Sector outlook 'constructive' on rising demand, tariff improvement: Bharti Infratel

NEW DELHI: Bharti group’s tower arm Bharti Infratel said the company is positive about rising demand for telecom infrastructure in the post-Covid era and the introduction of the next-gen 5G technologies.
Akhil Gupta, Chairman, Bharti Infratel, said that 2019-20 proved to be a challenging year for the global economy with the emergence of COVID-19 towards the end of the year and the AGR matter which has disturbed the financial health of the telecom sector.

But the tariff hike taken by telcos in December 2019 “was a welcome first step towards sustained financial health of the sector after years of intense price competition that has led to significant revenue erosion,” Gupta said in the company’s annual report released Sunday.

Infratel’s stock ended 0.79% higher at Rs 210.65 per piece on BSE as the benchmark Sensex rose 0.27% on Monday’s trade.

“We feel the telecom industry, in general, has been one of the least negatively impacted industries due to Covid19 so far and there is no significant financial impact of COVID19 pandemic on the Company as well,” DS Rawat, Infratel MD and CEO said in the annual report.

The board is also confident about the outcome of the company’s merger deal with Indus towers which has been hanging for a while. “Post the imminent merger of Infratel and Indus, the combined entity will have a unified, nationwide presence along with very strong financial muscle to invest and capitalize on these upcoming Opportunities,” Rawat said.

Bharti Infratel had extended the long stop date for the closure of its merger for the fifth time, to August 31, saying some conditions still need to be met. The fruition of the deal depends on survival of ailing carrier Vodafone Idea.

Gupta also lauded TRAI’s recommendations on enhancement of scope of Infrastructure Providers-I (IPI) category to include active infrastructure in addition to passive infrastructure. “Acceptance of these favorable TRAI recommendations will enable companies like ours to significantly enhance scope of services and to provide passive as well as active infrastructure services to the enhanced service providers including TSPs.”

“The ongoing digital revolution, the next-generation technologies such as 5G, Smart cities, IoT, and the need for a better network in a post Covid19 world will open up new avenues for telecom infrastructure,” Rawat said.

For the full year ended March 2020, Bharti had made a profit of Rs 3300 crore up 32% on-year while consolidated revenues were at Rs 4647 crore, up 0.4% Y-o-Y and consolidated EBITDA was at Rs 7442 crore, up 23% Y-o-Y.