Airtel may hike mobile tariff after FY24 PAT plunge debacle
In last few years, the other private telecoms too have followed Airtel's strategy of tariff hikes.
Bharti Airtel is expected to increase mobile tariffs as the telecom’s net profit in fourth quarter (Q4) of financial year (FY24) fell 31 per cent year-on-year (YoY) to Rs 2,072 crore from Rs 3,005.6 crore in year ago period. Even on an annual basis, the Sunil Mittal-owned telecom’s profit has plunged 10.5 per cent YoY to Rs 7,467 crore in FY24.
Bharti Airtel Managing Director Gopal Vittal has said, “Company’s performance was impacted primarily by the devaluation of the Nigerian Naira.” Vittal has blamed Nigerian currency’s devaluation as the main reason behind the profit plunge. Airtel suffered a forex loss of Rs 2,544.4 crore on account of currency devaluation.
Due to the profit plunge debacle, the telecom may again have to increase mobile tariffs which would further increase its average revenue per user (ARPU) which has already risen 8 per cent YoY to Rs 209 in the March 2024 quarter from Rs 193 in year ago period. Currently, Airtel has highest ARPU in the country. Vittal said, “We continue to deliver industry leading ARPU growth along with growing average data usage per customer.” Airtel’s average data usage per customer stands at 22.6 GB at the end of Q4 FY24.
Bharti Airtel, founder, Sunil Mittal has outrightly pitched for ARPU of Rs 300 for the company to be fundamentally strong in India. And he has been able to hike tariffs in the past and is further hooting to shoot up ARPU from current levels.
In last few years, the other private telecoms too have followed Airtel’s strategy of tariff hikes. Although, Reliance Jio and Vodafone Idea had hiked with a marginal difference. For example, Reliance Jio’s ARPU is only up by a meagre one per cent to Rs 181.7 in the March quarter vs Rs 178.8 in year ago period.
Despite jacking up the ARPU, Airtel has been able to increase its customer base:
Despite jacking up the ARPU, the New Delhi headquartered telecom has been able to increase its customer base continuously in the past. Airtel’s subscriber count is up 5 per cent YoY to 35.22 crore in Q4 FY24 from year-ago period.