Bharti Airtel is working towards increasing its post-paid subscriber base with the help of its aggressive 5G rollout, which is attracting Vodafone Idea customers. For your information, let us tell you that Vodafone Idea has not yet rolled out its 5G service, analysts of JM Financial gave this information through a comment. According to media reports, 6 percent of the customers of the Sunil Mittal-led telecom operator are on postpaid plans, whereas in other emerging markets this figure ranges from 20 to 40 percent. Airtel’s strategy to focus on premium customers has continued to drive strong ARPU growth over the past few quarters, even without opportunities related to tariff hikes.
JM Financials said
Bharti’s premiumisation focus is expected to drive its ARPU to grow at a CAGR of 9 per cent to Rs 300 in FY28 (vs Rs 200 in 1QFY24), JM Financials said in a statement. Of this, 3-4 per cent growth is likely to continue due to MBB upgrades/increase in data usage, while 5-6 per cent growth is likely to be through regular tariff hikes. Bharti Airtel’s premiumization strategy will likely drive 13 percent EBITDA CAGR. It is focusing on acquiring premium customers through feature phone to smartphone upgrades, resulting in doubling of ARPU.
Helped in achieving ARPU growth
As part of its premiumization strategy, the telco is also driving pre-paid to post-paid upgrades through family post-paid plans, aggressive 5G rollout and data monetization as customers opt for additional data or higher data limit plans. Are. Not only this, the telco’s simplified plans and sharp increase in entry-level pre-paid tariffs have added to its premiumization strategy. Commenting on the matter, analysts said, this has helped Bharti achieve strong ARPU growth in the last few quarters despite the absence of opportunities related to tariff hike.
MBB penetration in Brazil and developed countries reaches 85-100 percent
For your information, let us tell you that ARPU in India is still the lowest at 2.2 dollars per month, whereas the global average is 8-10 dollars per month or 6.9 dollars per month in China. The brokerage said India’s ARPU as a percentage of per capita GDP is down at +1.0 per cent in FY2013, compared to +1.5 per cent before FY2015. The AMDU (Average Monthly Data Usage) per data subscriber growth trajectory is likely to continue over the next 3-5 years with a gradual increase in 5G penetration. Additionally, after growing to 72 per cent in June 2023 versus 47 per cent in March 2019 (before the start of the tariff hike), the industry has significant scope to grow its MBB (mobile broadband) penetration to 85-90 per cent over the next 3-5 years . For your information, let us tell you that the penetration of MBB in China, Brazil and developed countries is 85-100 percent.