Bharti Airtel Subscribers, Duopoly Scenario and Tariff Hikes to Drive ARPU: Jefferies

Bharti Airtel’s market share gains among 4G subscribers is garnering attention from every corner, especially brokerages. To recollect, Airtel added 15 lakh wireless subscribers in December 2022 and has a stellar Q3FY23 performance with a reported ARPU of Rs 193, the highest in the Industry. Considering Bharti Airtel’s progressive 5G Network Rollouts, Duopoly like scenario and entry-level Tariff Hikes accordingly, Global brokerage Jefferies has turned bullish and upgraded its long-view rating to BUY.

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Also Read: Bharti Airtel’s ARPU to Touch Rs 199, Bolstered by Tariff Hikes: CLSA

Bharti Airtel Subscriber Base and Mix

Jefferies has noted Airtel market share gains among 4G subscribers and said 4G users are driving ARPUs. Share gain is evident from Airtel’s 60% incremental market share in 2HCY22 compared to its overall market share of 30%. The subscriber mix Airtel got has helped the company raise its ARPU. With another 107 million voice subscribers on the network yet to upgrade to data plans, the brokerage expects the ARPU of Airtel to improve.

Focus on Improving ARPU

Airtel is leading the market with tariff hikes. The company discontinued its Rs 99 plan in November, a move which extended to 19 of 22 circles, contributing to over 90% of India’s mobile revenues. Jefferies says this move indicates that the telco is looking to boost ARPUs even if it leads to some subscriber churn among ARPU subscribers.

Improving Tariff Outlook

According to a statement by Jefferies, the government’s recent decision to convert Vodafone Idea’s debt to equity is likely to align its interest in favour of a tariff hike and shift Airtel’s focus towards market expansion.