Accumulate Bharti Airtel; target of Rs 1,620: Prabhudas Lilladher

Prabhudas Lilladher's research report on Bharti Airtel

Bharti Airtel has announced a tariff hike of 10-20% across its various plans, effective from 3rd July, 2024. This move follows a similar increase by its major competitor, Reliance Jio, and is aimed at bolstering revenue and sustaining the company's investments in network expansion and quality improvement. Factoring in this hike, we estimate ARPU change of 13%/14% to Rs 236/269 for FY25/26E. We anticipate a subscriber addition of 16/20mn to 362/381 subs for FY25/26E.

Outlook

Factoring in this hike we build in a 13/14% hike in ARPU in FY25/26 to Rs236/269/month and 16/20mn subscriber addition to 362/381mn for the India mobile business. Given the much needed tariff hike undertaken by the company and acquisition of spectrum to enhance network coverage we remain positive on Airtel’s India business. Maintain Accumulate rating with a TP of Rs 1,620.