5G price wars may weigh on Bharti Airtel
economictimes.indiatimes.com5G price wars, combined with a lack of significant tariff hikes and limited support from 4G tariff interventions, could slow Bharti Airtel's average revenue per user (ARPU) growth, some analysts said.
In addition, reduced capex could result in loss of subscriber market share to market leader Reliance Jio with the latter turning aggressive in 5G rollout and using 5G offerings to drive premiumization, they said. Airtel’s stock was trading about 0.5% lower in morning trade on Wednesday.
The telco announced its quarterly results the day prior post market hours.
“5G price wars have commenced that can put a ceiling on ARPU from new subs and deflate top-up momentum,” analysts from JP Morgan said in a report.
While both Airtel and Jio are yet to roll out 5G specific mobility tariffs, both have launched their 5G fixed wireless access (FWA) offerings where Jio has bundled content offerings across a range of plans. Airtel, on the other hand, has a single plan currently without any bundling.
Airtel has maintained its focus on premiumization – conversion of 2G customers to 4G and migrating customers to postpaid or higher priced pre-paid plans – to increase its ARPU and has seen benefits over the past few quarters.
