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Telcos are expected to witness 1.1%-1.6% QoQ ARPU growth in 2QFY26, aided by ongoing upgrades-led improved subs mix and 1 more day QoQ. We expect Jio’s ARPU to improve 1.1% QoQ to ~INR 211 in 2QFY26, while its subs gains will be robust at 7.0mn (vs. 9.9mn in 2QFY26). Hence, Jio’s 2QFY26 revenue/EBITDA is likely to grow by 2.4%/2.5% QoQ. Bharti is expected to register 2%/2.1% QoQ growth in its India wireless revenue/EBITDA, led by robust MBB subs gains (at ~7.2mn), and as ARPU is likely to improve 1.6% QoQ (to INR 254). Similarly, BHL is expected to register 2% QoQ growth in its wireless EBITDA due to healthy MBB subs gain (at 0.7mn) and 1.6% QoQ ARPU improvement (to INR 250). Separately, VIL’s revenue/reported EBITDA/cash EBITDA is expected to grow by 0.8%/1.1%/ 0.9% QoQ as ARPU is likely to improve 1.2% QoQ to INR 167, though it will be partly offset by net subs loss of ~0.5mn (though MBB subs is likely to grow by ~1mn). We expect net tenancy additions to remain healthy for Indus Towers, driven by VIL’s network expansion and Bharti’s rural rollouts; reported EBITDA could grow 0.3% QoQ while adjusted EBITDA may grow 2.4% QoQ in 2QFY26. Separately, we expect TCOM’s revenue and EBITDA to grow 1.2%/1.8% QoQ led by digital portfolio, though partly offset by weakness in core connectivity on account of SAARC regionrelated issues.

* Telcos’ ARPU to grow 1.1%-1.6% QoQ aided by ongoing upgrades-led improved subs mix and 1 more day QoQ in 2QFY26; Subs gain likely to be strong for Jio (7mn) but lower for Bharti (2mn):

We expect Jio’s ARPU to improve 1.1% QoQ to ~INR 211, aided by upgrades and 1 more day QoQ in 2QFY26, while its subs gains (including FTTH/UBR/5G FWA) will be robust at 7.0mn (vs. 9.9mn in 2QFY26). Hence, Jio’s revenue and EBITDA is likely to grow by 2.4% and 2.5% QoQ respectively. However, Bharti’s overall wireless subs addition is expected to be lower at 2mn in 2QFY26. Hence, Bharti is expected to register 2% QoQ and 2.1% QoQ growth in its India wireless revenue and EBITDA respectively, led by robust mobile broadband (MBB) subs gains (at ~7.2mn) and as ARPU is likely to improve 1.6% QoQ (to INR 254) due to ongoing healthy upgrades to smartphone/post-paid plans and 1 more day QoQ in 2QFY26. Similarly, BHL is also expected to register 2% QoQ growth in its wireless EBITDA due to healthy MBB subs gain (at 0.7mn) and 1.6% QoQ ARPU improvement (to INR 250). Separately, VIL’s revenue, reported EBITDA and cash EBITDA are expected to grow by 0.8%, 1.1% and 0.9% QoQ respectively as ARPU is likely to improve 1.2% QoQ to INR 167 due to improved subs mix and 1 more day QoQ in 2QFY26, though it will be partly offset by net subs loss of ~0.5mn (though MBB subs likely to grow by ~1mn).

* Indus Adj. EBITDA likely to grow 2.4% QoQ on healthy net tenancy additions driven by Bharti’s rural expansion and VIL rollouts; TCOM’s EBITDA may grow 1.8% QoQ in 2QFY26 led by digital portfolio:

We expect net tenancy additions to remain healthy (~6.1k in 2QFY26 vs. ~5.8k in 1QFY26) for Indus Towers, driven by VIL’s network expansion and Bharti’s rural rollouts. However, we assume that the average rental per tenancy (ARPT) could be 0.3% lower QoQ on account of sharing discount due to tenancies from VIL on account of its ongoing network expansion rollouts (largely forming second tenancy on existing towers). Hence, its reported EBITDA could grow 0.3% QoQ while adjusted EBITDA may grow 2.4% QoQ in 2QFY26 (adjusting for recovery of ~INR 0.9bn of past dues from VIL in 1QFY26). Separately, we expect TCOM’s revenue and EBITDA to grow 1.2% and 1.8% QoQ respectively led by digital portfolio, though partly offset by weakness in core connectivity on account of SAARC region-related issues (difficulty in recoverability of dues from a few clients in the SAARC region, leading to subsequent exits).

