Bharti Airtel’s revenue market share (RMS) increased most among local telecom operators in the first quarter through June, analysts said, as investments in data and volume growth in voice helped the market leader consolidate its lead over rivals Vodafone India and Idea Cellular. The Sunil Mittal company’s RMS rose 1.3 percentage point from a year earlier to 32.7% in the past quarter, brokerage BNP Paribas said in a report.
Nearest rival Vodafone India posted slight expansion to 23.3%, while at third ranked Idea Cellular, shrinking to 19.2%. The top three telcos cornered just over three-fourths of the revenue market share in the industry, where adjusted gross revenue growth slowed in the quarter ended June 30. Analysts said while the fiscal quarter through September is historically slow for industry, good monsoons — plentiful rains this year are expected to boost the agriculture-led rural economy and so consumer spending — may help demand and the second half of the fiscal is likely to be better than the first.
“Bharti’s market share gains have accelerated with higher investments in data network,” BNP said. At the same time, a steep price increase by Idea — its average revenue per minute rose 8% in the last two quarters versus stable realisation for Airtel — aided Airtel’s voice volume share gain, it added.
Idea reported sequential decline in RMS in some circles where Airtel and Vodafone are leaders — Mumbai, Delhi, Kolkata and Karnataka — as the Aditya Birla Group company raised prices, in spite of being a weaker operator and as it lacked adequate spectrum to compete against leaders in some of these data markets, it said.
Idea Cellular though continued to report RMS gains in circles where it is already a leader, such as Kerala, Maharashtra and Madhya Pradesh. Vodafone India RMS has been stable at around 23% for the past three years. Airtel reported revenue growth in all circles except Mumbai where it declined 0.3% on quarter. Among the top three, only Vodafone reported revenue growth in the Mumbai circle, brokerage Emkay said.
Karnataka emerged as the largest revenue contributing circle for Airtel, with a sequential expansion of 3.0%. Punjab, Maharashtra, Haryana, Gujarat and Kolkata circles recorded highest on-quarter growth for the market leader, Emkay added.
BNP said the telecom industry adjusted gross revenue growth in the first quarter slowed to 6.2% from a year earlier, compared with 10.9% in the fourth quarter of the last fiscal year.