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In Q3FY21, consumer spend on mobile services (post GST) rose 4.6% QoQ / 20.9% YoY to Rs390bn on benefit of price hike and 4G penetration. Postpaid net revenue dipped 8.1% YoY, while it was up 0.4% QoQ on rising subs. Prepaid net revenue grew 6.2% QoQ / 34.1% YoY and ARPU rose 5.6 QoQ / 35.7% YoY to Rs95. 4G subscriber (sub) addition was strong at 3.3% QoQ (net add: 22.4mn) to 698mn. RJio’s 4G sub market share dipped 125bps QoQ (down 275bps YoY) to 58.6%. Bharti Airtel’s 4G sub market share improved to 23.7%, up 110bps QoQ / 320bps YoY, and the company has been gaining market share in data usage, which rose 170bps QoQ / 550bps YoY to 32% (significantly narrowed gap with its AGR market share, which is a positive).

The Telecom Regulatory Authority of India (Trai) has released the sector’s performance indicator report for Q3FY21.

Highlights:

* Consumer spend on mobile services (post-GST) rose 4.6% QoQ / 20.9% YoY to Rs390bn in Q3FY21 and net revenue (deducting inter-company settlements) rose 5.5% QoQ / 27.9% YoY to Rs351bn. ARPU (based on consumer spend) rose 4% QoQ / 22.1% YoY to Rs113 (Rs138 including GST) on tariff hikes taken in Dec’19. Postpaid net revenue grew 0.4% QoQ / fell 8.1% YoY to Rs37bn in Q3FY21. Prepaid net revenue rose 6.2% QoQ (34.1% YoY) to Rs314bn. Postpaid ARPU (based on net revenue) dipped 3% QoQ (fell 13.4% YoY) to Rs227 and prepaid ARPU was up 5.6% QoQ (35.7% YoY) to Rs95. Prepaid revenue also benefited on shift from 2G to 4G.

* 4G sub base grew 3.3% QoQ (22.4mn net add) to 698mn and RJio’s 4G sub market share fell to 58.6% (down 125bps QoQ) while Bharti Airtel’s improved 110bps to 23.7%. VIL’s sub market share was stable at 15.7%. Industrywide 3G subs continue to decline fast and were down 2.5mn QoQ to 26mn. Total sub-base expanded 0.5% QoQ (net add: 5mn) to 1,154mn. Postpaid subs rose 4.4% QoQ (net add: 2.3mn subs) to 55mn. Bharti ’s postpaid sub market share rose to 29%, up 10bps QoQ, while that for VIL reduced to 37.6%, down 240bps.

* Data usage market share rose 170bps QoQ for Bharti Airtel. Data usage grew 4.7% QoQ to 26,405-bn MB led by 4G segment growth of 5.3% QoQ to 25,631-bn MB (and contributed 97.1% to total data usage). 2G data volume dipped 13.4% QoQ and 3G data volume was down 12.7% QoQ. Bharti Airtel and VIL’s data usage market shares were 32% (up 170bps QoQ) and 17.0% (down 20bps QoQ), respectively. Industry minutes rose 3.7% QoQ to 2,711bn. Bharti Airtel’s minute market share improved to 34.1%, up 120bps QoQ, while VIL’s stood at 20.2%, down 100bps QoQ. RJio’s minute market share rose 30bps QoQ to 36%.

* Fixed broadband subs rose strong 5.5% QoQ (16.5% YoY, net add: 1.17mn) to 22.3mn. This was led by 25% QoQ / 156% growth in FTTH subs to 6.9mn, while DSL continues to decline at 8.8mn, down 5.2% QoQ / 21.5% YoY. RJio’s market share inches to 9.3% of total FBB subs, while it is 30% of FTTH subs. Bharti’s market share in FBB has been stable at 12.6% despite RJio’s aggression. BSNL’s market share dipped 930bps to 34.5% in the past one year.

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