Bharti Airtel likely to post 15% rise in Q4 net profit at Rs 2,318 crore

Brokerages expect revenue growth of 16 percent YoY to Rs 36,521 crore (2 percent QoQ rise).

Bharti Airtel is expected to report a 15 percent increase in net profit when it releases its Q4 earnings today.

Profit at India’s second-largest telecom company may rise to Rs 2,318 crore in the three months ended March from a year earlier (46 percent QoQ growth) while revenue may grow 16 percent YoY to Rs 36,521 crore (2 percent QoQ rise), according to the average estimates of brokerages polled by Moneycontrol.

Brokerage Motilal Oswal pegged Airtel’s quarterly revenue growth at 3 percent sequentially, led by a 2 percent increase in average revenue per user (ARPU) and subscriber addition of 1 percent.

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Kotak Institutional Equities expects 2 percent QoQ growth in the company’s India wireless business revenue/EBITDA as a 1 percent QoQ uptick in ARPU after an increase in minimum recharge plans to Rs 197 is offset by a likely paying-subscriber decline and fewer days in the quarter (90 days versus 92 in the third quarter).

“Among the other business segments, we model sequential revenue growth, as (1) 5 percent for home broadband, (2) 1 percent for enterprise and (3) largely flat for Airtel Africa. Overall, we expect 1-2 percent QoQ growth in consolidated revenue/EBITDA,” it added.

Earnings before interest, taxes, depreciation and amortisation (EBITDA) is also projected to rise 2 percent on a quarterly basis to Rs 18,780 crore. On a yearly basis, growth is expected to come in at 17 percent, according to the poll.

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The EBITDA margin might remain little changed QoQ but may expand as much as 50 bps YoY to 51.4 percent. Motilal Oswal expects the EBITDA margin to improve 20 bps on a sequential basis to 51.7 percent.

“We expect India wireless/Airtel Africa to see a sequential revenue growth of 3 percent each” and expect capital expenditure to remain higher, it said.

According to Axis Securities, QoQ improvement may be seen with an increase in India and Africa wireless revenue as a strong service mix and a rise in ARPU may help in expanding margins.

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