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Photo: Pradeep Gaur/Mint (MINT_PRINT)

Bharti Airtel shares jump 9% on strong Q2 earnings

  • A boom in remote work propelled a 58% year-on-year jump in data consumption at Bharti Airtel in the September quarter, helping India’s second-largest telco post record consolidated revenues, which offset the telco’s net loss during the quarter

NEW DELHI: Shares of Bharti Airtel Ltd on Wednesday rallied nearly 9% after the telecom operator reported robust earnings for the September quarter. The stock was also the highest gainer among Nifty 50 stocks in opening trade.

Airtel stock rose to 470.45 on the BSE, while the benchmark Sensex was flat at 40,512.26 points.

The stock recently flirted with its post-covid lows seen in March. It hit a seven-month low of 394 on the BSE, the lowest level since 19 March. Airtel's share price has declined by around 30% since the adjusted gross revenue (AGR) verdict on 1 September.

A boom in remote work propelled a 58% year-on-year jump in data consumption at Bharti Airtel in the September quarter, helping India’s second-largest telco post record consolidated revenues, which offset the telco’s net loss during the quarter.

“Our focus on building the most aspirational brand in Indian telecom to win quality customers is delivering results. Our data consumption grew by 58% y-o-y which reflects strong engagement of customers on our network," Airtel’s chief executive Gopal Vittal said on Tuesday.

During the quarter, Airtel recorded a sequential growth of 14.4 million in 4G user base at 152.7 million, up 48% from a year ago, as more customers turned to better data services.

“The company continues to garner a strong share of the 4G net adds (additions) in the market. 4G data customers increased 48.1% to 152.7 million compared to the previous year, while traffic increased to 77.3 PB (petabyte)/day vs 48.9 PB/day in the corresponding quarter last year," Airtel said in a statement. The telco now has 440 million users in 16 countries.

Airtel’s average revenue per user (Arpu) rose to 162 from 128 a year ago, and 157 in the June quarter. This led to the company clocking its highest consolidated quarterly revenue of 25,785 crore, up 22% from a year ago. It, however, posted a consolidated net loss of 763 crore due to higher expenses, including network operating costs, licence fees and spectrum usage charges, and higher finance cost.

The company had posteda consolidated net loss of 23,045 crore in Q2 of FY20. A Bloomberg poll of 10 analysts had estimated a profit of 121.60 crore for the September quarter.

While total expenses rose 15% from a year ago to 14,143 crore, net finance cost was up 28% y-o-y at 3,7,26 crore, led by an increase in charges such as additional regulatory liabilities and decrease in investment income, the company said.

Consolidated earnings before interest, taxes, depreciation and amortization (Ebitda) rose to 11,848 crore from 8,936 crore a year ago. Ebitda margin was at 46%, representing an improvement of 366 basis points y-o-y.


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