Note: This is a preliminary transcript and may contain inaccuracies. It will be updated with a final, fully-reviewed version soon.
Bharti Hexacom Ltd (NSE: BHARTIHEXA) Q4 2026 Earnings Call dated May. 14, 2026
Corporate Participants:
Vaidehi Sharma — Moderator
Soumen Ray — Group Chief Financial Officer
Shashwat Sharma — Managing Director & Chief Executive Officer
Gopal Vittal — Executive Vice Chairman
Sunil Bharti Mittal — Chairman
Analysts:
Manish Adukia — Analyst
Unidentified Participant
Sanjesh Jain — Analyst
Vivekanand Subbaraman — Analyst
Pranav Kshatriya — Analyst
Presentation:
Vaidehi Sharma — Moderator
May include certain forward looking statements that must be viewed in conjunction with the risks that we face. Post the Management Opening Remarks we will open up for an interactive Q and A session. Interested participants may click on Raise hand option on the Zoom application to join the Q and A queue. The participants may click this option during the Management Opening Remarks itself to ensure they find a place in the queue. Upon announcement of name participants to kindly click on Unmute myself in the pop up screen and start asking the question post Introduction with this I would like to hand over to Mr.
Soman Ray for his opening remarks.
Soumen Ray — Group Chief Financial Officer
Thank you Vedi welcome to the Q4FY26 earnings call of Bharti Airtel Ltd. I have with me Gopal, Shashwat, Akhil and Naval. Pleased to inform you that today we will have Mr. Sunil Bharti Mittal, Chairman Bharti Airtel Limited joining us for the last 1015 minutes of the webinar to address queries relating to promoter shareholding. I will now start with an update on our consolidated financials for the fourth quarter and full year ended FY26 post which I will hand over to Shashwat to talk about our India business including the strategic priorities.
First, a quick roundup on FY26 we delivered another year of strong performance. Our consolidated revenue crossed another milestone and came in at a lifetime high of about 2,11,000 crores backed by strong performance in both India and Africa. Ebital came in at about 1.8000crore with a margin of 51.2%. India. Ebital excluding passive came in at about 72,500 crores, growing around 18% and delivered a 3.1% improvement and stood at 51.7%. Our sustained operational excellence is underpinned by our portfolio premiumization, sharp execution and tight control over cost through war on waste initiatives.
Capex for FY26 for India excluding passive was around 31,000 crores. Operating free cash flow, which is Ebital minus Capex was a solid 41,500 crores plus. Disciplined capital spending and operational excellence continue to strengthen our balance sheet. Net debt to Ebitdal now stands at 1.1. The board recommended the dividend of rupees 24 per share, a significant increase over last year’s rupees 16 per share. This is in line with our stated philosophy of progressive increase in payouts. Let me now turn to our Q4 performance.
Consolidated revenues came in at about 55,400 crores, a growth of 2.6%. Sequentially, Africa maintained its underlying growth trajectory Q4 constant currency revenue growth was at 1.1% and was impacted by seasonality as well as lesser number of days. Currency tailwinds further supported growth in reported currency. India revenues excluding passive came in at about 36,100 crores. Ebital margins came in at about 52% and improvement of 20 basis points. Let me now talk about the strength of our diversified portfolio and an update on our new growth bets.
Our diversified and resilient portfolio continues to play well. Underlying performance across India and Africa was strong. Africa now accounts for 29% of revenues. India mobile 52%, India non mobile at 13% and Indus at 6%. Our investments are directed towards future proofing Airtel by building world class digital network, sharpening the code portfolio and scaling new digital growth engines. Our strategy to further diversify our portfolio is reflected through investments in new growth bets. Let me spend a few minutes on the same.
Over the year through a very disciplined approach we have identified new areas which we call adjacencies and operated calibrated experimentation on them. To us, adjacencies means the business must pass two filters. First, we have a proven right to win and second, we can create a differentiated value proposition. We have sharpened our focus basis the result of the experimentation in three specific adjacencies. These are Data centers, Financial services and Airtel Cloud. In data centers we continue to make steady progress against our ambition of building 1 gigawatt capacity over the next few years.
To augment this journey, Nexta announced a $1 billion fundraise from Marquee investors alongside participation from Airtel. We see this as a strong validation of both the scale of the opportunity and our execution capabilities in this business. In financial services we reached an important milestone with our subsidiary Airtel Money Limited receiving the Reserve bank of India’s approval to operate as a non deposit taking non banking financial company. We are now progressing towards commercial launch.
