar,JK,Punjab,UP(W)).Wecalculateitsnetoutgoat
aboutRs92bn.

Others: Players like RCOM and Aircel are unlikely to be serious bidders in the auction
evidentfromtheEMDsmadebyboth.TTSLislikelytobidinthe800MHzbandinMumbai
andMaharashtracirclesandin1800MHzinMaharashtraandAP.Cumulativenetoutgofor
thesethreecompaniescouldbeaboutRs100bn.

Page|1|PHILLIPCAPITALINDIARESEARCH

NaveenKulkarni,CFA,FRM
(+912266679947)
nkulkarni@phillipcapital.in

ManojBehera(+912266679973)
mbehera@phillipcapital.in

TELECOM SECTORUPDATE

Recommendedreservepriceacrossserviceareasinvariousbands
ReservepriceperMHz(inRsbn) 700MHz 800MHz 900MHz 1800MHz 2100MHz 2300MHz 2500MHz
AndhraPradesh
9.71
6.06
2.43
2.72
0.68
0.68
Assam
1.58
0.40
0.46
0.02
0.02
Bihar
2.48
1.36
4.44
0.62
0.86
0.06
0.06
Delhi
15.95
8.48
3.99
5.54
1.43
1.43
Gujarat
9.52
2.85
6.73
2.38
2.58
0.39
0.39
Haryana
1.86
0.57
0.47
0.55
0.08
HimachalPradesh
0.64
0.24
0.16
0.20
0.01
0.01
Jammu&Kashmir
0.52
0.13
0.11
0.01
Karnataka
7.40
3.03
1.85
3.28
0.98
0.98
Kerala
3.34
2.43
0.83
1.77
0.16
0.16
Kolkata
5.96
1.60
1.49
1.16
0.33
0.33
MadhyaPradesh
3.31
4.08
0.83
1.23
0.08
0.08
Maharashtra
12.72
7.99
3.18
3.41
0.58
0.58
Mumbai
11.92
7.27
2.98
4.61
1.46
1.46
NorthEast
0.44
0.11
0.12
0.01
0.01
Odisha
1.52
0.57
0.38
0.38
0.04
0.04
Punjab
3.08
1.19
0.77
0.91
0.21
Rajasthan
3.64
2.04
0.91
1.40
0.06
TamilNadu
9.00
3.60
3.44
1.32
1.32
UttarPradesh(East)
4.59
2.19
7.76
1.15
1.10
0.09
UttarPradesh(West)
3.84
1.82
7.39
0.96
1.11
0.12
WestBengal
1.83
0.82
0.46
0.52
0.05
0.05
Total
114.85
37.46
8.17

Spectrumavailabilityacrossvariousbands
Quantumforsale(inMHz)
AndhraPradesh
Assam
Bihar
Delhi
Gujarat
Haryana
HimachalPradesh
Jammu&Kashmir
Karnataka
Kerala
Kolkata
MadhyaPradesh
Maharashtra
Mumbai
NorthEast
Odisha
Punjab
Rajasthan
TamilNadu
UttarPradesh(East)
UttarPradesh(West)
WestBengal
Total

700MHz 800MHz 900MHz 1800MHz 2100MHz 2300MHz 2500MHz

35.0
7.5
4.4
20.0
20.0
40.0
35.0
19.8
15.0
20.0
20.0
35.0
2.5
4.6
12.2
20.0
20.0
20.0
35.0
2.5
12.8
20.0
20.0
40.0
35.0
6.3
3.0
13.0
15.0
20.0
40.0
35.0
1.3
7.4
15.0
20.0
35.0
3.8
11.4
20.0
20.0
20.0
35.0
32.0
15.0
20.0
35.0
2.5
4.2
15.0
20.0
40.0
35.0
2.5
2.0
15.0
20.0
20.0
35.0
2.5
4.0
15.0
20.0
40.0
35.0
2.5
4.6
15.0
20.0
20.0
35.0
7.5
13.4
15.0
20.0
40.0
35.0
5.0
5.0
20.0
20.0
40.0
35.0
9.2
15.0
20.0
20.0
35.0
3.8
1.4
20.0
20.0
20.0
35.0
6.3
15.4
15.0
20.0
35.0
7.5
11.0
15.0
20.0
35.0
2.5
15.0
20.0
40.0
35.0
3.8
0.6
5.4
15.0
20.0
35.0
2.5
1.2
14.6
15.0
20.0
35.0
1.3
18.4
15.0
20.0
20.0
770.0
73.8
9.4
221.6
360.0
320.0
600.0

