Bharti Airtel ARPU rises in Q1, data consumption grows: Key takeaways

Mumbai: The bright side of Bharti Airtel’s report card for the quarter ended June was the recovery in its India mobile services business, on the back of an uptick in average revenue per user (ARPU) for the fifth quarter in a row, even as the telecom major reported losses for the fifth straight quarter.

The company said its net loss for the June quarter widened to Rs 15,191.2 crore for the quarter ended June, from Rs 15,933 crore from Rs 2,866 crore in the same quarter a year ago.

Here are the key takeaways from Bharti Airtel’s Q1 earnings:
India business shines: India revenues for the quarter came in at Rs 17,589 crore, an increase of 14.6 per cent year-on-year (YoY) on a reported basis. Mobile revenues have witnessed a YoY growth of 18.5 per cent.

ARPU increases: ARPU for the quarter wast Rs 157 as compared to Rs 129 a year ago, led by full impact of the tariff hikes in the previous quarter alongside the company’s continuing focus on quality customers.

Management commentary: “We are going through an unprecedented crisis caused by Covid. Despite this, our teams have served the country well and kept our customers connected. Data traffic growth surged by around 73 per cent YoY even as 4G net additions slowed down to 2 million caused by supply chain shocks in the device eco system,” said Gopal Vittal, MD and CEO, India & South Asia

“Revenues grew by 15 per cent Y-o-Y and performance was satisfactory across all segments. Our flagship “War on Waste” program, helped improve EBITDA margin by 1.6 per cent over the previous quarter,” he added.

Data consumption jumps: 4G data customers have increased by 45.3 per cent to 138.3 million from 95.2 million in the corresponding quarter last year while traffic has increased to 74.09 PB/day vs 42.90 PB/day in the corresponding quarter last year.

AGR provisions: During the quarter, the group has further recorded an incremental provision of Rs. 10,744.4 crore, including net interest on total provision created considering interest rate to give effect of the differential amount between DoT demand along with provision for subsequent periods for which demands have not been received computed based on the terms of the license agreement, court judgement, and the guidelines and AGR provision.

Steady home business segment: Homes business segment continues to remain steady and witnessed a revenue growth of 1.4 per cent YoY. Although on a YoY basis, customer base increased by 4.5 per cent, growth was impacted during the quarter on account of closure of several commercial establishments owing to COVID, the company said.

Airtel Business grows: Airtel Business continues to accelerate its revenue growth momentum with a 9.2 per cent YoY growth led by growth across all its segments – connectivity revenues from global business, domestic enterprise business besides solutions such as data centres, cloud, IOT.

Addressing recharge concerns: Bharti Airtel said one key customer grievance was the inability to access their regular retailers to recharge during lock-downs, and so it has enabled many new channels such as ATMs, pharmacies, groceries, post offices etc. while also educating customer towards online recharges and payments.