Brokerage firm Prabhudas Lilladher has updated its outlook on Bharti Airtel following the company’s strong June quarter results. The new target price is set at ₹2,275, reflecting growth in profits and average revenue per user. Investors should note that while the company's debt metrics are improving, high spending on network expansion and intense market competition remain key factors to watch.
Prabhudas Lilladher has revised its outlook on Bharti Airtel, setting a target price of ₹2,275 for the stock. This update follows the telecom major’s financial results for the quarter ending June 30, 2026, which showed strong growth in both revenue and profit.
The company’s performance in the first quarter of the 2027 fiscal year was marked by a consolidated revenue of ₹58,539 crore, an increase of 18.4% compared to the same period last year. Net profit also saw a significant rise of 37.3%, reaching ₹8,167 crore. A key metric that analysts often look at is the Average Revenue Per User (ARPU), which measures how much money the company earns from each customer. For the June quarter, this figure stood at ₹264 for the India mobile division.
Balance Sheet and Expansion Strategy
The company has shown progress in managing its debt levels. The consolidated net debt-to-operating profit ratio improved to 1.17, down from 1.70 a year earlier. This indicates that the company is effectively reducing its debt burden as its earnings grow.
Despite the positive financial trend, the company continues to invest heavily in its network infrastructure. Expanding 5G services and growing its data center business requires significant capital spending. This ongoing investment is necessary to maintain service quality and its competitive edge, but it also places a sustained demand on the company's cash flow. The company recently announced the grant of over 900,000 stock options to employees, which is part of its ongoing organizational management.
Competition and Market Risks
Investors should also consider the broader sector dynamics. The Indian telecom and data center sectors are highly competitive, with large players like Reliance Industries and the Adani Group actively expanding their footprint. This competition could impact pricing power and subscriber growth for all players in the market.
Furthermore, the telecommunications sector faces potential regulatory hurdles that could change the operating environment. While the company’s Africa operations have shown long-term potential, they remain subject to risks, including currency fluctuations or one-off commercial issues. Earnings estimates for the future may also be affected by working capital cycles and broader macroeconomic factors.
Moving forward, market participants will likely monitor the company’s ability to sustain its ARPU growth and manage its debt as it continues its expansion projects. The company’s focus on moving customers toward higher-value plans will also be a key factor to track in the coming quarters.