BHARTIARTL - Bharti Airtel Ltd. Share Price

Management Outlook and Major Points:

Strategic Initiatives:

• Transferring ~16,100 telecom towers to Indus Towers to enhance efficiency and long-term value.
• Focus on ESG: Solarizing sites, AI-driven energy optimization, and impacting 3M+ children via the Airtel Foundation.

Financial Performance:

• Consolidated revenue at Rs.45,130 Cr; India revenue (ex-Indus) grew 4.8% QoQ. EBITDAaL margin improved to 49.3%.
• Prepaid Rs.35,500 Cr high-cost spectrum debt over six quarters; net debt/EBITDAaL reduced to 1.8x.
• Capex prioritizes transport, homes, and B2B; FY2025 capex to be lower than FY2024, with further moderation in FY2026.

Segment Highlights:

• Mobile: ARPU rose to Rs.245 (+5.2% QoQ) driven by smartphone upgrades (6.5M adds), postpaid growth (0.6M), and 5G expansion (120M users).
• Broadband: Added 674K customers; FWA live in 2,000+ cities. Fiber home pass reached 35M (1.9M added/quarter).
• Airtel Business: Revenue up 8.7% YoY to Rs.5,650 Cr. Exiting low-margin global commodity voice/messaging to focus on high-growth digital adjacencies (Cloud, IoT, Cybersecurity).
• Digital Services: Airtel Payments Bank (Rs.2,800 Cr annualized revenue) and Airtel Finance (Rs.2,500 Cr AUM) scaling via Bajaj Finance partnership.

Growth Priorities:

• Homes: Targeting 80"“90M market via FWA, fiber expansion, and retail channel activation (100K+ points of sale).
• Postpaid: Focus on 80M potential upgraders; simplicity and convergence to drive adoption.
• B2B Retooling: Investing in Cloud, IoT, and SD-WAN; launching cloud solutions soon.

Industry Outlook:

• ARPU remains among the lowest globally; further tariff repair critical for sustainable returns.
• AI integration to drive operational efficiency and cost savings.

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Question 1: Regarding future capital expenditure (capex) allocation, network site expansion limits, and free cash flow utilization
Full Question Text: "My first question is on the capex, which for the India business is now tracking about 20% lower on a nine-month basis versus the previous year. Now going forward, which parts of your business do you expect continue to see elevated capex? [...] Is there a theoretical upper limit beyond which you do not need to expand mobile sites? [...] What are the areas where free cash flow may be channelized (M&A, shareholder returns, debt repayment)?"
Answer Summary: Capex will moderate, focusing on transport infrastructure, homes, and B2B. Mobile radio capex will reduce as 5G rollout stabilizes. Free cash flow will prioritize deleveraging, increased dividends, and selective M&A (no immediate plans). Home broadband growth is constrained by retail channel activation, but experiments show promise.

Question 2: On ARPU growth drivers beyond tariff hikes and 5G/FWA network coverage
Full Question Text: "In the mobile segment, barring tariff hikes, how much of ARPU improvement is probable using subscriber mix improvement? [...] What is the network coverage in FWA using 5G SA, and what is the rollout plan?"
Answer Summary: Underlying ARPU growth (4-5% annually) stems from smartphone upgrades, prepaid-to-postpaid shifts, data monetization, and roaming. FWA uses NSA 5G; SA readiness exists but isn't critical yet. FWA's economics mirror fiber, with similar ARPU (~Rs.500"“1,000) and data usage.

Question 3: About mobile segment EBITDA margin surge and FWA economics
Full Question Text: "Incremental EBITDA margin for the cellular business is 90%. Is this a new normal or quarter-specific? [...] What is FWA's margin profile?"
Answer Summary: High margins reflect tariff hikes flowing directly to EBITDA (fixed-cost business). FWA margins align with fiber (50-55%), with capex included in homes segment. Data center investments remain cautious pending GPU-as-a-service maturity.

Question 4: On 5G data usage trends and transport infrastructure needs
Full Question Text: "Are 5G customers upgrading to higher data plans? [...] Will FWA drive faster fiber backhaul rollout?"
Answer Summary: 5G drives adoption of unlimited 2GB+ plans. Transport capex follows a pre-defined blueprint (fiber/E-band) to meet long-term demand, unaffected by short-term FWA needs.

Question 5: Regarding enterprise EBITDA decline and digital revenue competition
Full Question Text: "Why did enterprise EBITDA decline? [...] How does Airtel Finance's partnership with Bajaj work?"
Answer Summary: Enterprise EBITDA dip reflects low-margin hardware sales in bundled solutions. Exiting low-margin global voice/messaging (6-month timeline) will improve margins. The Bajaj partnership leverages Airtel's distribution and Bajaj's underwriting, monetizing via fees (consolidated under Airtel).

Question 6: On postpaid subscriber potential and pricing dynamics
Full Question Text: "Is the postpaid opportunity about subscriber count or pricing? Why is pricing closer to prepaid now?"
Answer Summary: Postpaid targets 80 million credit-worthy users (~50 million potential). Pricing compression (2x prepaid vs. historical 4-5x) limits upside, but tariff hikes could revive differentiation.

Bharti Hexacom-Specific Question 1: Impact of tower transfer to Indus and capital allocation
Full Question Text: "How will transferring 3,400 towers to Indus affect EBITDA and capital structure?"
Answer Summary: EBITDA margin dips marginally due to lease costs, offset by debt reduction. FWA capex may rise slightly, but net debt/EBITDA (1.03) supports dividend increases.

Bharti Hexacom-Specific Question 2: Exceptional charge clarification
Full Question Text: "What caused the Rs.1.4B exceptional charge?"
Answer Summary: Provision for regulatory dues (non-cash) and legal adjustments. No recurring trend expected.