Bharti Airtel, one of India's leading mobile network operators, announced a significant 10-21% increase in mobile tariffs. This move, effective immediately, is expected to have a major impact on the stock market and investment tracking in the telecom sector. Bharti Airtel's decision comes as competitors such as Vodafone Idea and Reliance Jio have also hiked their tariffs in recent months. This latest development highlights the changing landscape of the Indian telecom industry and the ongoing battle for dominance in the highly competitive market.
Bharti Airtel has announced a significant hike in mobile tariffs by 11% to 21%, effective from July 3. This comes after Reliance Jio's announcement of a 12% to 27% price increase, the first in two and a half years. In order to ensure a financially healthy business model for telcos in India, Airtel has maintained that the mobile ARPU should be at least Rs 300. This move is expected to result in a modest price increase for consumers, with Airtel revising its unlimited voice plan prices from Rs 179 to Rs 199 and from Rs 1,799 to Rs 1,999.
The highly anticipated spectrum auctions have concluded with disappointing results, as only 12% of the estimated value was sold. Bharti Airtel emerged as the biggest buyer, acquiring radiowaves worth over Rs 6,800 crore. Vodafone Idea and Reliance Jio also made significant purchases, adding to their 4G networks. This news has caused concern for the government, as it only managed to sell a fraction of the expected value.
The struggling telecom company, Vodafone Idea, successfully completed its follow-on public offer, with bids for 6.35 times the total offer size. The FPO was subscribed 17.56 times by qualified institutional bidders and 4.13 times by non-institutional investors. Retail investors, however, only showed interest in 0.90 times of their designated quota. The FPO, which offered equity shares at a discount to the current market price, attracted a large number of anchor investors, including Life Insurance Corporation and One 97 Communications, raising ₹5,400 Crores. The funds raised through this FPO will help Vodafone Idea to compete with larger players like Reliance Jio and Bharti Airtel in the Indian telecom sector, and also improve its 4G and 5G services.