Source:Company,PhillipCapitalIndiaResearch

Page|2|PHILLIPCAPITALINDIARESEARCH

TELECOM SECTORUPDATE

Ideaexistingspectrumholdings
Maharashtra
Kerala
M.P.
Punjab
Haryana
AndhraPradesh
UP(W)
Gujarat
HP

Delhi
UP(E)

Karnataka
Mumbai

Rajasthan

Bihar

TamilNadu

NorthEast

J&K

Kolkata

Orissa

WestBengal

Assam

TotalSpectrum(inMHz)

900MHz1800MHzGSM1800MHzLTE 2100MHz
9
4
5
5
6
10
5
7.4
2
5
5
5.6
3
5
5
6
1
5
5
5
1
5
5
5
2.2
5
5
1.6
5
4.4
4.8
5
5
8.6

6.2
5
5
1
5
6.4

6.2

5.65

6.4
5
6
5
5
5
5
5
5
5
6.25

59
91.9
59.8
60

GSM

3G

LTE

Source:Company,PhillipCapitalIndiaResearch

Rationale: We estimate that Idea will acquire most of its required spectrum
(excludingUPWcircleinthe1800MHzband)atthereservepricebecauseofample
availabilityofspectrumacrossbandsandlimitedcompetitionfromotherincumbents
in Ideas circle of interest. In UP (W) circle, Idea is going to face competition from
RelianceJIOandVodafoneinthe1800MHzband,andweestimatethatthisspectrum
wouldbesold25%higherthanitsreserveprice.

Bidintheupcomingauction
SpectruminMHz
UP(W)
Gujarat
Mumbai
Rajasthan
Bihar
WestBengal
Assam
Total(inMHz)

1800
4.6
5.0
5.0
5.0
5.0
5.0
29.6

2100 Payout(inRsbn)
UP(W)
Gujarat
5.0 Mumbai
5.0 Rajasthan
5.0 Bihar
WestBengal
Assam
15.0 Total(inRsbn)

Source:Company,PhillipCapitalIndiaResearch

Page|3|PHILLIPCAPITALINDIARESEARCH

1800
5.5
11.9
4.6
3.1
2.3
2.0
29.4

2100

23.1
7.0
4.3

34.4

Total
5.5
11.9
23.1
11.6
7.4
2.3
2.0
63.7

TELECOM SECTORUPDATE

BhartiAirtelexistingspectrumholdings

AndhraPradesh
Assam
Bihar
Delhi
Gujarat
Haryana
HimachalPradesh
Jammu&Kashmir
Karnataka
Kerala
Kolkata
MadhyaPradesh
Maharashtra
Mumbai
NorthEast
Odisha
Punjab
Rajasthan
TamilNadu
UttarPradesh(East)
UttarPradesh(West)
WestBengal
Total

900
4
3
7.8
1

2.4
6.2
3.8

8.2
7.4
5
1
6.2
6.2

6.6
70.8

1800
5
5.65
3
2
6.2
9.6
5.2
2.6
3.8
6.2
2
8.8
8.2
10.2
5.4
3
4.2
3.2
9.2
1
6.2
6.2
116.9

_______3G_______
900
2100
5
5
5
5
5
5
5
5
5
5
5
5
5
5

5
5
5
5
5
5
5
5
5
5
5
10
5
5
5
50
100

_______4G_______
1800
2300
5
20
20
5
20
5
20
5
5
20
5
20
5
20
5
20
5
20
10
20
20
5
20
5
20
10
20
5
20
5
5
20
5
5
20
100
340

Rationale: In the upcoming auction, Airtels spectrum requirement would be

restricted to a few circles like Assam, Gujarat, Kerala, and West Bengal. As the
competition is limited across bands, it is likely to get the required spectrum at the
reservedprice.

