Bharti Airtel has been quite vocal about what it has wanted for a long time. The telco is all about keeping the highest paying customers in India on its network. This helps Airtel to keep its ARPU level at the top of the competition. Airtel has often said that its short-term ARPU target is Rs 200. ICICI Securities recently said that Airtel’s ARPU is expected to reach Rs 184 in Q1 FY23. If this is what the actual data means then Airtel will be just Rs 16 shy for its short term ARPU target of Rs 200.
Airtel set to exceed Rs 200 ARPU level very soon
India’s telecom operators are planning another round of rate hikes. Airtel has already said it will not shy away from being the first operator to raise prices again. This will certainly help Airtel exceed its short-term ARPU target of Rs 200. In the long term, Airtel’s ARPU target is of Rs 300. With the current rate levels, it will be too difficult to do that.
Bharti Airtel need to add more 4G customers. At the moment, the telco also has older network users on its network. In principle, these users do not need to purchase heavily loaded 4G subscriptions. So the main thing that Airtel needs to do is focus on pushing the legacy network users on its network to 4G services. This further means that these new 4G consumers will spend more money on Airtel’s services and help increase the company’s ARPU.
But one thing is certain; the target level of Rs 200 ARPU is quite achievable in the short term for Airtel. Another rate hike would push the company’s ARPU to more than 200 levels, which is what the telco wants. Vi is also likely to follow Airtel in increasing the rates of prepaid plans, but the move will certainly benefit Airtel more.
