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Airtel: Strong Performance; VIL witnesses some hopes of revival

ICICIdirect Research 07 Nov 2025 DISCLAIMER

Wireless Business on a strong footing: The wireless business of Airtel is on a strong footing. It continued to witness healthy key metrics in Q2 such as a) ARPU (2.2% QoQ growth vs. ~1.2% for Jio), and b) Margins (Overall Indian margin (ex-tower) was up 45 bps QoQ at 58.5% vs. 54.2% for Jio (up 18 bps QoQ) along with c) strong cash flow generations (FCF (post interest) of ₹ 15161 crore for Airtel
Non-wireless business – To step up Data Centre: Bharti via Nxtra will do data centre build-out partially for Google. Bharti will build a cable landing station and intra-city as well as inter-city fibre network (under Enterprise segment). Nxtra aims to have +1GW data centre capacity over the next few years (including above data centre build-out capacity) with an aim to step up Nxtra’s market share from current 12-15%. We have a BUY with a TP of 2450 on Airtel
Supreme Court clarification - a shot in the arm for Vodafone Idea: The Supreme Court clarified that the government is free to consider relief on both additional and reassessment of the AGR dues. The clarification came after *Vodafone Idea* sought a review of its petition, which talked about additional AGR demand up to FY17. Now the focus shifts on structure and quantum of AGR relief (over ₹ 80000 crore dues) total dues of that Vi gets from reassessment. Furthermore, media reports suggested that PE firm TGH is in talks to invest up to $6 billion (around ₹ 50,000 crore) in the company, which company denied. We highlight that any development on the same could change the future of Vi in terms of survival.

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