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TRAI’s Oct’22 subscriber (subs) data shows industry’s MBB (Mobile Broadband — 3G+4G) subs addition was robust at 5.0mn in Oct’22, continuing the healthy trend of 5-6mn additions per month since May’22 (except for moderate 1.6mn addition in Sep’22). This is despite a sharp rise in the price of entry level smartphones since Mar’22. MBB addition in Oct’22 continued primarily for Bharti (3.0mn) and Jio (1.4mn); VIL continued to see only marginal addition (of 0.2mn). Further, the industry’s active subs rose by 2.9mn in Oct’22 due to a sharp 4.9mn addition for Jio; however, active subs base declined for Bharti (down 1.0mn) and continued to fall for VIL (down 0.5mn). Industry’s overall subs addition was down 1.8mn, continuing the muted growth/declining trend since Dec’21.

Jio’s net subs rose for the 8 th consecutive month, up 1.4mn in Oct’22; further, active subs also went up by a sharp 4.9mn. Hence, Jio’s VLR ratio rose MoM to 92.8% in Oct’22 vs. 91.9% in Sep’22 (vs. peak of 94.0% in Feb’22, but it is significantly higher than sub-80% before Aug’21) and vs. 98.1% for Bharti and 86.2% for VIL. Bharti’s MBB subs addition was strong at 3.0mn in Oct’22; however, active subs declined by 1.0mn. VIL’s MBB subs rose by a marginal 0.2mn in Oct’22; however, active subs continued to fall. Separately, FTTH addition remained strong for both Jio and Bharti.

* Jio’s net subs rise for the 8 th consecutive month in Oct’22 at 1.4mn; further, active subs also go up sharp 4.9mn:

Jio’s net subs rose by 1.4mn in Oct’22 following an increase of 0.7mn/3.3mn /2.9mn /4.2mn /3.1mn /1.7mn /1.3mn in Sep’22/Aug’22 /Jul’22 /Jun’22 /May’22 /Apr’22 /Mar'22; this is after having reported net subs loss of 3.7mn /9.3mn /12.9mn /19mn in Feb’22 /Jan’22 /Dec’21 /Sep’21 due to sim consolidation post the Nov’21 tariff hike and repurposing of customer retention efforts for low-ARPU subscribers. Further, Jio’s active subs rose by a sharp 4.9mn in Oct’22 following addition of 1.4mn/2.5mn in Sep’22/Aug’22; this comes after a muted addition/decline since Mar’22 (except for 4.5mn addition in May’22); but Jio had seen strong active subs addition of ~4mn per month during Mar’21 to Jan’22. Hence, Jio’s VLR ratio rose MoM to 92.8% in Oct’22 vs. 91.9% in Sep’22 (vs. peak of 94.0% in Feb’22, but it is significantly higher than sub-80% before Aug’21) and vs. 98.1% for Bharti and 86.2% for VIL.

* Bharti’s MBB subs addition strong at 3.0mn in Oct’22; however, active subs declined by 1.0mn: Bharti’s MBB (Mobile broadband – 3G+4G) subs addition was strong at 3.0mn in Oct’22 after having reported robust addition of 1.5-2mn each month in Feb-Sep’22 (except for a decline of 0.3mn in Apr’22). Bharti’s management had highlighted in the 2QFY23 concall that there was ~30% reduction in MBB upgrades due to a rise in the average price of entry level smartphones since Mar’22 (to INR 8.5-10k from INR 6-7k earlier); however, it hopes that MBB upgrades will normalise in the next few quarters as customers start to gradually accept high smartphone prices. But Bharti’s active subs base declined by 1.0mn in Oct’22 vis-à-vis healthy addition of 1.5-2mn each month witnessed since May’22 (except for 1.0mn decline in Jul’22); hence, its VLR ratio moderated to 98.1% in Oct’22 (vs 98.6% in Sep’22).

* VIL’s MBB subs rose by a marginal 0.2mn in Oct’22; however, decline in active subs continues: VIL’s MBB subs addition rose by a marginal 0.2mn in Oct’22 (with Nov’21-Oct’22 cumulatively witnessing only 0.9mn rise in MBB subs). However, its active subs base dipped by another 0.5mn in Oct’22, continuing the declining trend over the past many months due to the outsized churn in the lower ARPU segments given the entry level prepaid tariff hikes undertaken in Jul’21 and Nov’21. We believe that despite the moratoriums and recent tariff hikes, VIL may have to close the ~INR 100bn fund-raise exercise from non-promoters (with the promoter having agreed to infuse INR 49.4bn) for a meaningful increase in capex to boost upgrade of customers to MBB.

* Jio and Bharti’s robust FTTH addition continues: Jio’s FTTH subs additions continued to be robust at 0.29mn in Oct’22 (vs. peak addition of 0.35mn in Apr’22). Further, Bharti’s FTTH subs addition was robust at 0.14mn in Oct’22 (vs. peak addition of 0.17mn in Jul’21).

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