Indian Telecom Revenue To Grow 10-12% In FY26; ARPU Likely At Rs 220: ICRA

The Indian telecom industry is poised to see a strong 10-12% growth in operating income in FY2026, ICRA said on Friday. Industry revenues are expected to be Rs 3.5-3.7 lakh crore with an Operating Profit Before Interest, Depreciation, Taxes and Amortisation or OPBIDTA of Rs 1.7-1.9 lakh crore for FY2026, driven by recent and upcoming tariff hikes, ICRA said.

The previous tariff hikes have already pushed Average Revenue Per User or ARPU beyond Rs 200 in FY2025, and further growth is expected to lift it to Rs 220 in FY2026.

According to ICRA, another round of tariff increases later this fiscal will provide additional momentum.

The sector has frontloaded its 5G investments in FY2024 and FY2025, and capex intensity is now likely to decline, it noted.

The industry debt, however, is estimated to peak at Rs 6.6 lakh crore by March 2025 before gradually easing.

While satellite communication is emerging as a potential competitor, ICRA believes it will primarily complement terrestrial networks in the medium term, particularly in remote and difficult terrains.

Given its higher costs, satellite services are unlikely to disrupt mainstream telecom services in the near future, ICRA said in a release.