Bharti Airtel's Q4 performance likely to lag behind Idea Cellular’s growth
The expectation of relatively slower growth of Bharti is on account of its lower number of subscriber additions compared with Idea's net additions.
By Ranjit Shinde, ET Bureau | Updated:
Bharti Airtel, the country’s largest telecom player is expected to report lower quarter-on-quarter growth in revenue and net profit for the March 2012 quarter compared with its smaller peer Idea Cellular, shows the average of estimates from seven brokerages and ETIG forecast. Bharti will declare its fourth quarter numbers on Wednesday.
Bharti’s net profit is likely to grow by 13% sequentially to Rs 1,142.9 crore in the March 2012 quarter helped by the absence of one-time write-downs in its African operations that hampered profit in the previous quarter. Revenue is likely to increase at a moderate pace of 2.4%.
Last week, Idea reported 6.7% revenue growth and nearly 19% jump in net profit boosted by a higher proportion of subscriber additions, more or less stable tariff rates, significant improvement in total minutes on the network Idea’s topline is a little over one-fourth of Bharti’s revenue. The expectation of relatively slower growth of Bharti is on account of its lower number of subscriber additions compared with Idea’s net additions and the impact of strike in one of the African markets of Bharti.
Analysts expect net subscriber addition of 4.9 million in the March quarter, two million more than that in the previous quarter. Idea added over 6.3 million user in the tree months to March 2012.
Compared to the year ago, Bharti’s revenue is expected to increase by 16.2% but net profit will drop by 18.4% due to higher interest outgo, and increased tax rate. Analysts expect average revenue per minute (ARPM) to increase marginally in the March quarter on a sequential basis. But, Idea’s numbers, which revealed a small drop in ARPM, have created a doubt whether Bharti would be able to live up to analyst expectations.
A marginal rupee appreciation against other currencies may also have an adverse impact on Bharti’s profit given the company’s exposure to Sri Lanka and 16 African countries. In the December 2011 quarter, African operations contributed 29% to its topline.
Bharti’s net profit is likely to grow by 13% sequentially to Rs 1,142.9 crore in the March 2012 quarter helped by the absence of one-time write-downs in its African operations that hampered profit in the previous quarter. Revenue is likely to increase at a moderate pace of 2.4%.
Last week, Idea reported 6.7% revenue growth and nearly 19% jump in net profit boosted by a higher proportion of subscriber additions, more or less stable tariff rates, significant improvement in total minutes on the network Idea’s topline is a little over one-fourth of Bharti’s revenue. The expectation of relatively slower growth of Bharti is on account of its lower number of subscriber additions compared with Idea’s net additions and the impact of strike in one of the African markets of Bharti.
Analysts expect net subscriber addition of 4.9 million in the March quarter, two million more than that in the previous quarter. Idea added over 6.3 million user in the tree months to March 2012.
Compared to the year ago, Bharti’s revenue is expected to increase by 16.2% but net profit will drop by 18.4% due to higher interest outgo, and increased tax rate. Analysts expect average revenue per minute (ARPM) to increase marginally in the March quarter on a sequential basis. But, Idea’s numbers, which revealed a small drop in ARPM, have created a doubt whether Bharti would be able to live up to analyst expectations.
A marginal rupee appreciation against other currencies may also have an adverse impact on Bharti’s profit given the company’s exposure to Sri Lanka and 16 African countries. In the December 2011 quarter, African operations contributed 29% to its topline.
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