Airtel & Jio Slow 5G Expansion as Capex Declines, Impacting Towers
India’s 5G rollout is slowing down as leading telecom operators Reliance Jio and Bharti Airtel reduce capital expenditure on network infrastructure. According to ICICI Securities, new 5G base station deployments have dropped to 8,000-9,000 per quarter in Q2 and Q3 of FY25, a significant decline from 111,000 per quarter in Q2 FY24, as per Department of Telecommunications (DoT) data.
Impact on Tower Companies
The slowdown in 5G expansion is expected to affect telecom infrastructure providers, particularly Indus Towers, which depends on Airtel for tenancy growth. While Vodafone Idea (Vi) continues its 4G expansion and early-stage 5G deployment, it is unlikely to fully compensate for the decline. Analysts predict slower tower additions in FY26, particularly as Airtel’s rural 4G rollout nears completion.
Jio & Airtel Cutting 5G Investments
Both Jio and Airtel are significantly reducing network investments in FY26. JM Financial estimates their annual capital expenditure will drop to ₹28,500 crore for Airtel and ₹29,500 crore for Jio, down from ₹33,400 crore and ₹48,900 crore in FY24, respectively. This is attributed to the near-completion of nationwide 5G deployments and slower-than-expected monetization due to low subscriber penetration (30-35%) and affordability challenges for 5G smartphones.
Shift in 5G Strategy
Analysts note that 5G expansion is primarily being implemented as an overlay on existing 4G networks to improve data capacity rather than extend network coverage, further slowing new tower deployments.
Source: Business Standard