Over the last three years we have built a strong foundation as a loan service provider serving customers need through Digital First Solutions. Our loan service provider business continues to deliver strong growth with monthly loan disbursement run rate now over 550 crores. What gives us confidence here is the combination of our digital platform data and analytics capabilities and strong operating discipline. Together these position us well to expand access to simple, secure and innovative financial services at scale within our financial service portfolio, Airtel Payments bank delivered another quarter of strong performance.
It ended Q4 with monthly transacting users of about 120 million. Annualized revenue run rate is now about 3400 crores growing 23% YoY deposit remains strong at over 4600 crores growing at 27% YoY in Airtel Cloud Our telco grade sovereign cloud offering is seeing encouraging traction. We ended the year with securing 24 deals followed by further wins in April and we are currently in conversation with multiple customers across industries. We have also made very good progress in building attributes and credentials required by our customers in this business in these new growth bets.
We are still in early days but we are encouraged by the progress, confident in the opportunities ahead and committed to building these businesses with the same discipline, customer centricity and long term focus that have shaped Airtel’s journey so far. Now an update on group synergies. We are working on various areas including technology, network, supply chain and talent across the group. Initial outcomes are extremely encouraging and moving as per our plan, our tech stack has already been extended to Africa Payments bank and Indus Towers at arm’s length pricing.
This gives significant leverage across the group to shorten the learning curve, drive cost effectiveness and accelerate digital ways of working to drive growth. In addition, we have taken B2B and homes as two areas for massive synergy. Within this we are working towards significantly reducing dependence of diesel by transitioning towards high powered batteries and renewable power. We strongly believe that work across these areas will provide meaningful outcomes with superior revenue growth and cost efficiencies.
Moving to the material transaction that was approved by the Board to acquire additional stake in our Africa operations, the Board yesterday approved a share swap transaction between Airtel and ICIL to acquire additional 16.3% in Airtel Africa. We continue to remain confident about the long term growth opportunity in Africa led by low tele density at about 45% on Unixims, smartphone penetrations of only about 52%, very low data consumption per customer and overall demographic young demographic profile of the market.
Further, there are two large growth opportunities, the first one being homes, enterprise and data centers and the second being Airtel Money where there is a potential for further value unlock with listing. This is a no cash deal and value accredited to Airtel shareholders. Before I hand over to Shashwat, I would also like to talk about the impact of the ongoing geopolitical crisis. There are a few areas of our operations which are seeing impact including international roping capex on account of INR depreciation, restriction on gas supply affecting galvanizing industry in turn leading to lower tower build outs.
The other obvious impact is energy price increase. Africa has already been impacted by it. Having said that we are looking at all possible opportunities to mitigate the impact of with amplified efforts through our War on Waste initiatives. With this, I will now hand over to Shashwat for an update on India Business.
Shashwat Sharma — Managing Director & Chief Executive Officer
Thank you Shoman. Very good afternoon to everyone. I’ll start by sharing an update on our ESG plans followed by each of our business segments and then our strategic priorities. Let me start with esg. Our ESG progress is anchored in our strategy and in the way we leverage technology and digital innovation to drive sustainable operations with enhanced efficiency. A key focus area is increasing the use of energy from alternate to renewable sources. This is reflected in our continued expansion of solar power deployment across our network infrastructure.
We ended the year with 42,000 network sites which have solar access. Over the last two years we have solarized nearly 27,000 network sites. We also made significant progress on workforce diversity. Women contribute to over 20% of our workforce today, improving from 11% that we had in 2023. This is not enough and we believe that we must continue the work much more to improve our women representation in our workforce. Moving on to a quick update on each of our businesses, let me start first by rounding up the year gone by.
We delivered strong performance across our businesses. Mobility, sustained revenue, market share gains to reach a lifetime high share homes accelerated strongly this year adding 4.2 million customers while B2B further strengthened its market share in core connectivity and delivered strong outcomes in its digital businesses. Our IPTV launch last year was well received with encouraging customer adoption. We continue to invest in digital infrastructure, deploying nearly 7,800 more network sites and rolling out nearly 43,000 kilometers of fiber.
Fiber deployment remains a strategic priority for us and I’ll come back to this shortly. Underpinning this, our digital first approach and relentless focus on serving customers better every day. FY26 was a landmark year for us. We continue to deliver strong performance and seeded three new digital growth engines that we believe will drive the long term growth of the company. Let me now turn to the quarterly performance of the business segments for quarter four mobile we added 4.7 million customers in quarter four and 5.8 million out of those were smartphone customers.
Our ARPU for the quarter came in at rupees 257, which on an EDB basis was an increase of rupees 3 for the quarter. We’re not happy with the arpu increase of rupees 3. Part of this issue was linked to West Asia crisis and international roaming revenues, but we are now determined to doubling down on all our levers on ARPU and growing and accelerating this pace Homes we continue to deliver another strong quarter. Our net adds came in at 1.1 million while FWA continued to expand the addressable market for us.
