By Ojasvi Gupta
Telecom operators are expected to report stable quarter-on-quarter (q-o-q) growth for the April-June quarter, driven by steady improvement in average revenue per user (Arpu) and consistent subscriber additions. According to analysts, the combination of higher number of days during the quarter and continued migration from 2G to 4G/5G networks has supported topline momentum, with Reliance Jio expected to outperform its peers.
Brokerages have projected Arpu growth of 1-2% q-o-q for all three major players — Reliance Jio, Bharti Airtel, and Vodafone Idea (VIL) — as users continue shifting to premium plans.
According to Axis Capital, Jio is expected to post the strongest revenue growth at 3% q-o-q, with estimated revenue of Rs 35,146.7 crore. Bharti Airtel is expected to follow with a 1.6% increase to Rs 49,364.4 crore, while Vodafone Idea is likely to report flat revenues around Rs 11,012.5 crore.
“Jio would continue to gain subscriber market share at the expense of VIL,” brokerage firm Centrum said in its report, stating that Jio would have added around 6 million users during the quarter, while Airtel may have added approximately 3 million subscribers. Vodafone Idea, by contrast, is likely to have lost around 1.5 million subscribers, continuing a long-term trend of subscriber erosion.
Despite stable operating metrics, ICICI Securities pointed out that the benefits of the July 2024 tariff hike have already been absorbed in the previous quarter, limiting incremental revenue growth during the April-June quarter. The brokerage does not expect further price hikes in the near term but has projected a 20% increase in tariffs in FY27.
Airtel’s Q4FY25 performance was boosted by a one-time gain from provision reversals related to Indus Towers. With no such exceptional item in the current quarter, Airtel’s underlying growth may appear more modest.
Still, Bharti Airtel remains a top sector pick for Centrum, which expects its Arpu to rise 2% q-o-q to Rs 250. Revenue has been forecasted at Rs 49,160.2 crore, reflecting 2.7% growth, and Ebitda is likely to come in at Rs 27,561 crore. This compares with Axis Capital’s forecast for Jio’s revenue at Rs 30,900 crore and Ebitda of Rs 16,500 crore.
While network expansion by VIL is hampered due to delays in fundraising, limiting tower additions and capex rollout, Indus Towers might see a slight earnings bump if it reverses previously booked provisions for bad debts. Overall, the quarter is likely to reflect stability in operations, with continued gains for the stronger players and a slow recovery path for Vodafone Idea.