Company Update - Bharti Airtel - ICICI Direct

We attended the Analyst Day of Bharti Airtel.

- The management reiterated the call for higher ARPU, another tariff hike by CY22 end and a couple more in the next few years (albeit inflationary trend, competitive stance and affordability a lower end could be a key deterrent in the near term, in our view). It outlined that US$3,3 (Rs. 250) ARPU could propel RoCEs to 20% vs. 6% in FY21 at US$2.2 ARPU. It indicated that all heavy lifting in terms of capex is done. It also termed itself 5G ready with trails done, successful testing of use cases, 5G core & infra ready with only implication being on higher radio capex in near term, albeit with no major change in capex in three-year period from current levels

- Identified broadband to be area of focus with home pass expansion from 16 million to 40 million by 2025 through own and LCO model of expansion

- It outlined emerging products under Enterprise such as Data Centre, IoT, Security, Cloud, Communication Platform as Service (CPaaS) and Network as a Service (NaaS) as another key area of growth (current cumulative market size of Rs. 36000 crore and ~25%+ CAGR ahead)

Key triggers for future price performance

- Tariff hike flow through to boost Airtel's India ARPU, India EBITDA by 20%, 30%, respectively, from pre-hike levels

- Relative market share gain from VIL, given its stressed balance sheet and long term potential driven by growth opportunity from 5G & Enterprise

For details, click on the link below:

Link to the report

Shares of Bharti Airtel Limited was last trading in BSE at Rs. 709.25 as compared to the previous close of Rs. 706.25. The total number of shares traded during the day was 163661 in over 6892 trades.

The stock hit an intraday high of Rs. 714.40 and intraday low of 705.80. The net turnover during the day was Rs. 116281861.00.

Source : Equity Bulls

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BhartiAirtel INE397D01024 CompanyUpdate AnalystDay ICICIDirect