Reliance Jio pips Airtel to claim number 2 spot in revenue market share

KOLKATA: Reliance Jio Infocomm has become a strong No. 2 in India by revenue market share (RMS) in the January-March quarter, racing ahead of Bharti Airtel, while Vodafone Idea managed to keep its No. 1 spot with its RMS rising for the first time after 10 quarters of decline, analysts said.

Jio reported a 182 basis points sequential jump in RMS in the March quarter to 31.7%, while the Sunil Mittal-led telco’s slumped 285 bps to 27.3%. Market leader Vodafone Idea, in turn, reported a modest 57 bps sequential rise in RMS to 32.2%, brokerage Emkay Global said in a report analysing financial data collated by the Telecom Regulatory Authority of India (Trai).

Vodafone Idea, which started reporting combined RMS data from the September quarter of FY19 following the merger last August, had been reporting dips on this score. Before the merger, erstwhile Vodafone India and Idea Cellular had last reported RMS growth in the June quarter of FY17.


Mukesh Ambani-owned Jio, however, has recorded strong revenue growth across 21 circles and is the leader in 15 markets.

“Jio continues to be market leader across category A, B & C circles while Vodafone Idea maintains metro market leadership,” Rajiv Sharma, co-head of research at SBICap Securities, said in a note seen by ET.

By contrast, Bharti Airtel suffered sequential revenue declines in key markets such as Karnataka (-15%), Tamil Nadu (-16%), Delhi (- 33%) and Andhra Pradesh (-8%), culminating in the nation’s second-largest telco being relegated to the third spot on the RMS count.

Bharti Airtel saw an 11.4% sequential fall in adjusted gross revenue (including national long distance or `NLD’ service revenue) in the March quarter to Rs 8,608.2 crore, which is 19% lower than the Rs 10,632 crore quarterly mobile revenue from local mobile services it reported in the fiscal fourth quarter.

“There is a clear divergence between AGR decline and Bharti’s revenues reported to investors,” said Emkay Global in a note.

Sharma of SBICap Securities said Airtel’s AGR slump in Mumbai, Delhi and J&K may have been “triggered by one-off adjustments in the quarter or due to volatility in IUC (interconnect) payments by the company”.

Jio’s AGR, on the contrary, has grown 4% sequentially to nearly Rs 9,986 crore, while Vodafone Idea largely arrested AGR slump by limiting on-quarter fall at 0.3% to roughly Rs 10,149 crore. Overall telecom sector AGR (including NLD revenue) has dipped 1% on-quarter to Rs 31,518.2 crore.

Analysts acknowledged the stability in Vodafone Idea’s RMS but said the outlook remained bleak as the market leader suffered revenue dips in 14 markets, and continued to lose AGR in leadership circles such as Mumbai, Tamil Nadu, UP-East and Andhra Pradesh, amid Jio’s continuing pricing onslaught.

Both Vodafone Idea and Airtel have been steadily losing ground to Jio over the past two-and-a-half years. The country’s youngest telco once again outclassed its older rivals in the fiscal fourth quarter, reporting a 65% on-year jump in bottom line to Rs 840 crore, on the back of nearly 27 million user additions and rising data usage.

By contrast, Airtel posted a loss of Rs 89.8 crore before interest and taxes in its India services for the March quarter, compared with an operating profit of Rs 101 crore a year earlier.

Vodafone Idea too remains in the red, although its net loss narrowed to Rs 4,878.3 crore in the FY19 fourth quarter, helped by a tax refund and lower expenses, as service revenue crept up after 11 quarters of declines.