The telecom sector has entered a phase of steady growth, but one name is standing out in the latest report of the global brokerage firm Jefferies. As per this brokerage report, the September 2025 quarter showed some trends from rising Average Revenue Per User (ARPU) to stronger margins for Jefferies to stick with its preferred pick in the sector – Bharti Airtel.
The brokerage has reviewed all major players, including Reliance Jio, Vodafone Idea and Indus Towers in its report. While each company showed a mix of gains and challenges, Jefferies believes this telecom sector stock continues to stand stronger than the rest.
Jefferies on Telecom sector: Revenue momentum stays steady
Speaking about the telecom sector stocks, Jefferies noted that the July–September 2025 quarter recorded an 11% year-on-year rise in overall revenues for the top three telecom operators. The gain came mainly from higher Average Revenue Per User (ARPU), with Reliance Jio and Bharti Airtel growing faster than others.
Jefferies said this shift shows that telecom operators are now leaning on multiple sources of income. The brokerage added, “India mobile revenues continued to rise for the 24th straight quarter, reaching US$35 billion on an annualized basis – a fresh peak.” Reliance Jio gained slightly, Bharti Airtel remained stable, and Vodafone Idea lost ground.
Jefferies on Telecom sector: Subscriber additions slow but ARPUs rise
New subscriber additions moderated in the quarter even though gross activations touched a seven-year high. Reliance Jio led net additions, supported by growth in home broadband. Bharti Airtel, meanwhile, saw a stronger improvement in revenue per user.
Jefferies on Telecom sector: Margins improve as costs ease
Margins strengthened across the top three operators. Jefferies said that “aggregate EBITDA margins expanded to 54.7%, mainly due to a decline in SG&A costs.”
Bharti Airtel delivered the highest incremental margins.
Jefferies on Telecom sector: Vodafone Idea struggles while Indus Towers gains attention
Jefferies pointed out that Vodafone Idea continues to face challenges related to network expansion and capital expenditure (capex). The brokerage further noted that “VIL’s performance continues to lag peers,” highlighting low investments and subscriber losses.
Meanwhile, tower company Indus Towers surprised positively. According to Jefferies, “Indus Towers’ results beat estimates…rental revenues surprised positively,” and any relief related to Adjusted Gross Revenue (AGR) dues could help improve growth and payouts.
