The rating agency S&P expects Airtel to maintain leverage discipline while increasing capital expenditure for data centres, cloud services and African operations, with no major spectrum costs anticipated until FY30.
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Bharti Airtel (Airtel) has been upgraded to a ‘BBB+’ rating from ‘BBB’ by S&P Global Ratings, reflecting strong growth in Africa and India and balance sheet discipline.The upgrade reflects Airtel’s improving earnings, disciplined capital management, and strong market position, with a stable outlook contingent on maintaining leverage and cash flow growth, the rating company said.“The stable outlook reflects our view that Bharti Airtel will pay down debt as earnings and cash flows rise, while maintaining a supportive leverage tolerance for the ‘BBB+’ rating over the next 12-24 months,” S&P said in a report on Wednesday.Strong data demand and India ARPU growth to drive earningsIt said growing data consumption and fundamental improvements in the Indian and African telco markets will help expand Airtel’s earnings. In India, it projected Airtel’s subscriber numbers to increase by 3-4 per cent over the next year and average revenue per user to grow by 5-7 per cent.As of March 31, 2026, Airtel’s India Mobile revenue had increased by 8.3 per cent year-on-year (YoY), driven by higher realisations and an expanding customer base. The company also achieved strong average revenue per user (ARPU) growth, with an ARPU of ₹257 for Q4 FY26, up from ₹245 in Q4 FY25.“Bharti Airtel’s India operations will benefit from higher consumer spending on telco services, as well as subscriber additions. This will stem from growing data consumption and the company’s efforts in driving premiumisation. Churn from other players will also support earnings growth in India,” the S&P report noted.Africa business momentum and EBITDA expansion outlookOn Airtel Africa, the report highlighted that operating performance at African businesses is stronger than expected and anticipated that it will outpace India’s business earnings over the next 12-24 months.“Under our base case, we project the African customer base to grow 9-11 per cent annually, and 5-7 per cent annual growth in ARPU in dollars through the fiscal year ending March 31, 2028. The rebasing of Africa’s earnings also reflects their local currencies’ relative strength against the Indian rupee, which has depreciated 5-7 per cent against the US dollar over the past six months,” it said.The global rating agency also forecast that the company’s consolidated EBITDA will increase by 8-10 per cent annually over the next two years, following a 28 per cent increase in FY26. Over the same period, Africa earnings will rise to 25-27 per cent of Bharti Airtel’s consolidated EBITDA, up from our previous estimates of about 20 per cent.Capex plans, data centres and long-term spectrum outlookAirtel is also likely to increase capital spending to fund new growth drivers, with capex rising annually, reaching around ₹56,500 crore by FY28, up 25 per cent from ₹45,200 crore in FY26. The company will use the increased capex for its data centre business (Nxtra Data), cloud services, and its African operations, it said.“Meanwhile, Bharti Airtel’s India financial services segment would require more capital investments as it ramps up more meaningfully over the next few years. We do not anticipate that the company will need to spend large amounts on spectrum auctions at least until FY30, when its next band of spectrums will be up for renewal,” S&P added.Published on June 24, 2026
