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Vodafone Idea Shares Fall 14%, End 3-Day Rally

Olga Robert

Shares of Vodafone Idea paused their three-day winning streak on Tuesday, falling as much as 14.1 percent to Rs 6.70 apiece. The decline comes on the same day that new tariff plans of the company kick-in.

Leading telecom names in the country have announced their plans to hike prices of call and data services this month. Tariff increase by Vodafone Idea and Bharti Airtel became effective on Tuesday while Jio's new plans will go live on 6 December.

In a BSE filing, Vodafone Idea announced its new tariffs/plans offered to customers wherein the price of a 365-day plan will cost 41.2 percent more at Rs 2,399 from the earlier rate of Rs 1,699.

In addition to the revision of old plans, new plans were also introduced.

Investment research house CLSA had retained its "sell" call on Vodafone Idea but the price target was increased from Rs 5.50 per share to Rs 6.50. While a 40 percent tariff hike by 2021-22 was factored in, the key challenge for the company remains its market share loss.

While details of arch-rival Reliance Jio's hike are awaited, analysts feel that the Mukesh Ambani-led telecom company's plans could still be 15-20 percent cheaper than the others.

Jio has said that it will be introducing an "all in one" plan from 6 December across multiple price points with unlimited voice and data which will have 300 percent more benefits than earlier.

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