jio: Reliance Jio adds most active users despite gross sub losses: Analysts | Techno Glob


Reliance Jio added the highest number of active mobile users among India’s top telcos in January 2022, even as it lost 9.3 million gross subscribers.

Analysts said the trend was due to the fact that the Mukesh Ambani-led telco was not affected by the SIM consolidation that led to a sharp tariff hike in December last year, as well as the ongoing purge of low-paying and inactive users that began in September last year.

Jio added 4.2 million active users, taking its active user base to 369 million in January, according to the latest customer data released by the Telecom Regulatory Authority of India (Trai). Airtel’s pace of active user additions was slower at 1.3 million, taking its January active user base to 350 million. Vodafone Idea lost fewer active users (0.7 million), leaving its active user base almost unchanged at 229 million.

BNP Paribas said “the limited impact of the November-December 2021 rate hike on the active user base highlights that mobile telecommunications is now an important service and that the industry has high pricing power.”

The telecommunications market leader strengthened its leadership in the share of total active users. Jio extended its lead over Airtel (34.8%) in active user market share to 36.6% in January. The loss dropped Vi’s active user share a few decimal points to 22.7%.

Active or Visitor Location Register (VLR) data released monthly by Trai reflects the actual number of subscribers actively using the mobile network.

Jefferies said, “In the last six months, Jio has added 22 million active subscribers and not recognized 59 million inactive users,” resulting in an increase in its latest VLR ratio of 13 ppts to 91%.

According to analysts, Jio’s VLR ratio has risen sharply to 91%, improving customer experience and ARPU, and much of the erosion caused by secondary connections is involuntary. With only 38 million inactive users remaining on Jio’s 4G network, analysts do not expect the market leader to continue to purge subscribers for long.

Jefferies added that the sector’s active mobile user share (read: industry VLR ratio) hit a nearly 3-year high of 88% in January 2022, largely driven by Jio’s continued weeding of low-paying users.

“Jio has gained 3.3% VLR market share over the past year, well ahead of the 0.3% added by Bharti, while Vi has continued to lose market share, dropping 3.5% year-on-year to now 22.7 % down,” Kotak Institutional Equities said in a note seen by ET.

Jio also extended its lead over Airtel in the fibre-based home broadband market, even giving state-owned BSNL more space to the top two telcos.

Jio added 0.26 million customers to its JioFibre service in January, taking its fixed broadband user base to 4.8 million. Airtel, on the other hand, added 0.13 million such users, increasing its wired broadband subscriber base to 4.3 million. BSNL lost another 0.17 million users to remain in third place with 3.9 million subscribers, highlighting its inability to compete effectively with Jio and Airtel.

“Jio had 18.1% share of the home broadband subscriber base at the end of January, compared to 16.2% for Airtel and 14.6% for BSNL,” ICICI Securities said in an analysis of Trai data.

Hathway, which provides cable TV and internet services among others, had a 4.1% share of the wired broadband market, while the rest was owned by regional and other smaller players, Trai numbers showed.



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