We are deepening our footprint on ftth with accelerated HomePass expansion. Digital TV saw a turnaround. We added nearly half a million customers during the quarter led by the IPTVX adoption. Our IPTV take rates continue to improve and are delivering on our converged agenda on content. Airtel business revenue came in at about 5,500 crores growing 2.6% sequentially. We ended the year on a strong note with a healthy order book and a funnel across domestic and global business with multiple wins from large enterprises.
During the quarter we secured multiple deals on IoT security, cloud core connectivity and Nextra and we ended the year with a strong order book growth of 17% in FY26. Digital businesses delivered a strong revenue growth for us at growing at 27% in FY26. We continue to strengthen our offerings through strategic investments across our digital portfolio spanning cloud, CyberSecurity, Financial Services, IoT Digital Platforms and CPaaS. These investments are enabling us to build scalable enterprise grade digital capabilities and diversify our revenue mix.
Let me now move to our strategic pillars and start with quality customers starting with homes I had mentioned earlier, we see a large opportunity with market potential of nearly 100 million connected homes over the medium term in India. Growing smart TV penetration, evolving content consumption behaviors of consumers and the growing need for reliable and secure home connectivity are driving a very strong demand well beyond key urban centers. Given the global environment, there has been challenge on this business with memory and chipset supply as well as prices.
Given this scenario and the fact that fiber offers the superior experience and reliable connectivity to our customers, we have doubled down on all our efforts to grow our fiber business. In FY26 we rolled out upwards of 8 million home passes to cross 45 million home passes and we continue to expand rapidly. Another area where we see growth is driving fixed and mobile convergence. We have seen converging wi fi and mobile for our customers drops their churn by nearly 50%. We are determined to leveraging our existing relationships with high value customers and and scale our converged pace.
We have taken a step in this direction through our recently launched one Airtel plans which offer customers convenience, flexibility of bundling as well as great value. Let me now switch to mobile. The focus on mobile is to dramatically accelerate our ARPU growth in the business overall upgradation with data consumption in 5G handset upgrades from feature phones and international roaming offer large headrooms for growth. However, we see a very large opportunity in upgradation to postpaid and are determined to accelerating postpaid growth by driving differentiation.
Our rural network expansion program continues and contributes significantly to our growth momentum. Let me now turn to B2B. Majority of incremental growth for the industry in B2B is coming from adjacencies including cloud security, IoT, CPaaS, data centers. Core connectivity growth is moderate and we continue to grow competitively. To capitalize on the growth opportunities, we are focusing on three key areas. First is to build a gold standard infrastructure with low latency flapless fiber networks, deeper subsea cables, presence across the globe, augment DC DC connectivity and expand our OPGW infrastructure.
Over the last three years we have deployed over 1 43,000 kilometers of fiber and we believe the pace of deployment should continue to address the growing customer needs across as well as in future proofing Airtel itself The other area we need to strengthen is our digital portfolio capabilities while building a world class delivery and assurance organization. We are developing comprehensive suite of digital services to deepen and sharpen our portfolio across Cloud, IoT, Cybersecurity, CPaaS and SD WAN.
We are strengthening our account management capabilities to deliver superior customer experience supported by digital tooling and data science platforms. The second pillar of our strategy is the obsession to deliver brilliant experience. Delivering an exceptional experience to our customers remains paramount to us and underpins everything we do from network investments to digital innovations. Our converged data engine that powers digital experience layer is accelerating our ways of working and enabling deeper customer engagement through persuasion and contextual marketing.
Our network priorities are towards building a gold plated experience and we are investing in strengthening our transport layer and launching advanced capabilities on 5G. Our 5G network is now fully SA ready. FWA is running fully on SA while mobile customers are transitioning in a phased manner. We continue to refine our digital tools and depth of data science to improve our experience and reduce customer churn. Customer obsession is deeply embedded in our culture that we have built over the years and this is anchored in two core beliefs ownership, mindset and entrepreneurial spirit.
Embodying this philosophy, we have established an annual tradition. Teams across the organization spend a day in the field with frontline colleagues directly interacting with customers, listening to them, learning and grasping their pain points. Every year through this initiative we gather critical insights across network customer journeys, delivery and assurance and many other areas. These insights help us resolve issues structurally and make our network more resilient and help us serve our customers better every day.
The third pillar of our strategy is to build and leverage our digital capabilities. AI is now central to our digital agenda and we are progressively embedding AI across our platform architecture. Let me give you some flavor of notable outcomes from AI last quarter. Our fight against spam has always been powered by AI at scale. In quarter four we identified an additional 14 billion spam calls and over 520 million spam messages. Our next best action AI model generated 135 million actions last quarter, which helps us accelerate our cross sell and WI fi, postpaid and financial services.
