Bharti Infratel will report its fourth-quarter earnings on Wednesday and the street is expecting a fairly flattish quarter this time.
- Revenue growth is seen at only 1 percent on a sequential basis. There are two factors at play. One, the rationalisation of tower tenancies from players particularly Vodafone Idea. They had announced it in the prior quarter. And even the other telecom players – so that is expected to put negative pressure on Bharti Infratel.
- On the other hand, because of this tower cancellation, a lot of these players have to also give some exit penalty, the penalty for stopping the contract midway. So the two will offset each other and net-net you are going to have is a flattish quarter.
- The exit cancellation penalty, which is revenue to Bharti Infratel, is seen at Rs 90 crore this quarter versus Rs 55 crore in the prior quarter.
- Margins according to CNBC-TV18’s poll should be down about 20-30 basis points (bps) and that will put some pressure on the profitability – a cut of close to about 1.5 percent.