Report
Aliasgar Shakir
EUR 120.00 For Business Accounts Only

MOSL: BHARTI AIRTEL (Buy)-Steady earnings despite lockdown; encouraging outlook

BHARTI AIRTEL: Steady earnings despite lockdown; encouraging outlook

(BHARTI IN, Mkt Cap USD42.5b, CMP INR574, TP INR720, 25% Upside, Buy)

 

  • Bharti Airtel (BHARTI) delivered healthy EBITDA growth of 5% QoQ on a consol basis (5% above est.), led by EBITDA growth of 5.1%/5.3% in the India Mobile / Africa businesses – despite subscribers/ARPU for the India business being impacted by the lockdowns. However, it had high capex toward network investments in India and paid dues towards a deferred spectrum liability for the spectrum acquired from the recent auction. As a result, it continues to post negative FCF and higher leverage.
  • a) Subscriber recovery over June–July’21, b) the management indicating growth opportunities in the Enterprise and Digital verticals, and (c) flat to declining capex in FY22 (v/s a high spend in 1QFY22), underscores a healthy earnings and FCF outlook. We estimate a 21%/17% CAGR EBITDA growth for India Mobile / the consol business over FY21–23E, in line with the trend of 30% YoY growth seen in India Mobile, despite no tariff hikes. Maintain Buy.
Underlying
Bharti Airtel Limited

Bharti Airtel provides telecommunication systems and services to individuals and businesses in India with operations in 20 countries across Asia and Africa. In India, Co.'s product offerings include 2G, 3G and 4G wireless services, mobile commerce, fixed line services, high speed DSL broadband, IPTV, DTH, enterprise services including national & international long distance services to carriers. In the rest of the geographies, it offers 2G, 3G wireless services and mobile commerce. Co. had nearly 287 million customers across its operations at the end of Dec 2013.

Provider
Motilal Oswal
Motilal Oswal

​Motilal Oswal Financial Services Ltd. is a reputed name in Financial Services and Online Trading with group companies providing services such as Private Wealth Management, Retail Broking and Distribution, Institutional Broking, Asset Management, Investment Banking, Private Equity, Commodity Broking, Currency Broking, Principal Strategies & Home Finance. 

Motilal Oswal Securities is a group company of Motilal Oswal Financial Service Limited which started as a stock trading company and has blossomed into well diversified firm offering a range of financial products and services. Motilal Oswal has built a reputation as the source for best stock trading company and this has taken a wealth of experience, knowledge and expertise, constantly working in tandem, over the years.

Analysts
Aliasgar Shakir

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