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07 December 2023 India | Equity Research | Q1FY24 Performance Indicator Report

Telecom

Industry 5G subs base at 76mn in Q1FY24

In Q1FY24, consumer spend on mobile services (post-GST) rose 2.5% QoQ / 9.7% YoY to INR 524bn. Net revenue grew
2.2% QoQ / 9% YoY to INR 500bn led by higher intercompany settlements. Postpaid net revenue fell 1.3% QoQ / 3.3%
YoY on lower ARPU. Bharti Airtel’s (Bharti) postpaid sub base (incl. M2M) rose 13.4% QoQ / 38.3% YoY to 40.4mn, and
its postpaid sub market share was up 421bp QoQ at 42.8%. Prepaid net revenue rose 2.6% QoQ / 10.4% YoY as ARPU
increased 3% QoQ / 11.8% YoY to INR 144. 4G subs base fell 7.8% QoQ (net less: 61.9mn) to 733mn as 5G subs rose
76mn. 4G+5G sub market share for RJio was up 10bp QoQ to 54.2%, while that for Bharti also improved 20bp QoQ to
28.4%. FTTH subs market share for Bharti / RJio improved to 25.8% (+126bp QoQ) / 18.4% (+37bp QoQ), respectively.

Consumer spend on mobile services (post-GST) up 2.5% QoQ / Sanjesh Jain

9.7% YoY to INR 524bn sanjesh.jain@icicisecurities.com
+91 22 6807 7153
Inter-company settlements were higher by 10.1% QoQ, leading to slightly
Ashvik Jain
slower net revenue vs consumer spend. ARPU (based on consumer spend)
ashvik.jain@icicisecurities.com
was up 2.5% QoQ / 9.8% YoY at INR 153, benefiting from an additional day in
the quarter. Postpaid net revenue fell 1.3% QoQ / 3.3% YoY INR 47bn in
Q1FY24. Prepaid net revenue rose 2.6% QoQ / 10.4% YoY to INR 453bn.
Postpaid ARPU (based on net revenue) dipped 4.2% QoQ / 15.9% YoY to INR
166. Prepaid ARPU was up 3% QoQ / 11.8% YoY at INR 144.

5G subs base at 76mn in Q1FY24

Bharti Airtel (BUY)
Accordingly, 4G subs base declined by 6.19mn to 733mn. RJio’s 4G+5G sub 1100
market share was up 10bp QoQ to 54.2% and Bharti’s improved 20bp QoQ to 1000

28.4%. VIL’s 4G sub market share dipped 23bp QoQ to 15.2%. Industry-wide, 900
800
3G subs continued to decline (-0.7mn QoQ to 16mn). Total sub-base was
((INR)

700
flattish QoQ at 1,144mn. Postpaid subs rose 2.2% QoQ (net add: 2mn, 600
probably from M2M) to 94mn. Bharti’s postpaid sub market share rose to 500
42.8% (+421bps QoQ) and VIL’s expanded to 24.1%. 400
300
5G data already at 4.6% of total data usage in Q1FY24
Dec-20

Dec-21

Dec-22

Dec-23
Jun-21

Jun-22

Jun-23

Data usage grew 7.6% QoQ to 44,967bn MB led by 4G segment growth of

2.7% QoQ to 42,505bn MB and contributed 94.5% of total data usage while Vodafone Idea (under–review)
5G data usage stood at 2,063bn MB (4.6% of total). 2G data volume fell 2.1% 18
QoQ and 3G data volume fell 3.3% QoQ. Bharti and VIL’s data usage market 16
14
shares stood at 33.2% (down 13bp QoQ) and 13.3% (down 54bps QoQ),
12
respectively. RJio’s market share stood at 52.1% (+95bp QoQ). Industry
(INR)

10
minutes were up 1.5% QoQ to 3,294bn. Bharti’s minute market share rose to 8
6
34.9% (+23bp QoQ) and VIL’s rose to 12.8% (down 35bp QoQ). RJio’s minute
4
market share increased by 31bp QoQ to 40.7%. 2
0
Fixed broadband subs up 4.7% QoQ (23.7% YoY; net add
Jun-23
Jun-21

Jun-22
Dec-20

Dec-21

Dec-22

Dec-23

1.6mn) to 35.5mn
This was led by 6.8% QoQ / 44.3% YoY growth in FTTH subs to 30.6mn, while
DSL continued to decline (down 12.1% QoQ / 55.9% YoY to 1.2mn). RJio’s
market share inched up to 25.8% (+126bp QoQ) of total FBB subs while its
share of FTTH subs was 30%. Bharti’s market share in FBB was up 37bps to
18.4%. BSNL’s market share dipped 32bps QoQ to 10.4%.