Bidinupcomingauction
SpectruminMHz
Assam
Gujarat
Kerala
WestBengal
Total(inMHz)

1800
5.0

2100

5.0
5.0
10.0

5.0

2300
Assam
20.0 Gujarat
Kerala
WestBengal
20.0 Total(inRsbn)

Page|4|PHILLIPCAPITALINDIARESEARCH

1800
2.0

2100

2300
7.8

8.9
2.3
4.3

8.9

7.8

Total
2.0
7.8
8.9
2.3
21.0

TELECOM SECTORUPDATE

VodafoneExistingspectrumholding
MHzSpectrum
Circle
AP
Assam
Bihar
Delhi
Gujarat
Haryana
HP
J&K
Karnataka
Kerala
Kolkata
MP
Maharashtra
Mumbai
NorthEast
Orissa
Punjab
Rajasthan
TamilNadu
UPEast
UPWest
WestBengal
Total

900

5.0
6.0
6.2

6.4
7.0

5.0
11.0

5.0

6.4
6.2
5.6
6.2
6.6
82.6

1800
6.8
6.9
6.9
8.0
7.8
4.9
5.7
6.9
13.0
9.3
8.0
6.9
1.3
8.2
6.9
6.9
8.1
0.8
1.0
6.5
2.5
4.3
137.4

2100

5.0

5.0
5.0
5.0

5.0
5.0
5.0

5.0
5.0
5.0

5.0
5.0
5.0
5.0
5.0
75.0

GSM

3G

LTE

Rationale:Asdiscussedearlier,VodafoneislikelytofacecompetitionfromIdeaand
Reliance JIO in the 1800MHz in the UP (West) circle and the final price is likely to
settleat25%higherthanthecurrentreserveprice.Allotherspectrumrequirements
arelikelytobefulfilledatthereservepriceduetolimitedcompetition.

Bidintheupcomingauction

AP
Assam
Bihar
HP
J&K
MP
Maharashtra
NorthEast
Orissa
Punjab
Rajasthan
TamilNadu
UPWest
WestBengal
Total(inMHz)

1800

2300
20.0

5.0
5.0
5.0
5.0
20.0
5.0
5.0
20.0
5.0
5.0
20.0
5.0
5.0
50.0

80.0

2100
5.0 AP
Assam
5.0 Bihar
5.0 HP
5.0 J&K
5.0 MP
Maharashtra
NorthEast
5.0 Orissa
5.0 Punjab
Rajasthan
TamilNadu
UPWest
WestBengal
35.0 Total(inRsbn)

Page|5|PHILLIPCAPITALINDIARESEARCH

1800

2300
13.6

2100
13.6

1.6

4.3
1.0
0.6
6.2

2.0
3.1
0.8
0.7
15.9
0.6
0.8
3.9
4.6

1.9
4.6

26.4
4.8
2.3
38.5

42.4

32.1

Total
27.2
2.0
7.4
1.8
1.2
7.8
15.9
0.6
2.7
8.4
4.6
26.4
4.8
2.3
113.0

TELECOM SECTORUPDATE

RelianceJIOsexistingspectrumholding

AndhraPradesh
Assam
Bihar
Delhi
Gujarat
Haryana
HimachalPradesh
Jammu&Kashmir
Karnataka
Kerala
Kolkata
MadhyaPradesh
Maharashtra
Mumbai
NorthEast
Odisha
Punjab
Rajasthan
TamilNadu
UttarPradesh(East)
UttarPradesh(West)
WestBengal
Total

800
3.75
5.00
5.00
3.75
3.75
5.00
5.00
5.00
3.75
3.75
5.00
5.00
3.75
5.00
5.00
5.00
3.75
2.50
3.75
5.00
5.00
3.75
96.25

1800
5.8
5.4

2300
20
20
20
20
20
20
20
20
20
20
20
20
20
20
20
20
20
20
20
20
20
20
440

5.4
6.0
4.0
5.4
5.0
5.0
10.0
6.4
5.0
6.6
6.4
5.0
10.0
6.8
3.0
5.6
106.8

Bidintheupcomingauction

AndhraPradesh
Bihar
Delhi
Gujarat
Haryana
Jammu&Kashmir
Karnataka
Kerala
MadhyaPradesh
Maharashtra
Punjab
Rajasthan
TamilNadu
UttarPradesh(West)
WestBengal
Total(inMHz)

