The June quarter for Bharti Airtel and Vodafone Idea will be an unpleasant one as they are expected to see a significant fall in their revenue growth due to the restrictions that have been imposed across India due to the COVID-19 virus.
This impact can be directly attributed to many reasons including the significant reduction in their subscriber base due to the migration of workers, deactivation of multiple sim cards’ users, and the mass job losses across the country.
Due to the lockdown-led delays in recharges, it has been expected that the Reliance Jio Infocomm Ltd will be reporting a lukewarm revenue growth.
While its lower share of business when it comes to international roaming services, it will also save them from a rapid Arpu fall.
As said by ICICI Securities in a report, Aitel and Vodofone’s ARPU (average revenue per user) is likely to decrease in the months of April-June due to the significant decrease non-feasibility of offline recharges, temporary recharge aberration, decrease in international roaming revenue, and mutes 4G net additions.
Emkay Global Financial Services highlighted, “We project Jio’s subscriber additions to be compressed at 6 million and Arpu to decline 2% Q-o-Q (quarter-on-quarter) to ₹128. Lower interest charge (post-fund raise and debt restructuring in Q4) shall aid profit after taxes growth of 11% Q-o-Q."
Requesting anonymity, a telecom analyst stated, “A fall in subscriber base in April would hit overall revenue growth. However, Arpu could go up given the lower denominator and assuming that the maximum fall has come from low-end customers… We need to see the numbers for May and June."
As yet to clear the adjusted gross revenue-related dues of ₹50,400 crore, Vodafone Idea does not sit well with the current fall in its revenue.
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