* Reiterate BUY on Bharti/BHL/TCOM; maintain positive view on Jio:

We reiterate BUY on Bharti (unchanged TP of INR 2,240) and BHL (unchanged TP of INR 2,000) and our positive view on Jio as we believe industry’s wireless ARPU will grow at ~13% CAGR in the next 3-5 years, driven by regular tariff hike and multiple premiumisation strategies. Further, there is improved visibility of the next tariff hike of 12-15% in the next few months due to Jio’s likely IPO by 1HCY26, coupled with the government’s intent to ensure a ‘3+1’ player market. Bharti/Jio’s 5G subs penetration has risen to ~42%; 5G monetisation is a potential opportunity in future but is currently limited via tariff hike, push towards high-ARPU plans, reduction in cost/GB of data and FWA rollouts. We have revised our rating on VIL to ADD (from HOLD, revised TP of INR 9.5) and on Indus to REDUCE (from HOLD, unchanged TP of INR 340) to align with our new rating system; there is a 9% increase in TP for VIL factoring in possibility of some AGR relief. We reiterate BUY on TCOM (unchanged TP of INR 2,000) on expectation of improvement in profitability of the digital portfolio segment.

Detailed 2QFY26E expectations for telecom coverage universe

* Jio’s EBITDA to grow 2.5% QoQ on strong subs gain and 1.1% QoQ growth in ARPU to INR 211 (due to upgrades and 1 more day QoQ):

Jio’s ARPU is expected to grow 1.1% QoQ to INR 211 (from INR 208.8) due to 1 more day QoQ in 2QFY26 and upgrades. Further, Jio’s net subs gain (including FTTH/UBR/5G FWA) is likely to be robust at 7.0mn in 2QFY26 (added 0.5mn wireless subs and 0.93mn homes broadband subs in Jul’25 as per TRAI’s data; vs. total wireless and homes broadband subs gain of 9.9mn in 1QFY26). Strong traction in FTTH/UBR/5G FWA additions is likely to continue with addition of ~3mn subs in 2QFY26. Hence, we expect 2.4% QoQ growth in Jio’s standalone revenue to INR 323bn and 2.5% QoQ growth in EBITDA to INR 177bn – Exhibit 1.

* Bharti India wireless EBITDA to grow 2.1% QoQ due to strong MBB subs gain, and as ARPU is likely to improve 1.6% QoQ to INR 254 (due to upgrades and 1 more day QoQ):

Bharti is expected to report robust mobile broadband (MBB) subs addition, at 7.2mn in 2QFY26 (vs. 3.9mn in 1QFY26) while its overall subs addition is expected to be lower at 2mn (added 0.5mn overall subs in Jul’25 as per TRAI’s data). Further, its wireless ARPU is likely to grow 1.6% QoQ to INR 254 (vs. INR 250 in 1QFY26) due to upgrades and improved subs mix, and aided by 1 more day QoQ. Hence, we build in 2% QoQ growth in India wireless business revenue to INR 279bn, and 2.1% QoQ rise in EBITDA to INR 166bn. Further, homes broadband segment is likely to witness healthy subs gains (~1.05mn subs addition QoQ) while the enterprise business EBITDA is expected to grow 2.2% QoQ (after completely exiting very low margin commodity voice and wholesale business in 1QFY26) – Exhibit 3.

