Buy Bharti Airtel For Rs. 820 Price Target: Axis Securities

Rationale for a ‘Buy’ on Bharti Airtel:

–Encouraging performance in the Africa business: The Africa business continues to perform well and it has been adding significant value in terms of consistent growth in operating profits and cash flows. The company’s relentless focus on stepping up customer experience led to Africa revenue growth of 7.6% QoQ to reach Rs 8,177 Cr. Operating Margins for the quarter, too, improved by 30bps to 48%. The management is optimistic about gaining momentum and generating free cash flow as it treads ahead.

Industry-leading ARPU in India: Bharti Airtel is to maintain an industry-leading ARPU in India with leading per-user data consumption (16.4 GB/month). We expect the company to benefit from the operating leverage as ARPU improves with 60-70% of the revenue pass-through to EBIT. Enterprise revenue was up2.2% QoQ while the operating margin expanded by 145bps QoQ.

Axis Direct said “We recommend a BUY rating on the company with SOTP based valuation at Rs 820/share aided by superior margins, stronger subscriber growth,

and higher 4G conversions. TP indicates an upside of 13% from CMP.

Q2fy22 results of Bharti Airtel

For the September ended qtr. of Fy22, the company reported a Consolidated Total Income of Rs. 28435.20 Crore, up 5.07 % from last quarter. Company’s reported net profit after tax came in at Rs 1399.30 Crore in the latest quarter.

About Bharti Airtel

The company incorporated in the year 1995, is a Large Cap company from the Telecommunications sector. Of late the sector as a whole is under tremendous financial crisis due to spectrum fee and AGR dues.

Slowly and gradually after hiking its tariff plans for the pre-paid offerings the company and its peer expect to offset the financial crisis at hand gradually.

Disclaimer:

The stocks is taken from the report of Axis Securities. Stock market investment is risky, investors should engage in their own analysis and research and then take on any investment call.