Bharti Airtel, the second largest carrier, is the top pick of ICICI Securities among Indian private telecommunications companies. As of 2010, India has more than Rs 3.26 billion wireless customers and 14 African countries with Rs 1.28 billion subscribers. In India, telcos lead the highest in average revenue per user (ARPU) segment. Currently, Airtel’s ARPU is Rs 178, and the telco has a short-term plan above the Rs 200 ARPU level, but its medium- to long-term goal is Rs 300. Given that they are planning to procure mobile phones, the telephone company is achievable. Tariffs for consumers.
The company is experiencing strong growth in B2B and FTTH services. In the near future, 5G is expected to further increase the corporate profits of telephone companies. ICICI Securities believes Airtel has been placed in the sweet spot to maintain its strength among its peers due to the industry structure of the three telephone companies, further relief from the government, and tariff increases along the way. .. In addition, Bharti Airtel was able to raise funds very easily. This helps telco provide its customers with a formidable digital ecosystem.
SUC decision to support Airtel
The Government of India has decided to abolish the 3% floor rate of Spectral Fees (SUC), which eliminates such payments in the long run, as SUCs from future spectrum auctions have been removed.
This will bring great benefits to Airtel in the long run. Second, there is also a large chunk of remnants (Rs 15,740) from the Rights Fund that Airtel will be able to use in future spectrum auctions. Telephone companies can also borrow from outside at attractive interest rates to raise funds for the purchase of 5G auctions. Airtel is generating free cash flow and telco has managed to save money, so future spectrum auctions shouldn’t incur much debt to Airtel.
According to ICICI Securities, Airtel and Jio are expected to spend approximately Rs. 38,000 each to acquire the 100MHz PAN-India spectrum in the 3300MHz band, 500MHz in the 2600MHz band and the 4G spectrum in coverage / capacity. Analysts have declared Airtel the top pick with a target price of 860 rupees.
