Reliance Jio, India's largest telecom operator, will likely witness its average revenue per user (ARPU) cross Rs 200 in Q3 FY25. This would be a major milestone for the company. The ARPU will see a boost due to the tariff hikes implemented in July 2024. The ARPU could range between Rs 203 to Rs 206 in the quarter. This is a sequential growth of 4-6% QoQ.
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But the full impact of the tariff hike on the ARPU will continue to take place in the coming quarters. According to a Financial Express report, Axis Capital said in a research note, "We expect continued benefit of tariff hike in Q3FY25, though at a lower level than in the previous quarter. The trend of drop in subscriber base from the initial sticker shock of tariff hikes also appears to have waned."
Reliance Jio saw its overall subscriber base dipping by several million customers. This was due to a sudden increase in tariffs. However, that effect has now subsided and the telco is expected to add new users in the coming quarters. Jio's ARPU before the tariff hike, in Q1 of FY25 stood at Rs 182. This is decent levels of growth in just two quarters for the company.
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Bharti Airtel and Reliance Jio have invested thousands of crores in rolling out 5G. Now the telcos are looking to monetise their networks and focus more on high-paying customers. Bharti Airtel's ARPU has already touched Rs 233 and is expected to grow aggressively again in Q3 FY25. Airtel has high-paying customers on its portfolio, and with the Airtel Black service, the telco is incentivising customers to take bundled services and upgrade to more value plans.
