Reliance Jio Might Not Increase Tariff Prices Due To Less User Additions

Despite Vi (Vodafone-Idea) being set to increase prices further, Reliance Jio has no plans for the same as its new users' addition decreased during the October-December period. Notably, Reliance Jio tariffs packs are 7 to 20 percent lesser priced than Airtel plans.

"The rise in monthly subscriber churn to over 1.5% for the past two quarters is impacting Jio's net additions, which may deter it from taking tariff hikes in the near term," brokerage firm Jefferies was quoted by ET.

Notably, Reliance Jio added 5.2 million customers during the same quarter compared to 7.3 million in September and 10 million customers in June. Besides, industry analysts believe that Reliance Jio might launch an Android smartphone with Google to retain its JioPhone users as there are high chances that more users might leave the services. Besides, it is expected that the contracts of 8-10 million Jio Phone users might expire.

Meanwhile, another brokerage JM Financial said that this trend will continue as Reliance Jio's market share losses in the broadband user base, which means it will acquire fewer customers than Airtel. The telecom operator also said that Covid-19 and malicious and motivated campaigns affected the 4G user addition.

Reliance Jio reported 16 percent in its net profit during the same quarter. Also, the company has managed to increase average revenue per user growth, while the revenue increased to Rs. 18, 492 crores from Rs. 17, 481 crores from the previous quarter.

It is worth noting that Reliance Jio is still leading the sector with 411 million customers, while Airtel has 293. 74 million users and Vi is serving only 271 million customers at December end. Furthermore, both Airtel and Vi are yet to release the details of Q3 performance and the former is likely to post good results.