Reliance Jio Infocomm (RJio), the telecom arm of Mukesh Ambani-controlled Reliance Industries, on Thursday reported a jump of 65 per cent in its net profit to Rs 831 crore during the December 2018 quarter (Q3FY19), mainly on account of a rise in customer base.
While average revenue per user of Reliance Jio continued to decline, the impact seems to have mitigated with a sharp increase in customer base to 280 million by the end of December, from 160 million in the year-ago period. Net addition during the quarter of 27.9 million was slightly lower than the previous four-quarter average of 28.4 million.
“Given strong subscriber growth, high churn in incumbents’ subscriber base and a huge opportunity in the feature phone category, management clearly highlighted that there is a limited reason to tinker with the price plans,” Motilal Oswal Securities said in result update.
“We have subsequently factored in 12 million monthly subscribers in Q4FY19 and a lower 6 million in FY20 (reaching 387 million in FY20). We have marginally increased our FY20 ARPU (Average Revenue per User) estimate to Rs 129 (prior Rs 125), as JioPhone is attracting better ARPUs, according to management commentary”, the brokerage firm said in a report.
RJio is likely to continue its pricing onslaught with rock bottom tariffs until it draws level with Vodafone Idea and Bharti Airtel on revenue share in the country’s biggest telecom markets, The Economic Times reported citing brokerage Citi Research note.