Bharti Airtel , one of India's leading telecommunications companies, has announced robust financial results for the first quarter, demonstrating significant growth across key metrics. The company's Vice-Chairman and MD, Gopal Vittal, also commented on India's mobile pricing structure, highlighting concerns about its impact on different income groups.

Financial Highlights

Bharti Airtel reported consolidated revenues of Rs 49,463.00 crore for Q1, marking a substantial 28.40% year-over-year increase from Rs 38,506.40 crore in the previous year's June quarter. The company's consolidated profit rose by 43.00% year-on-year to Rs 5,947.90 crore, driven by customer base growth.

Operational Performance

The company's India operations saw an increase in Average Revenue Per User (ARPU) to Rs 250.00, up from Rs 211.00 in the same period last year. Mobile data consumption grew 13.40% to 26.90 GB per customer monthly.

Management Commentary on Pricing

Gopal Vittal, Vice-Chairman and MD of Bharti Airtel, stated that India's mobile pricing architecture is skewed, with wealthy customers paying less while low-income users don't need to pay more. He explained that entry-level plans offer substantial data, calling, and messaging benefits, reducing the incentive for upgrades.

Vittal cited Indonesia's pricing model as more sensible, noting that India's average data price was 16 cents compared to Indonesia's 28 cents in 2023.

Segment Performance

India Business

Airtel's India business continued to show strong growth, with the mobile services segment reporting significant revenue increases. The company's focus on smartphone customer additions and ARPU improvement has contributed to this growth.

Homes Services

The Homes Services segment demonstrated robust momentum, achieving substantial year-over-year revenue growth.

Network Expansion and Innovation

During the quarter, Airtel continued its nationwide network expansion in India, installing additional towers and mobile broadband stations. The company's commitment to delivering superior network quality remains evident.

Digital Initiatives

Airtel continues to innovate in the digital space, launching several new services and features to enhance customer experience and security.

Strategic Partnerships

Bharti Airtel has formed strategic alliances to strengthen its network and service offerings, partnering with leading technology companies.

Conclusion

Bharti Airtel's Q1 results demonstrate the company's strong market position and its ability to capitalize on the growing demand for digital services. However, the company's leadership has also highlighted concerns about the current mobile pricing structure in India, suggesting that a more balanced approach might be necessary for sustainable growth across all customer segments.

Bharti Airtel , one of India's leading telecommunications companies, has announced robust financial results for the first quarter ended June 30. The company reported significant growth across key metrics, demonstrating its strong market position and operational efficiency.

Financial Highlights

Bharti Airtel's consolidated revenues for Q1 stood at Rs 49,463.00 crore, marking a substantial increase of 28.5% year-over-year (YoY) and 3.3% quarter-over-quarter (QoQ). This growth was primarily driven by strong performance in both India and Africa markets.

The company's consolidated EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) reached Rs 28,167.00 crore, up by 41.2% YoY, with an EBITDA margin of 56.9%. This represents a significant improvement from the 55.0% EBITDA margin in the corresponding quarter last year.

Notably, Bharti Airtel's consolidated net income (before exceptional items) more than doubled YoY to Rs 5,948.00 crore, compared to Rs 2,925.00 crore in the same quarter of the previous year. The company's EBIT (Earnings Before Interest and Taxes) also saw a substantial increase of 67.0% YoY, reaching Rs 15,621.00 crore with an EBIT margin of 31.6%.

Segment-wise Performance

India Business

The India business posted quarterly revenues of Rs 37,585.00 crore, up 29.0% YoY and 2.3% QoQ. This growth was backed by improved realizations in the mobile segment and strong momentum in the Homes business.

• Mobile Services: Reported a 21.6% YoY revenue growth, driven by ARPU improvement and continued strong additions of smartphone customers. The ARPU (Average Revenue Per User) increased to Rs 250.00 from Rs 211.00 in the same quarter of the previous year.

• Homes Services: Witnessed a 25.7% YoY increase in revenues, with record quarterly net additions of 939,000 customers.

• Airtel Business: Saw a revenue decline of 7.7% YoY due to portfolio transformation, aligning with the strategic objective to discontinue low-margin business.

• Digital TV Services: Reported a slight decrease of 1.8% YoY in revenues.

Africa Business

Airtel Africa demonstrated solid performance with a 24.9% YoY revenue growth in constant currency. The EBITDA margin for Africa operations improved to 48.1%, up 292 basis points YoY.

Operational Highlights

• The company's overall customer base grew to 605 million across 15 countries, up 6.7% YoY.
• Consolidated mobile data traffic increased by 22.6% YoY to 23,454 petabytes.
• In India, smartphone data customers increased by 21.3 million YoY, now representing 77% of the overall mobile customer base.
• The Homes business saw a significant step-up in customer additions with 939,000 net adds in Q1.

Balance Sheet and Cash Flow

Bharti Airtel's balance sheet remained strong, with the consolidated Net Debt to EBITDA ratio (annualized) improving to 1.70 times compared to 1.86 times as of March 31. The Net Debt (excluding lease obligations) to EBITDAaL ratio stood at 1.26 times.

Management Commentary

Gopal Vittal, Vice-Chairman and MD of Bharti Airtel, commented on the results: "We delivered another quarter of consistent growth, with consolidated revenues growing 3.3% sequentially. Our India revenue, including Passive Infrastructure Services, increased by 2.3% sequentially. Africa reported solid performance with 6.7% growth in constant currency."

He further added, "Our digital network across India and Africa now serves over 600 million customers. This is a testament to our passion for connecting customers through sustained investments and superior customer experience. Our balance sheet continues to demonstrate strength, supported by solid cash flow generation and disciplined capital allocation."

Conclusion

Bharti Airtel's Q1 results demonstrate the company's ability to maintain strong growth momentum across its key markets and business segments. The significant improvements in revenue, EBITDA, and net income reflect the company's successful strategies in portfolio premiumization and operational efficiency. As Airtel continues to expand its customer base and improve its service offerings, it remains well-positioned to capitalize on the growing demand for telecommunications and digital services in its markets.