Telecom stocks rise on new policy draft

Extending the previous session's rally, telecom stocks led by Bharti Airtel surged by up to 5 per cent on the BSE on Tuesday after the government unveiled a new policy that will help users avail free roaming services across the country and inter-circle mobile number portability.

Shares of the country's largest private telecom company Bharti Airtel surged by 4.66 per cent to a high of Rs 380.20 on the BSE.

Similarly, stocks like Idea Cellular, which rose by 4.32 per cent, and Reliance Communications, which jumped by 3.44 per cent, attracted buyers' interest.

MTNL, too, surged by 3.53 per cent and Tata Communications' stock went up by 1.87 per cent.

Commenting on the policy, Emkay Global Research said in a note, "The policy indicates a long-term vision and objectives, but the ongoing spectrum-related issues remain unresolved. We maintain our positive view on the sector. Draft NTP-2011 does not indicate any kind of significant negative for incumbents."

"However, the key issues related to the spectrum re-farming and a one-time fee for excess spectrum remained unanswered," it said.

The government on Monday unveiled a new policy that will help users avail free roaming services across the country and inter-circle mobile number portability.

Another boost for the industry are provisions in the draft bill for recognition of telecom as an infrastructure sector, analysts said.