800
1.25
1.25
1.25

1.25
1.25
1.25
1.25
2.50
1.25
1.25
13.75

1800
AndhraPradesh
5 Bihar
Delhi
Gujarat
1 Haryana
5 Jammu&Kashmir
Karnataka
Kerala
5 MadhyaPradesh
Maharashtra
5 Punjab
Rajasthan
TamilNadu
5 UttarPradesh(West)
WestBengal
21.0 Total(inRsbn)

Page|6|PHILLIPCAPITALINDIARESEARCH

800
7.6

1800
7.6

10.6
3.6
3.5
0.7
3.8
3.0
3.8
10.0
1.5
5.1
4.5

11.9

14.0
1.0
50.7

41.4

7.6
7.6
10.6
3.6
3.5
0.7
3.8
3.0
3.8
10.0
13.3
5.1
4.5
14.0
1.0
92.0

TELECOM SECTORUPDATE

RatingMethodology
Weratestockonabsolutereturnbasis.Ourtargetpriceforthestockshasaninvestmenthorizonofoneyear.
Rating
Criteria
Definition
BUY

>=+15%

Targetpriceisequaltoormorethan15%ofcurrentmarketprice

NEUTRAL

15%>to<+15%

Targetpriceislessthan+15%butmorethan15%

SELL

<=15%

Targetpriceislessthanorequalto15%.

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UNITEDSTATES:PhillipFuturesInc.
141WJacksonBlvdSte3050
TheChicagoBoardofTradeBuilding
Chicago,IL60604USA
Tel(1)3123569000Fax:(1)3123569005

AUSTRALIA:PhillipCapitalAustralia
Level10,330CollinsStreet
Melbourne,VIC3000,Australia
Tel:(61)386339800Fax:(61)386339899
www.phillipcapital.com.au

SRILANKA:AshaPhillipSecuritiesLimited
Level4,MillenniumHouse,46/58NavamMawatha,
Colombo2,SriLanka
Tel:(94)112429100Fax:(94)112429199
www.ashaphillip.net/home.htm

HONGKONG:PhillipSecurities(HK)Ltd
11/FUnitedCentre95QueenswayHongKong
Tel(852)22776600Fax:(852)28685307
www.phillip.com.hk

INDIA
PhillipCapital(India)PrivateLimited
No.1,18thFloor,UrmiEstate,95GanpatraoKadamMarg,LowerParelWest,Mumbai400013
Tel:(9122)23002999Fax:(9122)66679955www.phillipcapital.in

