The lockdown, imposed to combat the coronavirus pandemic, led to delayed recharges, fewer subscriber additions, and absence of international roaming revenues for telcos.
"Wireless revenues for Bharti and VIL shall fall in Q1FY21 due to the nationwide lockdown, which resulted in delayed recharges by low ARPU (Average Revenue Per User) prepaid subscribers on account of the reverse labour migration and impact on income levels, minimal subscriber additions, SIM consolidation, and absence of international roaming revenues," Emkay Global said in its sector update.
APRU is expected to decline sequentially in Q1 of 2020-21 after healthy growth in the preceding quarter (Q4FY20), it added.
"Bharti and VIL are likely to see five per cent quarter on quarter fall in ARPU. Home broadband to see a healthy increase in new connections, boosted by the lockdown. Airtel Africa should perform well as the impact of COVID-19 was minimal," it said.
It expects moderation in subscriber additions due to lack of smartphone sales in April and early May.
"In fact, reverse migration could lead to subscriber loss for the industry due to delayed or no recharges," Emkay Global said.
It expects decline in subscriber base of Bharti and VIL, with a more pronounced subscriber loss for the latter. Both operators are likely to see minimal increase in data subscribers.
It, however, anticipates subscriber addition in case of Reliance Jio on account of market share gains.
Data consumption for all three private operators is estimated to rise by 10-12 per cent sequentially, driven by underlying increase even as new subscriber additions are expected to remain muted.
Cost savings are seen accruing from marketing, channel margins (lower gross additions and increased digital recharges) and other costs, whereas network opex shall continue to rise on increased utilisations.
There could be some provisions on delayed payments in the enterprise segment for Bharti and VIL, it pointed out.
Reported finance cost could be lower based on moratorium on both deferred spectrum payment and bank loans, it added. MBI RVK