Govt must reduce levies, 5G reserve prices: Airtel CEO

Bharti Airtel (Airtel) on Wednesday said while the recently announced reforms by the government are game changing, more should be done to rationalise the industry such as lowering the levies and reserve prices of 5G spectrum.

“While the reforms are game changing, more needs to be done and we look forward to the next round of measures planned by the government. In particular, the high levies on the industry need rationalisation. Equally, the reserve prices for 5G spectrum must be lowered so that it is viable for us to purchase spectrum,” Gopal Vittal, Managing Director and Chief Executive Officer (India and South Asia), Airtel, said in a post-earnings call.

He also indicated that there may be some tariff hikes in the current quarter, adding that the company will continue its emphasis on acceleration of new products.

ARPU (average revenue per user) rose to ₹163, an increase of ₹9. “We are again at a new lifetime high in terms of a revenue market share of 36.9 per cent, validating our strategy of winning with quality customers. Early signs of tariff increase have been encouraging and the full flow through is expected to be felt in the fourth quarter. At the same time, we have seen some Sim consolidation leading to some moderation in customer adds as customers make decisive choices in favour of their preferred brand. We expect this consolidation trend to correct from here on,” Vittal said.

In the broadband business Airtel is seeing healthy customer additions driven by the increased demand for Fiber-to-the Home. Airtel has now hit a milestone of going past the four-million customer homes mark, he said adding, “Our innovative Uber like digital model with the local cable operator partner as also the acceleration in the roll out of our own fiber in the top 100 cities are the pivots around which our home broadband strategy revolves”.

Airtel’s overall presence has now expanded to 672 towns and it has added 1.1 million home passes in the quarter. “We believe Fiber to the Home is a massive opportunity for us. We will continue to step up investments to take our network to 2,000 towns across India with 35 million home passes in the next three years,” Vittal added.

He said the company was seeing consistent growth across portfolio including homes, mobile and enterprise.

Airtel on Tuesday had reported a consolidated net profit of ₹830 crore for the third quarter ended December, a decline of three per cent year-on-year (YoY), compared with ₹854 crore in the corresponding period of the previous year.

However, consolidated total revenue grew 13 per cent YoY at ₹29,867 crore for the quarter in review against ₹26,518 crore in the October-December quarter 2020. The company said overall customer base stood at 485 million across 16 countries as of December 31 and total capex spend for the quarter was at ₹6,101 crore.

Shares of Airtel closed at ₹719.60 apiece on the BSE on Wednesday, up 1.52 per cent from the previous close.

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