Summary:
India’s telecom industry could see another 12–15% tariff increase over the next four to five months, according to Centrum Institutional Research, as market consolidation improves pricing conditions. Reliance Jio, Bharti Airtel and Vodafone Idea are expected to see ARPU growth in Q2FY27, with Jio and Airtel likely to continue gaining subscribers. Jio is projected to add around 8 million users, Airtel 3 million and VIL 1 million, while 5G expansion and migration from 2G to 4G/5G are expected to support growth. The report also forecasts revenue growth for Indus Towers and Tata Communications, while VIL’s fundraising and network expansion plans will remain key areas to watch.
India’s telecom sector could witness another 12–15 per cent increase in tariffs over the next four to five months, as market consolidation has created a more supportive pricing environment, according to a report by Centrum Institutional Research.
“With the market now comprising 3+1 players, the pricing environment has become more favourable, and we expect another 12–15% tariff hike over the next four to five months,” the report said.
From a financial perspective, Bharti Airtel, Reliance Jio and Vodafone Idea Limited (VIL) are expected to record a quarter-on-quarter (QoQ) increase of around 0.8–2.0 per cent in average revenue per user (ARPU) during Q2FY27.
The expected improvement is likely to be supported by customers moving from 2G to 4G/5G services, growth in postpaid connections and the higher number of days in the quarter.
The report further said Bharti Airtel and Reliance Jio are likely to continue increasing their subscriber market share, largely at VIL’s expense.
“Reliance Jio is expected to add around 8 million subscribers QoQ, while Bharti Airtel is expected to add around 3 million India wireless subscribers QoQ,” the Centrum report stated.
“VIL is expected to add around 1.0 million customers QoQ. Data consumption per customer is expected to remain strong, supported by increasing 4G/5G network penetration.”
The report also reviewed developments in network coverage across the industry. Reliance Jio and Airtel have extended 5G services to more than 95 per cent of districts and are now focusing on increasing the number of 5G devices connected to their networks. Meanwhile, VIL’s 5G services are available in around 200 cities, with the company continuing to expand its 5G footprint.
“VIL is actively engaging with banks to finalise its Rs 250 bn debt fund raise, which is required as part of its Rs 450bn capex programme for FY27E-29E,” the report noted. “Reliance Jio and Airtel are also witnessing strong momentum in 5G FWA and fixed broadband additions, while penetration in these segments remains low.”
For Reliance Jio, Centrum expects the operator to add around 8 million subscribers QoQ, taking its total base to 541 million. Its ARPU is projected to rise 1 per cent QoQ to Rs 218 per month, supported by 5G FWA additions and the higher number of days in the quarter. As a result, revenue is estimated to increase 2.6 per cent QoQ.
Bharti Airtel is projected to add approximately 3 million subscribers QoQ, taking its base to 380 million. Its ARPU is expected to increase 2.0 per cent QoQ to Rs 269 per month, the highest in the industry, driven by continued migration from 2G to 4G and the higher quarterly day count. Revenue is estimated to grow around 3.1 per cent QoQ.
Vodafone Idea is expected to add about 1.0 million subscribers QoQ, reaching 194 million, while blended ARPU is projected to rise approximately 0.8 per cent QoQ to Rs 178 per month. Investors will closely monitor management’s comments regarding VIL’s capital expenditure plans and progress in securing funds.
Beyond the three telecom operators, the report expects Indus Towers to record around 1.7 per cent QoQ revenue growth, supported by a 1.5 per cent QoQ rise in co-locations. The increase is expected to be driven by higher capex from VIL as it works to strengthen network coverage and capacity.
Tata Communications is projected to deliver 1.6 per cent QoQ revenue growth, supported by stronger momentum in its Digital Platform and data-related services. Its EBITDA margin is expected to improve by around 61 basis points sequentially to 19.3 per cent.
