Bharti Airtel stock up over 2% as investors hope every customer spent 10% more on average

Even as the stock traded in red for the past few days, it has given investors a return of almost 30 percent in the past year.

From traders' point of view, Prashanth Tapse, vice-president (research), Mehta Equities Ltd, said Bharti Airtel stock may test Rs 725-750 levels in the medium term while the stock looks like a good investment opportunity from a long-term perspective.

"The stock has made a short-term bottom near 680-690 range and close above Rs 707. It can test 725-750 levels in the medium term, and a close below 681 will be seen as bearish with immediate downside risk at the 639 mark," he told CNBCTV18.com.

The prediction follows the tariff hike that was implemented last year. Bharti Airtel was the first to raise mobile services rates by 18-25 percent in November 2021.

The Street expects a 10 percent revenue growth quarter-on-quarter for the company's India mobile business, which is above 58 percent of the company's overall revenues. A CNBC-TV18 poll has predicted a sequential growth of 6.3 percent in consolidated revenue.

The telco targets hitting an average revenue per user (ARPU) of Rs 200 in 2022. Bharti Airtel’s ARPU during the fourth quarter of the 2022 financial year is likely to have gone up 10 percent on a quarter-on-quarter basis against its competitors, Vodafone Idea and Reliance Jio, which reported an increase of about 8-10 percent.

Investors want to know when the next tariff hike may take place and the 5G auctions that are due this year. In February, Bharti Airtel indicated it would hike tariffs again this year but not in the next three to four months.

Meanwhile, the telecom firm's margins are expected to stabilise around the 50 percent mark.

At a CII event last week, the firm’s chairman Sunil Mittal said, "The balance sheet is healthy. And we are now down to two-and-a-half players for a country the size of India, so the future looks good now. Will there be one more crisis? Who knows, but this company has become very strong and battle-hardened."