Bharti Airtel (BHARTI)’s consol. income was up 6% q-o-q to Rs 265.2 bn (in line on LTL). Consol. Ebitda was up 9% q-o-q to Rs 120.5 bn (5% above est.) on wholesome operating leverage in the Wireless and Africa organizations. The consolidated Ebitda margin was up 190bp q-o-q to 45.5% (180bp above estimate).
Subsequently, reported net profit stood at Rs 13.5 bn. Excluding Rs 45.6 bn of exceptional expense and Rs 99 bn profit from the Indus Tower de-merger adjustment, adjusted net loss following minority stood at Rs 2.98 bn v/s –Rs 7.4 bn q-o-q (est. net profit of Rs 5.3 bn).
India Wireless Ebitda up 13% q-o-q (10% above est.): Revenue was up 6.8% q-o-q to Rs 147.8 bn (2% above est.), led by 2%/5% development in ARPU/subs. Ebitda was up 12% q-o-q to Rs 65.8 bn (5% beat), with incremental Ebitda margins at a wholesome 73%. Network opex was up just 2% regardless of continued investments, whereas SG&A costs had been elevated by 7%, possibly to obtain subscriber marketplace share.
ARPU continued to see a steady uptick – it came in 2% q-o-q greater at Rs 166 (v/s est.Rs 164). This was led by a mix advantage from wholesome 4G subs adds and income recovery from the COVID-19 effect. ARPU has enhanced 8% considering the fact that Q4FY20, with out any tariff hike! Subscribers jumped strongly for the second quarter in a row by 14.2 m (RJio added 1.7 m), highlighting that it has continued to obtain the lion’s share of VIL’s subscriber loss.
4G subs adds had been at 12.9m – the second straight quarter of higher adds for the business – accounting for practically 90% of business adds. For the previous six months, BHARTI’s pace of subscriber additions has grown robustly. Data visitors grew 11% q-o-q to 8.5 b GB (16.8 GB/user). BHARTI’s information visitors and information subscribers are ~50% of RJio’s levels, with the capacity gap a lot reduce. This highlights a wholesome network capacity and space for improvement.
Rebound in Africa nos surpasses Q1FY21 loss Ebitda up 14% q-o-q : Africa income/Ebitda jumped by a powerful 8/12% CC. In reported currency, it elevated 7/10% to Rs 76.4/35.9 bn. Subs/ARPU was up 2%/4% as each Voice and Airtel Money saw very good offtake.
Other segments present tailwinds: Home income/Ebitda fell 4%/8% q-o-q to Rs 5.7/3.3 bn with the current cost cuts taken to match RJio. Enterprise income was flat (up 1% q-o-q) at Rs 36.2 bn whilst Ebitda grew 5% q-o-q to Rs 13.5 bn. Passive income fell 47% due to the deconsolidation of Indus Towers post the Bharti Infratel-Indus Towers merger. Digital income grew 5% to Rs 7.9 bn whilst Ebitda was flat at Rs 5.6 bn.
Rise in capex slows FCF net debt rises due to AGR Capex remained higher at Rs 68.6 bn
(Rs 173 bn in 9MFY21). Operating FCF was powerful at Rs 53.1 bn. 4G base stations/towers continue to see powerful 31k/8k adds to 568k/207k. Net debt elevated by Rs 45 bn to Rs 1,145 bn due to Bharti Infratel’s deconsolidation, which has a net money position. Including lease liability of Rs 324 bn, net debt stood at Rs 1,474 bn, raising net debt to Ebitda to more than 3x on an FY21 basis as nicely as interest expense by 5%.