In Q4 we processed 375 million customer interactions with our voice AI bot and processed 256 million images using our vision AI for safety, design and workmanship. AI is contributing to nearly 30% of all code written at Airtel and this number is growing with every passing week. I want to emphasize that we are still in the early stages of our journey on AI, but we are beginning to see meaningful impact scaling up across businesses. The last and fourth pillar of our strategy is war on waste. As there are cost headwinds on both OPEX and capex, I want to underscore that we have widened the funnel to identify and eliminate waste across the organization.
While unpredictable scenarios are playing out globally, the cost pressures we are seeing today remain confined to a few specific areas, particularly in servers and memory prices as well as availability of these components. Significant steps to re engineer and redesign are underway in the organization to mitigate these pressures. We have also taken significant steps to reduce our dependency on diesel consumption across our sites. These initiatives are beginning to deliver meaningful outcomes and we believe there is a lot of work still to be done in this space of war and waste.
To sum up overall, we delivered another year and a quarter of strong performance underpinned by strength of our diversified portfolio and sharp execution. Looking ahead, we continue to see large growth opportunities across mobility led by ARPU growth through portfolio premiumization and postpaid rapid expansion of homes and across B2B. At the same time, our investments are directed to building digital businesses and new growth bets at scale to future proof Airtel and its long term growth. Digital acceleration remains at the core of our strategy with AI increasingly embedded across the businesses at scale.
The strength of our balance sheet reflects our disciplined capital allocation, sustained deleveraging and operational excellence. This has enabled us to sustain a progressive dividend policy with our dividends in FY26 increasing by 50% over the previous year. With that summary, let me now hand it over back to Vaidehi for The Q and A session.
Questions and Answers:
Vaidehi Sharma
Thank you very much Ashwath. We will now begin the Bharti Airtel Q and A interactive session for all the participants. Please note that the Q and A session will be restricted to the analyst and investor community only due to time constraints. We would request if you could limit the questions to two per participants to enable more participation. Interested participants may click on Raise hand option on the Zoom application to join the Q and A queue upon announcement of name participants to kindly click on Unmute myself in the pop up screen and start asking the question post introduction.
Participants are requested to limit their questions to Bharti Airtel till 1pm as the management will start the Q and A discussion on Bharti Hexacom from 1pm onwards with this. The first question comes from Mr. Manish Adukia. Mr. Adukia, you may please unmute your side, introduce yourself and ask your question now.
Manish Adukia
Thank you for taking my questions. This is Manisha Rukia from Goldman Sachs. My first question is on capital allocation and thank you for the color around dividend payout. Now the free cash flow you’re generating in the India business last 12 months, more than $4 billion consol business, more than $5 billion of free cash flow. In the context of that free cash flow, the dividend payout is still less 40% of that free cash flow generation. Plus for Africa you’ve done like a share swap transaction. So in the context of that large free cash flow generation over the next few years, one, how are you thinking about progressively what payout may look like in a steady state and two, if you can just talk about what are the other priorities in terms of assets outside of India that you may potentially look to explore in the future given just a strong free cash flow generation and maybe the criteria you may look to, you know, assess any asset that you may want to acquire outside India.
That’d be my first question please.
Gopal Vittal
Yeah, Manish, let me take that. I think the, you know, obviously the free cash flow generation for the company has increased and that is the reason why we have sort of stepped up and also said to you in the past that there will be a progressive dividend policy which is the reason that you’ve seen the step up in dividend as far as capital allocation is concerned. I think the way we think about it is the first and primary port of call is to really invest in the core business. This is the core business in India, the core business in Africa, the core business in Indus Towers, et cetera and I think the climate stake in Africa was predicated on that assumption of really picking up a greater stake in a very valuable asset where the penetration of data tele density, the penetration of smartphones is low.
Airtel money is a big opportunity, so we are very excited about that. The second port of call is really to continue to deleverage to the extent that we need to. But the third port of call is to invest in some of these adjacencies which Shamin spoke about, data centers. You will note that despite the investments we’ve put in, we are a big player in the data center market. We are only at about 10 to 12% share and for a company of our size, we’re not satisfied with that kind of presence. So we really need to step up our game in data centers.
And our ambition is to get to a gigawatt as we mentioned, in a few years time. But that game will not end there. We will continue to build out and you know, the data center market has 50 to 60% of its demand coming out of Mumbai. So you know, land will need to be acquired and data centers will need to be built. Second port of call is really around financial services and this is why we’ve announced our NBFC after the experiments that Shaman spoke about. Again, we are excited about it because we believe we have a genuine mote here to really drive the business as a whole and create stickiness for our user base in a market where the penetration of financial services and lending generally is very low and the headroom for growth over the next three decades is high.
