Bharti Airtel Q2 profit zooms 89% to ₹2,145 cr

India's second-largest telecom operator Bharti Telecom Ltd has recorded an 89.1% year-on-year rise in its consolidated profit in the July-September period at ₹2,145 crore, up from ₹1,134 crore in the same period last year. The company has attributed strong Q2 performance to "consistent performance delivery" across the portfolio and crossing 500 million customers globally. On a sequential basis, Bharti Airtel's net profit surged 33.5%.

Bharti Airtel's quarterly revenue surged 21.9% YoY and 5.3% QoQ to ₹34,527 crore, with India business seeing a 22.3% YoY rise at ₹24,333 crore in Q2 FY23, the company reported to the exchanges today. Of all its businesses in India, the homes business rose 38.9% YoY in revenue, followed by mobile services at 24.8%.

The Sunil Bharti Mittal-led company's consolidated EBITDA stood at ₹17,721 crore, up 26.4% YoY and 6.7% QoQ, while the EBITDA margin stood at 51.3%, an improvement of 184 bps YoY. "EBITDA margins across businesses remained healthy, with India mobile services EBITDA improving from 49.2% in Q2’22 to 52.4% in Q2’23," says the company.

Airtel's average revenue per user to ₹190 in Q2 from ₹153 in the year-ago period. Notably, Reliance Jio Infocomm Ltd, the telecom unit of RIL and India’s biggest telco, had clocked in a net profit of ₹4,729 crore in Q2, a growth of 26.9% YoY. Reliance Jio ARPU was ₹177.2 per month, a 23.5% growth YoY.

"ARPU for the quarter stood at ₹190 as compared to ₹153 in Q2’22 on the back of our continued focus on quality customers, feature phone to smartphone upgradation and data monetisation," said Airtel.

Airtel said it strengthened its "leadership position" in the postpaid segment, with a customer base of 31.6 million, including IoT. "We added 17.8 million 4G data customers to our network over last year, an increase of 9.2% YoY."

Airtel rolled out additional 8,000 towers in Q2. Airtel rolled out 5G services with a launch in 8 cities in Q2, and eventually, plans are to cover all of the urban and key rural areas of India by March 2024. Airtel's homes business grew 38.9% YoY, with 4,17,000 customers during Q2, totalling a base of 5.2 million. Airtel said its Africa revenue (in constant currency) has risen 18.5% YoY, while its EBITDA margin grew 49.0%, up 25 bps YoY. In Africa, the company's customer base stands at 134.7 million.

Airtel said it has paid 4 years of 2022 spectrum dues worth ₹8,312 crore. This, coupled with a moratorium on spectrum dues and AGR, will free up future cash flows. With this, Airtel says it'll be able to dedicate resources to drive the 5G rollout.

Gopal Vittal, MD and CEO, of India & South Asia, says the 5G technology has the potential of bringing tremendous innovation into India. At the same time, he said there's a concern about the "low ROCE that our business delivers due to pricing that's the lowest in the world".

The Airtel stock closed 1.85% up at ₹832 on the NSE today.