Bharti Airtel’s Q3FY24 Financial Performance: Consolidated Profits Surge Amidst Operational Growth
- Bharti Airtel reported a significant 54% increase in consolidated net profit, reaching Rs 2,442 crore for Q3FY24, compared to Rs 1,588 crore in the same period the previous fiscal year.
- Consolidated revenue from operations rose by 6% to Rs 37,900 crore in Q3FY24, with the growth partially affected by currency devaluation in Africa.
- Average revenue per user (ARPU) marginally increased to Rs 208 in Q3FY24, up from Rs 203 in Q2FY24, contributing to the company’s competitive standing.
- Despite positive financial indicators, Airtel faced challenges, with expenses rising by 4.23% to Rs 18,085 crore, driven by increased spending on spectrum charges, marketing, and network operations.
- The company acknowledged a one-time charge of Rs 130 crore due to foreign exchange net loss and discussed strategic initiatives, including a focus on premiumization and the imperative need for tariff repair to ensure industry health.
Bharti Airtel Ltd, a leading telecom firm, declared a substantial 54% surge in its consolidated net profit, reaching Rs 2,442 crore for the quarter concluding on December 31, 2023, marking a noteworthy advancement from the Rs 1,588 crore recorded in the corresponding period of the previous fiscal year. The company’s consolidated revenue from operations displayed a commendable growth of 6%, totaling Rs 37,900 crore in Q3FY24, as opposed to the Rs 35,804 crore reported in Q3FY23. The rise in revenue was, however, partly influenced by currency devaluation in Africa, according to the company’s statement.
Airtel’s average revenue per user (ARPU) exhibited a marginal increase, reaching Rs 208 in Q3FY24, in comparison to Rs 203 in Q2FY24. This financial performance had repercussions in the stock market, with Airtel’s scrip on BSE concluding 3% lower at Rs 1,113.1 on the mentioned day.
Furthermore, the company communicated a reduction in its consolidated net debt, excluding lease obligations, to Rs 1.42 lakh crore in Q3FY24 from Rs 1.54 lakh crore in the corresponding period of the preceding fiscal year. In terms of regional revenue, Airtel witnessed an 11.4% YoY growth in its India revenue, reaching Rs 27,811 crore during Q3FY24.
The customer base of the company expanded by 4% YoY, reaching 34.56 crore customers as of December 31, 2023, compared to 33.22 crore in the corresponding quarter of the previous year. Notably, the 4G/5G data customer base experienced a significant increase, standing at 24.5 crore, marking a QoQ rise of 74 lakh and a YoY increase of 2.82 crore, as disclosed in the company’s stock exchange filing.
Despite the positive financial indicators, the company also faced challenges, with expenses rising by 4.23% to Rs 18,085 crore. This escalation was attributed to increased expenditures in spectrum charges, marketing, and network operations. Additionally, tax expenses witnessed a notable increase of nearly 15%, reaching Rs 1,232 crore.
Airtel reported a one-time charge of Rs 130 crore, attributing it to a foreign exchange net loss due to currency devaluation in its group subsidiaries. This strategic insight into the financial intricacies of the company provides a comprehensive understanding of the factors influencing its profitability and market position.
It is noteworthy that Airtel’s financial results were released at a time when the telecom industry is undergoing dynamic changes. The competitive landscape has been influenced by recent developments, such as Jio breaking a four-quarter streak of slowing profit growth, bolstered by subscriber additions in the preceding month.
Gopal Vittal, the Managing Director, emphasized the company’s commitment to a strategy of premiumization, contributing to the addition of 7.4 million 4G/5G customers and achieving an industry-leading ARPU of Rs 208. Despite this, he acknowledged the challenge of a low return on capital employed at 9.4%, underscoring the criticality of tariff repair for sustaining industry health.