Obviously it’s a business that needs to be run prudently. Collections are more important, as many of you have told us in smaller conversations, and we fully understand that. But the power of our platform is showing us that the delinquencies as well as the collection cost as well as sales acquisition cost are much lower than if you do it alone in a very fragmented market. So that’s the second port of call. The third port of call is really around cloud. And here again, we haven’t really started. I mean we’ve got 25 deals, as Shamin mentioned.
These are small deals, but we’ve just begun. We think this could be a large opportunity, especially in a new geopolitical context where a lot of workloads and when I speak to many companies, they tell me that a lot of workloads do need a sovereign requirement. We are fully sovereign. We are controlled by an Indian entity. So the control plane, the data plane, the jurisdiction, all of it is in India. And our capabilities that we have built for ourselves, which by the way runs one of the largest cloud instances in India, has given us the confidence to extend into the space.
All of these will require capital. So once we’ve concluded that, then we will look at any other areas. As of now, there’s nothing to talk about in terms of additional capital being needed in any other area.
Manish Adukia
Thank you Gopal and thanks for the comprehensive answer. So just to clarify on that one, given whatever you listed is all India assets and given the large transaction in Africa you’ve announced, it’s safe to assume that for the foreseeable future there are no plans for further capital deployment in non India assets. Would that be fair to say
Gopal Vittal
For now? Yes, absolutely. I think we will continue to look at bolt on acquisitions in the spaces that we’ve already talked about, whether it’s in towers, it’s in cloud, it’s in cybersecurity, in B2B specifically. So those are areas that we will continue to look at. But if there’s anything that’s going outside, then at this point in time, there’s nothing to talk about.
Manish Adukia
Very clear. My second question just on ARPUs and when I look at, let’s say the ARPU, while yes, the growth’s been weak, but even despite limited ARPU growth, you’re now generating like decent returns on capital in the India business at about mid teens, free cash flow is improving every year. Your CapEx requirements are not material, at least in the core wireless business. So in the context of that one, is it even realistic to assume any meaningful tariff hikes in the foreseeable future? Like what would be the rationale for more tariff hikes when the business is doing generally okay from a free cash flow and returns perspective.
And a related question, Shashat mentioned that, you know, from here on you’re not happy with how the ARPU was in the previous quarter and you look to accelerate. But what will really change the trajectory? I mean your postpaid ads have been strong. Data ads have been strong. So given the base is so large, without tariff hike, shouldn’t the growth only continue to decelerate? If you can just maybe provide more color there. Thank you.
Gopal Vittal
You know Manish, I mean, let me take this and you know Shashwat can supplement this. If Shashwat, you’ve got anything to add. Fundamentally, my belief is that, you know, the price architecture in this country is broken. You contrast Indian pricing with African pricing. You know, for every GB that is consumed, there is a little bit of revenue that you get here at fundamentally at about 340350 rupees. You’re capped out because you’re running unlimited data plans. Now, nowhere in the world do you see this capping out at unlimited data at these levels.
I mean, if you look at markets in the U.S. For example, these kind of plans begin at 60, $70. You look at even US, Europe, most of these markets, unlimited data would really begin at about €35 or 30 to 35 pounds. So the fact is that it’s the architecture of pricing that fundamentally is broken and needs to be repaired. You’re absolutely right. At the lower entry levels, you know, the price is today at rs199 in India. You know, at a time like this, to take up prices on those kind of packs is something that we will need to do with caution.
But if the allowances were to change and the architecture were to change, which is really moving from small, medium, large and extra large, where you have different sort of amounts of allowance going in, which allows a natural pathway to upgradation, given the stratification in this country, from the very poor all the way to the very rich, the fact is that ARPU will only go up. So it’s an unfortunate situation, like I’ve mentioned before, where the rich are paying less than they ought to and the poor are perhaps paying as much as they need to.
So this is, I think, the. The thing that needs to change. Shashrath, is there anything to add?
Shashwat Sharma
Nopal, I think this is all. Thank you.
Manish Adukia
Thank you for taking my questions. All the best.
Vaidehi Sharma
Next question comes from Mr. Kunal Vora. Mr. Vora, you may please unmute your side, introduce yourself and ask your question now. Mr. Vora, you may please unmute your side, introduce yourself and ask your question now. The next question comes from Mr. Ankurudra. Mr. Rudra, you may please unmute your side, introduce yourself and ask your question now.
