Vodafone Idea’s (Vi) revenues are likely to grow by 20% to 25% in fiscal 2023. As per CRISIL, the other two private telcos are going to see their revenues going up by the same margin. The growth in revenues will be there because of the rise of tariffs in 2021. CRISIL said that due to the full-year impact of tariff hikes, the ARPU (average revenue per user) figure of all the private telcos should go up by 15% to 20%.
However, the growth would be partially offset because of the downtrading of recharges, said CRISIL.
Vodafone Idea Lost Leadership in Five Circles
CRISIL said that because of losing subscribers for consecutive quarters, the telco lost leadership in over five circles. Regardless, because of the tariff hikes, the overall revenues for the telcos are going to go up. According to CRISIL, the EBITDA for the telcos in fiscal 2023 would expand by 180-220 bps this fiscal.
The tele-density in the country is going to grow. This means more wireless service consumers will be available in the market for the telcos to add to their subscriber base. Vi could benefit from this as the revenues will go up.
After the tariff hikes, SIM consolidation took place in the telecom sector, which saw over private telcos losing about 37 million users. However, the active subscriber base of the telcos grew steadily by 29 million. This will help the telcos in achieving a better ARPU figure in the short term.
In the second half of fiscal 2023, the telecom players are expected to raise prepaid mobile tariffs again. This will further boost the revenues of the telcos and improve their ARPU. However, there would be downtrading of recharges at a much higher level after the prepaid tariff hike expected to come later in the year. So some of the gains will be offset because of that.
