Full-year CapEx guidance of INR 28,000-31,000 crore
CapEx front-loaded in H1, with full-year spend in line with guidance, focused on 5G, broadband, and data centers.
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capex
ARPU target of INR 300 as longer-term goalpost
Management targets ARPU of INR 300 over the long term, driven by premiumization levers and potential tariff reset.
Rural site rollout completion by November-December 2023
60% of 60,000 high-potential villages already covered; rollout expected to conclude by year-end.
Tariff repair full flow-through in two quarters
The July tariff hike is expected to fully reflect in revenue within two quarters, with early signs encouraging.
Industry needs minimum ARPU of INR 300
Management reiterated that the industry requires ARPU of at least INR 300 for sustainable investment and respectable returns.
FWA launch on SA technology by Q2 FY25
Fixed wireless access will be launched on standalone 5G architecture nationally by August/September 2024.
Capex moderation in FY25
Full-year capex will be lower than FY24, with India mobile capex expected to moderate.
Fiber home pass run rate target of 2.5 million per quarter
Management aims to increase quarterly fiber home pass additions from 1.6 million to 2.5 million.
B2B underlying growth to continue with strong funnel
Underlying B2B revenue grew 2% QoQ after exiting low-margin business; order book and funnel remain strong.
CapEx to trend down in wireless, modular in cloud
Radio CapEx is declining; cloud CapEx is modular with two regions operational and headroom available.
Dividend to increase over time
Management reiterated commitment to step up dividends as leverage declines.
CapEx moderation in FY25
Peak CapEx in FY24; radio CapEx will moderate next year, though transport and data center spend continues.
FWA full rollout by end of calendar 2023
Airtel Air Fiber (FWA) with outdoor CPE to be launched in full by end of 2023, complementing FTTH.
Global B2B order book improvement in 2-3 quarters
Expect global business order book to pick up in about two to three quarters as OTT spending normalizes.
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.
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.
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.
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.
Data center capacity target of over 1 GW
Airtel aims to scale Nextra's capacity to over 1 GW in the next few years, a four-fold increase from current operating capacity, driven by the Google partnership and organic expansion.
Home broadband industry to reach 100 million homes in 5-6 years
Management expects the home broadband market to grow from ~50 million to 100 million connected homes over the medium term, with Airtel investing aggressively to capture share.
Capex to moderate directionally over time
While near-term capex may be elevated due to home broadband and data center investments, management expects a directional decline in capex as a percentage of revenue over the medium term.
CapEx moderation in FY25
Management indicated that FY24 is an elevated CapEx year, and CapEx will moderate in the next fiscal year.
Target India net debt-to-EBITDA below 2.5
Harjeet Kohli stated the goal is to reach closer to 2.5 or below for India leverage in the next 4-6 quarters.
Gradual move from NSA to SA over two years
Management expects to start refarming 4G spectrum to 5G and move to standalone architecture over the next two years.
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.
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.
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.
Dividend step-up likely
Free cash flow will be used for deleveraging, dividend step-up, and selective bolt-on acquisitions in B2B adjacencies.
Data center capacity target of 1GW in 3-4 years
Airtel plans to scale data center capacity from ~130MW to 1GW, targeting ~25% market share.
Continued ARPU growth without tariff repair
Management expects to drive ARPU through feature-to-smartphone upgrades, prepaid-to-postpaid, data monetization, and international roaming.
Step-up in fiber home passes to 2M per quarter
Airtel is rolling out 2 million fiber home passes per quarter to support broadband growth.
CapEx moderation in FY25
Management expects clear moderation in overall CapEx in FY25 after peak levels in FY24, driven by lower wireless CapEx.
FWA to scale in Q2 FY25
Fixed wireless access will be at scale in the coming eight weeks (by Q2 FY25), complementing FTTH in weak fiber areas.
25,000 new sites rollout
Expect to roll out over 25,000 sites in the next couple of quarters to plug coverage gaps in rural areas.
Domestic enterprise growth 18-20%
Domestic enterprise business continues to grow at 18-20%, driven by adjacencies like CPaaS, IoT, and cloud.
FY26 CapEx to be lower than FY25
Management guided that total CapEx will trend downwards in FY26, driven by substantially lower rural rollout and moderation in radio CapEx.
Broadband home passes to increase to over 2.5 million per quarter
Management aims to step up fiber home pass rollout from current 1.7 million per quarter to over 2.5 million.
Postpaid net adds expected to step up in coming quarters
Management expects postpaid net adds to increase from current 600K per quarter as tariff repair impact settles.
Data center capacity to double over next 18 months
Management plans to significantly step up data center capacity, with multiple builds underway and aspirations to increase market share from 12%.
Capex for FY27 expected to be similar to FY26
Management indicated that total capex for FY27 will be in the ballpark of FY26 levels (~INR 31,000 crore for India), with focus on fiber, edge data centers, and homes.
Data center capacity target of 1 GW over next few years
Nxtra aims to build 1 GW data center capacity, supported by a $1 billion fundraise from marquee investors.
Financial services NBFC commercial launch progressing
Airtel Money received RBI approval to operate as an NBFC and is moving towards commercial launch, with monthly loan disbursement run rate over INR 550 crore.
Progressive dividend policy with 50% increase in FY26
Board recommended dividend of INR 24 per share, up from INR 16 last year, reflecting commitment to progressive payout.