As Reliance Jio, Airtel hold on to tariffs, volume growth falls off the cliff

Telecom Regulatory Authority of India’s (Trai’s) latest performance indicator report has mixed news for telecom investors. Consumer spends on telecom services, which had been falling for several quarters, have stabilised recently. But while telecom companies hold on to tariffs and maintain revenues, volume growth came off significantly in the March quarter.

First, the good news on revenue. Aggregate consumer spends on mobile services, including goods and services tax, stood at around ₹35,000 crore in the quarter ended March, according to an analysis by Kotak Institutional Equities. This translates to annual spend of ₹1.4 trillion, 5% higher than the lows of ₹1.34 trillion in the September 2018 quarter.