Bharti Airtel share price jumps 5%, dodges bears after tariff revision; stock may rise further

]

On the technical side, analysts at ICICI Direct have a ‘buy’ call on Bharti Airtel.

Bharti Airtel share price rose more than 5% on Wednesday while overall market sentiment was negative and bears were wreaking havoc. The telecom giant’s stock was trading at Rs 567 per share. “Bharti Airtel is getting positive momentum in stock due to the increase in tariff rates for the postpaid subscriber,” Amarjeet S Maurya, A.V.P. Research, Angel Broking said. Earlier in the day, Airtel announced that it will be discontinuing its Rs 49 entry-level prepaid recharge plan. Bharti Airtel share price has jumped 7.75% in the last one week of trade.

ARPU increase on cards?

The company had also announced new plans for postpaid corporate and retail customers last week as the telecom industry continues to inch closer towards another tariff hike. “Airtel has recently upgraded its postpaid and prepaid plans. With this the market is anticipating an increase in Average Revenue Per User (ARPU) of Bharti Airtel going forward,” Vishal Wagh, Head of Research, Bonanza Portfolio told Financial Express Online. Vishal Wagh added that Bharti Airtel has also been gaining momentum when it comes to active wireless subscribers. As per TRAI data, as of April, Bharti Airtel had 346.95 million active wireless subscribers, followed by Reliance Jio’s 335.17 million users. Vishal Wagh said that this is helping investors gain confidence in Bharti Airtel.

Although the exact impact of the changes made by Bharti Airtel so far is unknown, analysts expect healthy growth. “The company is increasing tariffs rate for the enterprise segment (which account for around 60% of the company’s postpaid users) which would boost overall average ARPU for Bharti Airtel. Going forward, we expect Airtel to report healthy top-line & Bottom-line growth on the back of a strong brand, growth in customer additions, and improvement in ARPU. Hence, we are positive on the stock,” Amarjeet S Maurya added.

Charts suggest further upside

On the technical side, analysts at ICICI Direct have a ‘buy’ call on Bharti Airtel. “We believe the stock has undergone healthy consolidation setting the stage to resolve higher towards Rs 595 levels in coming months as it is the 80% retracement of February-March 2021 decline (Rs 623-500),” they said in a note earlier. “The stock has formed a higher base above 52 weeks EMA and currently resolving out of past two months range (550-520) coincided with five months falling trend line, indicating resumption of the primary uptrend that augurs well for next leg of the up move,” ICICI Direct added. The brokerage firm has a stop-loss of Rs 510 on Bharti Airtel and recommends this trade with a 3-month time frame.

Bharti Airtel raises entry-level pricing of prepaid plans; share price up 5%

]

live bse live

nse live Volume Todays L/H More ×

Bharti Airtel share price added over 5 percent on July 28 after the company raised the entry-level pricing of its prepaid plans.

With a focus on improving realisation, Airtel on Wednesday announced revisions to its prepaid plans, raising its entry-level pricing by nearly 60 percent.

The telecom operator said it has discontinued its Rs 49 entry-level prepaid recharge. The company’s prepaid packs will now start from the Rs 79 smart recharge and offer up to four times more outgoing minutes of usage to customers along with double data, Airtel said in a statement.

“This change is in line with the company’s focus on offering superior connectivity solutions. Airtel customers on entry-level recharges can now stay connected for longer without worrying about their account balance,” Airtel said.

The revision will be effective from July 29, 2021.

The Rs 79 plan packs in Rs 64 talk time, and 200 MB data, with a validity of 28 days.

“The company is increasing tariffs rate for the enterprise segment ( which account for around 60% of the company’s postpaid users) which would boost overall average ARPU for BAL,” said Amarjeet Maurya - AVP - Mid Caps, Angel Broking.

“Going forward, we expect BAL to report healthy top-line & bottom-line growth on the back of a strong brand, growth in customer additions, and improvement in ARPU. Hence, we are positive on the stock,” he added.

At close, Bharti Airtel was quoting at Rs 567.9, up Rs 27.35, or 5.06 percent on the BSE.

The share touched a 52-week high of Rs 623 and a 52-week low of Rs 394.05 on 04 February 2021 and 19 October 2020, respectively.

With inputs from PTI

Bharti Airtel gains 5% as its cheapest prepaid plan gets costlier by ₹30

]

Bharti Airtel has discontinued its ₹49 entry level prepaid recharge plan and started ₹79 smart recharge offer.

Shares of the company rose 5% after the company announced the development.

With this, the telecom operator says it is focusing on offering superior connectivity solutions.

Advertisement

Advertisement

Shares of Bharti Airtel gained 5% as the company announced that it has discontinued its cheapest prepaid recharge plan of ₹49.Instead it has started a new prepaid recharge pack of ₹79 that offers up to four times more outgoing minutes of usage to customers along with twice the amount of data. Basically, it has hiked its cheapest prepaid plan to ₹79.“This change is in line with the company’s focus on offering superior connectivity solutions. Airtel customers on entry level recharges can now stay connected for longer without worrying about their account balance,” the company said in a BSE statement.“If they have hiked the plan the stock would have reacted but I don’t think there is any long term positive on the stock…eventually they will have to compete with Jio and Vodafone Idea and the space is so overcrowded that eventually none of these players have any pricing power at all.. The stock has really gone nowhere in 13 years now and unlikely to as right now they are competing in a market which is so stiff that everybody wants to gain market share,” said Rajat Sharma, founder of Sana Securities.Traders in the market must have found this announcement as a positive and that is why the rise in stock price, added Sharma.Moreover, a report said the telecom stocks were rallying as a report suggested that the government was considering a slew of long-term measures to improve the health of the debt-laden telecom sector, which includes prospectively redefining adjusted gross revenue (AGR) to exclude ‘non-telecom’ items and allowing telcos to surrender unused spectrum for a small penalty.As per The Economic Times report, the government was also considering other measures with the Department of Telecommunications (DoT) including a reduction in licence fees (LF) and spectrum usage charges (SUC) and phasing out of bank guarantees.SEE ALSO: It’s not just Zomato — From Happiest Minds to CDSL, some of India’s hottest stocks are melting too