Result Analysis: Bharti Airtel Ltd. (CMP: Rs.785.35) Result Update: Q3FY23

Airtel is a global communications solutions provider with over 500 Mn customers in 17 countries across South Asia and Africa. The company ranks amongst the top three mobile operators globally and its networks cover over two billion people. Airtel is India’s largest integrated communications solutions provider and the second-largest mobile operator in Africa. Airtel’s retail portfolio includes high-speed 4G/5G mobile broadband, Airtel Xstream Fiber that promises speeds up to 1 Gbps with convergence across linear and on-demand entertainment, streaming services spanning music and video, digital payments, and financial services. For enterprise customers, Airtel offers a gamut of solutions that includes secure connectivity, cloud and data center services, cyber security, IoT, Ad Tech, and CPaaS (Airtel IQ).

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    Stock Details
    Market Cap. (Cr.) 532454
    Equity (Cr.) 2786.81
    Face Value 5
    52 Wk. high/low 877 / 629
    BSE Code 532454
    Book Value (Rs.) 131.59
    Sector Telecomm-Service


    Key Ratios
    Debt-equity: 2.65
    ROCE (%): 11.26
    ROE (%): 11.43
    TTM EPS: 12.84
    P/BV: 6.0
    TTM P/E: 61.16

    Result Highlights:

    • Total Consolidated Revenue showed robust growth of 19.88% on YoY basis and grew marginally on QoQ basis by 3.70% to Rs. 35,804.40 cr. in Q3FY23, Consolidated mobile data traffic at 13,625 PBs in the quarter with a healthy YoY growth of 23.7%.

    • Company has clocked PAT of Rs. 2,613.70 in the Dec. quarter, showing de-growth of 12.26% QoQ, whereas a growth of 58.34% YoY. The PAT margin of the company shrunk sequentially by 133 bps while expanded by 177 bps on YoY basis to 7.30%.

    • EBITDA margin of the company witnessed an increase sequentially of 72 bps and 237 bps on YoY basis to 52.26%.

    • India revenues at Rs. 24,962 crore, increased by 19.4% YoY. Mobile revenues grew by 20.8% YoY, ARPU for the quarter stood at Rs. 193 as compared to Rs. 163 in the Q3FY22.

    • Airtel has launched ‘Airtel World Pass’, one pack works seamlessly across 184 countries that will cover layover at an airport or travelling to two or more countries.

    • Airtel added 21.2 Mn 4G data customers to its network over last year, an increase of 10.8% YoY, and 65% of overall mobile customer base

    • Mobile data consumption by the users up by 22.5% YoY, consumption per customer at 20.3 GB per month.
    • Homes business segment continues its strong momentum and delivers a revenue growth of 29.8% YoY. The company added 432 K customers during the quarter to reach to a total base of 5.6 Mn.

    Financial Performance:

    Shareholding Pattern:

    Particulars %
    Promoters & Promoter Group 55.12%
    FIIs 22.92%
    DIIs 19.16%
    Public 2.10%
    Others 0.7%

    Managerial commentary:

    • Gopal Vittal, MD, said: “We have delivered another quarter of consistent and competitive growth across all our businesses. Revenue grew sequentially by 3.7%, while EBITDA margin expanded to 52.0%. Our strategy of winning quality customers has helped us add 6.4 Mn 4G customers and exit the quarter with an industry leading ARPU of Rs 193. Postpaid, Enterprise, Homes as well as our Africa business sustained their momentum while the DTH business showed signs of growth in an industry that continues to be under pressure. Our overall performance is testimony to the breadth and diversity of our portfolio that spans across both geographies as well as businesses. Our 5G rollout is on track to cover all towns and key rural areas by March 2024.


    Bharti Airtel posts quarterly revenues of Rs 35,804 crore up by 19.88% YoY, backed by strong and consistent performance delivery across the portfolio. However, the company reported a lower-than-expected quarterly profit even as it earned more from each user amid the 5G rollout on account of provision for license fee of Rs. 669.80 cr. related to earlier periods in one of the Group’s wholly-owned subsidiaries. ARPU of the company showed a margin growth of 1.6% sequentially which is lower than expectation, however the growth was better than industry average. For the 9MFY23 Dabur has reported the earnings of Rs.9.48 and we expect the company to close the FY23 at the eEPS of Rs.12.64. Based on the estimated earnings the company is available at PEx of 62.13 at the CMP.


