Bharti Airtel believes its average revenue per users (ARPU) would have touched Rs 200 if not for the pandemic and believes that the company should get there in the next few months, according to a Goldman Sachs report.
According to the company, the ideal ARPU for the industry is Rs 300, but the journey to get there will be longer.
Goldman Sachs said in a recent note that it hosted Bharti Enterprises Chairman Sunil Bharti Mittal at its CIO tour on December 11.
The report said, "ARPUs at Rs 300 does not mean there will not be offerings for consumers at Rs 100 price points, and the company believes high-end customers should be able to pay USD 6-8 per month,"
The report stated that Bharti Airtel mentioned that it will not raise the tariffs at the cost of market share. It further said that the current industry structure (4 players) is ideal, however, the telco expects market share to consolidate further.
The note read, "...it believes the top two operators can end up with around 80 per cent market share (currently around 75 per cent) in 12-18 months,"
Bharti Airtel said that the company's target is higher quality customers, and it has consistently been able to attract and retain mid-to-high end users.
On 5G, the report said Bharti Airtel believes if spectrum prices were to remain at current levels "they may not participate in auctions in 2021". However, by 2022, they may need to buy 5G spectrum and expect 5G launch in main cities of India in 2-3 years.
According to Bharti Airtel, there aren't currently enough use cases for 5G and devices will need to be more reasonably priced for 5G to happen.
The company does not think 5G will lead to incremental capex as it would just be substituted by a reduction in 4G capex, the report added.
The report said that Bharti Airtel's execution continues to be near-flawless, encouraged by the closing of the incremental market share gap between Bharti and Jio.