Motilal Oswal is bullish on Bharti Airtel has recommended buy rating on the stock with a target price of Rs 410 in its research report dated May 07, 2019.
Motilal Oswal's research report on Bharti Airtel
Bharti (BHARTI) bucked the competition-driven downtrend of the past several quarters with a strong fourth-quarter performance. Consol. EBITDA grew by a robust 7% QoQ to INR66b (5% beat), with the margin expanding 150bp QoQ (200bp beat) to 32.2%, led by a turnaround in the India wireless business margin (+410bp QoQ). However, adj. net loss widened to INR12b (our estimate: INR7.2b) from INR10.4b in the previous quarter. For FY19, consol. revenue/EBITDA/PAT declined by 2%/14%/63% YoY.
Outlook
Incrementally, the Africa IPO and the Bharti Infratel stake sale could drive additional deleveraging. The stock is attractively priced at 7x FY21E EBITDA. Maintain Buy with an SOTP-based target price of INR410.
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