India Telecommunications Q4 2020
We observe that mobile operators are now focused on maximising revenue from high-value subscribers, and arealso looking at expanding coverage to rural areas for organic subscription growth. 3G continues its rapid decline as subscribers latchon to LTE services, enabled through the proliferation of low-cost smartphones and featurephones. We view that the next phase oforganic growth for operators will be in rural and underserved regions, which has unsurprisingly been the target of operatorinvestments. However, India's mobile market and its lofty 5G ambitions could be a victim of rising tensions between with China; thepotential ban on 5G gear made by Huawei and ZTE in all Indian mobile networks could raise costs for operators and delay its rollout.This could add further downside pressure on our already bearish forecasts for 5G in India; we only expect uptake to take-off in themedium term when operators have sufficiently monetised their 4G networks, and when the ecosystem of 5G devices becomesmore affordable.
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