Bharti Airtel Ltd’s revenue market share declined again in the quarter ended March, data released last week by Telecom Regulatory Authority of India (Trai) show.
Bharti reported gross revenue of Rs 10,566 crore to Trai for its mobile business, just 0.7% higher compared with the December quarter. The other companies that reported numbers saw cumulative revenues rise at a much healthier rate of 3.9%.
One basis point is 0.01%.
For the March quarter, all companies excluding Etisalat DB Telecom Pvt. Ltd, S Tel Pvt. Ltd and Videocon Telecommunications Ltd reported revenue details to Trai. Reports suggest these three companies have decided to shut down operations after the Supreme Court ruling cancelling their licences.
Also See | Fighting back (PDF)
If one were to normalize the December quarter numbers by excluding the revenue of these three companies, the drop in Bharti’s market share last quarter stands at 64 basis points.
Given this backdrop, it’s little wonder that Bharti has turned increasingly aggressive in the marketplace on subscriber acquisition. As pointed out in this column last week, the latest numbers show Bharti has taken the lead with respect to subscriber addition in the past two months, after being in the third position, behind Idea Cellular Ltd and Uninor, in the preceding six months.
Bharti’s aggression is expected to impact tariffs, with the average revenue per minute expected to be under pressure in the June quarter. But mobile revenue may not decline materially, considering that subscriber addition as well as usage has picked up owing to lower tariffs. Bharti has also taken the lead in cutting 3G tariffs by up to 70%.
There was a concern among investors that the new proposals on spectrum pricing will lead to a hike in tariffs and the industry business model will change to a high-tariff, low-volume one. In the interim, though, operators are clearly out to grab share by cutting tariffs, despite reduced competition from newer firms.
PDF
by Navin Kumar Saini/Mint.
