Telecom stocks in demand

Shares of three mobile operators rose by 1.17% to 1.29% at 09:25 IST on BSE, extending Monday's gains after the telecoms regulator allowed carriers to offer free nationwide mobile roaming to subscribers for a fixed fee from 1 July 2013.

Idea Cellular (up 1.29%), Bharti Airtel (up 1.18%) and Reliance Communications (up 1.17%), edged higher.

Tata Teleservices (Maharashtra) (down 1.87%) and MTNL (down 0.55%), edged lower.

On Monday (17 June 2013), Reliance Communications rose by 3.92%, Idea Cellular rose 2.72% and Bharti Airtel rose 2.53%.

The S&P BSE Sensex was down 73.44 points, or 0.38% at 19,252.43.

The Telecom Regulatory Authority of India (TRAI) said it has reduced ceilings for national roaming calls and SMS and instituted a new regime for providing flexibility to telecom service providers to customise tariffs for national roamers through special tariff vouchers (STVs) and combo vouchers. TRAI has also mandated two types of free national roaming plans to be provided by all telecom service providers. These changes will come into effect from 1 July 2013.

As per the latest TRAI mandate, outgoing local call charges, while on roaming, will be capped at Rs 1 per minute from Rs 1.40 earlier, while outgoing STD charges, while on national roaming, have been capped to Rs 1.50 from Rs 2.40 per minute earlier. The ceiling tariffs for incoming calls while on national roaming have been reduced from Rs 1.75 per minute to 75 paise per minute, TRAI said. Outgoing local SMS-es will cost Re 1, while outgoing STD SMS will cost Rs 1.50. Incoming SMS will remain free of charge.

India is divided into 22 telecom zones. Currently, subscribers pay an additional fee for making and receiving calls when they are outside their home zone.

Meanwhile, Bharti Airtel announced during trading hours on Monday, 17 June 2013, that it completed the allotment of 19.98 crore new shares, representing 5% equity stake in the company, to Qatar Foundation Endowment. The shares, having face value of Rs 5 each, have been issued at a price of Rs 340 each on a preferential basis for a total consideration of Rs 6796 crore. The allotment marks one of the largest private equity transactions in the history of India, Bharti said. On 3 May 2013, Bharti and Qatar Foundation Endowment had announced a binding agreement for the share sale. As part of the entitlement, QFE is entitled to one seat on the board of Bharti.

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