During the quarter ended September 2023, Bharti Airtel and Reliance Jio witnessed robust financial performance, while Voda­fo­ne Idea Limited (Vi) continued its trend of widening net losses. However, all three telecom operators continued to post positive growth in revenue. The earnings be­fore interest, taxes, depreciation and amortisation (EBITDA) for both Jio and Airtel remained above the Rs 100 billion mark during this quarter.

Operationally, Airtel had the highest ARPU at Rs 203. Meanwhile, Jio retained its market leadership in terms of subscriber base, with a net subscriber addition of 11.1 million and a total of 459.7 million customers. The key highlights of the quarter were the commercial launch of 5G-powered fixed wireless access solutions, and the pan-Indian 5G network roll-out nearing completion.

A look at the financial and operational results of telecom operators during the qu­a­rter ended September 2023…

Reliance Jio

Reliance Jio continued to register positive financial growth during the quarter. The net profit reported by the telco’s parent company Jio Platforms Limited (JPL) increased from Rs 47.29 billion during the quarter ended September 2022 to Rs 52.97 billion during the quarter ended Sep­tember 2023, a year-on-year growth of 12 per cent. JPL’s gross revenue for the quarter stood at Rs 315.37 billion, up from Rs 285.06 billion in the corresponding quarter in the previous year. Further, the revenue fr­om operations increased to Rs 268.75 billion from Rs 242.75 billion during the same period. In terms of EBITDA, JPL posted a steady 12.6 per cent year-on-year growth, from Rs 120.11 billion to Rs 135.28 billion. The EBITDA margin inc­reased to 50.3 per cent.

Meanwhile, Reliance Jio’s operating revenue rose from Rs 225.21 billion during the quarter ended September 2022 to Rs 247.5 billion during the quarter ended September 2023. The growth in operating revenue was driven by an improved subscriber mix across the mobility and home business segments, and the scaling up of digital platforms. Jio’s net profit grew from Rs 45.18 billion to Rs 50.58 billion.

On the operational front, Jio’s net subscriber addition continued to accelerate with the addition of 11.1 million subscribers during the quarter. The telco’s total customer base stood at 459.7 milli­on, as of September 30, 2023. The mon­thly subscriber churn decreased to 1.7 per cent. The company’s ARPU increased by 2.5 per cent year on year to Rs 181.70, despite offering 5G services at a lower cost. The increase in ARPU can be attri­buted to a better subscriber mix across the mobility and wireline segments. En­gage­ment on Jio’s network remained strong, with the addition of over 3 ex­a­by­tes of data traffic for the second succe­ssi­ve quarter. Total data traffic increased by 28.5 per cent to 36.3 billion GB, while total voice traffic grew by 8.3 per cent to 1.33 trillion minutes.

During the quarter, the telco launched JioAirFiber in eight cities, demonstrated India’s first satellite-based gigabit broadband, and completed the first-ever global fre­quency range 2 standalone mmWave roll-out on a commercial scale.

In terms of 5G roll-out, Jio has dep­loy­ed over 1 million 5G cells pan-India, covering more than 8,000 cities and towns. The operator has contributed to 85 per cent of the overall 5G capacity in the country till date. This has been powered by an in-house 5G stack, designed, developed and manufactured indigenously.

Bharti Airtel

Bharti Airtel posted an increase in consoli­dated revenues from Rs 345.27 billion during the quarter ended September 2022 to Rs 370.44 billion during the quarter ended September 2023, backed by strong and consistent performance in India. The operator’s consolidated EBITDA grew considerably, from Rs 177.21 billion to Rs 196.65 billion, while the EBITDA margin increased from 51.3 per cent to 53.1 per cent during the same period. Its consolidated net income (before exceptional items) rose by an impressive 44.2 per cent to Rs 29.6 billion. However, the telco’s consolidated net profit plummeted from Rs 29.79 billion to Rs 20.93 billion.

For the India business, Airtel reported an increase in quarterly revenues from Rs 243.33 billion to Rs 269.95 billion, up 10.9 per cent year on year. In addition, the India business posted an EBITDA of Rs 145.61 billion, with an EBITDA margin of 53.9 per cent. Further, the capex spending on the telco’s India business saw a significant leap to Rs 77.78 billion from Rs 56.84 billion during the same quarter in 2022.

With regard to operational performance, Airtel had the highest ARPU among all telecom operators in India during this quarter at Rs 203, compared to Rs 190 during the quarter ended September 2022. The telco attributes this to its sustained focus on acquiring high-value customers and improved realisations on account of premiumisation. Further, Airtel’s subscriber base increased from about 364 million to more than 389 million during the reported period. The average data usage per customer grew to 1.7 GB per month.

Airtel installed nearly 11,100 towers during the quarter ended September 2023. Over the past year, it has set up around 41,000 towers to ensure coverage and connectivity in rural as well as urban areas. During the quarter ended September 2023, it launched Airtel Xstream AirFiber, India’s first wireless home Wi-Fi service powered by 5G plus, in Delhi and Mum­bai. Airtel Business maintained an organic revenue growth of 9.5 per cent year on year by leveraging the converged portfolio of Airtel and harvesting the rapidly in­c­reasing demand for data- and core connectivity-related solutions.

Vodafone Idea Limited

In marked contrast to other private telcos, Vi continued to witness strained financial and operational metrics during the quarter. The telco’s consolidated net loss continued to widen, from Rs 75.96 billion during the quarter ended September 2022 to Rs 87.38 billion during the quarter ended September 2023. However, the telco reported a marginal increase of 0.6 per cent in revenue, from Rs 106.15 billion to 107.16 billion, supported by an improved subscriber mix and 4G subscriber additions.

The operator’s EBITDA (on a reported basis) improved to Rs 42.83 billion compared to Rs 40.98 billion in the same quarter. However, its EBITDA (ex­cluding the impact of Ind-AS 116) declined from Rs 21.2 billion to Rs 20.6 billion during the same period. Capex spending for the quarter stood at Rs 5.2 billion.

Vi’s total gross debt (excluding lease liabilities and including interest accrued but not due) stood at Rs 2.13 trillion. This comprised deferred spectrum payment obligations of Rs 1.35 trillion and an ad­justed gross revenue liability of Rs 681.8 billion that are due to the government, debt from banks and financial institutions worth Rs 78.6 billion (which decreased by Rs 72.2 billion from Rs 150.8 billion in September 2022), and optionally convertible debentures amounting to Rs 16.1 billion. The net debt stood at 2.13 trillion.

In terms of operational metrics, Vi witnessed a continued decline in its subscriber base to 219.8 million during the quarter ended September 2023, from 234.4 million in the same quarter in 2022. However, the telco’s 4G subscriber base grew for the ninth successive quarter and stood at 124.7 million in September 2023. Meanwhile, its ARPU improved to Rs 142, primarily aided by the migration of subscribers to higher-ARPU plans. Data usage per broadband customer was around 15.8 GB per month. During the quarter, the company launched “Vi One”, a converged proposition offering fibre, mobility and over-the-top services under a single plan. Vi is in discussions with various network vendors for the finalisation of its 5G roll-out strategy.

Sarah Khan