Bharti Airtel - Q4 FY21 First cut: Inline - YES Securities

Bharti Airtel reported 4QFY21 operating earnings (Ebitda) at Rs 123.3bn (+21% YoY), stood broadly in-line with our (Rs122.8bn), but marginally below consensus estimates (Rs 126.3bn). Key Highlights:

- Consolidated Revenue: Bharti's consol. revenue at Rs 257.4 bn (+8% YoY; -3% QoQ), stood in-line with estimates. While the YoY growth was largely driven by 13% growth in customer base and 7% increase in ARPU, moderated by switch to 'Bill & Keep' regime. The QoQ drop in revenue was mostly on account of sequentially 1% weaker ARPU and removal of IUC revenue.

- EBITDA: EBITDA at Rs 123.3bn, stood higher by 21% YoY and 2.3% QoQ. While YoY growth was primarily driven by 7% YoY higher ARPU, aided by 1% YoY and 7% QoQ drop in operating expenses. The total Ebitda for FY21 stood 25% YoY higher at Rs 458.6bn.

- Profit/(Loss) After Tax: On after tax basis, Bharti Reported a Profit of Rs 15.1 bn vs. a loss of Rs (49.7) bn in 4QFY20 and loss of Rs 84.6bn in 3QFY21; The company however still ended the year in red with after tax loss of Rs 228bn, primarily on account of exceptional expense of Rs 159.1bn.

- Exceptional Item: The company reported an exceptional gain of Rs 4.4bn during the quarter, still leading to an annual exceptional loss of Rs 159bn for the FY21. The exceptional gain during the quarter stood on account of a) reversal of impairment of intangible assets, b) reassessment of useful life of network assets and c) reassessment of contractual/regulatory levies.

- Customer Base: The total customer base on consolidated basis stood at 471mn a net addition of 48mn customers on YoY basis and 13mn on QoQ basis.

India Mobile Services Business

- Revenue: India mobile revenue at Rs 140.8bn stood + 8.7% YoY but -4.7% QoQ; While, the QoQ drop stemmed from removal of IUC regime, the YoY growth was led by a stronger customer base (+13% YoY) and improvement in ARPU (+7% YoY) moderated by absence of IUC revenue

- EBITDA: stood at Rs 66.9bn (+31% YoY; +3.6% QoQ); primarily on higher ARPU; Absence of IUC revenue was offset by removal of IUC charges; being a net IUC payer Bharti benefited from the adoption of Bill & Keep regime.

- Capex: Total India Capex stood 46% YoY and 5% QoQ lower at Rs 51.4 bn (of which mobile business: Rs 37.4bn) on addition of new sites and towers

- Infrastructure: During the quarter the company added 8300 towers and 38438 broadband stations, taking the total to 217K towers and 607K broadband stations

- Operating Cashflow: stood 31% QoQ higher at Rs 29.5bn, taking the cumulative for the year at Rs 96bn (+430% YoY)

- ARPU: stood at Rs 145 vs Rs 135 last year same quarer and Rs 146 in previous quarter (adjusted for IUC)

- Customer base: The total India consumer base stood at 350mn, a net addition of 14mn subscribers QoQ; of which the mobile subscriber base stood at 321mn, a net addition of 13mn subscribers

- Data subscriber base increased by 13mn QoQ to 188.6mn, on continued uptrading by consumers and new additions

- Data traffic improved by 9% QoQ to 9.2 tnMB; however data usage per customer was largely flat on sequential basis at 16.8GB

- Voice traffic also improved by 8% QoQ to 997bn minutes; voice usage per customer however stood largely flat at 1053mins

Other Business

B2B Business: Revenue up 9.7% YoY & 2.2% QoQ to INR 37bn; EBITDA/EBITDA margin at INR 14.8bn/ 40%

Home Services: Revenue up by 5% YoY and 6% QoQ to INR 6bn; ARPU at INR 684 (vs 705 in 3QFY21)

Digital TV: Revenue at INR 7.6bn (+27% YoY & -3% QoQ); Net reduction of 156k subs in 4Q; ARPU at 144 (3Q:149)

Africa: Revenue up 17% YoY but flat QoQ Rs 76bn and EBITDA at Rs 36bn (+27% YoY+1.1% QoQ); ARPU improved to USD 3 (from USD 2.3 in 3QFY21)

South Asia: Revenue at INR 0.98bn (-18%YoY; -7% QoQ); EBITDA: Rs (122) mn vs a profit of Rs 39mn in 3QFY21

Shares of BHARTI AIRTEL LTD. was last trading in BSE at Rs.536.3 as compared to the previous close of Rs. 549.55. The total number of shares traded during the day was 1194210 in over 19461 trades.

The stock hit an intraday high of Rs. 552.85 and intraday low of 534.65. The net turnover during the day was Rs. 646224553.

Source : Equity Bulls

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