Bharti Airtel’s consolidated revenues for Q1FY20 stood at Rs 20,738 crore – an increase of 6.8% from the same quarter last year. However, it posted a net loss of Rs 2,866 crore in the first quarter of the financial year 2019-20 (Q1FY20), a massive fall of 3047% as compared to the same quarter last year (Q4FY19) when it posted a profit of Rs 97 crore; but that, the company said was because of its adaptation to a new telecom standard (IND AS116) and a one-time investment into it.
- India revenues grew 5.5% year-on-year to Rs 15,345 crore in Q1FY20. Africe revenues, meanwhile, grew by 10.2 %.
- Mobile ARPU (average revenue per user) increased to Rs 129. One thing to note here is that this is more than Reliance Jio’s ARPU of Rs 122 in the same quarter.
- Consolidated mobile data traffic grew by 94% year-on-year and stood at 4,045 PBs in the quarter. In India, it more than doubled to 3,904 PBs year-on-year.
- Mobile 4G data customers increased by 63.3% to 95.2 million from 58.3 million in the corresponding quarter last year.
- Overall customer base of 404 million across 16 countries.
- Mobile services’ customer base saw a 18.4% decline in Q1FY20 compared to the same quarter last year.
- DTH customer base grew by 9.4% year-on-year in Q1FY20.
Scoop on Bharti Airtel
In the investors’ call, Bharti Airtel’s MD and CEO Gopal Vittal and CFO, Badal Bagri talked about shutting down Airtel’s 3G network, unsustainable pricing levels and 5G’s onset in India:
Shutting down its 3G network by December: Airtel will shut down its 3G network across India by December, according to Vittal.
- “We have experimented quite boldly in Kolkata to really shut off the 3G network altogether…That has given us a lot of confidence. We now have a plan to pretty much shut the 3G networks across the country by December” – Vittal
Will there be any cost savings by shutting down its 3G network? No, according to Bagri. “The cost savings would not be enough because most of the places, we had already migrated to SRAN (single radio network access). So, we will be using the same equipment to deliver 4G. So, there would not be significant cost saving from a network perspective,” said Bagri.
5G adoption anytime soon in India? No, according to Bagri.
- “We do believe that this 4G handset penetration still has significant headroom to grow and therefore, for the foreseeable future, India will be largely a 4G market” – Bagri
Are current pricing levels sustainable? Not according to Vittal.
- “The pricing levels in India are unsustainably low. It is you get, for 45 gigs of data, unlimited calling for about Rs.150, which is clearly very, very low. That needs to rise. But that is a function of the competitive dynamic in the market.” – Vittal
- Talking about Airtel’s postpaid connection numbers, Vittal said, “India should be much bigger in postpaid, and the only reason this has not yet happened is because prepaid is so underpriced when compared to postpaid”.
Airtel Thanks will be refreshed in the next three-four months: To encourage more people to upgrade to bigger plans, Airtel Thanks will see a very big refresh in the next three to four months, said Vittal.
Are PayTm and PhonePe competitors for Airtel? No, said Vittal.
- “They are just a wallet. In the case of Paytm, it is a wallet, or in the case of PhonePe, it is just a kind of a UPI platform, which the apps sit on top of the UPI platform with an underlying bank account. So, we do not see that as a competition.” – Vittal
On the status of ongoing AGR litigation against Airtel: “The case is in court. The hearings have been concluded. The order now is reserved. So as soon as the orders come, we will know. And that is what we are talking about the AGR case.” – Vittal
Airtel moved its fibre assets to a 100% subsidiary, while also expanding its fibre footprint to more than 280,000 route kilometers with most of the sites either single hub or 2 hubs from the fiber port.