The telecom sector revenue growth is likely to be more than double to 10% in the March quarter of FY22 when the full beneficial impact of sharp tariff hikes of last November hits home, according to analysts. The sector recorded a growth of 4.5% and 4.2% in the 2 ND and 3 rd quarters of FY 22. Kunal Vora, Head of India
Equity Research, BNP Paribas, told, “The telecom industry has seen a jump in its revenue growth in Q4FY22 at 10% due to the full impact of tariff hikes taken by operators last November, although 4G revenue growth will come down in the upcoming quarters due to the increase in the cost of services”.
He expects the growth to return to the 4-5% level sequentially in April-June FY23. He also added that the “combined revenue of Reliance Jio, Bharti Airtel and Vodafone Idea will go up to Rs 452 billion (Rs 45, 200 crores) in Q3FY22 from Rs 315 billion (Rs 31,500 crore) in Q1FY19. Alongside the telecom user base will also increase with the minimum cost of mobile services increasing to Rs 99 over the last 2 quarters”.
Bharti Airtel MD, Gopal Vittal recently said, that Airtel won’t hesitate to take the lead in pushing through another round of tariff hike in 2022, giving its ARP a boost to Rs200 to Rs300. He also reiterated the fact that the price hike next is related to the current wave of SIM consolidation eases.
Now, what is Sim Consolidation? Sim Consolidation leads to a sharp decline in the number of mobile sim card users. This eventually happens when consumers make fresh choices about telco brands based on services provided after a round of steep price hikes.