ARPU compounder with multiple optionalities

Research evidence excerpt

ARPU compounder with multiple optionalities

Global Markets Research

Bharti Airtel BRTI.NS BHARTI IN 30 June 2026

EQUITY: GLOBAL TELECOM SERVICES

RatingARPU compounder with multiple optionalities Remains Buy

Target priceImplied valuation discount vs Jio unwarranted; Bharti is Increased from INR 2,355our top sector pick with Buy and a higher TP of INR2,355 INR 2,220

A premium telco play with tariff boost and solid FCF generation; dividends to rise Closing29 June price2026 INR 1,841

Bharti Airtel is one of India’s premium telecom companies, and a structural beneficiary of a

consolidated three-player market. With 5G rollout largely complete and capex intensity past its peak, Implied upside +27.9%

we believe the resulting strong FCF generation is playing out into a deleveraging cycle. We expect

14%/14% EBITDA/FCF CAGR over FY26-29F, driven by an expected tariff hike (likely in 3QFY27), Market Cap (USD mn) 118,629.1

operating leverage, and ongoing premiumisation. We also like Airtel’s fundable options – data ADT (USD mn) 196.1

centers, Airtel Money, lending, cloud, and a rising stake in Indus Towers (INDUSTOW IN, Buy). We

believe Its valuation at a premium to global peers is justified by: 1) India’s favourable market Relative performance chart

structure; 2) long runway for ARPU growth; 3) multiple optionalities vs global peers; and 4) possible

regulatory tailwind to support the three-player market.

Valuation discount to Jio unwarranted; upside underpinned to Jio’s valuation

Adjusting Airtel's market cap with the quoted value of just its Africa/Indus/Nxtra holdings (see Fig.

56), the implied FY28F EV/EBITDA of the India telecom business at current price is 9.3x, which is

well below the ~12.2x implied multiple on Jio’s (unlisted) likely valuation (as per media article). This