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TELECOM SECTORUPDATE

DisclosuresandDisclaimers

PhillipCapital(India)Pvt.Ltd.hasthreeindependentequityresearchgroups:InstitutionalEquities,InstitutionalEquityDerivatives,andPrivateClientGroup.
ThisreporthasbeenpreparedbyInstitutionalEquitiesGroup.Theviewsandopinionsexpressedinthisdocumentmay,maynotmatch,ormaybecontraryat
timeswiththeviews,estimates,rating,andtargetpriceoftheotherequityresearchgroupsofPhillipCapital(India)Pvt.Ltd.
ThisreportisissuedbyPhillipCapital(India)Pvt.Ltd.,whichisregulatedbytheSEBI.PhillipCapital(India)Pvt.Ltd.isasubsidiaryofPhillip(Mauritius)Pvt.Ltd.
References to "PCIPL" in this report shall mean PhillipCapital (India) Pvt. Ltd unless otherwise stated. This report is prepared and distributed by PCIPL for
information purposes only, and neither the information contained herein, nor any opinion expressed should be construed or deemed to be construed as
solicitationorasofferingadviceforthepurposesofthepurchaseorsaleofanysecurity,investment,orderivatives.Theinformationandopinionscontainedin
thereportwereconsideredbyPCIPLtobevalidwhenpublished.ThereportalsocontainsinformationprovidedtoPCIPLbythirdparties.Thesourceofsuch
informationwillusuallybedisclosedinthereport.WhilstPCIPLhastakenallreasonablestepstoensurethatthisinformationiscorrect,PCIPLdoesnotoffer
anywarrantyastotheaccuracyorcompletenessofsuchinformation.Anypersonplacingrelianceonthereporttoundertaketradingdoessoentirelyathisor
herownriskandPCIPLdoesnotacceptanyliabilityasaresult.SecuritiesandDerivativesmarketsmaybesubjecttorapidandunexpectedpricemovements
andpastperformanceisnotnecessarilyanindicationoffutureperformance.
Thisreportdoesnotregardthespecificinvestmentobjectives,financialsituation,andtheparticularneedsofanyspecificpersonwhomayreceivethisreport.
Investorsmustundertakeindependentanalysiswiththeirownlegal,tax,andfinancialadvisorsandreachtheirownconclusionsregardingtheappropriateness
of investing in any securities or investment strategies discussed or recommended in this report and should understand that statements regarding future
prospects may not be realised. Under no circumstances can it be used or considered as an offer to sell or as a solicitation of any offer to buy or sell the
securitiesmentionedwithinit.Theinformationcontainedintheresearchreportsmayhavebeentakenfromtradeandstatisticalservicesandothersources,
whichPCILbelieveisreliable.PhillipCapital(India)Pvt.Ltd.oranyofitsgroup/associate/affiliatecompaniesdonotguaranteethatsuchinformationisaccurate
orcompleteanditshouldnotberelieduponassuch.Anyopinionsexpressedreflectjudgmentsatthisdateandaresubjecttochangewithoutnotice.
Important:These disclosuresanddisclaimers mustbereadinconjunctionwiththeresearchreportofwhichitformspart.Receiptanduseof theresearch
reportissubjecttoallaspectsofthesedisclosuresanddisclaimers.Additionalinformationabouttheissuersandsecuritiesdiscussedinthisresearchreportis
availableonrequest.
Certifications:Theresearchanalyst(s)whopreparedthisresearchreportherebycertifiesthattheviewsexpressedinthisresearchreportaccuratelyreflectthe
researchanalystspersonalviewsaboutallofthesubjectissuersand/orsecurities,thattheanalyst(s)havenoknownconflictofinterestandnopartofthe
researchanalystscompensationwas,is,orwillbe,directlyorindirectly,relatedtothespecificviewsorrecommendationscontainedinthisresearchreport.
AdditionalDisclosuresofInterest:
UnlessspecificallymentionedinPointNo.9below:
1. TheResearchAnalyst(s),PCIL,oritsassociatesorrelativesoftheResearchAnalystdoesnothaveanyfinancialinterestinthecompany(ies)coveredin
thisreport.
2. TheResearchAnalyst,PCILoritsassociatesorrelativesoftheResearchAnalystaffiliatescollectivelydonotholdmorethan1%ofthesecuritiesofthe
company(ies)coveredinthisreportasoftheendofthemonthimmediatelyprecedingthedistributionoftheresearchreport.
3. TheResearchAnalyst,his/herassociate,his/herrelative,andPCIL,donothaveanyothermaterialconflictofinterestatthetimeofpublicationofthis
researchreport.
4. TheResearchAnalyst,PCIL,anditsassociateshavenotreceivedcompensationforinvestmentbankingormerchantbankingorbrokerageservicesorfor
anyotherproductsorservicesfromthecompany(ies)coveredinthisreport,inthepasttwelvemonths.
5. TheResearchAnalyst,PCILoritsassociateshavenotmanagedorcomanagedintheprevioustwelvemonths,aprivateorpublicofferingofsecuritiesfor
thecompany(ies)coveredinthisreport.
6. PCIL or its associates have not received compensation or other benefits from the company(ies) covered in this report or from any third party, in
connectionwiththeresearchreport.
7. TheResearchAnalysthasnotservedasanOfficer,Director,oremployeeofthecompany(ies)coveredintheResearchreport.
8. TheResearchAnalystandPCILhasnotbeenengagedinmarketmakingactivityforthecompany(ies)coveredintheResearchreport.
9. DetailsofPCIL,ResearchAnalystanditsassociatespertainingtothecompaniescoveredintheResearchreport:

