Bharti Airtel set to ride its best financial performance phase in over a decade, says Antique

Bharti Airtel is set to ride its best financial performance phase in over a decade, believes global brokerage house Antique Broking. 

According to the brokerage, this performance will be driven by various factors including tariff hikes, 2G upgrades, robust enterprise and Fibre to the Home (FTTH) growth, and a reduction in capital expenditure following the rollout of 5G over the next three years.

It also anticipates return ratios exceeding 20 percent and historic high levels of free cash flow driving balance sheet deleveraging.

Despite challenges, particularly regarding Bharti's unique approach to 5G rollout compared to its competitors, Antique believes this won't significantly impact Bharti's subscriber base or growth trajectory.

Moreover, it feels that current valuations do not adequately reflect the positive macro environment in the telecom sector.

The stock has already delivered almost 59 percent returns in the last one year and gained over 19 percent in 2024 YTD, giving positive returns in 3 of the 4 months of the current calendar year so far.

Airtel shares have been flat but in the green in April so far after a 9.4 percent jump in March. However, it fell 4.1 percent in February but had risen 13.5 percent in January of this year.

The scrip also hit its record high of ₹1,244.95 last month on March 22, 2024. 

The stock is currently just 1.2 percent away from its peak. It has also advanced over 63 percent from its 52-week low of ₹752.70, hit on April 18, 2023.