Unidentified Participant
Hi. Thank you. So, you know, you mentioned ARPU is coming a bit lighter than you were expecting, but it’s still sort of up 5%, thanks to all the organic drivers you’ve been working on. I’m just curious if you think about F27. Some of the headwinds on international roaming probably are still, still here. Do you think there’ll be an additional headwind from smartphone shipment drops this year which might lead to a lower organic ARPU expansion short of any kind of tariff increases.
Gopal Vittal
You want to take that?
Shashwat Sharma
Yeah, I’ll take that. Gopal Ankur. I think the only thing I would add, Ankur, is there is we have seen some bit of softening of shipments of handsets etc and prices going up. So we haven’t yet seen any impact but we can’t rule it out. Having said that, the organic ARPU levers that we have which we want to sweat much more and especially led by a much bigger play in postpaid as well as getting customers to their best fit plans upgrading as much as possible within the tiers itself driven by consumption.
I think those levers still give us a good headroom for continuing ARPU growth for many quarters to come. So I think it’s a combination of both. As Gopal said, the pricing architecture eventually is the biggest unlock if you ask me. But the feature phone to smartphone space needs to be watched because handset prices have gone up very sharply in the last few weeks, which we’ll watch.
Unidentified Participant
Thank you. Second question is on CapEx you did highlight several demands on capital across new initiatives, financial services and perhaps even 5G densification, if that’s part of the plan. Could you maybe talk about CapEx plans for the coming year, how this will change versus prior years, particularly given the intensification on the growth bets versus the core and maybe just a follow up how overall capital allocation should look like this year? Thank you.
Gopal Vittal
Look, I think let me qualify the capital allocation and just sort of I reassure it and underscore the point that I was making. The first and primary port of call for any capital allocation will be our core business. I think we have no right to play in any adjacencies unless our core is vibrant. So within the core radio capex as I’ve mentioned before, is moderating. In Africa it’s growing, but in India it’s moderating. The core capex, which is a smaller component of capex, has moderated transport capex, we are going to double down and actually do more.
We’ve been doing this systematically for the last four years. Our fiber pops need, our fiber points of presence need to increase. A lot more quality of infrastructure needs to be put in place. There is a big project that is underway which we spoke about last time on resilience, just the resilience of our edge data centers. And you know we are focused right now on building in the next 18 to 24 months 56 world class edge data centers which will really stand us in very good stead over the next two to three decades and build a strong point of differentiation for us for computation that could happen at the edge over time.
So that will continue to be a focus. Data centers we’ve spoken about which will be a focus home Business is another big area of focus that will continue to get all of the focus and then wherever. The cloud business is a modular business in terms of the servers and the compute, but it goes into our existing data centers and we are carving out space in all the data centers that we have. We currently have three cloud regions and we will continue to bolster capacity in those regions as and when we need to.
Financial services will require some investment. We’ve announced our investment plan already. We will see how this plays out. We’ll do this carefully and prudently and we will step up our growth. But we’ll continue to do that in a way that leverages or sort of builds a culture of both collection, collection efficiency as well as compliance. So the net result of all of that, if you look at the CapEx, while we don’t give a guidance typically our sense is that, you know, we will be in the ballpark of, of this year, give or take a little bit.
Vaidehi Sharma
The next question comes from Mr. Aditya Suresh. Mr. Suresh, you may please unmute your side, introduce yourself and ask your question now.
Unidentified Participant
Thank you for the opportunity. The first question is on return on capital employed, you had kind of mentioned that there’s been an expansion there today on a console basis at about 19%. Is it possible to articulate any targets on a say two, three year basis in light of these capital allocation bets which the company is taking? That’s question one. Question two was on nextra, could you articulate the business model which you all are thinking about for nextra? Is it going to be tenancy or is it going to be involving GPUs and renting out said GPUs?
In that context again, could you maybe elaborate and touch on a little bit on your partnership with Google here? Thank you.
Gopal Vittal
On return on capital, I will dodge the bullet of what our targets are. I don’t think we give those targets out. I think the fact is that on our core business, given the scale that we have and given the massive amount of heavy lifting that we’ve seen over the years and the obsession to strip out waste, we hope to continue to see operating leverage as we get growth. That should give us additional sort of returns. On the nextra side, for us the model is really around tenancy. This is a collocation model with, specifically with Google.
They are building a very large AI data center in Visakhapatnam and we are sort of building it for them. So there’s again a colocation led project. We are currently not doing GPU as a Service. As I had mentioned earlier, we are watching the space because the GPUs that we bought for ourselves in the recent past, a few hundred GPUs. The efficiency of those GPUs is 10x of what the GPU is worth two and a half years ago. And they’re also cheaper. So you know, it’s unbelievable actually the pace at which these chips are getting more and more efficient.
