02-01-2021 09:48 AM | Source: Emkay Global Financial Services Ltd
Telecom Sector Update - Subscriber trends: Bharti sprints forward By Emkay Global
News By Tags | #2259 #3062 #276

Follow us Now on Telegram ! Get daily 10 - 12 important updates on Business, Finance and Investment. Join our Telegram Channel


Download Telegram App before Joining the Channel

Subscriber trends: Bharti sprints forward

* November was a strong month with 7.5mn VLR subscriber additions – the highest since Oct’19. Bharti continued to deliver robust performance by adding 7mn VLR subscribers in October and November - equivalent to our Q3 estimate in just two months.

* With data subscriber proportion standing at 51% (+129bps since Sep’20), Bharti’s wireless subscriber base has expanded by 8.3mn since Q2. Given strong data adds thus far, we believe that Bharti could potentially surpass our Q3 estimate of 10.4mn.

* In a positive move, Jio’s VLR proportion finally inched up to 79.6% to May’20 levels, but still lower than its long-term average of ~82%. Aided by the low base, Jio continued to see healthy traction in its wired broadband segment, posting 10% growth mom.

* The weakness persisted in the case of VIL, with VLR subscriber base narrowing by 3.1mn, and rural subscriber base proportion dipping 156bps since Q2. We continue to highlight that the absence of sizable network capex will result in further subscriber losses.

Gross subscriber as well as Visitor Location Register (VLR) base for November saw healthy gains of 3.4mn and 7.5mn, respectively. After rising for four months in a row, MNP requests for the month dipped to 6.8mn sequentially. Bharti’s performance tracked well, while Jio saw a rise in the VLR share after two months of poor additions. On the contrary, VIL had a relatively weak quarter, with VLR subscriber losses standing at 2mn vs. 1mn in the last quarter.


Broadband subscriber base: Wireless broadband subscriber base for the industry rose by 1%, with Bharti leading the pack with 4.2mn additions. This was followed by BSNL, which posted 1.5% growth mom, aided by a low base. The subscriber base of Jio and VIL expanded by ~0.5mn each. In the wired broadband segment, Jio dominated by clocking 10% mom growth. The telco has managed to post double-digit gains for the last three months.


Urban-Rural subscriber mix: For the fifth month in a row, Bharti and Jio managed to gain rural subscribers at VIL’s expense. Bharti’s rural subscriber base share has expended by 78bps since Q2 and now stands at 48%. That said, VIL still continues to hold the highest percentage of rural subscribers at 53.7%.


Player-wise analysis

Bharti Airtel: It was a strong month with VLR additions of 3.9mn, driven primarily by UP (E), and UP (W) circles. Bharti’s gross subscriber additions of 4.4mn outpaces Jio’s additions for the fourth-consecutive month. Wireless broadband subscriber additions stood strong at 4.2mn – the highest among all the telcos. The proportion of data subscribers also rose to 51.3%. With superior data additions in the two months of Q3, we expect Bharti to reach, if not exceed, our Q3 data sub estimate of 10.4mn.

Jio: After holding second position in the previous month, Jio retook the top spot with peak VLR subs of 325mn, with much of this rise stemming from UP (W) and Karnataka circles. Albeit being meaningfully lower than its peers, the VLR proportion inched up slightly to 79.6%. Though this is at May 2020 level, it is still lower than the previous run-rate of ~82%. The gap between gross and VLR subscriber base narrowed to 83m, the lowest since May’20. Although aided by a low base, additions of 0.2mn in the wired broadband segment point to a healthy picture, in our view.

Vodafone-Idea: It was another month of sustained weakness, with VLR subscriber losses rising to 2mn from 1mn in the previous month. Andhra Pradesh, Maharashtra and Kerala accounted for most of this decline. The company, which holds the highest proportion of rural subscribers, saw a decline in the rural share for the fourth-successive month. The expansion of 0.5mn in its wireless broadband segment was the only positive.


To Read Complete Report & Disclaimer Click Here


For More  Emkay Global Financial Services Ltd Disclaimer http://www.emkayglobal.com/Uploads/disclaimer.pdf & SEBI Registration number is INH000000354

Above views are of the author and not of the website kindly read disclaimer

Zerodha reports revenue of Rs 6,875 cr, profit at Rs...

Read More..

Oil prices steady as economic outlook balances tight...

Read More..

Climate change, tech and geopolitics will shape futu...

Read More..

JPMorgan sees India in its top 3 fastest-growing Asi...

Read More..

OYO set to report its 1st net profit at Rs 16 cr in ...

Read More..

FIIs stood as net sellers in equities as per Septemb...

Read More..

Investor Confidence Grows as Digikore`s IPO Continue...

Read More..

Delhivery, AWS, Nexus Ventures nurture logistics sta...

Read More..

India among most competitive aviation markets in wor...

Read More..

128 startup founders urge TRAI not to impose telecom...

Read More..