Synopsis : Telecom stocks witnessed a sharp rally with MTNL surging over 19% amid easing geopolitical tensions and renewed investor interest. Sector optimism is rising as ARPU growth and structural improvements drive bullish momentum.
In a robust session on Wednesday, June 25, Indian telecom stocks soared on the back of strong market sentiment following the Israel-Iran ceasefire. Leading the charge was MTNL, which surged over 19%, while Vodafone Idea and Bharti Airtel posted intraday gains of up to 3%. Other sector players like TTML, HFCL, Bharti Hexacom, and Indus Towers also registered notable gains in the range of 1-5%, continuing the sector's recent uptrend.
The rally was not without cause. Market experts point to a combination of bullish investor mood, better-than-expected Q4FY25 results, and industry structural changes as key drivers. Telecom players surprised the market in the March quarter, with the sector collectively swinging from a ?1,500 crore loss in Q4FY24 to a profit of ?6,100 crore in Q4FY25, largely powered by Bharti Airtel’s strong earnings.
Long-term prospects for the telecom industry are also looking brighter. ARPU (Average Revenue Per User), a key industry metric, continues to climb steadily post-pandemic, with increasing subscriber bases and data consumption trends supporting future growth. Stocks like Sterlite Tech, ITI, RailTel, and MTNL have posted monthly gains of 12-38%, underlining a resurgence in sector sentiment.
According to JM Financial, industry ARPU is expected to grow at a 12% CAGR, reaching ?290–?320 by FY28. This would be driven by tariff hikes, mobile broadband upgrades, growing post-paid subscriptions, and enhanced data monetisation. JM Financial remains bullish on Bharti Airtel, Bharti Hexacom, and Tata Communications, while maintaining a hold on Vodafone Idea and Indus Towers.
Adding a policy perspective, Union Telecom Minister Jyotiraditya Scindia voiced concern over the near-duopoly in India’s telecom sector, emphasizing the need for healthy competition. Former TRAI Chairman RS Sharma echoed this, calling for affordable broadband access through multiple channels to prevent monopolistic market behavior.
With geopolitical tensions easing and sector dynamics strengthening, telecom stocks seem to be dialing into a new growth cycle. For investors, the message is clear — it may be time to reconnect with this sector.
Disclaimer : This article is for informational purposes only and does not constitute financial advice. Always consult with a professional financial advisor before making investment decisions.
