Stock in Action – Bharti Airtel 21 November 2024

Highlights

• Bharti Airtel Nokia 5G deal marks a significant leap in India's telecom sector, with cutting-edge equipment set to redefine network performance across major cities.

• Airtel Q2 Results 2024 reflect robust financial performance, with a 168% surge in net profit, signalling strong growth and operational efficiency.

• The Airtel Nokia 4G 5G network expansion aims to enhance connectivity and capacity while supporting the evolution of India's digital ecosystem.

• Bharti Airtel stock performance remains resilient, delivering a year-to-date return of over 61%, making it a focus for long-term investors.

• Airtel 5G capacity and coverage are set to achieve new benchmarks with Nokia's energy efficient and innovative Air Scale solutions.

• Bharti Airtel investor insights suggest optimism, with analysts predominantly recommending 'Buy' ratings due to strong growth potential.

• Bharti share has shown remarkable growth this year, making it a strong contender in the telecom sector.

• The Bharti stock remains a favourite among investors due to its consistent performance and growth potential.

• Bharti share price has climbed steadily, reflecting the company’s robust Q2 results and strategic partnerships.

• With a strong year-to-date return, Bharti stock price continues to attract attention from long-term investors.

Why is Bharti Airtel in the News?

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Bharti Airtel, one of India’s leading telecom operators, has made headlines with a multiyear, multibillion dollar deal with Finnish telecom giant Nokia to deploy 4G and 5G network equipment across major Indian cities and states. This strategic agreement strengthens Airtel’s network capabilities and supports its ambition to lead in 5G connectivity while modernizing its existing 4G infrastructure. Additionally, Airtel has reported strong Q2 results for FY2024, showcasing a 168% YoY surge in net profit driven by robust performance in India and Africa. With its ongoing partnerships and a remarkable year-to-date stock performance, Airtel remains a focal point for investors.

What’s the Deal Between Airtel and Nokia?

Airtel has entered into a multibillion dollar contract with Nokia to deploy cutting-edge equipment from Nokia’s 5G Air Scale portfolio, including:  

Base stations, baseband units, and Massive MIMO radios, powered by Nokia’s energy efficient Reef Shark System on Chip technology.  

Equipment to modernize Airtel’s 4G network, with multiband radios and baseband units that are also 5Gready.  

This partnership extends Airtel and Nokia’s two-decade long relationship and is aimed at creating a futureproof network infrastructure that combines enhanced connectivity with eco-friendly solutions. Notably, Airtel will leverage Nokia's Manta Ray Network Management, an Abased tool for network optimization, monitoring, and digital deployment. This deal marks a significant step forward in Airtel’s Green 5G Initiative aimed at improving energy efficiency and reducing carbon emissions.

How Airtel Benefits from this Nokia Deal? 

The deal with Nokia provides Airtel with a technological edge in India’s competitive telecom landscape. Key benefits include:  

1. Enhanced Network Capacity and Coverage:  
Nokia’s advanced 5G AirScale solutions ensure exceptional capacity and coverage, enabling Airtel to provide seamless connectivity across major cities and states.  

2. FutureProof Infrastructure:  
By modernizing Airtel’s 4G network with 5Gready equipment, the deal ensures that Airtel’s infrastructure is prepared for future technological advancements.  

3. Improved Energy Efficiency:  
Nokia’s ReefShark technology and the Green 5G Initiative aim to reduce Airtel’s carbon footprint, aligning with the company’s sustainability goals.  

4. Customer Experience:  
The enhanced infrastructure will provide Airtel’s customers with unparalleled user experience, including faster speeds and better connectivity.  

5. Market Leadership:  
With this partnership, Airtel positions itself as a leader in 5G rollout, competing effectively with rivals like Jio and Vodafone Idea.

Q2 Results of Bharti Airtel

Airtel’s Q2 FY2024 results reflect strong financial performance, driven by robust growth in both its Indian and African operations. Key highlights include:  

• Total Revenue: ₹41,473.30 Cr in Q2 FY2024, up 11.96% YoY and 7.70% QoQ.
•  Net Income: ₹3,593.20 Cr in Q2 FY2024, soaring 168.01% YoY but declining 13.62% QoQ.
• Operating Income: ₹9,992.50 Cr in Q2 FY2024, reflecting a 21.72% YoY increase and a slight 0.91% QoQ growth.
• Diluted EPS: ₹7 in Q2 FY2024, up 86.90% YoY and 16.45% QoQ.

While quarterly profit saw a decline of 13.62%, the 168% YoY surge in net profit underscores Airtel’s strong operational performance. Revenue growth of 12% YoY further reflects its expanding market share and customer base.

Brokerage Overview of Bharti Airtel Share

• Airtel’s strong fundamentals and strategic partnerships have attracted significant optimism from brokerage firms:  

• Out of 28 analysts covering Airtel, 14 recommend Buy and 9 suggest Strong Buy, reflecting a strong consensus for investment.  

• Year-to-date, Airtel’s stock has returned an impressive 61.15%, outperforming broader indices.  
Airtel’s market cap of ₹9,95,537.9 crores and its resilience in the face of market volatility underscore its attractiveness as a stable investment. The stock’s 52week high of ₹1,779 reflects significant growth potential.

How Long-term Investors Should Pursue Bharti Airtel?

For long-term investors, Airtel presents a compelling investment opportunity:  

1. Sustainable Growth:  
Airtel’s focus on 5G expansion, energy efficiency, and partnerships with global leaders like Nokia positions it for long-term growth.  

2. Financial Strength:  
Consistent revenue growth, rising profitability, and strong EPS growth make Airtel a fundamentally solid stock.  

3. Market Leadership:  
As a pioneer in telecom innovation, Airtel is wellplaced to capitalize on India’s growing digital economy.  
4. Dividend Potential:  
With its improving financials, Airtel could enhance shareholder returns through dividends or buybacks in the future.  

Conclusion 

Bharti Airtel’s partnership with Nokia underscores its commitment to innovation, sustainability, and customer centric growth. The company’s robust Q2 results and market performance further solidify its position as a leader in India’s telecom sector. For long-term investors, Airtel offers a balanced mix of growth, stability, and strategic foresight, making it a stock worth considering. As Airtel continues to expand its 5G footprint and modernize its infrastructure, it is poised to deliver sustained value to its stakeholders.