Published on 14/06/2019 11:31:25 AM | Source: Motilal Oswal Securities Ltd

Telecom sector - RJio — the only player to add active subs in Mar`19 By Motilal Oswal

Posted in Broking Firm Views - Sector Report| #Telecom Sector #Motilal Oswal #Sector Report

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RJio — the only player to add active subs in Mar’19

Bharti's MBB market share stabilizing

The Telecom Regulatory Authority of India (TRAI) has released subscriber data for the month of Mar’19.


Key highlights:

* Net active subscriber base stood flat MoM at 1,022m. Bharti reported flat MoM active subs while Vodafone Idea lost 9.1m active subs. RJio continued its strong momentum, gaining 8.0m active subscribers in Mar’19.

* RJio’s strong gains could be attributed to the series of Jiophone offtake. Bharti and Vodafone Idea — both are potentially witnessing an impact from the rollout of minimum recharge plans on pan-India basis.

* Broadband subscriber adds stood robust at 12.8m (+10.2m in Feb’19), reaching 544m (53% of active subscriber base).

* RJio continued to take the lion’s share in incremental MBB adds (80% share among the top-3 players). However, we estimate it at 63% (ex-Jiophone), while Bharti gained ~20% share.


RJio – only telco to add active subs

Net active subscriber base remains flat MoM

Active subscriber base for the industry in Mar’19 was flat MoM at 1,022m (v/s Feb’19). RJio continued its strong active subscriber growth with 8m active subscriber adds (gaining healthy 80bp market share); Bharti’s active subscriber base/market share stood flat MoM. Vodafone Idea lost 9.1m active subscribers, potentially due to the implementation of minimum ARPU plans; market share was down 90bp MoM. Overall, gross subscriber base declined 2% to 1,162m.


Bharti’s active subscriber base/market share flat MoM

After witnessing a decline for three consecutive months, Bharti reported flat monthly active subscriber base at 328m; market share was also flat MoM at 32.1%. This could be attributed to the implementation of minimum ARPU plans on panIndia basis. However, gross subscriber base declined by 15m MoM (flat in Feb’19) to 325m.


RJio adds 8m active subscribers with healthy 80bp market share expansion

RJio remained the only telco to add active subscribers; it added 8m (+9.3m in Feb’19) active subs. Market share expanded 80bp MoM to 25.2%. However, it has decelerated from its six-month average of 8.6m. We believe ~50% of the addition could be attributed to Jiophone. Further, RJio added 9.5m gross subscribers on MoM basis.


Vodafone Idea sees 9.1m decline in active subscriber base; loses 90bp share

Vodafone Idea continued to lose active subscribers for almost 11 consecutive months. It lost 9.1m (-7.2m in Feb’19) active subscribers; with a 90bp MoM market share contraction to 36%. Vodafone Idea is losing ground potentially due to (a) implementation of minimum ARPU plans, and (b) deteriorating network quality possibly due to network integration issues. VIL cumulatively lost ~400bp active subscriber market share over the last one year. It lost 14.5m (-5.8m in Feb’19) gross subscribers on MoM basis.


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