So we are using it for our own needs for all the AI work that Shashwat spoke about. But you know, our data centers are being built with the latest technologies in terms of cooling capabilities, power efficiency and also a standard toolkit on the build out, which is really world class. So that’s an area that we, that, that we’re working on so that, you know, it’s fungible across different customers as we go and build these data centers out.
Unidentified Participant
Thanks, Kopal.
Vaidehi Sharma
The next question comes from Mr. Sumangal Nivetia. Mr. Nivetia, you may please unmute your side, introduce yourself and ask your question now.
Unidentified Participant
Good afternoon. Thanks for the chance. My first question is on the wireless one on the ARPU. Since we’ve seen very impressive 5% organic growth year on year and in our opening remarks, a focus on accelerating arpu, how should we look at this in absence of tariff hike, should we further expect some acceleration here and then on the wireless capex, we’ve hit a decade low at around 16% of sales. Are we close to the bottom or should we expect further moderation before 6G capex kicks in in the near coming years?
Gopal Vittal
Shashwat, can you take the first one and Shaman, maybe you can take the second.
Shashwat Sharma
Yeah. So on the atmo I think we touched upon this briefly, which was the fact that we see substantial headrooms. There are two parts to it. One is really correcting the pricing architecture going forward, which as and when it happens, will happen. But within the current construct levers of postpaid penetration within our base, which we feel needs a much larger unlock international roaming. We’ll see how that plays out this year. But even upgrades within the consumption baskets of our customers and the data that they are consuming, we continue to be very optimistic and this will be our largest growth lever as well.
So I think that’s what I would just reiterate
Soumen Ray
Coming to the CapEx on wireless, I think 16% is a derived number. As Gopal said, the core would be funded completely. We will ensure it is funded. So it has moderated significantly? Yes, it is one of the lowest as percentage sales. Also in absolute terms it’s very low. But if tomorrow we need to do higher 5G densification, we will not shy away. So we’re not chasing a target, but we will be optimal and prudent in deploying whatever is required because that’s the biggest of the core businesses.
Unidentified Participant
Got it. One just last small question on the homes arpu. Well, while we’ve seen impressive ads over the last few years, ARPU has been decelerating. So should we expect this trend to kind of continue given we are in the land grab phase in the coming years?
Shashwat Sharma
I’ll just take that. I think on homes, if you see the new additions in the industry have happened at a slightly lower ARPU compared to the traditional arpus that we had. But this is plateauing out. I think some of our quarter on quarter ARPUs are kind of bottoming out. Which trend is we are beginning to see in the last two quarters?
Gopal Vittal
I think just to qualify that there are two ways to look at arpu. One is the customers that you acquire, the new customers and this existing customer. So the existing customers simply because of penetration as it’s grown, you had people on higher plans in the past and so just the mix kind of drives that ARPU down. But that as Shashwood said, the acquisition ARPU is not declining at all over the many quarters. So at some point I think the real challenge here in homes is to step up our penetration and really grab as much share of homes because long term that will be a very significant mode for the company.
This is a very high, you know, this is a business that you return that that is very profitable over a period of time because the churn and the customer lifetime value of a home tends to be very low. And this is by the way, this is all across the world. And the moment you drive convergence, which means content plus mobility, the lifetime value increases even more. So our metric really is to expand the base. Right now that’s the focus.
Unidentified Participant
Thanks and all the best.
Vaidehi Sharma
We are very pleased to have Mr. Mittal join us on the call today. I request all the interested participants to kindly use the raise hand option to ask questions addressed to him with this. The next question comes from Mr. Sanjesh Jain. Mr. Jain, you may please unmute your side, introduce yourself and ask your question now.
Sanjesh Jain
Thank you. Thanks for the opportunity. I think I’ll take this opportunity to address Mr. Mittal. Sir, just wanted to understand now that we have executed the Africa stake sale and in the process the promoter stake in the company has gone up and we also have a stated objective of having A equal stake along with the partner Singtel. Now how should we see whether you still continue to have the view that it will be only Bharti Telecom which will own Bharati Airtel or you see an opportunity to have an equal stake with Pastel and ICL also owning along with Bharti Telecom.
Sunil Bharti Mittal
You know, basically the belief remains that you must have everything through one company. That should be the controlling, promoting shareholder. And BI Telecom, as you know, historically has just not, not only been the founding promoter of this company, has had almost always for a long period of time, a controlling shareholding of 51%. If you really ask me, my own wish is that in the next, I know it’s hard to put in, you know, ears on it. And in the next decade as I kind of come to a point where I hand over the reins to the next generation as shareholders, Bharti Telecom should get back to controlling shareholding.
