Stock markets expert SP Tulsian on Tuesday said telecom sector has a lot of potential and there is a possibility of duopoly situation --Reliance and Bharti Airtel --in this segment.

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Tulsian told CNBC-TV18 Vodafone-Idea is not seen to be a serious player.

“Things seems to be dilly-dally on Vodafone-Idea and the earlier management said they will exit from the business, but now information seems to be coming in that probably they may pay part of the adjusted gross revenue (AGR) due."

Therefore, the sector has a lot of potential, going ahead, Tulsian said.

“One has to take a call on Reliance Industries which is capturing the value of Reliance Jio--that seems to be having lot of potential. No baggage of AGR dues. In fact, AGR dues of Rs 195 crore has already been paid by the company."

Therefore, everything seems to be positive for Reliance Jio. Allow Bharti Airtel to get corrected by about 5-7 percent more. Now, Reliance Industries could definitely be looked into, he added.

Talking about Reliance Industries, he said: “I am not saying it’s difficult to comment on Saudi Aramco deal because going by Mukesh Ambani’s statement in the annual general meeting (AGM), he was categorical and I don’t think that market will brush aside his statement just like that the deal may come under cloud or may not go through."

"If you have that kind of fear then this kind of fall is warranted, but these are penny kind of things or maybe portfolio reshuffling now seen happening.”

Tulsian further added that selling and the gross buying and selling by foreign institutional investors (FIIs) and domestic institutional investors (DIIs) seem to be quite high for last one week or so.

Therefore, it’s difficult to comment but if the Saudi Aramco deal for the oil-to-chemical business is seen under cloud then definitely falls in Bharti Airtel and Reliance Industries could be seen. It is difficult to pinpoint what negative has come for the telecom stocks that both the stocks have seen to be corrected.

It is difficult to take a call at this point, he added.

SP Tulsian is an equity and fundamental analyst with more than three decades of experience.

First Published:Jan 28, 2020 4:08 PM IST