Bharti Airtel is a Buy or Sell?

Rukmani Gupta Feb 18, 2020 2939 0

Bharti Airtel Share Price touched below 540 today, but recovered later in the day & closed at 549.

Today Bharti Airtel has paid Rs.10000 crore to DoT (Department of Telecommunications).

It has total dues to be paid to DoT as AGR of about Rs. 35500 crore.

The company has ensured to pay the balance by 17th March.

The above Rs. 10000 crores paid on behalf of Bharti Airtel, Bharti Hexacom and Telenor.

Now the question arises it is good news or bad news, whether to buy the stock or sell the stock?

Many Experts like CLSA still maintaining their buy call.

But Many Experts are advising to sell as arranging remaining funds is a challenge alongside margin threats.

The company is in constant losses, and the Company's major assets are parked in non-current assets. Also as per the last audited balance sheet as on 31st Mar. 2019, Company reported current liabilities three times its current assets.

Which indicated a question mark on the long term sustainability of the business.

So It looks like we should avoid investing fresh money in it.

Views Got in Social Media

Mr. Sahil-

Buy! We don't see much further for Voda-Idea. Most of the people using double sim cards are keeping one sim as Jio. Others would-be either Vodafone or Airtel. Comparatively, there are lesser cases where people are keeping Vodafone and Airtel together. Soon the day will come when V-I will have to wind up. Then people will have to shift their V-I sim card to either Jio or Airtel. Hardly people will keep 2 Jio sims. Hence, Airtel would be a gainer in acquiring customers. Revenue will go up, the share price will go up. Your thoughts are invited.

Rukmani Gupta

You are absolutely right but I can foresee a threat towards its sustainability for long term seeing heavy losses with no liquid assets.

Mr. Sahil-

Revenue is more or less stable. Losses were due to write off of exceptional one-time cost (AGR dues). Opex and Capex are going to increase for airtel in the near future as they were having tower sharing agreement with V-I. But increased revenue will look after increased cost. Plus being duopoly, Jio and Airtel are soon going to raise their prices. Airtel will sustain unless Jio plays a trick like reducing its prices/ making service free for months.

Mr. Nimesh-

I do not think the government will allow duopoly and Vodafone -Idea to fail. Think if Vodafone - Idea grows from here. Nothing to lose from here.

Mr. Saurav-

It's a buy, airtel is a sleeping giant, that is great for wealth creation. Have already traded the stock from 470 Above 550 levels, which is the ATH of airtel the stock might run like anything, technically Fundamentally, its already a buy seeing the telecom sector and the duopoly that will exist once Vodafone exits the business..