Axis securities's research report on Bharti InfratelBharti Infratel recorded consolidated tenancy additions of 3,285 (Q2FY16: 3,421). Tenancies were impacted by one-off exits of 460 on standalone basis and 610 on consolidated basis. Monthly rental was steady at Rs 34,453 (revenue per sharing operator, up ~1% QoQ), leading to ~2% QoQ growth in revenue. EBITDA at Rs 13.5 bn was up 3% QoQ with energy margin at 4.8% (Q2FY16: ~3.5%).PAT declined 2.4% QoQ owing to lower other income. FY17 will see acceleration towards full-blown tenancies: In Q3, data installations on 3G/ 4G have grown 3x YoY. This is directionally positive as it is expected to lead to full tenancies led by higher data consumption. Metros and Circle A have seen increased traction. We expect 0.4x incremental tenancy over FY15-17 (FY13-15: 0.21x).We expect FY16-18 revenue CAGR of ~11% each. Steady energy margins and operating efficiencies with higher growth in tenancies (vs. towers)will lead to 14% CAGR in EBITDA for FY16-18E. Our DCF-based TP stands at Rs 452,implying an upside of 22%. The stock trades at 25x FY17E and 22x FY18E EPS of Rs15 and Rs17. Maintain BUY. For all recommendations, click here Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
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