Sr.no. Particulars
Yes/No
1
Whether compensation has been received from the company(ies) covered in the Research report in the past 12 months for
No
investmentbankingtransactionbyPCIL
2
WhetherResearchAnalyst,PCILoritsassociatesorrelativesoftheResearchAnalystaffiliatescollectivelyholdmorethan1%ofthe
No
company(ies)coveredintheResearchreport
3
WhethercompensationhasbeenreceivedbyPCILoritsassociatesfromthecompany(ies)coveredintheResearchreport
No
4
PCIL or its affiliates have managed or comanaged in the previous twelve months a private or public offering of securities for the
No
company(ies)coveredintheResearchreport
5
ResearchAnalyst, hisassociate,PCILoritsassociateshavereceived compensationforinvestmentbankingormerchantbanking or
No
brokerage services or for any other products or services from the company(ies) covered in the Research report, in the lasttwelve
months
Independence: PhillipCapital (India) Pvt. Ltd. has not had an investment banking relationship with, and has not received any compensation for investment
banking services from, the subject issuers in the past twelve (12) months, and PhillipCapital (India) Pvt. Ltd does not anticipate receiving or intend to seek
compensationforinvestmentbankingservicesfromthesubjectissuersinthenextthree(3)months.PhillipCapital(India)Pvt.Ltdisnotamarketmakerinthe
securitiesmentionedinthisresearchreport,althoughit,oritsaffiliates/employees,mayhavepositionsin,purchaseorsell,orbemateriallyinterestedinany
ofthesecuritiescoveredinthereport.
Suitability and Risks: This research report is for informational purposes only and is not tailored to the specific investment objectives, financial situation or
particularrequirementsofanyindividualrecipienthereof.Certainsecuritiesmaygiverisetosubstantialrisksandmaynotbesuitableforcertaininvestors.
Eachinvestormustmakeitsowndeterminationastotheappropriatenessofanysecuritiesreferredtointhisresearchreportbaseduponthelegal,taxand
accountingconsiderationsapplicabletosuchinvestoranditsowninvestmentobjectivesorstrategy,itsfinancialsituationanditsinvestingexperience.The
value of any security may be positively or adversely affected by changes in foreign exchange or interest rates, as well as by other financial, economic, or
politicalfactors.Pastperformanceisnotnecessarilyindicativeoffutureperformanceorresults.

