In FY23, the gross revenue of the four telecom operators was at nearly Rs 3.18 trillion, according to financial statements of the companies. That was the first time, the industry’s revenue topped Rs 3 trillion.
The gross revenue of telecom operators’ is expected to touch a record high of Rs 3.4 trillion in the current financial year ending March, according to industry estimates. A higher gross revenue will also benefit the government as it will receive higher licence fee from the telcos on revenue share basis. In fact, in FY24, the government is expecting the licence fee from telcos to improve to Rs 22,000-23,000 crore from the Rs 20,000 crore last financial year, officials said.
A year-on-year (YoY) expected growth of 7% in the gross revenue of the four telecom operators including state-owned BSNL, can be attributed to higher data consumption, increase in entry-level tariffs by telcos – Airtel and Vodafone Idea — growth in postpaid segment, and international roaming, among other things.
In FY23, the gross revenue of the four telecom operators was at nearly Rs 3.18 trillion, according to financial statements of the companies. That was the first time, the industry’s revenue topped Rs 3 trillion.
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As of nine months ended December, the telecom industry’s gross revenue was at Rs 2.53 trillion, a growth of around 8.5% from the same period last year. Of the telcos, Airtel’s gross revenue grew 9.4% to Rs 1.13 trillion, while that of Jio grew 11.1% to Rs 94,687 crore. Vodafone Idea’s gross revenue grew 1% to Rs 32,126 crore.
State-owned BSNL’s gross revenue are estimated to be around Rs 13,000 crore for the nine-months ended December, a growth of 5% from the same period last year, officials said.
Before the entry of Reliance Jio in 2016, the gross revenue of the industry was at Rs 2.7 trillion. After that the same witnessed a decline from FY17 to FY19, according to data by the Telecom Regulatory Authority of India and analysts’ estimates. During the period, industry also consolidated to three players, post the merger of Vodafone India and Idea. It was in FY20, the gross revenue of the industry came back to Rs 2.7 trillion-level.
Gross revenue includes the revenue from operations and other incomes of the telecom operators. Out of the gross revenue, adjusted gross revenue (AGR) is calculated by deducting non-telecom revenue, receipts from universal service obligation (USO) fund, income interest, dividend, pass through charges paid to other telcos, among other things. It is the AGR on which telcos pay 3% licence fee and 5% contribution to the USO fund.
Data usage trend on the telcos’ networks suggests that the average data consumption per user per month was at 21.66 GB in the October-December quarter, compared to 19.61 GB at the end of January-March quarter of FY23. This means that in the nine-months ended December, the average data consumption of the three telecom operators has increased by 10.5%.
“The industry’s growth outpaced those of other mass consumption categories such as consumer staples despite stable tariffs,” Kunal Vora, director, head of India equity research at BNP Paribas, said in a note on the telecom sector.
“We expect this outperformance to continue in FY25 led by tariff hikes. Industry consolidation continued, led by wide variance in network investments,” Vora added.
According to BNP Paribas, market share consolidation has been in favour of the top two operators – Jio and Airtel — led by significant difference in network investments. Vodafone Idea market share continued to shrink in subscribers, data volumes and revenue, it said.
