Maintain 'hold' on Bharti Airtel – TP Rs.285 - Geojit BNP Paribas

- 2QFY13 revenue was in line with market estimates. EBITDA beats market estimates on lower SG&A (selling, general and administrative) expenses.

- Higher finance costs and tax expenses lead to an EPS miss.

- Bharti reduced its tariffs in Africa that resulted in a 15% decline in ARPM, which was offset by a 14% MOU (minutes of use) rise.

- 2Q is the weakest quarter for Indian telecom companies and it is expected that performance to improve from here.

- A little interest in the spectrum auction and a potential downward revision in spectrum price could be positive to the company.

- Bharti has indicated that voice as well as data tariff has potential to increase while churn level could decline. These could be positive for the industry.

- Company's performance has improved after the weak 1Q. Still, hold rating is maintained. Prefer Idea to Bharti.

Source : Equity Bulls

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