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Bharti Airtel: A stable performance - Views on News from Equitymaster
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Bharti Airtel: A stable performance
Nov 23, 2015

Bharti Airtel has declared results for the second quarter of FY16. The company has reported a 4.3% YoY increase in total revenues and a 10.1% YoY increase in net profits during the quarter. Here is our analysis of the results.

Performance summary

  • Consolidated sales grew by 4.3% YoY during the 2QFY16. Continuing pressure in the African operations as well as a dull performance from the tower business were the reasons for the muted topline performance.
  • Mobile subscriber base in India grew by 11.1% YoY during the quarter. Total count of mobile subscribers in India stood at a little over 235.2 m at the end of September 2015. Total subscriber base on the network (including South Asia and African operations) grew by 11.9% YoY during the quarter.
  • Operating margins improved to 34.6% during the quarter. The operating profit grew by 7.1% YoY.
  • Interest expenses (including the cross currency impact) were up 89.8% YoY.
  • The net profit increased by 10.1% YoY. The net margin improved to 6.4% in the quarter compared to 6.1% seen in 2QFY15.

Standalone Financial Performance

(Rs m) 2QFY15 2QFY16 Change 1HFY15 1HFY16 Change
Sales 228,617 238,519 4.3% 458,672 475,327 3.6%
Expenditure 151,564 156,017 2.9% 304,341 310,263 1.9%
Operating profit (EBITDA) 77,053 82,502 7.1% 154,331 165,064 7.0%
Operating profit margin (%) 33.7% 34.6%   33.6% 34.7%  
Interest expense/(income) 10,264 19,483 89.8% 19,907 38,759 94.7%
Depreciation 38,530 42,390 10.0% 78,895 82,794 4.9%
Share of loss/(gain) in associates 1,709 2,404 40.7% 3,287 4,530 37.8%
Exceptional items (1,750) 6,596   (3,570) 20,910  
Profit before tax 28,218 29,629 5.0% 55,246 68,951 24.8%
Tax 14,765 13,326 -9.7% 30,091 35,107 16.7%
Profit after tax/(loss) 13,453 16,303 21.2% 25,155 33,844 34.5%
Minority interest (379) 1,076 -383.9% 238 3,074 1191.6%
Net profit 13,832 15,227 10.1% 24,917 30,770 23.5%
Net profit margin (%) 6.1% 6.4%   5.4% 6.5%  
No. of shares         3,997.4  
Diluted Earnings per share (Rs)*         14.4  
P/E ratio (x)*         23.6  
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