Rcom Share Price Traded On Its New Low On 18th Nov
RCom share price traded at Rs. 39.20 beating its previous one-year low on 15th Nov trade. On 16th, it repeated the stunt by trading at Rs. 38.00. On 18th Nov, RCom share price went as low as Rs. 37.75 breaking its last day’s record low. Intraday on Friday, the stock was trading at Rs. 38.40 and settled at Rs. 38.40.
RCom informed both the stock exchanges that it has incorporated a new subsidiary, named Towercom Infrastructure Private Limited (TIPL). This new measure is a step towards the telco’s divestment of 51per cent stake in Reliance Infratel for Rs. 11,000 crore to Canada’s Brookfield Infrastructure Group. TIPL will be an Infrastructure company, which is yet to start its business operations.
The new subsidiary has been formed with a subscribed and paid up capital of Rs. 1,00,000, the statement said.Under the non-binding pact with Brookfield Infrastructure Group, RCom will continue as an anchor tenant on the tower assets, under a long-term MSA (master services agreement), for its integrated telecommunications business. The deal valued the tower assets of RCom at over Rs. 21,500 crore.
Snippets of Q2
RCom registered a dip of 80 per cent in its consolidated net profit at Rs 39 crore in the 2nd quarter ended September 30, 2016 because of the pressure on margin and higher finance cost. Finance cost of the company grew by 15 per cent to Rs. 825 crore from Rs 717 crore during the period under review. Total income of RCom slipped 4.33 per cent and its India operations revenue declined by 4.7 per cent to Rs 4,488 crore from Rs 4,711 crore during the period under review.
Revenues from global operations rose marginally to Rs 1,089 crore from Rs 1,060 crore a year ago. The company informed that at the end of the reported quarter, its data customer base was seen at 3.5 crore comprising of 2.45 crore 3G and 4G customers. RCom said total data traffic on its network increased by 8 per cent to 10,480 crore megabyte on Y-o-Y basis.
Jio’s sharp decline in subscriber growth rate
In spite of expanding distribution channels from just Reliance-owned retail stores to others, Reliance Jio Infocomm Ltd is facing a trouble with slow subscriber growth. The subscriber run rate has fallen to less than 50 per cent post the first 15 days of the launch. As a matter of fact, the company’s sale of SIM cards has been hit adversely after the government’s demonetization move since there has been a 40-50 per cent dip in the footfall in comparison to last month.
RCom is one of the top 500 performing stocks for this quarter as identified by Dynamic Levels.
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