Bharti Airtel's capital expenditure to moderate in FY26: MD Gopal Vittal

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Bharti Airtel's capital expenditure will continue to moderate in the next financial year (FY26) as most of the expenditure of deploying 5G radio equipment has already been done, Vice-Chairman and Managing Director Gopal Vittal said on Friday in an analysts call on Friday. He also said the current financial year’s (FY25) capex will also end lower than FY24.

 

"Capex, as a percentage of revenue, will trend downwards, and we expect to level with global players going forward," Vittal said. The telco's capex in radio equipment will decelerate further as there are no plans for expanding 4G capacity, he said. Instead, the telco is deploying capex in transport, or the fiberization of assets, on which it is in line with internal estimates within a 5-year expenditure plan, he added.

 

Vittal said the telco had 120 million 5G customers at December-end, lower than Reliance Jio's 170 million. AIrtel's 5G user base has taken to 2 GB per day plans, driving monetization, Vittal said.

 

Airtel reported an average revenue per user (Arpu) of Rs 245, the highest in the industry, on Thursday. Vittal stressed underlying drivers such as users transitioning from feature phones to smartphones and prepaid to postpaid, along with increasing data monetization, and international roaming, remain strong. He reiterated the need for further tariff repair for industry to be financially stable.

 

Airtel’s Q3 profit rose 505 per cent year-on-year (Y-o-Y) to Rs 14,781 crore, up from Rs 2,442 crore in the year-ago period on exceptional gain from the consolidation of telecom tower infrastructure firm Indus Towers into Airtel. However, Vittal stressed that the mobile business in India makes up for 56 per cent of Airtel's consolidated revenue, followed by AIrtel Africa at 23 per cent, India's non-mobile business at 14 per cent, and Indus Towers at 14 per cent.

 

Airtel is targeting the 80 million potential postpaid customers in the country, and Vittal believes Airtel may rack up as many as 50 million postpaid users in the next few years. Meanwhile, the company won't be an early adopter in GPU as a service, he stated. The cloud-based solution that allows businesses to harness high-performance GPU computing without the hefty upfront investment or ongoing maintenance.