Reliance Jio, the telecom arm of Reliance Industries, will release its results for the October-December quarter of the financial year 2019-20 on January 17. The country's telecom sector witnessed large-scale disruption since the launch of Jio three years ago. In this short period, Jio’s importance in Reliance Industries (RIL) results has also increased exponentially.
Here's what to expect from Reliance Jio in Q3 of FY20:
A CNBC TV18 poll expects Jio to post a strong revenue growth of 10.7 percent in the third quarter of the current financial year. That will be led by subscriber addition and ARPU improvement. ARPU stands for average revenue per user, which is effectively the monthly telecom bill of users.
According to the Telecom Regulatory Authority of India (Trai) data, Jio gained 9 million subscribers in October, compared to 7 million subscribers in September, primarily aided by the launch of Jio Phone Diwali offer.
This trend of strong subscriber addition is expected to continue but partly offset by the potential loss of subscribers to another network since Jio started charging for voice calls in October.
The net subscriber additions could be of 22.8 million vs 23.9 million quarter on quarter, helping the company in reaching 378 million subscribers by December.
ARPUs are expected to increase Rs 124- 125 vs Rs 120 quarter on quarter, aided by the near 25 percent price hikes taken by the industry in December. However, the full impact of price hikes will be visible in the subsequent quarters.
The poll expects EBITDA margin to improve quarter on quarter, benefiting from revenue growth.
The telecom arm is expected to contribute around 25 percent to RIL's overall EBITDA.
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