Bharti Airtel prepays ₹8,024 cr as deferred liabilities; shares decline

Telecom major Bharti Airtel on Monday prepaid ₹8,024 crore to the government as part of deferred liabilities pertaining to spectrum acquired in the year 2015, according to the regulatory filing by the company. Notably, the company has more than ₹3,000 crore as AGR (adjusted gross revenue) for FY18 and FY19, which the telecom major plans to clear in four years.

"The said instalments had an interest rate of 10% and have been prepaid by Airtel, leveraging much lower cost financing available to it. Airtel continues to enjoy access to well-diversified sources of capital/financing, allowing it to have enhanced financial flexibility in its capital structure including optimised cost of financing using all opportunities for significant interest savings, like this prepayment," says the telecom major.

Following the development, shares of Bharti Airtel declined by 0.8% at ₹886.85 at 2:45 pm. In contrast to this, the broader BSE Sensex was trading 271.14 points or 0.41% higher at 66,431.34.

The scrip opened at ₹886.10, down by 1% as against the closing price of the previous session at ₹894.70. After surging by 0.3% to hit an intraday high of ₹897.85, the scrip, however, lost momentum and declined by 0.8%. At present, the share price of the telecom major is trading 1.6% lower than the 52-week high of ₹901.55, which the company touched on July 27, 2023.

Shares of Bharti Airtel are trading 32.1% higher than the 52-week low, which the company touched on July 29, last year. During the session, the company’s market capitalisation stood at more than ₹4.95 lakh crore with 22,416 shares exchanging hands as against the two-week average of 1.82 lakh shares. In the past one month, three months and one year, the counter has given 0.98%, 11.02% and 30.89% in returns, respectively.

The telecom major is yet to disclose the financial results for April to June quarter of this fiscal year. In the January to March quarter of FY23, the company clocked a 50% increase in consolidated net profit at ₹3,006 crore, compared to ₹2,008 crore during the same period last year. In Q4 of FY23, the company’s revenue stood at ₹36,009 crore, up 14.3% year-on-year. The company's India business posted quarterly revenue of ₹25,250 crore – up 12.2% YoY. In comparison, the company's mobile services India revenue grew 11.5% YoY, led by continued 4G customer additions and an increase in ARPU (average revenue per user).

According to the latest data by TRAI (Telecom Authority of India), Bharti Airtel added 76,328 additional mobile subscribers in April this year, while the company’s user base stood at 224.37 million. The telecom major cornered a market share of 32.45% in April.

Last week, rating agency CRISIL Ratings reaffirmed ratings its ratings on the debt instruments of Bharti Telecom Ltd (BTL) at 'CRISIL AA+/Stable/CRISIL A1+.' "The ratings continue to factor in the healthy market value to debt cover of the company and its robust financial flexibility, driven by the strong reputation of its promoters, the Bharti group (shareholding through Bharti Enterprises Holding Pvt Ltd [BEHPL]) and Singapore Telecommunications Ltd (Singtel; rated 'A/Stable/A-1' by S&P Global Ratings). These strengths are partially offset by exposure to market risks," says the rating agency.