FEATURE: India’s telecoms market is on a tear, with aggregate ARPU rising quarterly for the past two years and the growth forecast to continue until at least end-2024, leaving most of its regional rivals in the dust.
A report from Fitch Ratings predicted India’s operators will register 7.9 per cent ARPU growth in 2023, following by 10 per cent in 2024.
The credit agency said Indonesia is on track to see a 3.2 per cent rise in ARPU this year, but the rate will drop to just 1.2 per cent in 2024, while Thailand is expected to record no growth and 1 per cent gains, respectively, following declines in 2021 and 2022.
Increases in Singapore, South Korea and Malaysia in 2023 and 2024 are estimated to range between 2 per cent and 0.9 per cent.
Meanwhile, Fitch forecasts subscriber gains to slow to between 2.3 per cent and 1.1 per cent annually over the same period.
The good news in both users and prices are expected to rise in 2024 in all six Asia Pacific markets evaluated.
The rating company attributed consolidation across the region to paving the way for more rational mobile competition and leading to growth in profitability, citing recent mergers in Malaysia and Indonesia, as well as the huge industry shakeout in India a few years back.
Data from GSMA Intelligence showed ARPU in India climbed 34.2 per cent over the past two years to $2.00 a month at end-September, with the rise starting long before 5G services gave consumers a reason to pay more for zippy downloads.
Soaring profits
Net profit for Jio Platforms, Reliance Jio’s holding company, increased for 15 consecutive quarters, from INR13.5 billion ($162.3 million) in fiscal Q3 2019 to INR51 billion in fiscal Q1 2023 (ending 30 June).
Rival Bharti Airtel, with sizeable operations outside of India, booked double-digit revenue growth in its home market over the past three quarters, driven by rising ARPU which reached INR200 at end-June.
Struggling third-ranked Vodafone Idea continues to post losses but recorded revenue growth in the past two quarters, also aided by ARPU gains.
Fitch credited India’s strong position to moves towards more transparent governance, a welcome change from the sector previously facing high regulatory risks and troubles. The government, for example, took steps to alleviate financial pain by deferring spectrum liability payments.
It noted revenue growth of operators in South Korea remains solid, due to continued 5G migration, although at a slower pace compared with India. Intense competition in Singapore, however, has led to lower ARPU and profitability despite the early adoption of 5G.
The company warned expensive spectrum in upcoming auctions in India and Indonesia may weaken balance sheets and a spike in 5G capex across the wider market could provide no uplift in profitability, as consumers could hesitate to pay more for higher speeds.
The post India growth stands out in slowing APAC market appeared first on Mobile World Live.
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