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Last Updated : Feb 12, 2018 08:50 PM IST | Source: Moneycontrol.com

Buy Bharti Airtel; target of Rs 475: JM Financial

JM Financial is bullish on Bharti Airtel has recommended buy rating on the stock with a target price of Rs 475 in its research report dated January 18, 2018.

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JM Financial's research report on Bharti Airtel


Bharti’s 3QFY18 consol. revenue was broadly in line, but EBITDA of INR 75.9bn was 3.5% ahead of our forecast, partly aided by write-backs and reversals in India non-mobile (extowers) businesses. Africa delivered yet-another strong quarter, with underlying CCY growth of c.4% qoq in revenues and 12% in EBITDA, which may justify further re-rating versus 6.0xEV/EBITDA in our SOTP currently. India mobile revenue was 2.5% below forecast, as ARPU collapsed by 15.2% qoq (to INR 123); excluding impact of IUC cut, the ARPU decline from down-trading was 6.5% qoq. We see dim-prospects of a sequential revenue recovery in 4Q, and thus anticipate a 3-4% cut in our FY18E consol. EBITDA (excl. Telenor consolidation).


Outlook
We maintain Buy rating, but recommend adding Bharti stock below INR 475. Positive catalysts are: (1) sequential recovery in India mobile revenues; (2) Maxis exiting Aircel. Downside risk is Jio keeping tariffs low through much of FY19.


For all recommendations report, click here


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First Published on Jan 18, 2018 08:47 pm
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