Shares of Bharti Airtel rose close to 3 percent and hit a record high of Rs 1,608.40 on August 30, as the Supreme Court reviews the curative petitions filed by Bharti Airtel and Vodafone Idea in the Adjusted Gross Revenue (AGR) case.
Brokerages believe that the review of the the petition might prompt the government to offer some relief measures for the telecom majors. Factoring that in, along with expectations of a strong growth in the coming times, global brokerage Bernstein raised its price target for Bharti Airtel by 9 percent to Rs 1,740, while retaining its 'outperform' call on the stock.
At noon, shares of Bharti Airtel came slightly off the day's high and were trading at Rs 1,599 on the NSE.
Earlier this week, UBS Securities had also lifted its price target on the stock to Rs 1,595, even though it retained its 'neutral' rating.
Going ahead, Bernstein also sees a favourable market structure for the telecom industry, driven by the consolidation over the years. The firm noted that strong players like Bharti Airtel and Jio continue to gain market share.
On that account, Bernstein expects the market to consolidate further, with Vodafone Idea subscriber churn still sitting at higher levels.
In addition, as telecom giants hop on a tariff hike cycle, UBS anticipates that 60-75 percent of the hikes will translate into revenue over the next three quarters. Moreover, the firm expects churn to decrease during this period due to a significant reduction in the prevalence of double SIMs cards.
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