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Analysts say ‘buy’ Bharti Airtel after subscriber gains in Q4

Shares of Bharti Airtel Ltd. gave up all gains to end lower on Wednesday, even as analysts reiterated ‘buy’ calls on the stock after the fourth quarter, citing higher 4G user additions than peers and net debt reduction.

The telecom operator’s net profit more than doubled sequentially in the quarter ended March 31, beating analysts’ estimates, aided by tariff hikes and customer acquisitions.

Bharti Airtel Q4 Highlights (Consolidated, QoQ)

  • Net profit jumped 142% sequentially to Rs 2,007.8 crore.
  • Revenue increased 5.47% to Rs 31,500 crore.
  • Operating profit increased 9% to Rs 16,040 crore.
  • Ebitda margin widened to 50.92% from 49.23% as of December.

The company’s board also approved the reappointment of Gopal Vittal as managing director and chief executive officer for five more years—from Feb. 1, 2023 to Jan. 31, 2028—a sign of continuing stability.

“The quarter witnessed healthy growth. Our execution was strong despite the Covid-19 effect. We grew across competitively in all businesses and gained market share. We added Rs 13,440 crore to our top line over the last year,” Vittal said in a post-earnings webinar.

On the government’s 5G spectrum auction, Vittal said TRAI’s airwave auction reserve prices were “disappointing”. “We had expected substantial discounts. Though the government did lower prices, it’s still not what we wanted.”

Bharti Airtel, Vittal said, is future-proof, with its systems set up for 5G. There will be at least one more round of tariff hike this year. “It’s crucial in Airtel reaching the goal of an ARPU of Rs 200 and ultimately Rs 300.”

Shares of Bharti Airtel gained as much as 2.9%, the most since April 20, in early trade, but pared all gains to dip as much as 2.5% intraday before closing 1.5% lower at Rs 696.15 apiece.

Of the 34 analysts tracking the company, 30 maintain a ‘buy’, three suggest a ‘hold’ and one recommends a ‘sell’, according to Bloomberg data. The avearge of the 12-month consensus price target implies an upside of 24.1%. Bloomberg

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