The telecom operators ended the second quarter of FY22 on a positive note because of the relief package announced by the government. But there was also another positive for the telcos in the same quarter. Bharti Airtel and Vodafone Idea (Vi) discontinued their base plans of Rs 49, which meant an indirect price hike for the users on that particular discontinued plan as they would now have to recharge with the Rs 79 plan instead. As per analysts, Bharti Airtel is expected to beat Reliance Jio in reporting a stronger sequential growth in mobile revenue as well as better average revenue per user (ARPU) in Q2 FY22.
Airtel Might See 7.1% Sequential Growth Against Jio’s 4.7% Growth
As per Jefferies, Bharti Airtel might see 7.1% sequential growth as compared to Jio’s 4.7% in the July-September, 2021 period. Further, Jefferies believes that Bharti Airtel’s ARPU might jump by 7.3% QoQ to Rs 157. At the same time, Jio’s ARPU is expected to jump by 1.3% to Rs 140.
However, Reliance Jio is expected to report a strong subscriber addition during the quarter - around 14 million users. The reason behind the growth is expected to be the JioPhone 2021 offer, and the telco’s total subscriber base may touch 454 million during the second quarter of FY22.
Vodafone Idea Expected to Perform Decently
Vodafone Idea is expected to perform quite dim against its rivals. The telco’s subscriber base is expected to dip by 10 million during the quarter. This is fair because of the price hike and bad performance of the telco in the rural areas of the country.
However, because of the tariff hike, Jefferies expect that the churn rate for Airtel will be higher during the quarter. Thus the telco’s subscriber base might decline by 4 million. All the operators will soon start coming out with their quarterly reports, and it should be similar to what Jefferies has said.