Telecom Tariffs Set to Climb as Vi, Airtel Revise Plans Ahead of Sector-Wide Price Hike

Vi and Airtel have increased prepaid plan rates as analysts forecast a 15% industry-wide tariff jump amid slowing revenue growth.

Vodafone Idea (Vi), an Indian telecommunications company, increased the cost of its 84 day ₹509 plan by seven percent and its annual 1,999-rupee prepaid plan by twelve percent. Also, Bharti Airtel network has added ₹10 to its lowest voice-only package of ₹189. Without raising the pricing, state-run BSNL reduced the validity period of several of its entry-level prepaid plans.

In expectation of a sector-wide tariff increase in the coming weeks, all telecom companies, with the exception of Reliance Jio, have begun to update the prices of some prepaid plans starting in November.

Analysts predict a fifteen percent increase in telecom tariffs as overall revenue growth slowed to 10% in the September period from 14% to 16% over the previous four quarters and is predicted to drop even more in the December quarter.

Brokerage Motilal Oswal expects that telecoms will be able to return to a hike in prices cycle in December if inflation stays steady and there are no major elections in the coming months. Also, it stated that the popular 1.5 GB data package is expected to see a headline rate increase of about ₹50 per 28 day cycle.

According to Vi management, the next major price rise will be of a similar size as the earlier one, but after a gap of about 15 months from the last round.

While certain of its loyal, devoted user base has remained, the majority of Vi's low-end user base has left for competitors Airtel and Jio. An industry analyst specified these yearly plans are quite popular among them. They were being discounted due to VI lacking 5G services, but now they are at par with competitors.