iWorld
Telecom tariffs may rise another 12-15 per cent in next 4-5 months: Centrum
Airtel and Jio are expected to gain subscribers as Vodafone Idea faces continued pressure
MUMBAI: India’s telecom users could face another round of tariff increases, with industry prices expected to rise 12-15 per cent over the next four to five months as market consolidation creates a more favourable pricing environment.
According to a Centrum Institutional Research report, the presence of three major private operators alongside the public sector player has improved pricing conditions, giving telecom companies greater room to raise tariffs.
The report also expects Bharti Airtel, Reliance Jio and Vodafone Idea to post a 0.8-2.0 per cent quarter-on-quarter increase in average revenue per user (ARPU) in Q2FY27. Growth is expected to come from 2G-to-4G/5G migration, postpaid additions and a higher number of days in the quarter.
Subscriber gains, however, are likely to remain skewed towards Airtel and Jio, with both expected to continue gaining market share at Vodafone Idea’s expense.
Reliance Jio is projected to add around 8 million wireless subscribers during the quarter, taking its base to 541 million. Its ARPU is expected to rise 1 per cent quarter-on-quarter to Rs 218 a month, helped by 5G fixed wireless access (FWA) additions and a higher number of days in the quarter. This could translate into 2.6 per cent sequential revenue growth.
Bharti Airtel is expected to add around 3 million subscribers to reach 380 million. Its ARPU is projected to increase 2 per cent quarter-on-quarter to an industry-leading Rs 269 a month, supported by continued 2G-to-4G migration and the higher quarterly day count. Revenue could grow around 3.1 per cent sequentially.
Vodafone Idea is expected to add around 1 million subscribers, taking its base to 194 million. Its blended ARPU is projected to rise 0.8 per cent quarter-on-quarter to Rs 178 a month. Investors are likely to closely track management commentary on capital expenditure and fundraising.
The report also highlighted the continued expansion of 5G networks. Reliance Jio and Airtel have covered more than 95 per cent of districts with 5G services, with both operators now focusing on increasing the number of 5G devices on their networks.
Vodafone Idea’s 5G network is present in around 200 cities, with the operator continuing to expand coverage.
The company’s fundraising plans remain another key focus. Vodafone Idea is in discussions with banks to close a Rs 250 billion debt raise as part of its Rs 450 billion capex programme for FY27E-29E.
Meanwhile, Jio and Airtel are seeing strong traction in 5G FWA and fixed broadband additions, although penetration in the segment remains relatively low.
Beyond the three telecom operators, Indus Towers is expected to report around 1.7 per cent quarter-on-quarter revenue growth, supported by a 1.5 per cent rise in co-locations as Vodafone Idea increases capital expenditure to expand network coverage and capacity.
Tata Communications is expected to post 1.6 per cent sequential revenue growth, helped by improving traction in its digital platform and data services business. Its EBITDA margin is projected to improve by around 61 basis points to 19.3 per cent.
With subscriber growth increasingly concentrated around Jio and Airtel and pricing power improving across the market, the next tariff cycle could become another important test of how much consumers and operators can absorb higher mobile prices.
