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Informist, Wednesday, May 14, 2025

By Rajesh Gajra

NEW DELHI – Bharti Airtel Ltd. is keen on stepping up its capability to roll out optic fibre network in the country "a lot more" to expand its wireline offerings in its home services segment, the management of the company said in a post-earnings conference call with analysts and investors Wednesday. Managing Director and Chief Executive Officer Gopal Vittal said capital expenditure in expanding the fibre network will not materially impact the overall capex profile of the company "but it will be a small amount to put in for a business that is really experiencing tremendous growth, given the growing penetration."

The optic fibre network coverage of Bharti Airtel increased 2.4% sequentially to 489,098 route Kms in the March quarter in its India mobile services business. Vittal said he was not happy with the quarterly run rate of 1.7 million fibre-to-home passes the company was adding on average every quarter. "I would like to see it going up to over 2.5 million," he said.

According to the managing director, fibre deployment remained a strategic priority for the company with a focus on accelerating rollouts. Vittal said fibre connectivity is a superior technology compared to fixed wireless access "because it gives you concurrent uplink and downlink at the same levels." The capacities in fibre connectivity were infinite and "so one of our obsessions has been to really roll out fibre at a much more rapid pace," he said.

In 2024-25 (Apr-Mar) Bharti Airtel's home services segment had a revenue share of 4% in the consolidated revenue, 3% in earnings before interest, taxes, depreciation, and amortisation, and 12% in capital expenditure, according to the earnings investor presentation of the company. The segment's operations spanned 1,476 cities as of Mar. 31 and in the March quarter the company net added 812,000 customers, taking the total customer base to 10.04 million.

The home services segment of Bharti Airtel in its India mobile services business recorded a revenue growth of 5.8% on quarter to INR 15.96 billion in the latest quarter. EBITDA increased 6.6% sequentially to INR 7.96 billion, and the company incurred a capital expenditure of 15.17 billion in the March quarter, up from INR 11.40 billion in the previous quarter.

In the segment, the company provides fixed-line broadband services for homes primarily comprising high-speed broadband on fiber or wireless connectivity. The management said 40-45% of the company's overall net customer additions are coming in from fixed wireless access, or the wireless connectivity part. The management said it would like the share of fibre connections to be higher and fixed wireless access connections to act as a complement. Vittal said, "over time, fibre will chase fixed wireless access."

The management said it saw strong tailwinds in the broadband business due to changing content consumption habits and growing penetration of smart TVs. In the digital TV business of the company the management said it was making structural changes by completely eliminating subsidies. "We believe this will dramatically impact our cash flows," it said in the investor call.

In the India business-to-consumer business segment, which includes mobile services, homes services, and digital TV services, a key focus of the company is channel expansion. "All our channels now sell all our services, and this is continuing to accelerate our growth. This integrated approach will help us expand our footprint and drive momentum in the broadband segment," the management said.

The company was pleased with its performance in the Africa operations with growth being almost twice as that in India operations. The management said it is looking for opportunities to invest more capital in the business there.

However, overall capital expenditure will trend downwards in FY26, the management said. The rural rollout will substantially slow down, it said. In FY25, the consolidated capital expenditure declined 14% to INR 422.9 billion.

The March quarter saw a bump up sequentially in consolidated capital expenditure to INR 144 billion from INR 91.6 billion in the previous quarter. This was led by a surge in capex in the business-to-business segment of Airtel Business to INR 24.9 billion in the March quarter from INR 9.1 billion in the previous quarter.

The management said this was due to investments the company made in its cloud business. The company will be taking the cloud offering to the B2B market in June, it said. The management was of the view that cloud services was a critical need for its customers in the Airtel Business segment.

The March quarter capex increase in Airtel Business was also due to additional investments in data centres, the management said. Vittal said he was not pleased with the fact that the company had potentially less than 12% market share in data centers. He said the data centre market was growing quite rapidly but it was fragmented. The company will aspire to grow its share in this business and step up investments in it, he added.

Commenting on the overall B2B business performance, the management said the current order books in the core connectivity business and digital services were strong. However, the order book in the wholesale services part of the B2B business was under pressure, the management said.

Bharti Hexacom Ltd., a subsidiary of Bharti Airtel, also held a post-earnings conference with analysts and investors Wednesday. The management said in the call that the company's capital expenditure will trend downwards in FY26 but it will not compromise on any growth capital expenditure required to be deployed.

Bharti Hexacom offers consumer mobile services, fixed-line telephone, and broadband services in Rajasthan and north-eastern states, including Manipur, Meghalaya, Mizoram, Nagaland, Tripura, and Arunachal Pradesh. The management said a lion's share of growth in its home services segment in the March quarter came from fixed wireless access customers.

On Wednesday, shares of Bharti Airtel closed 0.8% higher at INR 1,834.20, while those of Bharti Hexacom closed 0.3% lower at INR 1,698.70 on the National Stock Exchange of India.  End

Edited by Deepshikha Bhardwaj

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