India's Bharti Airtel posts strong Q2 revenue growth on users additions

BENGALURU (Reuters) - Bharti Airtel Ltd, India's No.2 telecom carrier by subscribers, reported a bigger-than-expected increase in second-quarter revenue on Monday, helped by 4G subscriber additions and higher revenue per user.

The company's consolidated revenue from operations rose nearly 22% year-over-year to 345.27 billion Indian rupees ($4.17 billion) in the three months ended Sept. 30.

Analysts, on average, were expecting revenue of 339.21 billion rupees, according to Refinitiv IBES data.

Airtel, as the company is popularly called, said revenue from its India mobile services, which has 328 million subscribers, rose nearly 25% to 189.58 billion rupees.

Its 4G data customers increased by 5 million from the previous quarter to 210 million in the latest quarter.

Airtel's average revenue per user (ARPU), a key performance indicator for telecom firms, was 190 rupees, clocking a 3.8% sequential rise and a roughly 24% year-on-year increase.

Earlier this month, market leader Reliance Jio, the telecom arm of conglomerate Reliance Industries, said its ARPU rose just under 1% sequentially to 177.2 rupees in the quarter.

Airtel's net profit for the September-quarter climbed to 21.45 billion rupees from 11.34 billion rupees a year ago, but missed analysts' estimates of 24.67 billion rupees. Its expenses surged by 16.7% in the quarter.

The New Delhi-based company said mobile data consumption surged by 19.6%, with consumption per mobile data customer at 20.3 GB per month.

Analysts expect telecom firms to announce tariff hikes by the end of fiscal 2023, having spent billions of dollars in the country's recent 5G auction. Airtel spent 430.84 billion rupees and launched its 5G services earlier this month.

ARPU needs to be at 200 rupees and ultimately at 300 rupees for a financially healthy business model, Airtel said last November, when it raised tariffs.

The stock hit a record high of 833.80 rupees earlier in the day and has risen nearly 22% this year through Monday's close. ($1 = 82.8110 Indian rupees)

(Reporting by Rama Venkat in Bengaluru; Editing by Savio D'Souza)