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Bharti Airtel Limited — Q3 FY25
Bharti Airtel delivered a consistent quarter with consolidated revenues of INR 45,130 crores and India revenue (ex-Indus) growing 4.8% sequentially to over INR 33,000 crores.
bullish
high
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Bharti Airtel delivered a consistent quarter with consolidated revenues of INR 45,130 crores and India revenue (ex-Indus) growing 4.8% sequentially to over INR 33,000 crores. EBITDA margins improved to 56.2%, up 140 bps YoY, driven by tariff repair flow-through and operating leverage. Mobile ARPU rose to INR 245 from INR 233, with industry-leading growth. The company prepaid DoT spectrum dues, reducing India net debt/EBITDAL to 1.8x from 2.5x a year ago. Management guided for lower CapEx in FY26 and continued deleveraging. Key risks include potential slowdown in B2B growth from exiting low-margin commodity voice/messaging and competitive pressure in home broadband.
भारती एयरटेल का यह तिमाही कारोबार अच्छा रहा। कंपनी की कुल कमाई 45,130 करोड़ रुपये रही। भारत में (इंडस को छोड़कर) कमाई पिछली तिमाही से 4.8% बढ़कर 33,000 करोड़ रुपये से अधिक हो गई। कंपनी का मुनाफा मार्जिन (EBITDA) 56.2% तक पहुंच गया, जो पिछले साल से 1.4% ज्यादा है। इसकी वजह टैरिफ बढ़ोतरी और कम खर्च है। हर ग्राहक से औसत कमाई (ARPU) 233 से बढ़कर 245 रुपये हो गई। कंपनी ने सरकार को स्पेक्ट्रम का कर्ज चुका दिया, जिससे कर्ज का अनुपात 2.5 से घटकर 1.8 गुना रह गया। आगे कंपनी खर्च कम करेगी और कर्ज घटाएगी। जोखिम: कम मुनाफे वाले कारोबार से बाहर निकलने से B2B ग्रोथ धीमी हो सकती है और होम ब्रॉडबैंड में प्रतिस्पर्धा बढ़ सकती है।
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B2B EBITDA margin dilution from digital adjacencies
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Read Transcript →Quarter Snapshot
Mobile ARPU
INR 245
+INR 12 QoQ
Industry-leading ARPU growth driven by tariff repair and subscriber mix improvement.
5G Customer Base
120 million
+5.1% QoQ
5G base continues to expand; 5G handsets now over 80% of smartphone shipments.
Net Customer Additions (Mobile)
4.9 million
+4.9M QoQ
Healthy customer additions despite tariff repair; postpaid adds of 0.6 million.
Fiber Home Pass Additions
1.9 million/quarter
Sustained pace
Accelerated fiber rollout; total home passes at 35 million; FWA live in 2,000+ cities.
What Changed vs Last Quarter
NEW
CapEx moderation in FY26
CapEx for FY25 will be lower than FY24, and moderation will continue into FY26, with CapEx/revenue trending down toward global peer levels.
NEW
B2B low-margin exit to impact top line but not EBITDA
Exiting commodity voice and messaging business will reduce top line over ~6 months but have negligible EBITDA impact.
NEW
Home broadband momentum to improve
Expect continued growth in home broadband via FWA expansion, fiber rollout, and channel expansion to 100,000 points of presence.
NEW
Dividend step-up likely
Free cash flow will be used for deleveraging, dividend step-up, and selective bolt-on acquisitions in B2B adjacencies.
DROPPED
Full benefit of tariff repair to accrue over next two quarters
Management expects the full impact of the recent tariff increase to be reflected in the coming quarters, with normalization of customer trends already seen in October.
DROPPED
Full-year CapEx to moderate from last year's elevated level
CapEx will be lower than FY24, which was a peak year due to 5G and site rollout. Q2 CapEx was INR 6,250 crore, and the trend is expected to continue.
DROPPED
FWA on standalone 5G by December 2024
Trials for standalone 5G on FWA are underway, and commercial deployment is planned by December 2024 to improve uplink performance.
DROPPED
Rural site rollout largely complete this year
The project to add 25,000 rural sites will be mostly completed by the end of the fiscal year, with only a few circles remaining.
NEW RISK
B2B EBITDA margin dilution from digital adjacencies
Growth in lower-margin digital services (security, cloud) is diluting B2B EBITDA margins, a trend likely to continue.
NEW RISK
Home broadband competitive gap vs Jio
Despite improvements, Airtel's home broadband adds remain below Jio's; management acknowledges dissatisfaction but expects channel expansion to close gap.
NEW RISK
FWA unit economics uncertainty
FWA CPE costs are higher than fiber CPE, and payback depends on multi-port CPE adoption and network congestion; margin parity with fiber is not guaranteed.
NEW RISK
Regulatory/legal provisions
Bharti Hexacom took an exceptional charge of INR 1.4 billion related to regulatory dues; further provisions cannot be ruled out.
RISK GONE
AGR liability from rejected curative petition
The Supreme Court rejected the curative petition on AGR dues. A review petition is pending, but the moratorium period is yet to start, creating uncertainty.
RISK GONE
B2B global business order conversion delay
While customer discussions have improved, they have not yet translated into firm orders, posing a risk to B2B revenue growth.
RISK GONE
DTH customer losses due to seasonality
DTH lost over 500,000 customers in the quarter, attributed to pronounced seasonality, which could persist if competitive pressures intensify.
🤫 Topics management stopped discussing
Mentioned in Q2 FY25, Q3 FY24, Q4 FY24
While customer discussions have improved, they have not yet translated into firm orders, posing a risk to B2B revenue growth.
Mentioned in Q1 FY25, Q2 FY25, Q4 FY24
Management expects the full impact of the recent tariff increase to be reflected in the coming quarters, with normalization of customer trends already seen in October.
Mentioned in Q2 FY24, Q4 FY24
Free 5G data weighs on ARPU; management sees no near-term monetization and expects only gradual improvement via tariff repair.
Mentioned in Q1 FY25, Q4 FY24
Reverse auctions for government tenders and PSU contracts continue to exert pricing pressure, though management views it as business as usual.
Mentioned in Q1 FY25, Q4 FY24
Fixed wireless access will be launched on standalone 5G architecture nationally by August/September 2024.
Fast read
Guidance and risk preview
CapEx for FY25 will be lower than FY24, and moderation will continue into FY26, with CapEx/revenue trending down toward global peer levels.
Growth in lower-margin digital services (security, cloud) is diluting B2B EBITDA margins, a trend likely to continue.
View Risks →