Recharge price hike: Telecom operators are expected to implement a 15 per cent increase in mobile tariffs after a two-year hiatus, a move that analysts estimate will more than double the sector's revenue growth rate by FY27.
"We expect mobile tariffs in India to rise by 15 per cent in June 2026, two years after the last major adjustments—a timeline that aligns with historical industry trends," noted a report from Jefferies on Thursday. Beyond headline price increases, the report highlighted that rising data penetration, a shift toward postpaid plans, and surging data usage are consistently driving up India's mobile Average Revenue Per User (ARPU).
Recharge price hike to drive FY27 revenue surge
Recharge price hike and strategic pricing adjustments are expected to accelerate sector revenue growth to 16 per cent year-on-year (YoY) in FY27, a significant jump from the estimated 7 per cent YoY growth for FY26. Given the high likelihood of a 15 per cent headline tariff hike in June 2026, analysts model a healthy 14 per cent YoY growth in ARPU for FY27. However, the report cautions that subscriber additions may remain muted as consumers adjust to the increased costs.
Recharge price hike: Strategic impact on Jio and Vodafone Idea
Recharge price hike is also projected to involve a 10–20 per cent rate increase specifically from Reliance Jio, a move intended to align its valuation more closely with Bharti Airtel and provide investors with a double-digit internal rate of return. Meanwhile, the outlook for the debt-ridden Vodafone Idea (VIL) remains challenging; the firm will reportedly need to increase mobile service rates by a cumulative 45 per cent between FY27 and FY30 to meet its heavy statutory dues.
Currently, the government has frozen VIL's Adjusted Gross Revenue (AGR) dues at Rs 87,695 crore, with payments scheduled to commence in FY32 and conclude by FY41. While a proposed five-year moratorium could reduce VIL's immediate cash outflows toward government dues by 35–85 per cent through FY30, the company will still require massive tariff hikes and additional debt or equity funding to sustain its network investments.
Recharge price hike: Moderating capex and improving margins
Recharge price hike and the completion of major 5G rollouts are expected to lead to improved margins for telcos as capital expenditure (capex) begins to moderate. Analysts believe the most intensive phase of 5G infrastructure investment is now over, with spending intensity likely to remain moderate through FY27.
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