Airtel, Reliance Industries Shares Hit Record High After Telecom Tariff Hikes
Reliance Jio hiked tariffs on existing plans in the range of 12.5-25%, while Bharti Airtel raised tariffs by 10-20%.
Shares of Reliance Industries Ltd.—parent of Reliance Jio Infocomm Ltd.—and Bharti Airtel Ltd. rose to fresh record highs on Friday after the telecom companies hiked their tariffs one after another.
On Thursday, Reliance Jio hiked tariffs on existing plans in the range of 12.5-25%, and introduced new plans. The changes come into effect from July 3.
Taking cues from the market leader's actions, Airtel announced tariff hikes for unlimited voice plans, data plans and postpaid plans by 10-20% on Friday.
Post the tariff hike by Jio, brokerages baked in another 10% hike in FY27. The overall average revenue per use will reach Rs 231 by fiscal 2027 versus Rs 181 currently, Jefferies said in a note. "More confident that its subscribers are unlikely to churn out."
Morgan Stanley also does not expect any tariff hike by Jio till financial year 2027 and foresees a 17% rise in ARPU by next year. "Another tariff hike of 20% can raise earnings by 10-15% and rerate multiples further."
Vodafone Idea Ltd. stock hit a five-year high of Rs 19.18 apiece, anticipating the industry's tariff revision cycle.
While, shares of Indus Towers Ltd. surged 5.38% during the day to hit a six-year high of Rs 384.8 per share.
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Reliance Industries daily chart
Shares of Reliance Industries rose as much as 2.25% to hit a lifetime high of Rs 3,129.85 apiece on the NSE. It was trading 1.70% higher at Rs 3,113 apiece, compared to a 0.4% advance in the benchmark Nifty 50 as of 10:45 a.m.
The stock has risen 34.5% in the last 12 months and 20% on a year-to-date basis. The total traded volume so far in the day stood at 4 times its 30-day average. The relative strength index was at 64.
Twenty-eight out of the 35 analysts tracking the company have a 'buy' rating on the stock, five recommend a 'hold' and two suggest a 'sell', according to Bloomberg data. The average of 12-month analyst price targets implies a potential upside of 34%.
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Bharti Airtel daily chart (Source: NDTV Profit)
Shares of Bharti Airtel rose as much as 4.10% to a fresh high Rs 1,536.25 apiece on the NSE. It was trading 1.41% lower at Rs 1,455 apiece.
The stock has risen 70% in the last 12 months and 44% on a year-to-date basis. The total traded volume so far in the day stood at 13 times its 30-day average. The relative strength index was at 69.
Twenty three out of the 33 analysts tracking the company have a 'buy' rating on the stock, eight recommend a 'hold' and two suggest a 'sell', according to Bloomberg data. The average of 12-month analyst price targets implies a potential upside of 1%.
