Even as the telecom industry continues to undergo severe financial stress and competition, Mukesh Ambani, the Chairman of Reliance Industries said that the company is ahead of its schedule on earnings from Reliance Jio.
Even as the telecom industry continues to undergo severe financial stress and competition, Mukesh Ambani, the Chairman of Reliance Industries said that the company is ahead of its schedule on earnings from Reliance Jio. “We are ahead of schedule on earnings from Reliance Jio, will watch out for next few quarters,” PTI reported Mukesh Ambani as saying.
Yesterday, global firm CLSA said that Jio will be a huge growth driver for the conglomerate in the coming days. CLSA’s report says that discount reduction in Jio’s smartphone average revenue per user (ARPU) will drive EBITDA further. The beginning of downstream expansion will drive doubling of EBITDA over FY17-20. CLSA states that JioPhone will drive next leg of growth for Jio after a fabulous first year. Jio has achieved 12% subscriber market share a year after its launch.
Reliance Jio turned an impressive set of numbers for the July-September quarter which is otherwise seen as a weak period for mobile operators. The company, which started commercial operations from September 2016 for the first time released its full earnings and other operating metrics. As is known, Jio started charging customers for its services only from April 2017. Reliance Jio’s revenue during the quarter stood at Rs 6,147 crore, which is quite impressive considering that it has only around 138 million subscribers.
In September this year, Mukesh Ambani said that Reliance Jio is not merely the largest data network provider in India, but also enjoys the status worldwide. In a video message, Mukesh Ambani said, “Today Jio is not the largest network in India, it is the largest network in the world. Jio has made voice free for life.” Further, Mukesh Ambani 4G coverage will be better than 2G in India.
In July this year, Sunil Dutt, President of Reliance Jio Infocomm, said that India has increased its mobile data consumption by six times after Jio made an entry into the market. “After the introduction of Jio last year, the Indian consumer has ramped up its data consumption in six months to 1.2 billion gigabytes per month, out of which 1 billion gigabytes per month is consumed by Jio subscribers alone,” Sunil Dutt said. Notably, the telecom company also created a world record of the fastest 100 million user acquisition ever.
Telecom sector is under stress, and not just financial strain of being buried under a huge pile of debt, but also the operational stress as the hyper competition from Reliance Jio’s dirt cheap tariff offers and novel plans seems nowhere close to coming to an end any time soon. Incumbent operators, even the strong-footed ones, are reeling, and most have been forced to either sell out to the rivals, or wind up altogether.