Axis Securities Places Buy Call On This Telecom Stock, Shares Can Surge 11%

Axis Securities in its pick of the week has recommended a BUY rating on the Bharti Airtel Limited stock with a near-term Target Price of Rs 875, implying an upside of 11% from the Current Market Price. This large-cap telecom sector stock has a market capitalisation of Rs 4,66,243 crore.

Bharti Airtel Ltd. is India's one of the leading telecom services providers having large geographical presence. Airtel has a strong presence in Africa. Airtel has a strong diversified service portfolio including digital platforms, DTH fibre to home etc with strong presence across Indian geography.

Stock Outlook & Returns

The Current market price of the Bharti Airtel stood at Rs 792.35 apiece on NSE, down 0.23% from its previous close.

The shares in the past 1 week have fallen 1.37%, whereas, in the past 1 month surged 3.47%. Over the 3 months, it has given 13.98% positive return and over 1 year, it gave 13.93% positive return to shareholders. It gave 110.03% positive return in the past 3 years, and 106.02% in the past 5 years, respectively.

The 52-week low is Rs 628.75 apiece recorded on July 14, 2022, and the 52 week high is Rs 816.75 apiece recorded on October 04, 2022, respectively.

Data consumption in India likely to increase

Covid-19 outbreak proved as a boon for telecom and automation sectors. India Mobile Data Consumption Market is mainly driven by an increasing number of wireless data subscribers. Percentage of number of wireless data subscribers over total wireless subscribers increased from 36.32% at the year ending 2017 to 62.35% at the year ending 2022. The demand for the digital platform and mobile based usage gone up multiple folds in India. Rural penetration was big laggard in data consumption but likely to increase exponentially in the forthcoming quarters aided by digital revolution. The India Mobile Data Consumption Market size is projected to reach US$ 14.34 Bn. at the end of the forecast period at a CAGR of 14.7%

Strong 4G conversions and strong digital additions

The company continued a strong share of 4G net-ads in the market as the 4G customer base grew by 4.5 Mn QoQ to reach 195.5 Mn (This forms 63% of the overall customer base now). In the Homes Business, the company witnessed strong customer addition of 1.4 Mn in Q1FY23.

 

Healthy revenue growth

Bharti Airtel Ltd (Airtel) reported strong growth in Q1FY23 and reported consistent growth across the overall portfolio, mainly led by enterprise and Home Business. The company posted revenue of Rs 32,805 Cr for the quarter, up 4.1%/22.2% QoQ/YoY. Its consolidated EBITDA Margin remained flattish at 50.6% on account of its efficient execution, superior customer mix, and strong customer additions in 4G.

Disclaimer

The stock has been picked from the brokerage report of Axis Securities. Greynium Information Technologies, the Author, and the respective Brokerage House are not liable for any losses caused as a result of decisions based on the article. Goodreturns.in advises users to check with certified experts before making any investment decision.