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Impact of the COVID-led lockdown slows industry growth

Momentum from the Jiophone launch slows; subscriber additions for Bharti moderates; VIL remains in the red The Telecom Regulatory Authority of India (TRAI) has released data for Apr’21. Here are the key highlights:

* Industry gross subscriber additions moderated to 2.2m MoM (8.3m/13.2m in Feb’21/Mar’21) to 1.18b in Apr’21. Active subscriber additions too moderated at 3.4m, reaching 997.4m, v/s a healthy growth of 12m for Mar’21. This could be on account of the impact of the COVID-led lockdown and SIM consolidation in the feature phone category, reflecting in a 2.1m net decline in VIL. However, RJio/Bharti continued to see positive net additions of 3.5m/2.6m.

* RJio’s monthly gross and active subscribers continued to witness a push from the launch of Jiophone, but the momentum has slowed, with gross/active subscriber additions of 4.8m/3.5m (v/s 7.9m/7.4m), taking the total base to 428m/335m. Active subscriber share remained constant ~78.4% and saw a 20bp market share gain to 33.6%.

* Bharti’s gross/active subscriber additions moderated to 0.5m/2.6m (average of ~4m additions in the last 9-10 months) to 353m/347m in Apr’21 due to the impact of COVID-led lockdown and possible effects from the Jiophone launch. It continued to maintain its top spot in terms of active subscriber share (SMS) at 34.8%. The quality of subscriber additions remained strong, with higher active-to-gross subscriber additions.

* VIL’s gross subscribers additions turned negative after remaining positive for two months in a row, with 1.8m net decline (to 282m subscribers). Active subscribers declined by 2.1m MoM, the highest since Oct’20.

* Industry 4G subscriber additions too moderated to 5.1m additions to reach 760m, with 4G subscribers accounting for 76.2% (30bp additions) of active subscribers.

* Both RJio/Bharti 4G additions slowed to 4.8m/2.2m v/s 7.9m/3.6m in Mar’21, adding 30bp/10bp market share to 56.3%/25.1%. Adjusting for the Jiophone launch, RJio’s 4G additions could be similar to Bharti. VIL’s 4G additions turned negative, with a 1.1m decline, after posting positive additions for three consecutive months up to Mar’21.

* Industry wired broadband subscribers fell 0.4m to 22.8m, majorly affected by the 0.8m decline in BSNL’s subscribers. RJio/Bharti/smaller players continued to add 0.2m/0.1m/0.1m subscribers.

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