Airtel’s Q1 ARPU Nears Rs 200, Vodafone Experiences Muted Churn

Bharti Airtel Q1 Preview: Analysts Anticipate 60% YoY Rise in Consolidated Net Profit to Rs 2,676 Crore for Q1FY24

Telecom Q1 Preview: Bharti Airtel and Vodafone Idea Expected to Witness Stable Earnings in Q1FY24 with Support from 4G Mix Benefit, Market Share Gains (for Airtel), and Slowing Subscriber Churn.

Furthermore, analysts believe that the transition from 2G to 4G, premiumization through higher data plans and postpaid subscriptions, and data monetization efforts could lead to an increase in blended Average Revenue Per User (ARPU) for telecom companies.

On average, analysts anticipate Bharti Airtel’s consolidated net profit to increase by approximately 60% year-on-year (YoY) to Rs 2,676 crore in the current period, compared to Rs 1,606.9 crore reported in the corresponding quarter of the previous fiscal year. However, sequentially, there is an estimated decline of around 11% from the Rs 3,005.6 crore profit recorded in Q4FY23.

On a year-on-year basis, Vodafone Idea is expected to reduce its net loss to Rs 6,634 crore, while it may witness an increase on a quarter-on-quarter basis.

Bharti Airtel is set to release its Q1FY24 earnings on Thursday, August 3, while Vodafone Idea is yet to announce the date for its results announcement.

Bharti Airtel is a telecom services provider and one of the leading mobile network operators in India. It offers a wide range of services, including mobile voice and data services, broadband, DTH (Direct-to-Home), and enterprise solutions. The company has a significant presence in the Indian telecom market and has expanded its operations to several other countries as well. Bharti Airtel is known for its extensive network coverage, innovative offerings, and customer-centric approach.

According to ICICI Securities, Bharti Airtel is expected to add two million subscribers in the current quarter, resulting in a 2.9% quarter-on-quarter (QoQ) growth in Average Revenue Per User (ARPU) to Rs 199. This growth is likely to be driven by premiumization, such as the transition from 2G to 4G, a strong increase in postpaid subscribers, and a price hike in the minimum recharge plan. The firm also predicts that Bharti’s India revenue will rise by 3.4% QoQ (12% YoY) to Rs 26,300 crore, with the mobile segment contributing to a 3.7% QoQ (11.3% YoY) increase. Additionally, Bharti’s India Ebitda is expected to grow by 4.6% QoQ (18% YoY) to Rs 14,000 crore.

ICICI Securities forecasts Bharti Airtel’s net profit to decline by 22% quarter-on-quarter (QoQ) to Rs 2,400 crore. This decline is expected to be influenced by higher forex losses and increased taxes.

Prabhudas Lilladher has taken into account a net subscriber addition of 3 million and an Average Revenue Per User (ARPU) of Rs 196. It expects sales to rise by 11% year-on-year (YoY) and 1% quarter-on-quarter (QoQ) to Rs 36,329.5 crore. Additionally, Ebitda is projected to increase by 14% YoY and 0.8% QoQ to Rs 18,854.8 crore, while PAT (Profit After Tax) is anticipated to rise by 23% YoY and decline by 34.4% QoQ to Rs 1,917.3 crore.

According to JM Financial, India wireless revenue is expected to reach Rs 20,013 crore, showing a growth of 2.4% quarter-on-quarter (QoQ) and 10.3% year-on-year (YoY). Additionally, India wireless Ebitda is projected to increase by 2.3% QoQ and 16.1% YoY to Rs 10,762 crore. The firm also anticipates the addition of 357,000 households in FTTH (Fibre To The Home) services.

Overall, it is projected that consolidated revenue will witness a growth of 12% year-on-year (YoY) and 1.6% quarter-on-quarter (QoQ) to reach Rs 36,880.4 crore. Ebitda is expected to increase by 16% YoY and 2.2% QoQ, reaching Rs 19,408.2 crore. Profit After Tax (PAT) is anticipated to grow by 104% YoY and 9% QoQ, amounting to Rs 3,275.6 crore. Moreover, the Ebitda margin is likely to expand by 195bps YoY and 32bps QoQ, reaching 52.6%.

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