    Particulars (In Rs. Cr.) Q3FY23 Q2FY23 Q3FY22 QoQ% YoY% 9MFY23 9MFY22 YoY%
    Revenue from Operations 35,804.40 34,526.80 29,866.60 3.70% 19.88% 1,03,135.80 85,046.60 21.27%
    Other Income 257.60 201.90 197.10 27.59% 30.70% 651.70 515.70 26.37%
    Total Income 36,062.00 34,728.70 30,063.70 3.84% 19.95% 1,03,787.50 85,562.30 21.30%
    Network operating expenses 7,328.40 7,130.30 6,498.60 2.78% 12.77% 21,141.50 18,474.70 14.43%
    Access charges 1,935.20 1,931.00 1,723.20 0.22% 12.30% 5,736.00 5,010.60 14.48%
    License fee / Spectrum charges 2,842.10 2,951.10 2,729.80 -3.69% 4.11% 8,923.80 8,054.70 10.79%
    Employee benefits expense 1,235.30 1,208.60 1,133.60 2.21% 8.97% 3,567.40 3,269.10 9.12%
    Sales and marketing expenses 1,911.80 1,782.30 1,442.50 7.27% 32.53% 5,261.00 3,770.80 39.52%
    Other Expenses 2,098.40 1,929.70 1,636.10 8.74% 28.26% 5,929.70 4,973.10 19.24%
    EBITDA 18,710.80 17,795.70 14,899.90 5.14% 25.58% 53,228.10 42,009.30 26.71%
    EBITDA Margin (%) 52.26% 51.54% 49.89% 72 bps 237 bps 51.61% 49.40% 221 bps
    Finance Cost 4,685.60 4,940.30 4,367.10 -5.16% 7.29% 14,136.80 12,556.90 12.58%
    Depreciation & Amortisation expense 9,297.70 8,946.80 8,547.20 3.92% 8.78% 27,025.90 24,508.10 10.27%
    Share of profit/(loss) in associated and JV -368.40 356.70 616.10 TA TA 151.10 1,709.60 -91.16%
    Exceptional items (net) 669.80 0.00 -39.80 TA TA 669.80 -792.40 TA
    Profit Before Tax 3,689.30 4,265.30 2,641.50 -13.50% 39.67% 11,546.70 7,446.30 55.07%
    Tax 1,075.60 1,286.40 990.80 -16.39% 8.56% 3,485.30 2,856.10 22.03%
    Profit After Tax 2,613.70 2,978.90 1,650.70 -12.26% 58.34% 8,061.40 4,590.20 75.62%
    PAT Margin (%) 7.30% 8.63% 5.53% -133 bps 177 bps 7.82% 5.40% 242 bps
    EPS (in Rs.) 2.81 3.80 1.49 -26.05% 88.59% 9.48 4.06 133.50%
    Segment Income (In Cr.) Q3FY23 Q2FY23 Q3FY22 QoQ% YoY% 9MFY23 9MFY22 YoY% Segment%
    Mobile Services India 19,352.70 18,882.10 16,017.30 2.49% 20.82% 56,375.30 45,388.80 24.21% 52.17%
    Mobile Services Africa 11,087.60 10,445.20 9,105.30 6.15% 21.77% 31,234.90 25,874.10 20.72% 29.89%
    Mobile Services South Asia 77.60 69.50 97.50 11.65% -20.41% 213.80 288.50 -25.89% 0.21%
    Airtel Business 4,777.90 4,664.60 4,105.90 2.43% 16.37% 13,808.10 11,890.40 16.13% 12.88%
    Homes Services 1,034.30 989.80 796.90 4.50% 29.79% 2,950.60 2,162.80 36.43% 2.79%
    Digital TV Services 739.00 728.80 791.20 1.40% -6.60% 2,216.00 2,398.60 -7.61% 1.99%
    Others 26.10 20.40 8.20 27.94% 218.29% 55.50 26.00 113.46% 0.07%
    Total 37,095.20 35,800.40 30,922.30 3.62% 19.96% 1,06,854.20 88,029.20 21.38% 100.00%
    Less: Inter segment revenue 1,290.80 1,273.60 1,055.70 1.35% 22.27% 3,718.40 2,982.60 24.67%
    Income from Operations 35,804.40 34,526.80 29,866.60 3.70% 19.88% 1,03,135.80 85,046.60 21.27%
    Source: Company website, EWL Research

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