Bharti Airtel: In a nutshell

Over FY18-21, we expect Bharti Airtel to deliver India/consolidated Ebitda CAGRS of 18%/16%

Over the past decade, Bharti Airtel’s stock has languished on increased competition in India, cash burn in Africa after an expensive acquisition, uncertainty around spectrum renewals and the entry of Reliance Jio. With the mobile sector transitioning to a three-player oligopoly, African operations turning profitable, spectrum risks having subsided and Reliance Jio cutting discounts, we believe the tide is turning. While the stock experienced a lost decade over 2007-17, we see multiple rerating triggers. Over FY18-21, we expect Bharti Airtel to deliver India/consolidated Ebitda CAGRS of 18 per cent/16 per cent. We have a ‘buy’ on the stock with a Rs 640 target, suggesting 28 per cent upside.