Telecom sector to see further consolidation with Bharti, Jio continuing as dominant players

Bengaluru, 24 May Consolidation in the telecom sector is likely to continue with two major players Bharti and Jio further strengthening their positions in the coming quarters.

According to brokerage firms, any meaningful hike in the tariffs is possible post the general elections.

“Consolidation trend will bring potential change in the telecom industry with top-2 players gaining subscriber share at expense of its peers. A pending and much needed headline tariff hike is expected only after general elections,” Brokerage firm, Prabhudas Lilladher wrote in a note.

Notably, subscribers are leaving telecom operators like Vodafone and BSNL to Jio and Bharti in recent quarters. This trend is expected to continue in the near future.

Currently, Jio and Bharti have a majority market share with 70 per cent of subscribers using the services of these two companies.

While net subscriber loss for Vodafone was at 24 million in FY23, higher than 22.9mn loss in FY22; for BSNL, the loss was at 14.2 million subscribers, up from 4.8 million in FY22.

“Bharti & Jio showed impressive addition in mobile broadband (MBB) subscribers at 25 million & 26.2 million to have a total MBB count of 235.8 million & 430.2 million respectively. Vodafone also added 2.3 million to take the industry total to 790.8 million (up 7.3 per cent over last year),” the brokerage firm added.

Interestingly, broadband additions were impressive with most additions coming from tier-II cities across the country.

In the fixed broadband space, Bharti & Jio added 1.6 million & 3.1 million fixed broadband subscribers in FY23, while BSNL lost 0.3 million subscribers. Total subscriber base increased to 14.5 million, up 47.3 per cent from 9.8 million in FY22.