Bharti Airtel Posts Healthy Growth in Q2 FY2024 Results

Leading telecom operator Bharti Airtel today reported its financial results for the second quarter ended September 30, 2023. The company posted healthy growth in revenues, profits and key operating metrics during the quarter.

Bharti Airtel reported consolidated revenues of Rs 37,044 crore for Q2 FY2024, up 7.3% from Rs 34,527 crore in the same quarter last year.

The growth was driven by strong performance of the India business, which posted revenues of Rs 26,995 crore, up 10.9% YoY. Mobile services revenues in India grew 11% YoY to Rs 19,134 crore. Growth was led by continued momentum in 4G customer additions, increase in ARPU and benefit of tariff hikes taken in late 2021.

Africa revenues were up 19% in constant currency terms but declined in reported terms due to currency fluctuations. The Africa business contributed revenues of Rs 6,563 crore.

Digital TV and Airtel Business revenues were up 3.1% and 9.5% YoY respectively in India. Homes services maintained rapid growth momentum with revenues rising 23.3% YoY to Rs 958 crore.

Consolidated EBITDA Up 11%, Margins Expand 176 bps
Consolidated EBITDA increased by 11% YoY to Rs 19,665 crore compared to Rs 17,721 crore in the same quarter last year. EBITDA margin expanded by 176 bps YoY to 53.1% in Q2 FY2024, due to the company’s focus on the ‘War on Waste’ program to drive cost efficiencies.

In the India segment, EBITDA grew by 14.2% YoY to Rs 14,561 crore while EBITDA margin expanded 214 bps YoY to 53.9%. Africa EBITDA margin improved by 43 bps YoY to 49.6% in constant currency terms.

Net Profit hit by Exceptional Items
Consolidated net profit before exceptional items grew by 44.2% YoY to Rs 2,960 crore. However, net profit after exceptional items declined 37.5% YoY to Rs 1,341 crore due to two exceptional items:

  • One time spectrum charges of Rs 1,841 crore.
  • Provision of Rs 786 crore towards charges relating to license fee and SUC matters sub-judice before the Supreme Court.

Strong Momentum in Key Operating Metrics
The company reported robust momentum across key operating metrics during the quarter:

  • Overall mobile subscriber base grew by 7% YoY to 389 million in India.
  • 4G/5G subscriber base increased by 27.2 million YoY, reaching 69% of the overall mobile base.
  • Highest ever postpaid net additions of 1 million. Total postpaid subscribers reached 43.9 million.
  • Mobile ARPU rose to Rs 203 from Rs 190 in Q2 FY2023, driven by upgrade to 4G, increase in data usage and tariff hikes.
  • Monthly mobile data usage per user increased by 19.6% YoY to 21.7 GB.
  • Homes services added a record 471,000 customers in the quarter, the highest ever.
  • Digital TV customer base steady at 15.7 million.

Network Rollout
Bharti Airtel continued to expand its network presence by rolling out 11,100 new 4G towers in Q2 FY2024. It has added 41,000 towers over the past 12 months to boost coverage across urban and rural India.

The company announced an interim dividend of Rs 3 per equity share for FY 2024. The record date for dividend is November 15, 2022 and payment date is December 1, 2022.

Commenting on the results, Gopal Vittal, MD and CEO of Bharti Airtel said: “This has been yet another quarter of solid revenue growth and improved margins. Our India revenue continues to gain momentum and mobile ARPU expanded to Rs 203 on the back of tariff hikes and focus on quality customers.”

The Q2 FY2024 results indicate that Bharti Airtel’s India business continues to exhibit strong growth momentum, driven by its 4G and postpaid strategies. The uptake of its homes and enterprise connectivity solutions also remains robust.

However, the profitability was partially impacted by exceptional items during the quarter. The company maintains a healthy balance sheet position with net debt to EBITDA of 2.63x.