Should you buy, sell or hold Bharti Airtel post September quarter numbers?

Here's how leading brokerages have interpreted Bharti Airtel's September 2022 quarter (Q2FY23) numbers

Shares of Bharti Airtel traded with modest gains, a day after the company 89 per cent year-on-year rise in consolidated net profit for second quarter ended September 2022 to Rs 2,145 crore. The counter hit an intra-day high of Rs 838.90 on the BSE before trimming gains.

The total revenue rose 22 per cent year-on-year (YoY) to Rs 34,527 crore during period under review, the company said in a statement. READ ABOUT IT HERE

Here's how leading brokerages have interpreted Bharti Airtel's September 2022 quarter numbers.

Jefferies

Bharti Airtel's Q2-FY23 revenues beat estimates due to higher India-mobile average revenue per user (ARPU), higher growth in India-Enterprise and higher revenues in Africa. Tariff hikes are more likely to take place in the January-March 2023 quarter. Also, network costs as well as SG&A costs are likely to rise faster amidst 5G rollout and launch. 

We cut our India mobile estimates by 1-8 per cent to factor this. While Bharti's growth outlook remains strong (17 per cent/20 per cent India revenue/EBITDA CAGR over FY23-25), its 10x EV/Ebitda valuation for India business prices this in. We downgrade our recommendation to HOLD with a price target of Rs 855. Higher/earlier-than-expected tariff hikes can drive positive surprises.

Motilal Oswal Securities

The company has slowed 4G adds to 5 million for the last couple of quarters, down from the quarterly additions of 8-10 million, possibly due to an increase in smartphone prices and also a high base of 4G subscribers at 210 million at 64 per cent of total subscribers. Data traffic remained healthy, growing 7.4 per cent QoQ to 13.5 billion GB with 21 GB/user. Bharti’s data traffic and data subscribers are at 48 per cent of RJio, with a much lower capacity gap, highlighting better network experience. Maintain BUY rating.

ICICI Securities

Airtel continues to report healthy performance on Indian wireless business front with resilient and industry leading KPIs

in terms of India postpaid/4G subscribers, ARPUs and margins. We remain constructive on Airtel given the disproportionate benefits of market consolidation in Telecom Sector. Management commentary on overall growth drivers would be key monitorable ahead.