Page|8|PHILLIPCAPITALINDIARESEARCH

TELECOM SECTORUPDATE

Sources,CompletenessandAccuracy:ThematerialhereinisbaseduponinformationobtainedfromsourcesthatPCIPLandtheresearchanalystbelievetobe
reliable,butneitherPCIPLnortheresearchanalystrepresentsorguaranteesthattheinformationcontainedhereinisaccurateorcompleteanditshouldnot
berelieduponassuch.Opinionsexpressedhereinarecurrentopinionsasofthedateappearingonthismaterial,andaresubjecttochangewithoutnotice.
Furthermore,PCIPLisundernoobligationtoupdateorkeeptheinformationcurrent.Withoutlimitinganyoftheforegoing,innoeventshallPCIL,anyofits
affiliates/employees or any third party involved in, or related to computing or compiling the information have any liability for any damages of any kind
includingbutnotlimitedtoanydirectorconsequentiallossordamage,howeverarising,fromtheuseofthisdocument.
Copyright: The copyright in this research report belongs exclusively to PCIPL. All rights are reserved. Any unauthorised use or disclosure is prohibited. No
reprintingorreproduction,inwholeorinpart,ispermittedwithoutthePCIPLspriorconsent,exceptthatarecipientmayreprintitforinternalcirculationonly
andonlyifitisreprintedinitsentirety.
Caution:Riskoflossintrading/investmentcanbesubstantialandevenmorethantheamount/margingivenbyyou.Therecipientshouldcarefullyconsider
whether trading/investment is appropriate for the recipient in light of the recipients experience, objectives, financial resources and other relevant
circumstances.PCIPLandanyofitsemployees,directors,associates,groupentities,oraffiliatesshallnotbeliableforlosses,ifany,incurredbytherecipient.
Therecipientisfurthercautionedthattrading/investmentsinfinancialmarketsaresubjecttomarketrisksandareadvisedtoseektrading/investmentadvice
before investing. There is no guarantee/assurance as to returns or profits or capital protection or appreciation. PCIPL and any of its employees, directors,
associates, group entities, affiliates are not inducing the recipient for trading/investing in the financial market(s). Trading/Investment decision is the sole
responsibilityoftherecipient.
ForU.S.personsonly:ThisresearchreportisaproductofPhillipCapital(India)PvtLtd.,whichistheemployeroftheresearchanalyst(s)whohaspreparedthe
researchreport.Theresearchanalyst(s)preparingtheresearchreportis/areresidentoutsidetheUnitedStates(U.S.)andarenotassociatedpersonsofany
U.S.regulated brokerdealer and therefore the analyst(s) is/are not subject to supervision by a U.S. brokerdealer, and is/are not required to satisfy the
regulatorylicensingrequirementsofFINRAorrequiredtootherwisecomplywithU.S.rulesorregulationsregarding,amongotherthings,communicationswith
asubjectcompany,publicappearances,andtradingsecuritiesheldbyaresearchanalystaccount.
This report is intended for distribution by PhillipCapital (India) Pvt Ltd. only to "Major Institutional Investors" as defined by Rule 15a6(b)(4) of the U.S.
SecuritiesandExchangeAct,1934(theExchangeAct)andinterpretationsthereofbytheU.S.SecuritiesandExchangeCommission(SEC)inrelianceonRule15a
6(a)(2).IftherecipientofthisreportisnotaMajorInstitutionalInvestorasspecifiedabove,thenitshouldnotactuponthisreportandreturnthesametothe
sender.Further,thisreportmaynotbecopied,duplicated,and/ortransmittedonwardtoanyU.S.person,whichisnotaMajorInstitutionalInvestor.

InrelianceontheexemptionfromregistrationprovidedbyRule15a6oftheExchangeActandinterpretationsthereofbytheSECinordertoconductcertain
businesswithMajorInstitutionalInvestors,PhillipCapital(India)PvtLtd.hasenteredintoanagreementwithaU.S.registeredbrokerdealer,Decker&Co,LLC.
TransactionsinsecuritiesdiscussedinthisresearchreportshouldbeeffectedthroughDecker&Co,LLCoranotherU.S.registeredbrokerdealer.

IfDistributionistoAustralianInvestors
ThisreportisproducedbyPhillipCapital(India)PvtLtdandisbeingdistributedinAustraliabyPhillipCapitalLimited(AustralianFinancialServicesLicenceNo.
246827).

Thisreportcontainsgeneralsecuritiesadviceanddoesnottakeintoaccountyourpersonalobjectives,situationandneeds.PleasereadtheDisclosuresand
Disclaimerssetoutabove.Byreceivingorreadingthisreport,youagreetobeboundbythetermsandlimitationssetoutabove.Anyfailuretocomplywith
these terms and limitations may constitute a violation of law. This report has been provided to you for personal use only and shall not be reproduced,
distributedorpublishedbyyouinwholeorinpart,foranypurpose.Ifyouhavereceivedthisreportbymistake,pleasedeleteordestroyit,andnotifythe
senderimmediately.

PhillipCapital(India)Pvt.Ltd.
Registeredoffice:No.1,18thFloor,UrmiEstate,95GanpatraoKadamMarg,LowerParelWest,Mumbai400013

NAVEEN
KULKARNI

Page|9|PHILLIPCAPITALINDIARESEARCH

Digitally signed by NAVEEN KULKARNI

DN: c=IN, o=Personal , CID - 3573687,
postalCode=400072, st=Maharashtra,
serialNumber=97c18031b020ff979ee60
7a3efa48cfba8b1455defbde1b85beecb
fbf99bbde3, cn=NAVEEN KULKARNI
Date: 2016.09.22 13:22:07 +05'30'