India Ratings and Research (Ind-Ra) has revised its outlook on the telecommunications services sector for FY 2016-17 to stable-to-negative from stable.

"The rating agency expects the launch of Reliance Jio to intensify competition in the telecom space, which will squeeze the market share, EBITDA margins and credit metrics of incumbents," Ind-Ra said in a statement.

It also expects competition to increase as RJio contends with market share out of the existing pie of subscribers which are being serviced by incumbent operators.

As a result, data market will be first to face the impact of increased competition, resulting in decline in data average revenue per users, it said.

The rating firm noticed decline in revenue realisation of Airtel and Idea Cellular by 4.5-5.5 percent on quarter-on-quarter basis.

Furthermore, the agency expects data revenue to remain stagnant on account of 30-40 per cent decline in data realisations per megabyte in the current fiscal, driven by RJio's launch.

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