Telecom industry’s revenues continued to grow for the fifth quarter in a row during Q3FY21 to Rs 443 billion, India Ratings and Research (Ind-Ra) said in a report.
Accordingly, this trend was supported by the industry-wide tariff hikes implemented in the last 12-18 months, increasing penetration of high ARPU (average revenue per user) broadband subscribers, and increasing subscriber base.
Quoting the Telecom Regulatory Authority of India data, the report said industry-wide revenue continued to grow for the fifth quarter in a row in “3QFY21 to INR443 billion”.
“Reliance Jio Infocomm continued to be the largest telecom player by revenue market share (RMS) in December 2020 with RMS of 39.3 per cent in 3QFY21, followed by 32.8 per cent RMS of Bharti Airtel 20.8 per cent RMS of Vodafone Idea Limited and a 6.8 per cent market share of Bharat Sanchar Nigam.”
Besides, the number of broadband subscribers increased to 63 per cent of the overall wireless subscriber base in December 2020 from 62 per cent in November 2020 and 47 per cent in March 2019.
“In December 2020, the number grew by strong 5 million (November 2020: 6.9 million). This along with a rise in data tariffs reflects that the Indian telecom industry is moving towards a higher ARPU regime.”
“The tariff differentials for the prepaid and postpaid tariff plans among the telcos are already narrowing down over the past one year.”
According to the report, post-paid tariff plans by RJio and tariff hike announced by VIL for select plans, a few months back, indicated the inclination of industry players towards a higher ARPU regime in the long run.
“This is also reflected in the growth in ARPU in 3QFY21 for all the telecom players, where in BAL and VIL reported an increase in ARPU by 2 per cent and RJio reported an increase in ARPU by 4 per cent qoq in 3QFY21.”
“BAL continued to report highest ARPU of INR166 per user per month in 3QFY21 compared to the ARPU of INR151 of RJio and INR121 of VIL.”
Furthermore, the report cited that out of 856MHz spectrum sold in the recent auctions, RJio has acquired the highest spectrum, adding up to a total of 488MHz through three bands 800MHz, 1,800MHz and 2,300Mhz, while BAL has acquired 356MHz spectrum through five bands ranging from 800MHz to 2,300Mhz.
“That being said, the agency believes that both RJio and BAL have the strong financial flexibility to make the immediate upfront payment and adequate cash flow buffers to cover yearly spectrum payments FY24 onwards.”