In a strategic move that reflects its financial strength, Bharti Airtel, India’s second-largest telecommunications provider, has declared a final dividend of ₹16 for each fully paid-up equity share. This announcement coincides with the company’s impressive Q4 results for the fiscal year 2024-25. With a surge in average revenue and positive assessments from brokers, let’s delve into the five pivotal insights from Bharti Airtel’s recent updates.

Bharti Airtel’s Dividend Announcement

The board of Bharti Airtel has put forward a final dividend proposal of ₹16 per fully paid-up equity share and ₹4 for partly paid-up shares, as per the company’s regulatory release. This distribution is meant for shareholders in the financial year ending 2024-25.

Insights from Jefferies on the Dividend

Brokerage firm Jefferies has analyzed this dividend and concluded that the ₹16/share payout signifies an impressive 85% distribution of the company’s available free cash flow. The telecom giant’s consolidated free cash flow soared by 77% year-on-year, reaching ₹36,800 crore, thanks to robust operational cash inflow.

• Adjusting for prior spectrum repayments of ₹26,000 crore, Airtel’s distributable free cash flow stands at ₹10,800 crore, equating to ₹18.6/share.
• This substantial dividend is viewed as both significant and sustainable.

Jefferies Maintains a Positive Outlook

Jefferies has reaffirmed its ‘Buy’ rating on Bharti Airtel, adjusting the target price to ₹2,210, indicating a potential upside of over 20% from its current valuation. Their report highlights that:

• Bharti Airtel’s Q4 results surpassed expectations, driven by strong average revenue per user (ARPU) growth, new subscriber additions, robust margins, and a notable increase in dividends.
• The firm anticipates sustained momentum following tariff increases, projecting a 15-18% CAGR in both revenue and EBITDA through FY25-28.

Bharti Airtel’s Q4 FY25 Performance

In the March quarter, Bharti Airtel reported a consolidated profit after tax of ₹11,022 crore, significantly exceeding market predictions. The company’s ARPU rose to ₹245 in Q4 FY25, up from ₹209 the previous year, showcasing its growing revenue potential.

Market Reaction to Bharti Airtel’s Share Price

Following the positive Q4 report, Bharti Airtel’s share price jumped nearly 3% in early trading, later stabilizing with a 0.5% increase during the session.

• Over the past week, the stock experienced a 3.5% decline but showed a modest gain of around 2% over the last month.
• In the past six months, shares have gained approximately 18%, and in the last year, the stock has surged by nearly 42%.
• Year-to-date, Bharti Airtel’s shares have risen close to 15%.

With a market capitalization of ₹10.97 lakh crore, the company has reached a 52-week high of ₹1,917 and a low of ₹1,219.05.

By understanding these developments, investors can better assess the potential of Bharti Airtel in the competitive telecom landscape.