The Sunil Mittal-led telco’s India<\/a> mobile revenues increased about 6% sequentially in the quarter to December 2021, compared to the 3.3% growth reported by both Jio<\/a> and Vi.
Analysts expect this trend to continue, with Bharti Airtel<\/a>’s managing director Gopal Vittal<\/a> saying on Wednesday that the telco won’t hesitate to take the lead in pushing through another round of tariff<\/a> hikes in 2022 to further boost average revenue per user (ARPU) to Rs 200.
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ICICI Securities said “Airtel<\/a> has consistently improved its (revenue) market share” since the tariff hike<\/a>s taken in December 2019 and every tariff hike<\/a> subsequently has allowed it to speed up its gains from SIM consolidation.
“Airtel’s Q3FY22 India<\/a> mobile revenues grew 5.9% QoQ to Rs 16,100 crore compared to Jio and Vi’s 3.3% on-quarter revenue growth each, which implies its market share wins continue, and it looks likely that Bharti can keep outperforming in the next two quarters as it benefits from SIM consolidation,” the brokerage said in a note seen by ET.
SIM consolidation results in a sharp drop in the number of mobile SIM cards in the market. This normally happens when consumers make fresh choices about their preferred telco brands – based on quality of services – after a round of steep price hikes. Following the sharp price hikes by the big telcos last November, Bharti Airtel<\/a> appears to have an edge, in that it lost 0.6 million users in the December quarter compared to heavier customer losses of 8.5 million and 5.8 million for Jio and Vi respectively.
Chief executive Vittal has said that Bharti Airtel is at a new lifetime high in terms of RMS at nearly 36.9%, validating its strategy of winning with quality customers. The telco’s RMS, though, is a shade below that of Jio, which reported an RMS of 40.2% in the second quarter of the financial year. Vi’s RMS is at a modest 18.6%.
Bharti Airtel shares closed 0.6% higher on BSE on Thursday at Rs 723.80.
Motilal Oswal said, “Bharti’s superior execution quality is reflected in its strong performance in the last 8-10 quarters, where it gained market share consistently with consolidated Ebitda CAGR (compound annual growth rate) of 27% over FY20-22E”.
The brokerage has estimated Bharti Airtel’s 2021-22 to 2023--24 consolidated Ebitda CAGR at 20%, aided by “mobile India Ebitda CAGR of 25%, on improving 4G mix, market share gains, and full benefits of the tariff hikes announced last quarter”.
Analysts see prospects of a more affordable JioPhone Next – Reliance Jio’s budget 4G smartphone developed with Google – in the coming months. This, according to them, would hasten 2G to 4G smartphone conversions for the telecom market leader and intensify the battle for RMS between India’s top two telcos.