Bharti Airtel Q4FY18 result preview: Here's what brokerages expect

Telecom stocks have been under pressure thus far in calendar year 2018 (CY18) with the S&P BSE Telecom index slipping 21 per cent year-to-date (YTD), as compared to a 1.2 per cent rise in S&P BSE Sensex, ACE Equity data shows.
 

Bharti Airtel, Idea Cellular and Reliance Communications have bene among the top losers among the telecom service providers that have lost 24 per cent to 44 per cent.
 

Sunil Mittal – owned Bharti Airel is likely to announce its March 2018 (Q4FY18) results today. Here is a quick compilation of what leading brokerages expect:
 

Kotak Institutional Equities
 

Jio’s pricing moves in the month of January 2018, impact of international termination rate cut effective February 1, 2018, and continued ARPU downtrading are likely to reflect in another quarter of sharp sequential revenue decline.

Our ARPU forecast for Bharti's India wireless is Rs115 (down 8.6% qoq). Overall India EBITDA is likely to decline 24% yoy to Rs49 bn with the weakness not limited to the wireless segment. Consolidated EBITDA should be weak despite healthy trends sustaining for the Africa operations.
 

Edelweiss Research
 

We expect Bharti’s India mobility business revenues to further nosedive 6.0% QoQ on account of 8.8% decline in ARPU, as Bharti cut rates of bundled packages inorder to counter Reliance Jio and maintain existing subscribers. 

Revenues from Africa business are expected to rise 1.0% QoQ. We expect consolidated revenues to decline 1.9% QoQ. EBITDA margins expected to decline 300bps QoQ on account of revenue deceleration in India mobility business. Accordingly, we believe Bharti will report net loss of Rs 875 million during the quarter.
 

HDFC Securities
 

4QFY18 is likely to be another weak quarter for Bharti Airtel and Idea. Tariff cuts in Jan-18, IUC rate cut on international incoming calls from 53p to 30p from 1st February, 2018 and ARPU down trading on account of increasing proportion of bundled plans subscribers to exert pressure on revenues of incumbents.