Merger as the last resort: Vodafone-Idea union points to stress in telecom

Overseas investors have seen the bloodbath in the market and want to stay away.

Vodafone and Idea Cellular have decided to merge in order to survive in an industry that is seeing its fortunes dip with each passing quarter. The high debt burden caused by steep spectrum prices and the tariff war unleashed by Reliance Jio have left the industry gasping for breath. The numbers are startling: Of the five listed networks, four (except Bharti Airtel) reported losses in April-December 2016. In the unlisted space, all five telecom companies were in the red in 2015-16. The return on equity for the listed networks was 5.6 per cent in 2015-16 and is learnt to have