Your phone bill could rise by up to 25% post election
25% increase in their bills after the general election as telecom companies prepare for the fourth round of tariff hikes in recent years, a move which would give a boost to their average revenue per user (ARPU).
«We expect a meaningful hike of around 25% by the operators in the near term on the back of a stable competitive environment, their need to improve profitability following heavy 5G investment, and continued government support,» said a report by brokerage Axis Capital.
The report said while the quantum of hike may appear large, it should be manageable for both urban and rural users, especially as data usage is sticky. For urban households, subscribers' spending on telecom would go up to 3.6% of total expenditure from 3.2%, it said, while for rural subscribers spending would increase to 5.9% from 5.2%.
The roughly 25% increase in headline rates would result in a 16% growth in ARPU for telecom operators, Rs 29 for Bharti Airtel and Rs 26 for Jio, Axis Capital estimated.
Jio reported an ARPU of Rs 181.7 for the quarter to March, while the numbers for Bharti Airtel and Vodafone Idea (Vi) were Rs 208 and Rs 145, respectively, for the October-December 2023 period. Bharti Airtel and Vi have yet to report the March quarter numbers.
Operators will look towards monetising capex investments in 5G by undertaking tariff correction of bundled packs, said Peeyush Vaish, TMT industry leader, Deloitte, South Asia. «We expect a 10-15% increase in ARPUs to add around Rs 100 per subscriber by end of this calendar year,
