Telecom Sector Prepares for Tariff Surge Post-Election, Analysts Forecast 15-17% Increase

Anticipation mounts as analysts predict a significant tariff hike in the telecom sector following the conclusion of the upcoming general elections.

In anticipation of the conclusion of the upcoming general elections, analysts are forecasting a notable tariff hike of 15 to 17 per cent in the telecom sector. According to a recent analyst report, this surge is deemed "imminent," with Airtel expected to emerge as the primary beneficiary.

Scheduled to unfold across seven phases from April 19 to June 1, with results slated for announcement on June 4, the general election sets the stage for this anticipated tariff adjustment. The forecasted increase comes on the heels of a previous hike of approximately 20 per cent in December 2021.

The analysis, presented by Antique Stock Broking, outlines the expected trajectory of Average Revenue Per User (ARPU) for Bharti Airtel, India's second-largest telecommunications company. Currently standing at Rs 208, the ARPU is projected to soar to Rs 286 by the end of FY27. This surge is anticipated to be driven by multiple factors, including a Rs 55 contribution from the tariff hike, Rs 10 from the migration of 2G customers to 4G, and a Rs 14 gain from customer upgrades to higher data plans (both 4G and 5G) and transitions to postpaid services.