Bharti Airtel is best placed to benefit from rising ARPUs, according to analysts; here are the stock’s price targets

Bharti Airtel Ltd reported healthy second-quarter numbers and are seen as the best-placed telecom operators to benefit from rate hike-driven average revenue per user (ARPUs). The recent rate increases will further strengthen the balance sheet and cash flow profile, analysts said.

Nomura India reiterated its buy rating on the stock and raised its price target to Rs 1,850. The foreign brokerage expects FY25 ARPU of Rs 238, up 16 percent year-on-year, and raised FY26/27 ARPU estimates by 3 percent and 6 percent to Rs 269 and Rs 304, respectively, taking into account with a growth of 13 percent.

“We believe that Bharti Airtel will continue to benefit from its better quality subscriber base than its competitors and will be able to leverage its key digital and business initiatives in a 5G landscape, which will enable its transition from a telecom company to a tech co-company in the coming years will make possible. it said.

Bharti Airtel FY26 Ebitda has a sensitivity of 4 percent for every Rs 10 change in ARPU, the report said.

MOFSL said it continues to appreciate Bharti Airtel’s superior execution on the premiumization agenda. With moderation in investment intensity, Bharti Airtel is likely to generate significant free cash flows, which should lead to significant deleveraging and improvement in shareholder returns, the report said.

“We reiterate the buy on Bharti Airtel with a target price of Rs 1,900. We value India’s wireless and home business at DCF (implies 13 times FY27 EV/Ebitda), DTH/Enterprise at 6 times/10 times December 2026 Ebitda and Bharti’s stake in Indus Towers and Airtel Africa at a 25 percent discount to our target price/CMP,” MOFSL said.

Nuvama said Bharti Airtel is in an enviable position today, generating over Rs 10,000 crore in quarterly FCF, which should improve further as peak 5G capex lags.

The tariff increases will further strengthen the country’s balance sheet and cash flow profile, the report said.

“We continue to value the shares using SotP, valuing all companies based on September 26 estimates: India’s mobility business at 13 times (previously 12 times), other companies at 7 times September 26 EV/Ebitda, and the Tower/Africa operations at a 20 percent discount to the current market capitalization; maintaining ‘BUY/SO,'” the brokerage added.