 "SIM consolidation to normalise over 2 quarters: Airtel MD & CEO Vittal")
Bharti Airtel has seen limited amount of sim consolidation, and the trend is expected to stabilise over the next two quarters, Airtel Managing Director Gopal Vittal said on Tuesday in the post results call with analysts.
Vittal also suggested another round of tariff hikes to raise the return on capital employed (RoCE) for the sector.
“As we've seen in the past, these trends normalise over two quarters and we've already seen that normalisation happen. Through October, we've already seen a trend of reversal with customer additions. We added 4.2 million smartphone customers in the quarter. Postpaid net additions remained steady at about 0.8 million,” Vittal said.
July's industry-wide tariff hikes hit Airtel's subscriber numbers in the second quarter (July-September) of financial year 2025 (FY25), with customer base in India reducing by 2 million to 407 million at September-end. This was lower than market leader Jio’s 10.9 million subscriber loss in Q2. Airtel’s monthly churn increased to 3.2 per cent, higher than Jio’s 2.8 per cent.
Vittal also pointed out the RoCE was still very low at 11.2 per cent and further tariff repair remains the only way to improve it.
Airtel’s net profit in the July-September quarter (Q2) of FY25 rose 168 per cent year-on-year (Y-o-Y) to Rs 3,593 crore as against Rs 1,340 crore in the same period a year ago as a result of higher telecom tariffs imposed in early July.
The company’s average revenue per user (Arpu), a key performance metric for telecom firms, rose 14.7 per cent Y-o-Y to Rs 233, up from the Rs 203 in Q2FY24. As a result of the tariff hike, it shot up by 10.6 per cent sequentially, up from Rs 211 in Q1. Airtel’s Arpu is the highest in the industry, beating Jio’s Rs 191.5 and Vodafone Idea’s Rs 146 (as last reported by both companies).
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Talking about the organisational rejig announced by the telco on Monday, Vittal said the 'strategic succession' plan is “well thought out”, and aims to bring in a fresh crop of younger leaders into key positions to run India operations.
Vittal said he will also take up some of the roles that Bharti Enterprises Chairman Sunil Bharti Mittal currently dons across the group, “specifically driving synergy on procurement, digital, talent and network strategy”.
“We believe this would add capacity to the group. I will spend time scaling some of our incubation and growth areas- digital services, financial services and data centres. I will also provide broader oversight across our overseas operations,” Vittal said.
He would also continue as the deputy chair of GSMA, the premier global association of the mobile industry with over 1200 members.
What Vittal said
> Return on capital employed only 11.2% for India business
> Arpu has to rise to Rs 300 despite India having lowest tariffs
> Airtel optimistic about Fixed Wireless Access (FWA) offerings expanding to over 2,000 cities
> FWA equipment cost now comparable to fibre-to-home routers > Succession plans well thought out, to add capacity
> Vittal to drive synergy on procurement, digital, talent and network strategy