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R-Jio biggest gainer, muted subs trends for Bharti in Oct-23

TRAI’s Oct-23 subscriber data indicates a continuation of muted subscriber trends, with 0.8 mn wireless net adds. Vi (-19 bps) continued to lose wireless subs market share to Bharti (+1 bps) and R-Jio (+25 bps). VLR subs declined by 1.4 mn, with R-Jio emerging as the only telco to gain VLR subs in Oct-23. Despite strong festive smartphone sales, MBB net adds at 2.8 mn were the lowest in FY2024TD. Mobile Number Portability (MNP) requests remained elevated at 12.7 mn, indicating intense competition to attract subscribers, with tariff hikes unlikely until after the 2024 general elections, in our view.

Muted wireless net adds in Oct-23 with R-Jio emerging as the biggest gainer

Wireless net adds were muted at 0.8 mn. R-Jio (+3.2 mn, in line with monthly net adds in 1HFY24) was the biggest gainer. Bharti (+0.4 mn, lower versus ~1.1 mn monthly run-rate in 1HFY24) had a muted Oct-23. Vi continued to lose ground, with a 2 mn subs decline (versus 1.5 mn monthly net declines in 1HFY24). Vi lost further ~19 bps in wireless subs market share mom in Oct-23.

Visitor Location Register (VLR) subs dip, R-Jio the only telco to gain VLR subs

India’s VLR (peak active) subs base declined by 1.4 mn in Oct-23 (still up ~49 mn since the Dec-21 tariff hike compared to ~17 mn dip in wireless subs). R-Jio was the only gainer on VLR subs, with 1.8 mn net adds (but lower versus 3.2 mn wireless net adds and 3 mn monthly VLR net adds in 1HFY24). Bharti lost  1.2 mn VLR subs (versus 0.4 mn wireless net adds and 1.1 mn monthly VLR net adds in 1HFY24). After a surprising VLR subs gain in Sep-23, Vi’s VLR base declined by 1.4 mn in Oct-23 (in line with the 1HFY24 run-rate, but lower than 2 mn wireless net subs decline). Surprisingly, Vi was the only gainer in VLR market share in Metros in Oct-23.

Mobile Broadband (MBB): Muted trends, lowest MBB net adds in FY2024

MBB net adds at 2.8 mn subs were the lowest in FY2024TD. Bharti added a modest 0.5 mn MBB subs (versus ~2.5 mn monthly average net adds in 1HFY24). After gaining MBB subs in the past two months, Vi lost ~0.8 mn subs in Oct-23 (versus ~0.3 mn monthly net adds on average in 1HFY24).

Fixed Broadband (FBB): Another duopoly in the making

India’s FBB subs more than doubled in the last four years (+104% since JioFiber launch in Sep-19) and were up by a further ~0.5 mn to 37.4 mn (+19% yoy). JioFiber FBB net adds accelerated to 0.22 mn, reaching 10 mn subs (+40% yoy), while Bharti added 0.14 mn subs to reach 7.2 mn subs (+33% yoy). With recent FWA launch, we believe India’s FBB market will also move toward a duopoly.

Market share gains to accelerate for Bharti and R-Jio among premium subs

R-Jio and Bharti continued to gain wireless subs market share at Vi’s expense. In our base case (status quo on Vi, moderate tariff hikes), we expect accelerated market share gains for Bharti and R-Jio at Vi’s expense, especially among premium subscribers, driven by: 1) pan-India 5G rollouts and 2) Vi’s cash constraints, long-delayed fund-raise and uncertainty about the 5G launch.

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