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RCom, Tata Tele, Idea Shares Rise As Telecom Stocks Remain In Spotlight

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RCom, Tata Tele, Idea Shares Rise As Telecom Stocks Remain In Spotlight

Analysts say the sector is likely to witness consolidation to counter competition due to Jio's entry.


Tata Teleservices (Maharashtra) and Reliance Communications shares jumped up to 10 per cent on Monday amid high volumes after Economic Times in a report said that the telecom companies were in early talks to merge into a combine entity which would also include Aircel and MTS. Shares in Tata Teleservices (Maharashtra) Ltd rose 9.7 per cent while Reliance Communications Ltd jumped 7 per cent, surging to session highs of Rs 6.67 and Rs 35.45, respectively. The Bombay Stock Exchange or BSE sought clarification from Reliance Communications and Tata Teleservices (Maharashtra) on the matter.

Telecom shares were also up after a report by news agency Press Trust of India citing sources on Sunday said the merger between Vodafone and Aditya Birla group company Idea Cellular was likely to finalised within a month. Idea Cellular rose as much as 5.5 per cent to an intraday high of Rs 111.85.

Analysts say that the Indian telecom sector is likely to witness consolidation to counter competition due to the aggressive entry of Reliance Jio. (Also read'Telecom industry lost 20% revenue due to Jio giveaways')

British mobile phone giant Vodafone late last month confirmed it was in talks to merge its Indian unit - Vodafone India - with Idea Cellular in a move that would create India's largest telecom company. The announcement ended months of speculation that the two operators were exploring a deal.

By early afternoon, 10.4 lakh Tata Teleservices (Maharashtra) shares, 27.3 lakh RCom scrips and 12 lakh Idea Cellular shares had changed hands, as against their respective averages of 6.51 lakh, 26.85 lakh and 17.91 in the past two weeks. Reliance Communications or RCom shares were up 3.77 per cent at Rs 34.40 while Tata Teleservices (Maharashtra) was quoting 7.95 per cent higher at Rs 6.52 on the BSE.

Also, shares in Bharti Airtel - India's largest telecom operator - rose as much as 2.6 per cent during the day.


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