Summary:

According to Crisil Ratings, India's telecom industry is projecting a decade-high Average Revenue Per User (ARPU) of US$ 2.69 (Rs. 225) for the fiscal year 2019. This marks a 25% increase from 2023-24, driven by tariff hikes and rising data consumption amidst ongoing 5G deployment.

Mr. Manish Gupta, Senior Director at Crisil Ratings, attributed this growth to telecom operators' 17-19% price hikes and increased data usage from video streaming, social media, and online gaming, boosting ARPU. Consumers are opting for higher-value plans, contributing to this significant rise.

Crisil Ratings forecasts that the increasing per-user revenue will enhance operating profitability, pushing the telecom industry's Return on Capital Employed (RoCE) to approximately 11% by FY26, up from 7.5% in FY24. Projected reductions in capital expenditure (capex) for network expansion are expected to lower debt, improve profitability, and strengthen credit profiles.

Source: IBEF

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