Bharti Airtel's Vice Chairman and Managing Director (MD), Gopal Vittal, said in a recent statement that the industry (telecom) needs further tariff repair to ensure sustained investments and long-term value creation. This statement comes right after the telecom operators hiked the tariffs and saw an uptick in their ARPU (average revenue per user). Bharti Airtel's ARPU reached a staggering Rs 245 during the quarter, the highest for any telecom operator in India by a huge margin.
Read More - Airtel Q3 FY25 Results: Net Profit at Rs 5514 Crore, ARPU Jumps to Rs 245
Bharti Airtel's short-term ARPU goal is to reach the Rs 250 figure, which undoubtedly, the telco will achieve by the end of FY25. The medium-term target is to reach Rs 300 in mobile ARPU. For this, the telco would definitely need the help of another tariff hike. Telcos are not expected to hike the tariffs any time soon again, as it would irk the customers who are now used to carrying dual or even more than two SIM cards.
Vittal's statement suggests that the industry's tariffs are not at the optimum mark to enable the telcos to create value out of their investments. The ROCE (return on capital employed) for the top two telcos in India is still pretty low. Further expansion of services will allow Airtel in adding more high-paying customers to its networks.
