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Airtel Q1 Results Preview | Profit may surge 6.5-fold, revenue 21% on 3 million new users

Experts expect healthy revenue and EBITDA growth led by subscriber additions and ARPU improvement

August 08, 2022 / 07:17 AM IST
Bharti Airtel

Bharti Airtel

 
 
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Telecom major Bharti Airtel Ltd (Airtel) is expected to declare a 550 percent jump in its consolidated net profit for the quarter ended June 2022 over the year-ago period. Its consolidated revenues are likely to post a 21 percent growth on-year.

On a sequential basis, the revenues are likely to remain flat with a marginal improvement of 3 percent, while the profit after tax is likely to shrink in a high single digit.

Airtel will declare its results for the June quarter on August 8. The Gurgaon based, second largest telecom operator of the country is expected to report a consolidated PAT of Rs 1,843 crore on consolidated revenues of Rs 32,445 crore for the quarter, according to a poll of brokerages polled by Moneycontrol.

The company had registered a consolidated PAT of Rs 283.5 crore during the corresponding quarter of last year on revenues of Rs 26,854 crore.

During the January–March period, the company had reported a consolidated profit of Rs 2,008 crore and revenue of Rs 31,500 crore.

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The telecom services provider added 3 million net subscribers during the quarter (a sequential growth of 1.7 percent) taking its total subscriber base to 33 crore. The company is likely to reap the benefits of tariff hikes with the improvement in ARPU (average revenue per user) of 3 percent on quarter to Rs 185 per month.

“Among the other business segments, we model sequential revenue growth of 5 percent for Africa business, 2 percent for enterprise business and 9 percent for homes segment”, said a report from Kotak Institutional Equities.

The company witnessed a 2 percent QoQ growth in its subscriber base in Africa where the ARPU is seen improving by ~2 percent to $ 3.2 per month

“We expect healthy revenue and EBITDA growth with an EBITDA margin of 51 percent for Bharti, led by subscriber additions and ARPU improvement”, said a report from the brokerage firm Motilal Oswal Financial Services.

Bharti’s strong FCF (free cash flow) of over Rs 20,000 crore and Rs 21,000 crore expected cash inflow (from uncalled rights issue and Google equity infusion) is sufficient to meet their investment needs in 5G spectrum. However, the risk of higher capex towards 5G remains a key overhang and investors will be closely monitoring its plans and strategy for 5G implementation in the country.

Airtel shares closed Rs 9.35 higher at Rs 703.65 on August 5, on The National Stock Exchange. The stock has generated returns of close to 20 percent during the past one year and is trading flat over the past one month.

Disclaimer: The views and investment tips of investment experts on Moneycontrol.com are their own and not those of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
Gaurav Sharma
first published: Aug 8, 2022 07:17 am
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