Airtel's Success in Africa Fuels IPO Plans Amid Indian Market Challenges

## Airtel’s Financial Performance Decline

Bharti Airtel has reported a continued decline in both profit and revenue for the second consecutive quarter, reflecting challenges in its Indian market.

For the fiscal second quarter ending September 30th, Airtel’s profit decreased by 65.4% year-on-year to INR 1.19 billion ($16.3 million). Meanwhile, total revenue also fell by 6.2%, amounting to INR 204 billion.

### Struggles in Indian Market

The company observed a revenue drop in its Indian operations of 10.6%, totaling INR 149 billion. This downturn is largely attributed to reduced Average Revenue Per User (ARPU) caused by competitive pricing strategies. Gopal Vittal, Airtel’s CEO for India and South Asia, noted that the decline in ARPU has shown signs of moderation, thanks to their focus on quality customer relationships through simplified pricing and content collaborations.

Although Airtel’s Indian subscriber base grew by 14.4% yearly to reach 330 million, the number started to dwindle, with a loss of 6.6 million subscribers by the quarter’s end in September.

### Data Growth and Infrastructure Investments

Despite these challenges, mobile data consumption surged by 239% compared to last year. To accommodate this increase, Airtel plans to invest further, having added 27,000 broadband sites in this quarter alone.

## Positive Trends in African Operations

In contrast to its struggles in India, Airtel’s African operations are flourishing. The revenue grew by 10.9% year-on-year, reaching $824 million. At the end of September, the subscriber base in Africa reached 94.1 million, marking an impressive 14.9% increase, alongside a 32% rise in data subscribers.

Raghunath Mandava, MD and CEO of Airtel Africa, highlighted the strategic increase in capital expenditures to enhance their LTE network, which is vital for delivering a superior customer experience.

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### Strong Performance of Airtel Money

The company’s mobile money service, Airtel Money, has also shown significant growth, with $6.3 billion in transactions over the past year, reflecting a 31% increase. With a subscriber base of 12.9 million, this service is an essential component of Airtel’s overall growth strategy.

### Future Outlook and IPO Plans

While some reports suggested that Airtel might delay its anticipated IPO due to instability in emerging markets, the company remains optimistic. Recent funding of $1.25 billion, secured from leading global firms including Singtel and Softbank, will aid in reducing debt and supports their confidence in proceeding with the IPO.

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As Airtel navigates these complex challenges and opportunities, what are your thoughts on the company’s future in both the Indian and African markets?