Bharti Airtel ARPU Estimated to Surpass Reliance Jio in Upcoming Quarterly Reports

Bharti Airtel and Reliance Jio are locked in a battle, with the former set to surpass the latter in one of the key metrics of the industry in the upcoming weeks

Highlights
  • Reliance Jio had witnessed a peak ARPU of Rs 156, but now its ARPU stands at Rs 126
  • Bharti Airtel is expected to register an ARPU of Rs 127 in the upcoming reports

Reliance Jio Infocomm, which has been leading on many fronts till now in the telecom industry is going to witness fall in one of its metric. As per a new ET Telecom report, the average revenue per user (ARPU) which is a key metric in the telecom industry will be surpassed by Bharti Airtel, for the Mukesh Ambani led telecom operator. For quite a long time, Reliance Jio has been boasting of the highest ARPU in the industry, and now Bharti Airtel is going to take over the metric for the first time since the former started reporting its quarterly financials, as per the analysts.

Bharti Airtel to Touch Rs 127 in ARPU

As per the estimations of the analysts, Reliance Jio’s monthly ARPU may come down to the levels of Rs 124 thus seeing a decline for the seventh consecutive quarter. Whereas, Airtel’s ARPU is expected to climb up to Rs 127, thus surpassing the figure inked by Reliance Jio in this quarter. It is worth noting that the Mukesh Ambani led telecom operator has been amassing low-revenue generating customers from the sale of its 4G feature phone, the JioPhone. In contrast to that, Airtel has been putting focused efforts since the second half of 2018 to continuously improve its ARPU, and it seems that its efforts have been paying off.

According to Axis Capitals, “Jio’s ARPU will decline 2% sequentially to Rs 124 due to a mix change.” Also, Rajiv Sharma who co-heads SBICap Securities remarked on Jio’s monthly ARPU saying that it may “remain subdued as it continues to only add marginal customers, although things could change if it ramps up visibility on the postpaid and enterprise business domains, or rings in a quick tariff hike.”

Reliance Jio to Witness Consecutive Decline in ARPU

To recall, the last when Reliance Jio’s ARPU had peaked was in the July-September quarter of 2018, and it was registered to be Rs 156. Since then, the metric has only seen a decline for the telecom operator and has shrunk to Rs 126 in the past six quarters. As per Kotak Institutional Equities, Airtel’s efforts of introducing minimum recharge plans to do away with non-paying and low-revenue customers has helped the telco in upping its ARPU. As such, in the upcoming reports, the telco is expected to register and ARPU of Rs 127.

In the March quarter of FY19, Reliance Jio has transferred its fibre and tower assets to special purpose vehicles owned by the two InvITs. The parent company, Reliance Industries had acquired 51% stakes each in Jio’s fibre and tower units – Jio Digital Fibre and Reliance Jio Infratel. Also, the brokerage firms are estimating that Reliance Jio will post its seventh successful profitable quarter in the April-June period, owing to the sustained strong subscriber growth.

Arpit spends his day closely following the telecom and tech industry. A music connoisseur and a night owl, he also takes a deep interest in the Indian technology start-up scene and spends rest of his time spilling poetry and stories on paper.

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