Bharti Airtel Limited announces Q2FY21 earnings

Bharti Airtel Limited ("Bharti Airtel" or "the Company") today announced its audited consolidated Ind AS results for the second quarter ended September 30, 2020.

Q2'21 Performance:

The consolidated revenues for Q2'21 at Rs 25,785 crore grew 22.0% YoY with strong growth across the portfolio - geographies and segments. Consolidated mobile data traffic at 7,403 PBs in the quarter with a healthy YoY growth of 58.8%.

India revenues for Q2'21 at Rs 18,747 crore increased by 22.0% YoY. Mobile revenues grew by 26.0%. This is an outcome of the company's unrelenting focus on winning with quality customers on the back of a solid network, aspirational brand and delivery of a differentiated experience. Resultantly, ARPU for the quarter is at Rs 162 as compared to Rs 128 in Q2'20.

The company continues to garner a strong share of the 4G net ads in the market. 4G data customers1 increased by 48.1% to 152.7 Mn compared to the previous year while traffic increased to 77.3 PB/day vs 48.9 PB/day in the corresponding quarter last year. Engagement parameters continue to be best in industry - average data usage per data sub at 16.0 GBs/month; while voice usage was at 1,005 mins/sub/month. We continue to make progress on improving customer experience. We were awarded the 'Best Network Experience' for Gaming, Video, download speed and voice by Open Signal in their Sep'20 report. We continue to leverage the power of one Airtel to serve the evolving consumer behaviour - bank, secure payments and One Airtel propositions. After slowdown in site deployment due to COVID, we accelerated roll-outs in Q2 and added 5K+ sites to cross the 200,000 site count mark. We continue to remain focused on optimally augmenting our coverage and capacities to offer a differentiated network experience.

Homes business segment witnessed a revenue growth of 7.3% YoY. We added over ~129K customers during the quarter to reach to a total base of 2.58 Mn. We re-calibrated our offering and launched Xstream bundles with content and unlimited internet to accelerate penetration. The company signed on many more LCO partnerships in non-wired cities, extending the model to 48 cities. The company also focused on fast-track network expansion by rolling out Fibre Home Passes and upgrading existing copper network during the quarter.

Airtel Business continues to accelerate its momentum with 7.5% YoY growth, driven by data demand across global business and enterprise & government business. To further leverage growth from "Work from Home", various products were launched. Airtel BlueJeans, Airtel Secure, Airtel Cloud and Airtel IQ were launched to meet the specific needs of our B2B customers. In the Government segment, we are seeing gradual recovery and change in focus towards IT modernization and investments in security & cloud. In addition, there is a big drive on Energy Management Systems, robust connectivity platforms to enable Government connect with citizens and focus on smart cities. We are well positioned to serve this demand. Overall, the company remains fully geared and focused towards becoming a solution provider of repute and go beyond connectivity and drive solutions such as cloud, security, data centres and CPaaS solutions.

Digital TV witnessed a growth of 1.9% YoY on an underlying2 basis, on the back of strong customer additions of 549K during the quarter. We continued to expand our channel portfolio and are also working with educational institutions to broadcast classes to students to ensure education is not disrupted.

Airtel's journey as a digital services provider of strength continues to improve. We now have 160 Mn digitally engaged users. On Wynk - we are now #1 in terms of MAUs (59.3 Mn in Q2'21) with an addition of ~9 Mn during the quarter; Thanks platform has 81.6 Mn MAUs in Q2, with an addition of ~8 Mn and Airtel Xstream is at 33.7 Mn MAUs, addition of ~8 Mn users during the quarter.

There are over 1.1 million retailers transacting and making payments every day on Mitra App. Online recharges continue to contribute ~50% of overall revenues. As part of our strategy to build new revenue streams from best-in-class digital services, the company has forayed into the fast-growing Indian cloud communications market with the launch of Airtel IQ, an omni-channel Cloud based communications platform. Developed by Airtel's digital team, Airtel IQ helps businesses deepen customer engagement by orchestrating seamless and secure communication across voice, SMS, IVR in their applications through a unified platform.

Further in line with our partnership model and to augment our Cloud service offerings, we entered into a partnership with AWS Professional Services to develop differentiated Airtel Cloud products and capabilities leveraging AWS services, Airtel's data center capabilities and Airtel's network and telecoms offerings.

We also launched Airtel Secure, a suite of cyber security solutions for large, medium and small businesses as they shift to digital and cloud platforms, increasing the need to protect data and information from online attacks. We have partnered with firms like Cisco, VMware, Radware and Forcepoint to jointly provide cyber security solutions to both enterprises and government.

Consolidated EBITDA witnessed an increase of 32.6% YoY to Rs 11,848 crore in Q2'21. This led to an improvement in EBITDA margin from 42.3% in Q2'20 to 46.0% in Q2'21. Incremental EBITDA margins across businesses remained healthy, with mobile services EBITDA improving from 36.3% in Q2'20 to 42.6% in Q2'21.

Consolidated EBIT increased by 121.4% YoY to Rs 4,412 crore. The Consolidated Net Loss before exceptional items for the quarter stands at Rs 744 crore. The Consolidated Net Loss after exceptional items for the quarter stands at Rs 763 crore. The Net Debt-EBITDA ratio (annualized) and including the impact of leases as on September 30, 2020 is at 2.91 times as compared to 3.30 times as on September 30, 2019. Excluding pending AGR dues, the Net Debt-EBITDA ratio (annualized) is at 2.41 times as on September 30, 2020.

Gopal Vittal, MD and CEO, India & South Asia, said: "Despite being a seasonally weak quarter, we delivered a strong performance with revenue growing at ~22% YoY. In the mobile segment, we added over ~14 Mn 4G customers and grew revenues by ~26%. Our focus on building the most aspirational brand in Indian Telecom to win quality customers is delivering results. Our data consumption grew by 58% YoY which reflects strong engagement of customers on our network. This further underscores our DNA of customer obsession and delivering brilliant experiences through a future ready network and innovative digital platforms. Other lines of business also continued with steady growth momentum, with Airtel business growing 7.5% YoY.

We stay committed to improving the profitability of the business. Our continued focus on ARPU improvement and cost optimization led to EBITDA margin expansion by over ~ 158 bps in the quarter sequentially".

Shares of BHARTI AIRTEL LTD. was last trading in BSE at Rs.433 as compared to the previous close of Rs. 434.05. The total number of shares traded during the day was 540949 in over 12171 trades.

The stock hit an intraday high of Rs. 438.7 and intraday low of 427.55. The net turnover during the day was Rs. 234245829.

Source : Equity Bulls

Keywords