Reliance jio does it again.. what to do with airtel stock

A week ago i wrote that maybe it waa time to buy the airtel stock.

I was seeing that the pressure on profits was forcing them to not give away additional discounts.I had tried even going to Twitter.. with the same result... no discount

I felt it was time to buy.. until yesterday when reliance jio launched the next wave .. driving towards the post paid segment and the isd rates.

The difference is quite high, the market is again going to be disrupted... and people.. including me will move or take up another sim card with jio for my international calls.

Usually i use whatsapp when i dial internationally, but a lot of people are not on whatsapp. Especially in the US.  ( dont ask me why).

So when i then compare the rates of 50p per min vs 8 rs per min.. it makes absolute sense for me to get a jio number.. even if it is only for the international calls.

There are of course disadvantages of jio.. the lte features doesnt work once you go out of the main cities.. and there is zero connection there. .. i had tried that once when i was travelling .. and it was a tremendous dissapointment.

So two phones it is..

As for the airtel stock.. it fell 6% on fri..and it may fall more.. but i do believe it will jump back soon.. time to buy.. yes.. but in small chunks

Airtel.. time to buy this stock?

Airtel posted its quarterly loss this week. A giant battered down by Reliance Jio, hurt by predatory pricing by the reliance juggernaut.

There are so many places that one sees airtel trying to match the jio prices and also not losing its customers.

That may be the bottom for this stock. Why? Because the signs are changing ( no financial analysis needed for all of this)

I am a broadband user of airtel. And have been for the last 10 years. The service is good.. though the prices were high.

With jio coming in , airtel gave away smart discounts.. smart in the sense that it was a discount for the next 6 months and not a permanent reduction of the mrp.. very similar to the corporate world where companies give a retention bonus.. for the next one year while not giving any increase in fixed pay increase.

So.. now that the six months has gone.. i find that airtel is not giving any more of these discounts... and even threatening to shift doesnt help... they are at their wits end in the race for survival.

This change in demeanour leads me to believe that their moving to black ie profits is just a matter of a max few quarters away.

Its time to buy...

Looking at whats happening around .. and taking heed..

Thats simplefinancialsense!

Companies spends 11k crore on your dime

11,000 cr is what airtel spent on advertisements with the new " har friend.." theme. Amazing that they are spending so much money and then saying that they need to increase costs because of the reserve price that the government is auctioning.

Its an interesting concept of telecom companies, first increase expenses by spending such amazing amounts of money.. Then pass it onto consumers and blame the government.

That is why i prefer multi level marketing companies, where we can drive these costs down of advertising.

There was a recent article in the economictimes about amway india becoming a billion $ company in the next few years from its 2400 crores as of today.

These MLM companies are the disruptive business models that will change or is actually changing the way people will buy. In fact a lot of the internet based companies in india- flipkart.com , zovi.com, jabong.com - all in some way or the other actually use the MLM concept of taking away the middleman and brining things cheaper to the consumer.


As i have always said, it makes a lot of sense to go with disruptive technologies as they emerge.

Come join the bandwagon- its simplefinancialsense!!!