Bharti Airtel stock unlikely to dial in gains despite reduction in debt

Despite reduction in debt, muted revenue outlook and subscriber losses remain interim challenges

The Bharti Airtel stock has been rising over the last couple of months, gaining 15 per cent on deleveraging initiatives, a strong March quarter performance, and expectations of a pricing uptick in the next two quarters. 

The firm’s moves to pare debt has been a major factor. After raising Rs 25,000 crore from its rights issue, it announced that it will raise up to Rs 6,000 crore by listing its Africa subsidiary. 

This should help reduce current net debt levels of Rs 1.1 trillion and net debt-to-Ebidta of 4.2 times. Analysts at SBICAP Securities expect net debt to stabilise at Rs 85,500