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Bharti hikes pre-paid mobile tariffs
Bharti Airtel (Bharti) has hiked voice and SMS tariffs by 20% for prepaid users across
several circles –early signal of mobile players increasing tariffs to improve their profits.
Users of Bharti’s Advantage plan will have to pay 60 paise (earlier 50 paise) per minute
for local and STD mobile-to-mobile calls within the Airtel network. For mobile to landline
calls, the revised tariff is 90 paise (50 paise earlier) for local and STD calls. Further, SMS
charges have also gone up to `1 and `1.5 for local and national SMS, respectively.
Existing users will have to pay for new rates after the validity of their existing voucher ends.
Users of Bharti’s Freedom plan will have to shell out 1.2 paise per second on local and
long-distance calls instead of 1 paise per second earlier. The new tariff structure will be
effective in the Delhi, Rajasthan, Gujarat, Andhra Pradesh, Kerala and Madhya Pradesh
telecom circles. These circles constitute 34% of Bharti’s total subscriber base. There is no
change in any other tariff plan as of now.
The telecom sector may be nearing an inflection point again, as more telecom operators
test consumer sensitivity by raising call tariffs, which had been beaten down to rock-bottom
levels over the last couple of years amidst hyper competition. Operators might be seeking
to raise tariffs as they are facing higher costs when venturing out of tele-saturated cities to
India’s hinterland in search of subscribers and, though the rate hikes are happening in
regional pockets now, chances are that tariffs will be raised across the country sooner than
later. This kind of move will give support to falling ARPMs (ARPM of Bharti has fallen by
32.8% since the last 10 quarters) of all the telecom operators and support profitability in
the quarters ahead. However, we remain Neutral on Bharti as this, currently, is a signal of
suppression of price war kind of a situation in the telecom sector rather than having any
near-term financial implications.
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
Bharti hikes pre-paid mobile tariffs
Bharti Airtel (Bharti) has hiked voice and SMS tariffs by 20% for prepaid users across
several circles –early signal of mobile players increasing tariffs to improve their profits.
Users of Bharti’s Advantage plan will have to pay 60 paise (earlier 50 paise) per minute
for local and STD mobile-to-mobile calls within the Airtel network. For mobile to landline
calls, the revised tariff is 90 paise (50 paise earlier) for local and STD calls. Further, SMS
charges have also gone up to `1 and `1.5 for local and national SMS, respectively.
Existing users will have to pay for new rates after the validity of their existing voucher ends.
Users of Bharti’s Freedom plan will have to shell out 1.2 paise per second on local and
long-distance calls instead of 1 paise per second earlier. The new tariff structure will be
effective in the Delhi, Rajasthan, Gujarat, Andhra Pradesh, Kerala and Madhya Pradesh
telecom circles. These circles constitute 34% of Bharti’s total subscriber base. There is no
change in any other tariff plan as of now.
The telecom sector may be nearing an inflection point again, as more telecom operators
test consumer sensitivity by raising call tariffs, which had been beaten down to rock-bottom
levels over the last couple of years amidst hyper competition. Operators might be seeking
to raise tariffs as they are facing higher costs when venturing out of tele-saturated cities to
India’s hinterland in search of subscribers and, though the rate hikes are happening in
regional pockets now, chances are that tariffs will be raised across the country sooner than
later. This kind of move will give support to falling ARPMs (ARPM of Bharti has fallen by
32.8% since the last 10 quarters) of all the telecom operators and support profitability in
the quarters ahead. However, we remain Neutral on Bharti as this, currently, is a signal of
suppression of price war kind of a situation in the telecom sector rather than having any
near-term financial implications.
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