Telecom Sector Stock To Buy - Reliance Communications

A steeper fall compared to its peers has made the valuations of Reliance Communications highly attractive, where a further weakness appears unlikely.

RCom lost over 50% since last October as a sharp drop in telecom fares lowered its profitability. The future, however, appears bright.

The company has domestic and global assets in the form of telecom infrastructure in India and under-sea fibre optic network overseas. Its telecom towers are fast gaining tenancy from other operators, which is likely to support its revenue in future. It’s 3G licences win in 13 circles including Mumbai and Delhi gives a better balance between the initial capex fees and revenue prospects. Given its low valuations and asset base, the stock looks attractive at the current levels.

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