Please refer to important disclosures at the end of this report

Telecom | Q1FY24 Performance Indicator Report | 07 December 2023

Consumer spend on mobile services rose 2.5% QoQ and 9.7% YoY
INR mn Q1FY23 Q2FY23 Q3FY23 Q4FY23 Q1FY24 QoQ (%) YoY (%)
Consumer spend 4,78,009 4,90,163 5,04,450 5,11,525 5,24,469 2.5 9.7
Incremental revenue (QoQ) 13,477 12,154 14,287 7,074 12,944
Inter-company settlement (19,403) (17,953) (19,978) (22,434) (24,705) 10.1 27.3
% of consumer spend (4.1) (3.7) (4.0) (4.4) (4.7)

Net revenue (circle wise AGR) 4,58,606 4,72,210 4,84,473 4,89,091 4,99,764 2.2 9.0
Incremental revenue (QoQ) 20,497 13,605 12,263 4,618 10,673

Net revenue
Pre-paid 4,10,401 4,23,120 4,36,416 4,41,865 4,53,167 2.6 10.4
Post-paid 48,205 49,091 48,057 47,226 46,597 (1.3) (3.3)

Net revenue contribution (%)

Pre-paid 89.5 89.6 90.1 90.3 90.7
Post-paid 10.5 10.4 9.9 9.7 9.3

Consumer spend
Voice & others 72,084 72,603 75,208 76,907 77,855 1.2 8.0
Data 4,05,925 4,17,561 4,29,243 4,34,618 4,46,613 2.8 10.0

Consumer spend (%)

Voice & others 15.1 14.8 14.9 15.0 14.8
Data 84.9 85.2 85.1 85.0 85.2
Source: I-Sec research, TRAI

ARPU (based on consumer spend) grew 2.5% QoQ / 9.8% YoY

INR Q1FY23 Q2FY23 Q3FY23 Q4FY23 Q1FY24 QoQ (%) YoY (%)
Consumer spend (post GST) 139 143 147 149 153 2.5 9.8
Inter-company settlement (6) (5) (6) (7) (30) 352.6 423.9
Net ARPU (circle wise AGR basis) 134 137 141 143 123 (13.6) (7.7)

Net ARPU (circle wise AGR basis)

Pre-paid 129 133 138 140 144 3.0 11.8
Post-paid 198 193 182 174 166 (4.2) (15.9)
Source: I-Sec research, TRAI

Postpaid subscriber base rose by 2mn to 94mn

mn Q1FY23 Q2FY23 Q3FY23 Q4FY23 Q1FY24 QoQ (%) YoY (%)
Pre-paid 1,064 1,059 1,054 1,052 1,049 (0.2) (1.4)
Net add 1.4 (5.4) (4.8) (2.4) (2.4)
Post-paid 83 87 89 92 94 2.2 13.4
Net add 3.9 3.4 2.3 3.4 2.0
Total Subs 1,147 1,145 1,143 1,144 1,144 (0.0) (0.3)

Post-paid subs 83 87 89 92 94 2.2 13.4

Bharti Airtel 29.2 31.6 32.5 35.6 40.4 13.4 38.3
VIL 20.2 20.9 21.9 22.4 22.8 2.0 12.9
Others 33.9 34.3 34.6 34.4 31.3 (9.2) (7.8)

Post-paid subs market share (%)

Bharti Airtel 35.0 36.4 36.5 38.5 42.8
VIL 24.2 24.1 24.6 24.2 24.1
Others 40.7 39.5 38.9 37.3 33.1
Source: I-Sec research, TRAI

India | Equity Research 3

Telecom | Q1FY24 Performance Indicator Report | 07 December 2023

Total data subscribers rose by 13.1mn (1.5% QoQ)

mn Q1FY23 Q2FY23 Q3FY23 Q4FY23 Q1FY24 QoQ (%) YoY (%)
2G 36 35 34 34 34 (0.9) (5.5)
Net add (0.7) (0.9) (1.3) 0.6 (0.3)
3G 19 18 18 17 16 (4.1) (12.3)
Net add (1.9) (0.9) (0.2) (0.5) (0.7)
4G 752 766 781 795 733 (7.8) (2.6)
Net add 13.2 13.8 14.9 13.8 (61.9)
5G - - - - 76
Net add 76.0
Total data subs 807 819 832 846 859 1.5 6.5
Net add 10.6 12.0 13.4 13.9 13.1

4G data subs
Reliance Jio 413 420 425 430 439 1.9 6.2
Bharti Airtel 205 210 217 224 230 2.5 11.9
VIL 119 121 122 123 123 0.2 3.3
Others 15 15 18 18 18 (0.8) 17.4

4G data subs market share (%)

Reliance Jio 54.9 54.8 54.3 54.1 59.8
Bharti Airtel 27.3 27.4 27.7 28.2 31.3
VIL 15.8 15.7 15.6 15.4 16.8
Others 2.0 2.0 2.3 2.3 2.4
Source: I-Sec research, TRAI