* BHL’s wireless EBITDA also to grow 2% QoQ due to healthy MBB subs gain and as ARPU is likely to improve 1.6% QoQ to INR 250 (due to upgrades and 1 more day QoQ):

BHL’s (Bharti Hexacom Ltd) 2QFY26 ARPU is also likely to grow 1.6% QoQ to INR 250 (vs. INR 246 in 1QFY26) due to upgrades and improved subs mix and aided by 1 more day QoQ. It is also likely to report robust MBB subs addition, at 0.7mn in 2QFY26 (vs. 0.28mn in 1QFY26) while its overall subs addition is expected to be muted at 0.02mn (added 6k overall subs in Jul’25 as per TRAI’s data). Hence, we expect its wireless revenue to grow by 4.2% QoQ to INR22.6bn, aided by normalisation of roaming revenue while EBITDA to improve by 2% QoQ to INR12.2bn in 2QFY26 (with normalised access charges offsetting its normalised roaming revenue). Further, homes broadband segment is likely to witness healthy subs gains (~0.06mn subs addition QoQ). Hence, BHL’s overall revenue is expected to grow by 4.2% QoQ to INR 23.6bn and EBITDA to grow by 2.8% QoQ to INR 12.4bn in 2QFY26– Exhibit 4.

* VIL’s EBITDA to grow 1.1% QoQ as ARPU is likely to improve 1.2% QoQ to INR 167 due to improved subs mix and 1 more day QoQ, though it could be partly offset by net subs loss of ~0.5mn:

VIL is expected to report net subs loss of 0.5mn in 2QFY26 (vs. net subs loss of 0.5mn in 1QFY26, 1.6mn in 4QFY25 and 1.5mn-5mn per quarter over the last few quarters) while adding ~1mn MBB subs (added 1mn MBB subs in 1QFY26), aided by its ongoing network expansion rollouts. However, its ARPU is likely to grow by 1.2% QoQ to INR 167 (vs. INR 165 in 1QFY26) due to upgrades and improved subs mix, and aided by 1 more day QoQ. Hence, we expect its revenue to grow 0.8% QoQ to INR 111bn, reported EBITDA to be higher 1.1% QoQ at INR 46.6bn and Pre-IND AS EBITDA (or cash EBITDA) to be higher 0.9% QoQ at INR 22bn in 2QFY26 – Exhibit 6.

* Net tenancy additions for Indus to remain healthy driven by Bharti’s rural expansion and VIL rollouts; reported EBITDA to grow 0.3% QoQ while adjusted EBITDA to grow 2.4% QoQ:

We build in ~6.1k net tenancy additions in 2QFY26 for Indus Towers (vs. ~5.8k in 1QFY26), driven by Bharti’s continued rural expansion and VIL network expansion rollouts. We expect tower additions of ~2.7k in 2QFY26 (vs. ~2.5k in 1QFY26), primarily on account of Bharti’s continued rural network expansion. However, we assume that the ARPT could be 0.3% lower QoQ on account of sharing discount due to tenancies from VIL on account of its ongoing network expansion rollouts (largely forming second tenancy on existing towers). Hence, revenue is likely to grow 0.3% QoQ to INR 81bn, partly offset by lower energy revenue in 2QFY26. Further, reported EBITDA is also likely to grow 0.3% QoQ to INR 44bn in 2QFY26 as we build slightly improved energy EBITDA (at negative 3% in 2QFY26 vs. negative 4% in 1QFY26) and NIL provision for doubtful debt write-back (vs. recovery of ~INR 0.9bn of past dues from VIL in 1QFY26) given VIL has paid all of its undisputed past dues; adjusted EBITDA could improve ~2.4% QoQ to INR 44bn in 2QFY26 – Exhibit 7.

* TCOM’s revenue and EBITDA to grow 1.2% and 1.8% QoQ respectively led by digital portfolio; though partly offset by weakness in core connectivity on account of SAARC region-related issues:

We expect weakness to continue in TCOM’s core connectivity segment on account of SAARC region-related issues (difficulty in recoverability of dues from a few clients in SAARC region, leading to subsequent exits). Hence, core connectivity revenue is likely to be flattish QoQ in 2QFY26 while digital portfolio revenue is likely to grow 3.4% QoQ in 2QFY26. Hence, we expect overall revenue to grow 1.2% QoQ to INR 60.3bn and EBITDA to grow 1.8% QoQ to INR 11.6bn – Exhibit 8.

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