Reliance Jio’s Increased Tariff Plans Are Still Cheaper Than Peers’
Reliance Jio's new prepaid tariffs, effective Dec. 1, are cheaper than the comparable plans of Bharti Airtel and Vi.
After Bharti Airtel Ltd. and Vodafone Idea Ltd., now Reliance Jio Infocomm Ltd. hiked prices of its prepaid plans. Yet, that’s at least 13% cheaper than peers.
“In line with its commitment to further strengthen a sustainable telecom industry… Jio announced its new unlimited plans,” the Mukesh Ambani-led carrier said in a media statement. Jio, it said, reaffirmed its “customer-first commitment through new plans”, and upheld the “promise of providing the best-quality service at the lowest price globally”.
The entry-level JioPhone plan will cost Rs 91 compared with Rs 75 earlier.
Prices of unlimited voice and data packs have been raised by 20%.
The unlimited voice pack for 24 days will cost Rs 179 compared with Rs 149 earlier.
The 28-day pack will start from Rs 155 against Rs 129 earlier.
The 56-day pack will start from Rs 479 compared with Rs 399 earlier.
The 84-day plan will start from Rs 395 as opposed to Rs 329 earlier.
The higher-end 336-day plan will cost Rs 1,559 against Rs 1,299 earlier.
The minimum data add-on plan will cost Rs 61, up from Rs 51 earlier.
These prices, effective Dec. 1, 2021, are cheaper than the comparable plans of Bharti Airtel and Vi.
The 28-day plan of Reliance Jio is at a 13.4% discount.
The entry-level 84-day plan is 13.2% and 13.9% cheaper.
The starting high-end plan is 13.3% less, though this is not directly comparable as it offers a validity of 336 days compared to Bharti Airtel and Vi’s 365-day validity.
Motilal Oswal, in its Nov. 22 report, had estimated that a similar price hike would “increase Reliance Jio’s Ebitda by 23%”.
UBS sees a gradual increase in sector ARPUs of 10% annually over FY22-24E, driven by a combination of secular trends such as 2G to 4G / prepaid to postpaid migration, as well as gradual tariff increases. It estimates that if all operators increase tariffs, such ARPU expansion will be possible in a shorter time frame (next two-three quarters).
Reliance Jio’s average revenue per user—the amount an operator earns per subscriber per month—rose 3.7% sequentially to Rs 143.6 per month in the quarter ended September. ARPUs of peers Bharti Airtel and Vi, too, increased during the period.