Bharti Airtel’s minute market share rose 23bp QoQ to 34.9%

mn Q1FY23 Q2FY23 Q3FY23 Q4FY23 Q1FY24 QoQ (%) YoY (%)
Industry mins 31,38,877 30,74,698 31,54,532 32,45,054 32,94,014 1.5 4.9
Net add (1,51,160) (64,179) 79,833 90,523 48,960

MOU/subs (mins) 914 894 919 946 960 1.5 5.0

Pre-paid 936 920 950 983 1,000 1.7 6.8
Post-paid 621 567 542 518 509 (1.7) (18.0)

Minutes
Bharti Airtel 10,78,961 10,63,011 10,81,950 11,24,343 11,48,793 2.2 6.5
VIL 4,50,000 4,28,000 4,24,000 4,25,000 4,20,000 (1.2) (6.7)
Reliance Jio 12,50,000 12,30,000 12,70,000 13,10,000 13,40,000 2.3 7.2
Others 3,59,916 3,53,688 3,78,582 3,85,711 3,85,222 (0.1) 7.0

Minutes market share (%)

Bharti Airtel 34.4 34.6 34.3 34.6 34.9
VIL 14.3 13.9 13.4 13.1 12.8
Reliance Jio 39.8 40.0 40.3 40.4 40.7
Others 11.5 11.5 12.0 11.9 11.7
Source: I-Sec research, TRAI

India | Equity Research 4

Telecom | Q1FY24 Performance Indicator Report | 07 December 2023

Bharti Airtel’s data usage market share was down 13bp QoQ to 33.2%
mn MB Q1FY23 Q2FY23 Q3FY23 Q4FY23 Q1FY24 QoQ (%) YoY (%)
Data usage
2G 82,000 66,000 56,000 47,000 46,000 (2.1) (43.9)
3G 4,46,000 4,11,000 3,75,000 3,65,000 3,53,000 (3.3) (20.9)
4G 3,70,98,000 3,96,50,000 4,00,80,000 4,13,78,000 4,25,05,000 2.7 14.6
5G - - - - 20,63,000
Total 3,76,26,000 4,01,27,000 4,05,11,000 4,17,90,000 4,49,67,000 7.6 19.5

Data usage (%)

2G 0.2 0.2 0.1 0.1 0.1
3G 1.2 1.0 0.9 0.9 0.8
4G 98.6 98.8 98.9 99.0 94.5
5G 4.6

Data usage
Bharti Airtel 1,25,61,338 1,34,85,280 1,38,53,330 1,39,14,370 1,49,15,279 7.2 18.7
VIL 54,25,000 57,18,000 57,62,000 58,02,000 60,02,000 3.4 10.6
Reliance Jio 1,96,24,610 2,07,18,078 2,02,45,045 2,01,55,492 2,15,32,839 6.8 9.7

Data usage market share (%)

Bharti Airtel 33.4 33.6 34.2 33.3 33.2
VIL 14.4 14.2 14.2 13.9 13.3
Reliance Jio 52.2 51.6 50.0 48.2 47.9
Source: I-Sec research, TRAI

FTTH subs grew 4.7% QoQ / 23.7% YoY

mn Q1FY23 Q2FY23 Q3FY23 Q4FY23 Q1FY24 QoQ (%) YoY (%)
FBB subs (mn) 28.7 30.8 32.4 33.9 35.5 4.7 23.7
Net add (mn) 1.45 2.08 1.59 1.54 1.60
Of which
FTTH 21.2 23.4 26.0 28.7 30.6 6.8 44.3
Net add (mn) 2.24 2.15 2.60 2.69 1.95
DSL 2.8 2.6 2.3 1.4 1.2 (12.1) (55.9)
Ethernet/LAN/Leased line 3.8 3.9 3.2 3.1 3.0 (3.5) (20.9)

FBB subs (mn)

BSNL 3.8 3.9 4.1 3.6 3.7 1.6 (3.9)
Bharti 4.9 5.3 5.7 6.1 6.5 6.9 34.9
RJIO 6.2 6.8 7.6 8.3 9.2 10.1 48.9
Others 13.9 14.8 14.9 15.9 16.1 1.8 16.3

Market share (%)

BSNL 13.4 12.7 12.7 10.7 10.4
Bharti 16.9 17.1 17.6 18.0 18.4
RJIO 21.4 22.2 23.6 24.5 25.8
Others 48.3 48.0 46.1 46.7 45.4

RJIO's market share in FTTH 29.0 29.2 29.5 29.1 30.0

Source: I-Sec research, TRAI

India | Equity Research 5

Telecom | Q1FY24 Performance Indicator Report | 07 December 2023

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Telecom | Q1FY24 Performance Indicator Report | 07 December 2023

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