India's telecom sector will continue its growth trajectory, thanks to strong monthly additions in wireless subscriber base and increasing revenue from value-added services, despite pricing pressure, according to ratings agency Fitch.
In its report titled 'India Telecom Sector Outlook 2009', Fitch said the Indian telecom sector's prospects for for year 2009 is largely stable.
According to Fitch, the wireless subscriber base stood at 336.1 million at the end of November 2008, with an overall teledensity of 32.7 per cent, while net monthly subscriber additions were in the range of 8-10 million in fiscal 2009.
It added that with the addition of new players and 3G licence auctions, competition is set to intensify.
"However, the impact of the competition is expected to be seen from calendar year 10, as most of the new greenfield operators have delayed their network launches due to the increasing difficulty of raising finance in light of the tight liquidity situation," it said.
Fitch forecasts that the wireless average revenue per user (ARPUs) are expected to fall severely in CY2009 due to increased competition. Also, incremental subscribers are now mainly coming from the smaller cities, who are mostly prepaid customers with lower minutes of usage.
