NIL IUC regime to benefit Airtel; impact expected on Vodafone Idea: Report

NEW DELHI: Bharti Airtel’s EBITDA is likely to benefit by Rs 1 billion due to nil IUC that came into effect from 1st January, 2021, while Vodafone Idea would be hurt by Rs 0.8 million from the change, ICICI Securities said in a note.

Interconnect charges moved to nil from 1st Jan’21 from the earlier 6ps/min.

“We estimate the consequent ARPU impact at Rs14 each for Bharti and VIL. Bharti was net IUC payer of Rs1bn-1.2bn, while VIL was net IUC receiver of Rs0.8bn (thus Bharti’s EBITDA should benefit from nil IUC while VIL’s stands to get hurt),” ICICI Securities said.

The brokerage said that the Q4FY21 had 90 days compared to 92 days in Q3, hence it expects a 2% QoQ impact from the lower number of days.