Q3FY21 Result Update - Bharti Airtel - ICICI Direct

Bharti Airtel reported yet another strong operating performance with beat on KPIs such as ARPU, subscriber addition and margins. Consolidated topline came in at Rs. 26,518 crore, up 5.8% QoQ on a like to like basis, driven by Indian wireless revenues, which were up 6.8% QoQ (32.4% YoY) at Rs. 14,779 crore, with ARPU growth of 2.4% QoQ at Rs. 166 and strong net sub addition of ~14.2 million. Africa revenues were up 6.7% QoQ at Rs. 7644 crore. Consolidated EBITDA came in at Rs. 12,053 crore, up 8.9% QoQ on comparable basis with margin of 45.5% (up 128 bps QoQ). Overall Indian margin was up 78 bps QoQ at 45.2% with Indian wireless margins at 42.6%, up 110 bps QoQ, largely a function of operating leverage.

Valuation & Outlook

Bharti Airtel continues to report resilient numbers especially on Indian wireless business front. The strong subscriber addition and ARPU traction which percolated into superior EBITDA (incremental margins of ~60%) are key positive. The commentary of no major step up capex intensity in 5G (apart from spectrum spends), also provides clarity on cash generation. The non-wireless business traction along with Africa performance, continue to witness strong traction. We see the favourable industry structure of three players (two being strong), a good enough kicker for eventual hike in tariff as well as superior digital play in medium to long term. We maintain our BUY rating on the stock with a revised DCF based target price of Rs. 730/share (earlier Rs. 700/share).

For details, click on the link below: https://www.icicidirect.com/mailimages/IDirect_BhartiAirtel_Q3FY21.pdf

Shares of BHARTI AIRTEL LTD. was last trading in BSE at Rs.581.25 as compared to the previous close of Rs. 600.35. The total number of shares traded during the day was 1183057 in over 17477 trades.

The stock hit an intraday high of Rs. 605.4 and intraday low of 576.3. The net turnover during the day was Rs. 692431581.

Source : Equity Bulls

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