6 Good 5G Stocks To Invest for Long Term in India
Now-a-days the buzz word in Telecom is 5G. 5G is the next generation wireless access technology which will assures higher data capacity and speeds more than 10GB per second, which is far faster than the current 4G. This new 5G technology will bring revolution in data transfer speeds on smartphones, and there will be a large scope of redefinition in digital space. Industries such as Telecom, IT, Healthcare, Transport and Logistics will benefit largely with 5G technology. Indirectly 5G brings great revolution in almost all sectors. We can expect Telecom & Telecom related sector will benefit more.
What is 5G?
5G is fifth-generation cellular network technology. 5G is mainly designed to address the issues like speed and latency with 4G or 3G. The speed of the 5G network is 100 times faster than the 4G networks and the network latency is less than 10 ms. In India, network operators like Airtel, Vodafone-Idea JIO are partnered with vendors like Ericsson, Samsung, Huawei etc. for 5G trials.
Benefits of 5G
Greater speed and lower latency
Mobile speed increases from 100 MBPS to 10 GBPS
5G and IoT are perfect match
Can have capacity to communicate with thousands of devices seamlessly
Allows greater optimization of network of traffic and smooth handling of usage spikes
Disadvantages of 5G
Expensive infrastructure cost
Security and privacy issues yet to be addressed
Need to purchase new devices which are compatible to 5G
Accessing rural areas is an issue
Less coverage due to increased bandwidth, hence require to more cell towers
The radio frequency may become a problem
Best 5G Stocks to Invest in India for Long Term:
1. Indus Towers
Indus Towers Ltd., which is incorporated in 2006, is an Indian-based telecom tower company. Indus Towers merged with Bharti Infratel Limited in November last year. Bharti Airtel's stake in the firm after the merger is around 36.7 percent from its earlier 53.5 percent. Vodafone holds a 28 percent stake in Indus Towers after selling its 11 percent stake. As the 5G requires more towers because of lower coverage, expecting Indus Towers will benefit from the opportunity. Brokerage firm, CLSA recently given Indus Towers a 'BUY' rating, stating that the Indus Tower has added highest number of towers last year and has an upside potential to grow in valuation.
CMP as on 26-Jun-2021: Rs.244.60
HFCL is a leading manufacturer of Optical fiber cables, Optical transport, power electronics and broadband equipment for telecom industry. HFCL products are robust and reliable and have the reputation in India. HFCL also exports products to UK, Europe, Africa and Middle East areas. The homegrown optic fibre-to-night-vision devices maker said that its current order book currently stands at Rs 6,875 crore, and the company would continue to focus on next-generation (5G) portfolio, following which it has firmed up plans to design 5G small and micro cells.
CMP as on 26-Jun-2021: Rs. 64.70
3. ITI Ltd
ITI Limited is a public sector undertaking in the telecommunications technology segment established as a departmental factory in 1948. The company has manufacturing facilities in Bengaluru, Naini, Rae Bareli, Mankapur and Palakkad along with an R&D center in Bengaluru. It is paired with IT company Tech Mahindra to provide a 5G technology ecosystem in India including 5G-enabled devices, core system etc. This is mainly to reduce the dependency with other countries like China. Under government rule, ITI gets some quota to provide equipment that can be installed in the network of public sector telecom companies BSNL and MTNL. All these factors are favorable to invest in ITI Ltd. for long-term.
CMP as on 26-Jun-2021: Rs. 128.30
4. Smartlink Holdings:
Smartlink Holdings Ltd., earlier known as Smartlink Netwrok Systems Ltd., is one of India's leading IT Networking company. It was established in 1993 and is pioneer in the field of Active and Passive Networking. It has 3 subsidiaries: Digisol Systems Ltd., Synegra EMS Ltd., Telesmart SCS Ltd. The main products of Smartlink Holdings are Telecom Equipment goods, Cables and Network devices which are helpful in deploying 5G services. is also keeping a close eye on the various new opportunities in manufacturing likely to come up in the new technology space like FTTH products and 5G products. Technology is constantly changing and so are business needs. With the latest technologies like 5G, IoT, Wi-Fi 6, SDN and Cloud coming in, Digisol launched ConvergeX series Future Ready Structured Cabling Solution under its New Digisol Enterprise structured cabling system. These solutions have been helping enterprises build the next generation of business and create paths toward future growth.
CMP as on 26-Jun-2021: Rs. 112.30
5. Sterlite Technologies
Sterlite Technologies (STL) is an industry-leading integrator of digital networks. Their fully 5G ready digital network solutions help Telcos, cloud companies, citizen networks and large enterprises deliver enhanced experiences to their customers. STL provides integrated 5G ready end-to-end solutions ranging from wired to wireless, design to deployment, connectivity to compute through core capabilities in Optical Interconnect, Virtualized Access Solutions, Network Software and System Integration. STL has a strong global presence with next-gen optical preform, fibre, cable and interconnect subsystem manufacturing facilities in India, Italy, China and Brazil, along with two software-development center’s across India and one data Centre design facility in the UK. The demand for fibre-optic cable, a key to high-speed data connectivity and upcoming 5G networks, is expected to increase to 25 million fibre kilometers (fkm) by 2022 and the STL is planning to spend at least Rs 300-crore to boost its production capacity.
CMP as on 26-Jun-2021: Rs. 265.50
6. Tejas Networks:
Tejas Networks Limited is an active player in in shaping India's 5G strategy and also contributes to the global 5G standards through its work in TSDSI-India's telecom Standards Development Organization. The Company also offers products such as converged packet optical, packet transport network, and enterprise ethernet switches, as well as provides mobile backhaul, video transport, and wireless broadband access. Tejas Networks serves telecom carriers, utilities, media, and defense sectors worldwide.
CMP as on 26-Jun-2021: Rs. 177
The future growth is completely come from digital applications and services. Latest technologies like IoT, AI, ML etc. will play major role and provide good opportunities for the happening services sector. There always advantages and disadvantages with every new invention. We need to see how 5G will capitalize its advantage while shielding its issues. This only tells the success of 5G not only in India but across the Globe.
This data is for Academic purpose only. The data published on this post is just my opinion based on my own research and analysis and is provided as a general market commentary. As it does not take into account of your personal circumstances, please do not invest based solely on this information. By Viewing any material or using the information within this post you agree that this is general education material and you will not hold any person or entity responsible for loss or damages resulting from the content or general information provided here.