MUMBAI • Bharti Airtel, one of Singtel's regional associates, and Vodafone Idea are set to raise mobile tariffs next month, the first increase since the entry of billionaire Mukesh Ambani into India's telecommunications market three years ago caused a price war.
Following the news, shares of Vodafone Idea surged as much as 21 per cent in Mumbai yesterday, while Bharti Airtel jumped 5.8 per cent.
"Mobile data charges in India are by far the cheapest in the world even as the demand for mobile data services continues to grow rapidly," the company formed by the merger of Vodafone Group's local unit with billionaire Kumar Mangalam Birla's Idea Cellular, said in a statement on Monday. The tariffs will be raised from Dec 1, it added.
Separately, a Vodafone Idea spokesman declined to disclose details about the possible tariff increase and plan details.
The move comes after the wireless carrier reported the worst quarterly loss in Indian corporate history last week.
The increase was followed by Bharti Airtel, which also said it will raise tariffs from next month.
Vodafone Idea last Thursday took a one-time charge related to a US$4 billion (S$5.5 billion) demand from the government, leading to a net loss of 509 billion rupees (S$9.6 billion) in the three months to September.
Already saddled with about US$10 billion of net debt, Vodafone Idea is fighting for survival after India's top court last month ordered it and others, including Bharti Airtel, to pay billions in fees related to spectrum and licences that the government said were due from prior years.
Singtel posted its first-ever quarterly loss, of $668 million, last week after taking a hit from Bharti Airtel.
The Indian telco recorded a $5.49 billion pre-tax provision in its books, with Singtel forced to take a share amounting to $1.93 billion before tax.
Singtel is the biggest shareholder in Bharti Airtel, with an effective stake of about 35 per cent.
Indian telcos have also been faced with high debt and low prices, especially after the entry of Mr Ambani's Reliance Jio Infocomm in 2016.
That drove some to bankruptcy and led to the merger of others such as Vodafone with Idea.
The regulator, the Telecom Regulatory Authority of India, is likely to initiate discussions for bringing rationality in pricing, Bharti Airtel said in a statement justifying its move.
The acute financial stress in the sector has been acknowledged by all stakeholders and a high-level government panel is looking into providing appropriate relief, Vodafone Idea said on Monday.
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