Bharti Q3 revenues seen up 7% to Rs 18500 cr

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Bharti Q3 revenues seen up 7% to Rs 18500 cr

Bharti Airtel is set to announce its third quarter results. According to CNBC-TV18’s estimates, the company’s Q3 FY12 revenues are seen up 7.1% at Rs 18500 crore versus Rs 17269.8 crore, quarter-on-quarter, QoQ basis.

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Excerpts from Bazaar on CNBC-TV18 Watch the full show » ALSO READ News and Notices about Bharti Airtel See interviews with Bharti Airtel Management See what other Experts & Brokerages are saying about Bharti Airtel See previous Results of Bharti Airtel

By Reema Tendulkar, Research Analyst at CNBC-TV18

Bharti Airtel is set to announce its third quarter results. According to CNBC-TV18's estimates, the company's Q3 FY12 revenues are seen up 7.1% at Rs 18500 crore versus Rs 17269.8 crore, quarter-on-quarter, QoQ basis.

Its EBITDA is seen going up at Rs 6370 crore versus Rs 5815.1 crore.

Its EBITDA is expected to be at 34.4% versus 33.67% QoQ.

The company's PAT is likely to go up 32.5% at Rs 1360 crore versus Rs 1027 crore.

Street turned positive on Bharti post SC verdict on 122 2G cancellation Idea Q3: Strong, volume growth (minutes) up 7.3%, RPM up 1.4% FY12e EPS at 15.5; PE at 24X; FY13e EPS at 23 PE at 16.3X

Africa Q3 - good performance

$ Rev up 4% at $10671m versus $1030m
Rev up 12.6% at Rs 5295 cr versus Rs 4703.2 cr
EBITDA % at 27.57% versus 26.37%

India wireless Operating parameters  - volume + price increase

RPM up 1.3% at Rs 43.8 versus 43.2   
MOU up 2.4% at 433 versus 423
ARPU up 3.8% at 190 versus 183
Minutes on network expectation is a growth of ~3-5% (Idea was at 7.3%)

India and SA wireless

Rev up 5.5% at Rs 10320 cr versus 9782.7 cr
EBITDA at Rs 3605 cr versus Rs 3292.6 cr
EBITDA % at 34.9% versus 33.65%

Q3 highlights

Cons numbers expected to be strong. (Idea was also a strong set of results)
Q3 is a seasonally strong qtr and hence minutes growth is expected to be strong at 3-5% after a tepid Q2 (when minutes declined dn 0.4%)
RPM to grow again. This is first full qtr of tariff hike, tariff increase taken in July (Q2 RPM was up 1%)
PAT higher due to OPM expansion and slightly lower D&A and interest qoq despite forex loss
Forex loss expected to be lower at ~200 cr vs Rs 239 cr qoq. Q2 forex loss was lower than expectation hence gave confidence abt forex being well managed.
Strong Africa - $ Rev up ~4%, Re rev higher at ~13% due to INR depreciation
• Re depreciated ~8% vs African currencies
• Margins likely to improve due to completion of a majority portion of network/IT sourcing
Watch for volume and pricing growth + African mkt share and margin growth

Yesterday: TRAI released a consultation paper on 'review of policy of forbearance in telecom tariff -potentially negative for tariffs

Key implications from recent ruling of cancellation of 122 licenses
Fresh 2G auction:
• pricing could be lower -financial position of operators too stretched to be aggressive ((but CS says say it wont be meaningfully lower as all serious players in the fray
• More spectrums gets allocated to incumbents.
Tariffs: can increase due to lower competition
Lower regulatory payments:
• can see lower regulatory payment related to excess 2G spectrum pricing for Tel commission/TDSAT decides to use the price determined in auction rather than TRAI-determined prices (auction price may be lower)
• Pending Regulatory overhang like one time payment on excess spectrum, intra circle roaming agreement can be postponed given the timeline of 4 months given by SC, the govt /TRAI may expedite process of formulating the Exit policy and new license issuance to limit any negative impact on services to affected subscribers.