Bharti Airtel Q3 preview

Bharti Airtel is likely to report single-digit revenue growth when it reports results for the quarter ended December 2019 (Q3FY20) today, largely on the back of tariff hikes and growth in average revenue per user (ARPU). However, a loss of more than Rs 700 crore for the telecom operator is anticipated.

During the quarter under review, Airtel recorded 6.3 per cent YoY growth in subscribers to 30.1 crore, with data subscribers rising 24.6 per cent YoY to 17.3 crore.

In December 2019, Bharti Airtel raised tariffs by around 15-47 per cent across packs, which is likely to translate into FY21 revenue and Ebitda upgrade.

“There are four key things to watch out for in Bharti Airtel’s results: management commentary on the timing of tariff hikes, outlook on spectrum investments including renewals, network rollouts and capex outlay to cater to higher traffic on network, and comments on review petition filed against AGR ruling,” Jefferies.

“Airtel is expected to report a loss of Rs 722.6 crore even as revenue could rise 7 per cent on a year-on-year (YoY) basis to Rs 21,960.7 crore. Sequentially, revenue is seen growing 3.9 per cent, further aided by stable non-wireless revenues traction. The company had posted Rs 20,519 crore as revenue in the year-ago quarter and Rs 86 crore as profit. Airtel’s earnings before interest, tax, depreciation (Ebitda) are expected to grow 1.7 per cent sequentially to Rs 8,983.1 crore while Ebitda margins is seen at 40.9 per cent, down 90 bps QoQ,” ICICI Securities.

“Airtel’s Q3FY20 revenue is expected to be Rs 21,784.6 crore and loss Rs 780.8 crore. We see an Ebitda of Rs 9,290.3 crore, up 49 per cent YoY, and Ebitda margin at 42.6 per cent compared to 30.7 per cent in the year-ago quarter,” Kotak Institutional Equities.

“A 7.6 per cent YoY growth in Airtel’s revenue at Rs 22,144.2 crore and a loss of Rs 797 crore is expected,” Edelweiss.

At the bourses, Airtel has outperformed the benchmarks by surging 29.8 per cent in the October-December quarter as compared to Sensex’s 7.69 per cent gain during the period.
CT Bureau