Analysts' corner

BHARTI AIRTEL
Reco Price: Rs 389
Target price: Rs 450

Bharti with its higher quality subscriber base and its integrated business model (presence in all points of the data access supply chain) will benefit the most from the 3G revolution in India. In Africa, the company is focussing on issues such as distribution, network and pricing to ensure consistent longer term benefits. In the long run, the Ebitda margin of the Africa business is expected to increase from the current 34.9 per cent on the back of better than expected benefits from outsourcing. The India business is expected to continue to do well, supported by potential contribution from 3G revenues, which remains the key stock price driver for Bharti. The African business will be a longer term value enhancer. The latest figures for the month of May show Bharti was the leader in terms of net subscriber additions of 2.5 million, up 1.7 per cent M-o-M, while most operators reported a sharp decline. Maintain Buy.

— Karvy Stock Broking