CRISIL upgrades long term ratings of Bharti Airtel to 'AA+/Stable'

Bharti Airtel said that CRISIL Ratings has upgraded its long-term rating on the bank facilities and debt programme of the company to 'AA+/Stable' from 'AA/Stable' and has reaffirmed the 'A1+' rating on the commercial paper programme.

CRISIL said that the rating action reflects continued improvement in Bharti Airtel's (BAL's) operating metrics resulting in healthy financial risk profile.

It expects further improvement in the overall credit risk profile of the company over the near to medium term on the back of improving cash accruals, deleveraging plans including rights issue, notwithstanding adjusted gross revenue (AGR) dues and additional expenditure done for acquiring spectrum at the auction held in March 2021.

On 15 September 2021, the Union Cabinet approved several structural and process reforms in the telecom sector and provided various relief measures to telcos.

While the finer details of these measures are awaited, CRISIL Ratings believes that these reform and relief measures will ease out cash flows and will ensure optimal usage of resources, increase their accessibility and enable accelerated investments in the telecom sector.

The ratings continue to reflect BAL's strong market position and improving operating performance of the domestic mobile and non-mobile segment, diversification across businesses, healthy operations in Africa, improving debt protection metrics and high financial flexibility.

These strengths are partially offset by the company's exposure to regulatory and technological risks.

Bharti Airtel is a global communications solutions provider. The company ranks amongst the top three mobile operators globally. Airtel is India's largest integrated communications solutions provider and the second largest mobile operator in Africa. The company had 32.1 crore mobile subscribers in India as on 30 June 2021, and 12.1 crore in Africa.

The telco reported a consolidated net profit of Rs 284 crore in Q1 FY22 as against a net loss of Rs 15,933 crore in Q1 FY21. Total revenues increased by 15.3% YoY to Rs 26,854 in the first quarter.

The scrip rose 0.13% to currently trade at Rs 697.15 on the BSE.

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