Bharti Airtel, the second-largest telecom operator in India is counting on its legacy network users to increase revenues. The telco’s average revenue per user (ARPU) figure rose to Rs 153 in the September quarter which is a 5% sequential growth. While it is the best ARPU amongst all the telecom operators in India, Bharti Airtel still has room to grow it further in the short-term.
The telco will be counting on the legacy network users to shift to 4G networks and services, resulting in the growth of ARPU and overall revenues. According to a note by IIFL that has been seen by ET Telecom, Bharti Airtel’s ARPU can jump by 1.5x to 2x if the telco’s 2G users shift to 4G and then further start using postpaid services.
Bharti Airtel Confident About Smartphone Cashback Offer
Bharti Airtel is quite confident about the smartphone cashback offer that it has rolled out for the customers. The telco isn’t worried about competing with the JioPhone Next offer because of the price of the device from Jio.
The ultimate goal for Bharti Airtel is to onboard as many customers as possible in the Airtel Black plans. It will be the best ARPU booster for the telco. Further, it will help Airtel in growing in Direct-to-Home (DTH) and Fiber-to-the-Home (FTTH) segments.
Airtel can work on expanding the reach of its 4G networks and also increase the capacity in the near future with the help of additional spectrum. The recent rights issue concluded by the telco will help majorly with improving the cash flow for the company to invest aggressively in its networks.
Gopal Vittal has already said that Bharti Airtel is looking to reach Rs 200 ARPU levels in the short-term while in the long-term the company plans to hit the goal of Rs 300 ARPU levels. The Rs 200 levels can be reached with the help of tariff hikes but that would result in a higher customer churn rate.