Bharti Airtel Q4 Results: Profit Surges Over 60%, ARPU Flat

Bharti Airtel Ltd. has reported higher-than-expected profit in the March quarter, even as earnings from each user stagnated.

Net profit of India's second-largest telecom operator rose 61.68% over the previous three months to Rs 4,226 crore in the quarter ended March 31, according to an exchange filing on Tuesday. That came on the back of revenue that increased 0.47% sequentially to Rs 36,009 crore. Analysts tracked by Bloomberg had pegged the top line at Rs 36,743.82 crore and the bottom line at Rs 2,881.46 crore.

Bharti Airtel Q4 Results: Key Highlights (QoQ)

• Revenue up 0.47% at Rs 36,009 crore, as against an estimate of Rs 36,743.82 crore.

• Ebitda up 1.42% at Rs 18,982 crore, as compared with an estimate of Rs 18,887.35 crore.

• Ebitda margin at 52.17% vs 47.74%. Analysts had forecast it at 51.4%.

• Net profit up 61.68% at Rs 4,226 crore, as against an estimate of Rs 2,881.46 crore.

• Dividend of Rs 4 per share declared.

The telecom operator clocked an average revenue per user, or ARPU, of Rs 193—the same as in the October-December quarter. A year ago, that figure stood at Rs 178.

Bharti Airtel had reported a deferred tax expense of Rs 424.5 crore and an exceptional cost of Rs 669.8 crore in the October-December period. That had a bearing on the consolidated net profit numbers in that quarter.

For the full fiscal, the Bharti Group company clocked a revenue growth of 19.38% year-on-year to Rs 1,39,145 crore, even as net profit rose 47.94% to Rs 12,287 crore.

“Our focus on acquiring quality customers has resulted in 7.4 million new 4G customers, as we exit the quarter with an industry-leading ARPU of Rs 193,” Gopal Vittal, chief executive officer at Bharti Airtel, said in a statement accompanying the earnings.

“A simple strategy and our relentless focus on execution have ensured that we close the year with market share gains across all businesses.”

Operational Metrics

As on March 31, Bharti Airtel had 335.4 million customers, who spoke over the phone for a total of 1,124 billion minutes, pinging a total of 2,75,069 network towers. The 4G subscriber base stood at 224.1 million, who consumed data to the tune of 14,248 billion megabytes. 

The average mobile data usage per customer rose 8.0% year-on-year to 20.3 GB per month. Mobile revenue for the quarter stood at Rs 195.49 crore, up 11.5% year-on-year.

“We strengthened our leadership position in the postpaid segment with a customer base of 35.6 million (including IoT). We continue to garner a strong share of the 4G customers in the market and added 23.3 million 4G data customers to our network over last year,” according to the statement.

Indus Towers

Bharti Airtel, in the notes to the financial statement, brought up the issue of Vodafone Idea Ltd.'s pending dues to Indus Towers Ltd.—the joint venture of the telecom operators and Bharti Infratel Ltd.

"The said customer had been informed that a funding plan was under discussion and had agreed to a payment plan till December 2022 and 100% of the amounts billed from January 2023 onwards," Bharti Airtel said in the notes, without explicitly naming the debt-laden company.

"As regards the dues outstanding as of Dec. 31, 2022, it had agreed to pay the dues between January 2023 and July 2023. However, during the current quarter, the funding plan of the said customer did not materialise and the said customer has indicated challenges in making the payments pertaining to the outstanding amount due as of Dec. 31, 2022."

Airtel Africa

Bharti Airtel allocated $748 million towards capital expenditure in the fiscal ended March 31 to acquire additional spectrum in Nigeria, Tanzania, and Kenya. That was reflected in Airtel Africa Plc's earnings for the fiscal.

• Revenue grew 17.6% in constant currency terms to $5,225 million.

• Ebitda rose 17.3% in constant currency terms to $2,575 million.

• Ebitda margin in FY23 stood at 49%.

• Net profit dipped marginally to $750 million.

The company, which at present has operations in 14 African countries, grew its subscriber base by 9% to 140 million in FY23, on the back of a 16.9% increase in mobile data users to 54.6 million. The mobile money user base grew by 20.4% to 31.5 million.

On Tuesday, shares of Bharti Airtel fell 1.27% to Rs 787.85 apiece on the BSE, even as the benchmark Sensex ended the day 0.66% lower at 61,932.47 points. The quarterly results were declared after market hours.