Reliance Jio adds 42 million subscribers but the average revenue is pretty much the same

• Reliance Jio’s subscriber mix is holding back the amount of money it makes from each user.
• Despite India facing the worst of the COVID-19 pandemic in the previous quarter, Reliance Jio has reported over 44% profit growth.
• During the June quarter, Jio added 42.3 million new subscribers, continuing its upward trajectory from the March quarter.
• However, its average revenue per user (ARPU) remains an area of concern – it stood at ₹138.4, which is flat when compared to the previous quarter, and marginally down, year-on-year.

India’s leading telecom operator Reliance Jio posted a nearly 45% growth in its profit despite India bearing the worst of the COVID-19 pandemic between April and June this year. However, it’s not all rosy as the telco struggled to register a growth in the amount of money it makes from each of its 400 million plus subscribers.

Particulars	April-June 2021	Growth (YoY)
Revenue	₹22,267 crore	9.8%
Net profit	₹3,651 crore	44.9%

Despite analyst warnings, Jio has so far resisted raising tariffs, and it’s not something that subscriber growth can offset.

Instead, Jio has launched new plans that offer unlimited daily data in order to attract the premium, high-value customers, hoping that this will augment its average revenue per user (ARPU).


Two other factors weighing down on the profit are affordable postpaid plans and the JioPhone, which attracts low average revenue per user (ARPUs). Both the new phone and the cheaper postpaid plans were rolled out in Oct-Dec 2020, and they are now weighing down the financials.


Reliance Jio has added nearly three times more subscribers between April to June, 2021, compared to the preceding three months. But most of them are low-paying users, who use Jio as a second phone for cheaper plans, and therefore the subscriber addition is not adding to the revenue or the profit in a big way.

Reliance Jio’s last quarter in numbers

Beating analyst expectations, Jio reported a 4% increase in profit between April and June 2021, increasing to ₹3,651 crore from ₹3,508 crore in the previous quarter. On a year-on-year basis, its profit surged by nearly 45%.

Jio also witnessed a healthy surge of nearly 22% in its revenue during the quarter, increasing to ₹22,267 crore as compared to ₹18,278 crore in the quarter before. On a year-on-year basis, this is an increase of nearly 10%.


Data usage grows by nearly 15%, but voice usage declines marginally

Data traffic saw an increase of nearly 15% compared to the previous quarter. The average data usage per user during the quarter stood at 15.6GB, as compared to 13.3GB in the previous quarter.

Surprisingly, voice usage declined marginally to 818 minutes from 823 minutes in the quarter before.


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