Vodafone Idea will continue to face multiple challenges despite price hike

SIM consolidation, inferior network and negative free cash flows even after hike are the key worries for the market

The price hikes announced by telecom operators in their pre-paid plans was higher than what most analysts expected, leading to a sharp rally. Vodafone Idea and Bharti Airtel gained 5-16 per cent in trade while Reliance Industries was up 2.5 per cent. The new plans across segments announced by Bharti Airtel and Vodafone Idea are higher on an average by 30 per cent and come in to effect on December 3. 

This should help increase their blended average revenue per user by Rs 30 and their annual operating profit in the range of Rs 7,000-Rs 9,500 crore each.  Given the sharp