Withdrawal of ₹299, ₹579, ₹619 and ₹649 prepaid packs may push customers towards higher-value plans and strengthen Airtel’s premiumisation strategy
New Delhi: Bharti Airtel’s recent decision to withdraw four prepaid plans could provide a significant boost to the telecom company’s average revenue per user (ARPU), with brokerages estimating a potential monthly increase ranging between ₹4 and ₹12.
The telecom operator recently discontinued its ₹299, ₹579, ₹619 and ₹649 prepaid plans. The move has particularly affected users of the popular ₹299 plan, who may now have to choose a more expensive alternative.
Market analysts largely view the move as selective plan rationalisation rather than a formal, across-the-board tariff hike. However, the changes could still increase Airtel’s revenue per subscriber by encouraging customers to migrate towards higher-priced and higher-data plans.
₹299 plan users face higher entry price
The ₹299 prepaid pack was one of Airtel’s popular offerings. Following its withdrawal, customers looking for a comparable option may have to move to the ₹349 plan.
This represents an increase of approximately 16 per cent compared with the earlier ₹299 plan.
However, Airtel has retained its entry-level ₹199 and ₹219 plans, indicating that the company has not completely moved away from lower-priced prepaid offerings.
Instead, the changes appear to be targeted at specific customer segments and are aimed at encouraging users to upgrade to plans that generate higher revenue.
Brokerages estimate ₹4-12 ARPU increase
Several leading brokerages — Morgan Stanley, IIFL Capital, JM Financial and Citi — have analysed Airtel’s revised prepaid portfolio and estimated different levels of potential ARPU improvement.
Their estimates vary depending on assumptions regarding the number of subscribers currently using the discontinued plans and the proportion that eventually upgrade.
| Brokerage | Estimated ARPU Impact | Key Assumption |
|---|---|---|
| Morgan Stanley | ₹8-12 per month | 20-30% of wireless users below ₹349 upgrade to ₹349 |
| Citi | Around ₹4 per month | Based on the subscriber mix of the ₹299 plan |
| JM Financial | ₹5-6 per month | Around 10% of subscribers upgrade by roughly ₹50 |
| IIFL Capital | Up to ₹12 annualised | FY27 benefit estimated at around ₹4 |
The estimates show that even relatively limited customer migration to higher-value plans could have a meaningful impact on Airtel’s overall ARPU.
Morgan Stanley sees strongest potential impact
Morgan Stanley estimates that the plan changes could generate a gross company-level ARPU increase of approximately ₹8-12 per month.
Its assessment assumes that around 20-30 per cent of Airtel’s wireless subscribers who were previously using plans below ₹349 could move to the ₹349 offering.
According to the brokerage, the move represents a focused effort by Airtel to improve monetisation while taking advantage of growing customer demand for higher-data plans.
Morgan Stanley also described the move as an important first step in changing Airtel’s tariff architecture. The market will now watch whether other telecom operators follow a similar strategy.
Citi estimates around ₹4 monthly benefit
Citi has taken a more conservative view, estimating an ARPU benefit of approximately ₹4 per month based on assumptions about the number of subscribers using the discontinued ₹299 plan.
The brokerage believes the move is consistent with Airtel management’s broader strategy of increasing ARPU through premiumisation.
Rather than increasing prices across the entire customer base, Airtel appears to be selectively removing certain plans and encouraging users to migrate to more expensive offerings.
JM Financial sees ₹5-6 ARPU increase
JM Financial estimates that Airtel could see an ARPU increase of approximately ₹5-6 per month, equivalent to around 2 per cent.
Its calculation assumes that approximately 10 per cent of Airtel subscribers upgrade to plans costing around ₹50 more.
The brokerage believes the move is primarily designed to shift subscribers towards higher-data and higher-ARPU plans rather than representing a conventional tariff hike across the board.
IIFL Capital expects ₹12 annualised uplift
IIFL Capital estimates an annualised ARPU increase of approximately ₹12, although the actual benefit to Airtel’s FY27 numbers could be closer to ₹4 per month.
The difference arises because IIFL Capital’s projections already factor in the possibility of broader tariff increases later in 2026.
The brokerage has therefore described the latest plan changes as an early implementation of potential tariff increases on selected plans.
IIFL Capital believes the incremental impact from the current changes would be limited to around four months of FY27 if a broader tariff hike is implemented later in the year.
Premiumisation remains Airtel’s key strategy
The latest plan changes highlight Airtel’s continued focus on premiumisation — encouraging customers to move from lower-value plans to higher-priced packages offering greater data benefits.
For telecom operators, ARPU is a critical financial metric. Even a small increase in monthly ARPU can translate into substantial additional revenue when applied across a large subscriber base.
Airtel’s strategy therefore appears to focus not only on acquiring new customers but also on increasing revenue from its existing user base.
Not a traditional tariff hike
One important distinction is that Airtel has not announced a broad-based tariff increase.
Instead, the company has removed selected prepaid plans from its portfolio. Customers who were using those plans may consequently have to select a more expensive alternative.
This makes the latest move different from a conventional tariff hike, where prices across multiple plans are increased simultaneously.
However, from a consumer perspective, users affected by the discontinued plans could still experience higher monthly spending.
Impact on consumers
The biggest immediate impact is likely to be felt by customers who previously relied on the ₹299 prepaid pack.
If they require a similar service package and move to the ₹349 plan, their monthly expenditure would rise by around ₹50, or approximately 16.7 per cent.
Customers on the ₹199 and ₹219 entry-level plans, meanwhile, remain unaffected by the latest changes.
The eventual impact on Airtel’s ARPU will depend on how many subscribers actually upgrade rather than shifting to lower-priced alternatives or competitors.
What it means for Airtel investors
From an investor perspective, the plan rationalisation could be positive because it offers Airtel an opportunity to improve monetisation without immediately implementing a broad tariff hike.
Higher ARPU, combined with strong subscriber retention and increasing data consumption, could support revenue and profitability growth.
However, the strategy also carries the risk that some price-sensitive subscribers could downgrade, reduce usage or migrate to competing operators.
Key Takeaway
Bharti Airtel’s decision to withdraw the ₹299, ₹579, ₹619 and ₹649 prepaid plans represents a targeted restructuring of its tariff portfolio.
While the move is not a formal across-the-board tariff hike, it could encourage users to migrate towards higher-priced plans and potentially increase Airtel’s monthly ARPU by ₹4-12, according to estimates from major brokerages.
Morgan Stanley sees the highest potential impact at ₹8-12, Citi estimates around ₹4, JM Financial expects ₹5-6, while IIFL Capital sees an annualised uplift of around ₹12 but estimates the FY27 benefit at roughly ₹4.
The development reinforces Airtel’s premiumisation strategy and could mark an important step ahead of any broader tariff revision expected later in 2026.
