Bharti Airtel is anticipated to deliver strong results, with a 4 percent quarter-on-quarter (QoQ) revenue increase driven by a combination of rising Average Revenue Per User (ARPU) and subscriber additions. The company's home business is likely to continue its strong momentum, projecting an 18 percent year-on-year (YoY) growth, according to a report from BofA Securities on January 9, 2025.
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Indian Telecom Sector
India's telecom sector is expected to report steady performance in Q3 FY25, with Bharti Airtel and Reliance Industries (RIL) continuing to show growth, while Vodafone Idea (VIL) faces ongoing challenges. The report also highlights the positive impact of tariff hikes, operational leverage, and stable competition.
Bharti and Enterprise Segment
Bharti's DTH and African operations are projected to remain stable. As a result, Bharti's earnings before interest, taxes, depreciation, and amortization (EBITDA) margins are expected to improve by 84 basis points QoQ, aided by operational leverage.
"We expect slower growth at enterprise business and estimate 9 percent YoY growth," BofA Securities said in its report on 3Q Preview.
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Indus Towers
Indus Towers, which provides infrastructure support (Telecom Towers) to telecom companies, is set for an improvement in performance as well. The company is expected to add 7.2K towers in Q3, significantly up from 3.7K in the previous quarter. This is expected to increase its tenancy ratio to 1.67x from 1.65x in Q2. As a result, Indus Towers is expected to see a 6.1 percent YoY revenue growth.
Also Read: Bharti Airtel to Lead Telecom Revenue Growth in Q3 FY25: IIFL
Vodafone Idea
Meanwhile, Vodafone Idea, according to the report, continues to struggle with high subscriber losses, forecast to lose 5 million net subscribers in Q3. However, the company's revenues are expected to show a slight increase of 1 percent QoQ, driven by an improvement in ARPU following the recent tariff hikes. VIL's EBITDA margins are expected to improve by 44 basis points QoQ to 42.1 percent.
"We expect VIL's capex to materially increase qoq as its network deployment has started and believe the company should be able to spend Rs 80 billion capex in 2HFY25," the report said.
