Bharti Airtel’s India ARPU Rises The Most Since Listing
Bharti Airtel Ltd.’s average revenue per user for the quarter ended March jumps the most since its 2002 listing as India’s second-largest largest telecom operator weeded out low-paying subscribers and added more 4G users.
The Sunil Bharti Mittal-led company’s ARPU jumped over 18 percent to Rs 123 in the fourth quarter of financial year 2018-19. The telecom operator had reported its quarterly earnings on May 6, but didn't disclose the other details due to its rights issue.
Despite the fall in its overall subscriber base, Bharti Airtel’s added 4G users, aiding growth in its India business. While the company’s total subscriber base declined by 16 lakh, the number of 4G users increased by 1 crore, higher than its larger peer Vodafone Idea Ltd.
Bharti Airtel’s expansion of 4G coverage and lucrative bundled plans aided growth of its 4G user base.
That along with cost cuts resulted in strong operational performance for Bharti Airtel’s India business. The company’s earnings before interest, tax, depreciation and amortisation from its India business grew for the first time in 11 quarters.
Vodafone Idea Ltd.’s operating profit increased due to merger synergies. On the other hand, Reliance Jio Infocomm Ltd.’s Ebitda continued to grow, but at a slower rate.
The capital expenditure of Reliance Jio and Vodafone Idea increased in the fourth quarter. Bharti Airtel’s capital expenditure, however, declined.
Surprisingly, Jio’s spending was at an all-time high of Rs 21,500 crore in the fourth quarter which is even more than the annual capital expenditure of Bharti Airtel’s India business.
Jio was the only telecom operator which pared debt due to the demerger of its tower and fiber assets. That helped the company reduce its leverage ratio below Airtel’s for the first time. Debt of Vodafone Idea and Bharti Airtel, on the other hand, rose over the last quarter.