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Reliance Jio Republic day offer leads to 6% fall in Airtel, Idea shares

Reliance Jio, which has changed the dynamics of price game in telecom sector since its entery, on Tuesday announced a new republic day offer.

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The shares of two telecom majors, Bharti Airtel and Idea cellular tanked around 6 per cent over a surprise republic day offer by Mukesh Ambani's Reliance Jio. 

Reliance Jio, which has changed the dynamics of price game in telecom sector since its entery, on Tuesday announced a new republic day offer. 

Reliance Jio has announced 50% more data on all its tariff plans with effect from January 26, according to company sources.

Under the Republic Day offer, Jio's all existing 1GB per day packs will be increased to 1.5GB per day, while 1.5GB per day packs are now enhanced to 2GB per day. For instance, Jio's flagship Rs 399 plan will now provide free voice, unlimited data (1.5GB daily), unlimited SMS and premium subscription to Jio Apps for 84 days.

It has introduced a lower entry price-point for free voice and unlimited data (capped at 2GB) for 28 days at Rs 98. It has about 160 million users.

Following the announcement, the stocks of Airtel nosedived 5.99 per cent to the day’s low of Rs 461.45 while the stock of Idea Cellular fell 5.58 per cent to the day’s low of Rs 93.85. 

Bharti Airtel had recently introduced Rs 399 plan offering unlimited calls and 1GB 4G data daily with 84 days validity.

With this new offer, Jio's flagship Rs 399 plan will provide free voice, unlimited 4G data with 1.5 GB daily, unlimited SMS and premium subscription to Jio Apps for 84 days.

The Rs 98 pack at present offers 2.1 GB data at 4G speed and thereafter speed drops to 64 kilobit per second with 14 days validity.

According to Bharti Airtel MD and CEO, India & South Asia, Gopal Vittal, the battle among telecom operators is now for market share and the pressure on tariff will continue for sometime even though it is at a unsustainable level at present.

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