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- Airtel earns Rs 166 from every subscriber, Jio gets Rs 151 from every subscriber, Voda Idea earns Rs 121
- Airtel’s total user base was 33.6 crore, Voda Idea’s subscriber base was 26.98 crore and Jio’s user base was 41.08 crore
Financial results of telecom companies have arrived. Everyone’s performance has improved on a quarterly or yearly basis. The outlook for the sector looks better. Companies are competing to acquire the latest auction 4G spectrum. Some have raised funds for expansion, while some are in readiness. Let us see how their present is and what can help in the future.
Among the telecom companies, the most highly valued subscribers are Bharti Airtel. She earns Rs 166 from every subscriber and this figure is for the December quarter. In this case, Reliance Jio is at number two and Voda Idea at number three. In the last quarter, Jio earned Rs 151 from every subscriber while Voda Idea earned Rs 121.
On this average ARPU, the user shows who is more profitable in the telecom companies. Results for the December quarter of 2020 showed that Airtel’s ARPU increased by Rs 4, or Rs 2.5 per quarter, to Rs 166. If compared to the December quarter of 2019, then it has increased by 23% compared to the 135 rupees of the then ARPU.
As far as Jio is concerned, its ARPU increased by about four and quarter percent in the December quarter on a quarterly basis. According to the subscriber, the country’s largest telecom company earned an ARPU of Rs 151, while the market had expected Rs 148-150. Vodafone Idea’s ARPU stood at Rs 121 in the December quarter which was only one and a half percent higher on a quarterly basis. In such a situation, Jio’s performance is the best on a quarterly basis.
Now let’s talk about the subscriber base which plays an important role in increasing the ARPU of telecom companies. According to TRAI, Airtel created 1.42 crore subscribers in the December quarter, taking its total userbase to 33.6 crore. In the December quarter, Voda Idea’s subscriber base declined by 20 lakh to 26.98 crore. Jio’s subscriber base increased by 52 lakh to 41.08 crore on a net basis in the December quarter.
Revenue and profit
In terms of revenue, net profit of the country’s largest telecom company Jio grew 16% to Rs 3,291 crore on quarterly basis, while its revenue grew 6% to Rs 18,492 crore. Airtel, the country’s second largest telecom company, reported a net profit of Rs 853.6 crore in the third quarter. It had a net loss of Rs 763.20 crore in the September quarter.
As far as the third company Voda Idea is concerned, its loss fell to Rs 4,532.4 crore in the December quarter from Rs 7,218.5 crore in the September quarter. The company’s revenue during this period stood at Rs 10,849.1 crore as against Rs 10,791.2 crore in the previous quarter. The company’s better performance is due to the increase in the number of 4G subscribers during the December quarter.
Regarding the future planning of Voda Idea, MD and CEO Ravinder Collision says that the company is talking to potential investors. The company will raise Rs 25,000 crore, which will be spent on paying the outstanding AGR (adjusted gross revenue) and expanding the 4G network. The company has been steadily growing on a saving of Rs 4,000 crore in working expenses by December 2021.
Jio has raised $ 15.2 billion in the last year and a half and does not need additional funds. Airtel has raised about $ 8 billion in the last two years to expand its business. According to recent media reports, it is raising one billion dollars through Perpetual Bond. As far as AGR is concerned, Airtel owes about Rs 26,000 crore while Voda Idea owes Rs 50,400 crore.
Financial results of all three telecom companies have come and brokerage firms have given rating updates. Most brokerages are bullish for Airtel and are rated by Citi, Motilal Oswal, Ambit, HSBC and CLSA. Credit Suisse and Macquarie recommend Outperform and Jefferies hold. It has JP Morgan, Morgan Stanley Overweight, BofA Securities Neutral.