Weakening rupee, hardening diesel price to make telcos sweat this year

More, with the steep increase in diesel prices, fuel cost of the telcos is set to go up, primarily related to tower sites

Telecom companies are under pressure, with the rupee’s fall and rise in diesel prices over the past two months. They are expected to wipe off almost a tenth of their earnings in 2018-19.

Further eroding the margins of the older majors would be Reliance Jio’s continued pricing pressure, say analysts. Bharti Airtel (India) and Vodafone Idea (ex-Vodafone) are  expected to report a 17 and 26 per cent revenue slump, respectively, on a year-on-year basis. The outlook for the December quarter (the third one or Q3 in FY19) seems worse, after factoring in the impact of rupee depreciation and rising diesel