India Ratings and Research (Ind-Ra) has published the September 2021 edition of its credit news digest on India’s telecom sector. It highlights the trends in the telecom sector, with a focus on subscriber additions, subscriber market share, broadband subscribers, data usage, pricing and regulatory and industry updates.

The key highlights of the report are as under: 

Wireless and Broadband Subscribers Base Grew in June 2021: The industry-wide subscriber base increased by 4.0 million subscribers on a month-on-month (mom) basis in June 2021 to 1,181 million subscribers, as against a sharp decline of 6.3 million subscribers in May 2021. Broadband subscriber base also grew in June 2021 by 11.7 million subscribers to 769 million subscribers. Reliance Jio Infocomm Limited (RJio; ‘IND AAA’/Stable) reported the highest increase in both wireless subscribers and broadband subscribers among other telcos in June 2021, wherein they grew by 5.5 million and 5.7 million subscribers, respectively. Bharti Airtel Limited (BAL; debt rated at ‘IND A1+) also reported an increase in both wireless and broadband subscriber base by 3.8 million and 4.4 million subscribers, respectively in June 2021. Vodafone Idea Limited (VIL) reported a loss in subscriber base again in June 2021 by 4.3 million subscribers, while its broadband subscribers increased by 1.8 million. While BAL has also been gaining market share, RJio continues to be the largest telco by subscriber market share (SMS), holding 37% of the total SMS in June 2021, followed by 29.8% SMS of BAL and 23.1% SMS of VIL. The visitor location register subscriber base, which shows active subscribers, reported a dip by 1.3 million subscribers mom in June 2021 to 985 million subscribers. 

Industry-wide Revenue Continued to Increase in 1QFY22: As per the Telecom Regulatory Authority of India data, the industry-wide adjusted gross revenue (revenue: AGR, including national long-distance revenue) increased by 3% quarter on quarter (qoq) to INR464 billion in 1QFY22 (4QFY21: INR448 billion). This increase in revenue is largely supported by 11% qoq growth in revenue of RJio and a moderate 1% qoq increase by BAL, more than offsetting the 2% and 3% qoq decline in revenue reported by VIL and Bharat Sanchar Nigam Limited, respectively. RJio continued to be the largest telecom player by revenue market share (RMS) in June 2021 with RMS of 38.9% in 1QFY22, followed by 35.7% RMS of BAL, 18.4% RMS of VIL and a 6.7% market share of BSNL. 

Structural Sector Improvement Continues;
Average Revenue Per User Could Grow even without Tariff Hikes: The number of broadband subscribers increased to 65.1% of the overall wireless subscriber base in June 2021 from 64.4% in May 2021 and 47% in March 2019. In June 2021, while the number of broadband subscribers increased by strong 11.7 million (May 2021: decline by 2.9 million), the broadband penetration as percentage of overall subscriber base continued. Additionally, the average data used per user is increasing rapidly. BAL leads the industry with the highest reported average monthly data usage (GB), which grew to 18.9GB per user per month in 1QFY22 from 16.8GB per user per month in 4QFY21. The sliding voice tariffs, growing data tariffs, increasing data usage per subscriber and increasing data subscribers in the overall subscriber base over the last one year indicate that the average revenue per user of the industry could grow even without tariffs hikes. 

Source: Telecom Regulatory Authority of India

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Analyst Names

  • Priyanka Bansal

    Associate Director
    India Ratings and Research Pvt Ltd Wockhardt Towers, 4th Floor, West Wing, Bandra Kurla Complex, Bandra East,Mumbai - 400051
    +91 22 40356148

    Prashant Tarwadi

    Director
    +91 22 40001772

    Media Relation

    Ankur Dahiya

    Manager – Corporate Communication
    +91 22 40356121