Bharti Airtel To Shut 3G Network Across India By March 2020, Says Gopal Vittal

Bharti Airtel Ltd. on Friday said it expects to shut down its entire 3G network across India by March 2020, a process that has started with the Kolkata circle.

Airtel’s 3G network will be shut down in six-seven circles by September and then in the entire country between December and March, said Gopal Vittal, chief executive officer for India and South Asia at Bharti Airtel.

“Yes, we do see an upgrade when someone moves from 2G to 4G… On spectrum, probably by April 2020, we will really have only 2G and 4G,” said Vittal in a post-earnings call.

“So, all our spectrum will sit on 4G other than the administered spectrum which is on 2G, plus a small slug of spectrum that we require to run our 2G networks…everything else will be sitting on 4G band,” he added.

Airtel has also refarmed spectrum from 3G networks to 4G across both 900 megahertz and 2,100 Mhz bands. This has allowed the company to deliver improved indoor coverage as well as enhance capacities.

The telecom industry, which has essentially consolidated to three large companies, continues to see “some semblance of stability”, said Airtel’s Chief Financial Officer Badal Bagri. “While we have witnessed revenue growth despite any outright tariff increase, we continue to believe that prices needs to move up in the long-term to ensure industry viability,” Bagri said.

Airtel, however, said it does not expect tariffs to rise any time soon and is in fact prepared for it to remain at “unsustainable” levels.

When asked about Airtel’s asset monetisation plans for its fibre infrastructure, Bagi said the telecom firm continues to evaluate opportunities that come up.

“We had moved all our fibre assets to a 100 percent subsidiary, and we have all approvals in place right now…that is going to be effected in this current quarter,” said Bagri. “On monetisation, we will continue to evaluate opportunities and, at the right time, we may choose to see what should be the potential structure.”

On Thursday, Airtel reported its biggest loss since going public in 2002. That masks the underlying recovery the telecom operator has made since it changed strategy to focus on fewer, better-paying users.

Net loss in the June quarter stood at Rs 2,866 crore compared to a profit of Rs 107 crore in January-March, according to the company’s exchange filing. The loss was much higher than the Rs 907 crore estimated by analysts tracked by Bloomberg. It was also the first loss Airtel reported since the December-ended quarter of 2003.

Airtel was able to increase its 4G subscriber base to 9.5 crore from 8.7 crore earlier at an average revenue per user of Rs 129. That was despite cutting down about 15 lakh customers. The churn ratio—average number of customers which quit the network—also declined to 2.6 percent from 2.8 percent.

On Friday, Airtel shares rose 6.02 percent to Rs 343.45 apiece on the BSE on account of its Q1 results. The benchmark Sensex gained 0.27 percent to end the day at 37,118.22 points.―Bloomberg Quint