Vodafone Idea’s revenue market share stabilizes at 18.6% in Q2: Trai
Analysts attributed it primarily to segmented rate increases implemented around August in the core prepaid voice and postpaid business user segments.
Vi, formed in August 2018, recorded a stable RMS of 18.6% in the second fiscal quarter, equivalent to the number recorded during the April-June period, according to the latest financial data from telecom operators collected by the Telecom Regulatory Authority of India (Trai).
Bharti and Reliance Jio increased their revenue share, posting sequential gains of 101 basis points (bps) and 63 bps, respectively, to bring their September quarter RMS levels to 35.9% and 40.2%.
Airtel, in fact, gained the maximum RMS among the three private telecommunications operators, helped by good performances in subways and “category A” markets. The RMS is a measure of the overall leadership of the telecommunications market.
“Vi’s Q2 RMS is stable at 18.6%… it has shown a good recovery in metro and A ‘circles, with the exception of AP, and its market share will now be determined by its ability to translate the (latest) rate hike taken into adjusted gross income (AGR), ”said ICICI Securities, analyzing Trai’s data on telecom operators’ financial data.
Brokerage firm CLSA, supported the view, saying “revenue growth in the subways was led by Bharti and Vi, which saw 33-46% growth in QoQ.”
Analysts actually expect Vi to experience an almost 70% increase in operating profit and a 14% increase in revenue in FY 22 itself following his decision to increase all prepaid rates up to 25% starting November 25.
They also hope that a recent Trai regulation prohibiting telecom operators and distribution partners from making discriminatory tariff offers to attract customers of competing operators through mobile number portability (MNP) from September 2021. will help Vi to limit customer losses and maintain a share of the revenue.
Over the past three years, Vi has lost millions of customers and revenue share each quarter to its two financially stronger rivals – Reliance Jio and Bharti Airtel. This was mainly due to the inability of the cash-strapped phone company to adequately invest in expanding its 4G networks to match Jio and Airtel on mobile broadband coverage. Failure to raise sufficient funds only made matters worse, causing Vi’s customer base to drop to 253 million at the end of September, from 408 million at the time of the merger. Meanwhile, his RMS also almost halved, from over 32% to 18.6%.
But, backed by a recently announced government reform package, some specific price hikes it took in August, and general rate increases for prepaid users starting Thursday, things are starting to improve for the United States. phone company under siege, experts said.
BNP Paribas said that “Vi remains a leading operator in Kerala, Gujarat, Mumbai and Haryana with over 30% market share”.
Vi’s quarterly adjusted gross income (including NLD income) also increased by 1.8% sequentially to Rs 8,700 crore during the July-September period.
Airtel and Jio also increased their quarterly AGR between July and September.
Data from Trai showed that Airtel and Jio’s AGR (including NLD revenue) increased 4.9% and 3.6% sequentially to Rs 16,700 crore and Rs 18,700 crore, respectively, as of during the second fiscal quarter.
ICICI Securities said Airtel had, for “the third consecutive quarter, added more incremental AGR compared to Jio, clearly benefiting from strong market share gains in the rapidly growing subways and A ‘circles “.
Jio, he said, “has continued to gain market share in circles ‘B’ and ‘C’ (rural markets)”, although these are relatively smaller and have seen income growth. weaker.
Jefferies, however, said that although Vi has been successful in “controlling the decline in market share in the subways,” the overall market share shift continues towards Jio and Airtel.
The global brokerage firm, in fact, estimates Airtel’s RMS to reach 39% in FY 22-24, which is expected to help generate a 17% / 21% CAGR in its consolidated revenue and EBITDA. during the period.
Overall, the September quarter sector AGR (including NLD) rose 1.9% sequentially to Rs 46,600 crore, ICICI Securities said, adding that this was due to a combination of strong additions of 4G users and selective tariff increases taken by Airtel and Vi around July-August.
After the tariff increases taken by Airtel and Vi this month, Jefferies estimates that “the revenues of the telecommunications sector will increase from $ 26 billion to $ 33 billion by fiscal year 24.”