Please Share:: 
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
Bharti Airtel
3QFY11 – This time for Africa!
Bharti’s 3Q disappointed on domestic business but
Africa delivered positive surprise
Gains in Africa on the back of re-branding and tariff
intervention; management optimistic in coming quarters
India margins impacted by higher SG&A (ex rebranding)
One-offs from higher-than-expected branding costs and
forex/MTM losses led to a net profit decline of 27% qoq
Reiterate O/P. one-time impact from the New Telecom
Policy 2011 (NTP-11) to be offset by competitive
stability and lower spectrum charges.
Net profit down due to one-offs: Consolidated net profit at
Rs13.0bn declined 22% qoq due to one-off re-branding
expenditure of Rs3.4bn (vs. our estimate of Rs2-2.5bn) and
exchange rate loss of Rs1.5bn. Consolidated revenue
(Rs157.5bn, up 3.3% qoq) was in-line. However,
consolidated EBITDA (Rs49.6bn, down 2.7% qoq) was 6%
below our estimate due to higher re-branding costs and
higher SG&A. India SG&A increased due to higher gross
adds (200bps increase in churn). Africa SG&A increased
due to higher office expenses and one-time legal fees.
Africa – early signs of monetising the assets: Revenue
at US$911m was ahead of our estimate and EBITDA
margin (ex-rebranding) increased 110bps. Initial signs of
elasticity and/or market share gains are encouraging as
minutes increased 17% qoq and delivered 9% qoq revenue
growth despite 8% decline in RPM. Management indicated
that the present year capex of US$800m is mainly for
capacity but FY12 capex will be 70% for coverage; and
growth to accelerate from 2Q FY12 onwards.
India KPIs in line, but EBITDA below expectations:
Revenue at Rs117bn, minutes growth of 4.4% qoq and
rev/min decline of 0.25p was broadly in-line. EBITDA
margins disappointed due to higher SG&A in mobile and dip
in non-mobile businesses.
Reiterate Outperform: Our positive stance is based on
domestic tariff stability and turnaround in Africa over FY12-
13E. The one-off impact from the New Telecom policy is
likely to be offset by lower spectrum charges as well as
additional burden on the new entrants, in our view.
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
Bharti Airtel
3QFY11 – This time for Africa!
Bharti’s 3Q disappointed on domestic business but
Africa delivered positive surprise
Gains in Africa on the back of re-branding and tariff
intervention; management optimistic in coming quarters
India margins impacted by higher SG&A (ex rebranding)
One-offs from higher-than-expected branding costs and
forex/MTM losses led to a net profit decline of 27% qoq
Reiterate O/P. one-time impact from the New Telecom
Policy 2011 (NTP-11) to be offset by competitive
stability and lower spectrum charges.
Net profit down due to one-offs: Consolidated net profit at
Rs13.0bn declined 22% qoq due to one-off re-branding
expenditure of Rs3.4bn (vs. our estimate of Rs2-2.5bn) and
exchange rate loss of Rs1.5bn. Consolidated revenue
(Rs157.5bn, up 3.3% qoq) was in-line. However,
consolidated EBITDA (Rs49.6bn, down 2.7% qoq) was 6%
below our estimate due to higher re-branding costs and
higher SG&A. India SG&A increased due to higher gross
adds (200bps increase in churn). Africa SG&A increased
due to higher office expenses and one-time legal fees.
Africa – early signs of monetising the assets: Revenue
at US$911m was ahead of our estimate and EBITDA
margin (ex-rebranding) increased 110bps. Initial signs of
elasticity and/or market share gains are encouraging as
minutes increased 17% qoq and delivered 9% qoq revenue
growth despite 8% decline in RPM. Management indicated
that the present year capex of US$800m is mainly for
capacity but FY12 capex will be 70% for coverage; and
growth to accelerate from 2Q FY12 onwards.
India KPIs in line, but EBITDA below expectations:
Revenue at Rs117bn, minutes growth of 4.4% qoq and
rev/min decline of 0.25p was broadly in-line. EBITDA
margins disappointed due to higher SG&A in mobile and dip
in non-mobile businesses.
Reiterate Outperform: Our positive stance is based on
domestic tariff stability and turnaround in Africa over FY12-
13E. The one-off impact from the New Telecom policy is
likely to be offset by lower spectrum charges as well as
additional burden on the new entrants, in our view.
No comments:
Post a Comment