Reliance Jio And Airtel Might Add Few Customers In April-June Quarter

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Reliance Jio and Airtel are likely to add a few users in the Q1 of this financial year due to continued lockdowns and a decline in prepaid recharges. Also, vacations have been announced in schools, which is why recharges for online classes have declined.

 
Reliance Jio And Airtel Might Add Few Customers In April-June Quarter

"The April-June quarter is a typical weak one and curfews across states will prevent many from offline recharges. A shift to another network when one is completely dependent on their phone won't happen," a market expert said.

He states that Airtel and Reliance Jio are likely to add only 2 to 3 million new users, which is quite less than the last quarter. However, he added that this might help Vodafone-Idea as fewer users will shift.

In the last quarter (January- March), Reliance Jio said that it added 15.4 million customers, whereas Airtel and Vodafone-Idea are expected to share the exact number soon in the Q4 results. However, Airtel added 15 million users in the Q3 of the last financial year, while Vodafone-Idea lost users.

Similarly, a senior official in the sector said, "Lockdown and curfews will have an impact. Schools have a two-month holiday and this will mean fewer recharges, which will again show in the quarter." Therefore, Airtel recently announced that it is delivering SIM at customers' doorstep.

Average Revenue Per User Might Not be Affected

On the other hand, telecom expert Rajiv Sharma said that less subscriber addition might not affect the average revenue per user (ARPU). He added if there will be any slowdown in the postpaid sector, then it might affect the ARPU of the telecom operators.

However, Reliance Jio has recently received Rs. 138 ARPU in the Q4 FY21, which is less than Rs. 151 ARPU in the Q3. While Airtel and Vi posted Rs. 166 and Rs. 121 in the third quarter. Furthermore, Sharma also states that this might force telcos to raise tariffs soon.

 

It clearly shows that increasing COVID cases in India and lockdown in several states will affect offline recharging. Besides, summer vacation in schools and increased tariffs will have some impact on the online recharges too. However, it seems that both Airtel and Reliance Jio are still in a comfortable position, while Vi is likely to face major issues due to its weak revenue.

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