Revenue and EBITDA for wireless telecom service providers are expected to improve sequentially during March quarter 2019-20 fuelled by tariff hike in December, but the full impact is likely only in first quarter of the current fiscal when majority users come for recharge, according to Axis Capital.
Axis Capital, in its recent report outlining Q4FY20 preview, has also anticipated a soft quarter for infrastructure providers, impacted by the COVID-19 outbreak.
The report said Reliance Jio and Bharti Airtel are expected to benefit from the price hike as well as subscriber addition, while subscriber loss is expected to continue for Vodafone Idea.
“We expect revenue and Earnings before Interest, Tax Depreciation and Amortisation (EBITDA) for wireless service providers to improve led by tariff hike taken in December 2019, though the full impact is expected only in Q1FY21 when most users come for recharge,” it said. The report, dated April 3, added that EBITDA will “benefit from pass-through of the price hike with margin improvement in the range of 20 basis points(bps) quarter on quarter (QoQ) to 80 bps QoQ for Indian wireless business.”
On infrastructure providers, it said Bharti Infratel, is expected to have a muted quarter with modest tenancy addition.