51% of just over 50%. So that’s 10% more to go. And for a company of this magnitude and size, you can imagine that it’s not a small task. So the principal direction or vision that I carry in my mind is all share that we can from both ICIL or Bharti family entities. And Singtel should go into Bharti Telecom as much as possible. So to put a bit more granular sort of angle to it, Singtel had a difference of about 7% or rather has 7% direct stake in Airtel and it had about 6% to equalize now with this transaction.
Once this is done and shares are issued, this gap comes down to 3.6%. So first and foremost we should see overall this gap dramatically reduces. And if Singtel, which has been on the path of a sell down of this direct stake, has to sell now much less than earlier. So 3.6% over the next three years or so, let’s say three, four years as a one less than 1% a year gets Singtel onto the equalization path that they stated in the last two years. And that brings us to equal stake. And then it will be during this period of effort, depending on how well Gopal Shashwat Suman and the entire management team delivers these wonderful cash flows.
More dividends, more buybacks. Idea would be to keep using that twin lever to get BTL above the 50% stake. That would be my cherished desire. Our stake must go back to btl. For that I need a little bit more leeway in the hands of btl, which I’m hoping will be delivered through continuously enhanced dividend as you’re seeing and I think hopefully in the next couple of years some buybacks in addition to the dividend and that will give us the necessary capacity in BTL to buy more. If I could do it today, honestly I will do my transfer to BTL now but BTL needs then little bit more room and cash.
Sanjesh Jain
That’s very clear sir. Very helpful. Thanks for that. Answer two question on Shatwat, Gopal and team first on the enterprise business, you said the order book has grown 70 17% which is quite heartening to hear. How should we see growth rate now that the commodity business which we discontinued is behind and the growth rate for FY27 should be significantly better than FY26? And will this also mean that the new business will come with the better ROC in the in the enterprise part of the business? That’s number one.
And on second on the adjacencies we have been seeing there’s a widening gap of market share between us and jio. We are more using fiber as a lever to grow. FWA appears to be having a lower lead time and they’re able to grab that the customer base much faster. How should we see our strategy of heavily focused on fiber versus FW for the peer? That’s my first question.
Gopal Vittal
Sanjay, thank you. On B2B the B2B business actually comprises of a whole portfolio of businesses. So on the one hand you’ve got a commoditized business which is really messaging where the margins tend to be low, but there’s also no capex. It’s just riding on the existing pipes. And this business is sort of flattish to declining slightly depending on how you skin it, fundamentally because of price pressures as well as the move to OTT platforms. So this is one part of the business. The second part of the business is really connectivity which is growing.
The industry grows at about low single digits. We’ve been growing faster because we’ve been gaining share over the last few years and we continue to focus on connectivity. We have a leading position here in connectivity, particularly in distributed businesses, manufacturing, distribution, banking, financial services, etc. Etc. We need to do perhaps a slightly better job in the IT IT services space, but we have leading positions here on connectivity. Then you come to the third part of the portfolio, which is data centers which we’ve already spoken about.
And the fourth part of the portfolio is our digital businesses. The digital businesses are essentially CPAAs. These are sort of value added over the messaging, basic messaging, where you know the kind of things we’ve done on spam. The first project that we started with hdfc, working with a direct pipe, that really cuts spam altogether. No capex here. Right. So the margins tend to be lower because when you start looking at ebitda, it’s not necessarily a relevant indicator because there’s no capex on that business.
That’s one type of business. The second is security. Security comprises of basically our secure security operations center. That’s a service business. Again, very little capex. It’s people who run it and tools that run it and then partnerships with security companies which sell products. Again, no capex. Then there’s cloud, which has high capex. So when you look at all of this, if you ask me, if we have to step up growth, there will be some margin pressures because there’s just the mix of the business.
Connectivity will always continue to have very high margins. CPAs will have lower margins and digital businesses will have lower margins. Our effort has to be to grow the top line faster and grow the absolute EBITDA faster. Right. Absolute profit faster. I think that should be the focus of this business. And that’s really what we are embarked on on the, you know, the home broadband piece, you know, Shashwat will, will add to this, but I feel, you know, for us to comment on a competitor and, you know, how they are performing is not the relevant thing to do today.
The way that we look at it, Sanjay, is we have various ways to look at our competitive performance. We use OTT platforms like Meta, which have very rich data that is provided on the number of sessions or the number of connections that are run on different mediums. Whether it’s wireless, it’s fixed, or it’s fixed wireless access. And when I look at that over the last few quarters, and I must say that this was not true two quarters ago, over the last couple of quarters, our performance has been very, very delightful.
Shashwat Sharma
Yeah, Sanjish. Only thing to add on that is also what we are seeing is for us, if we can get a customer on fiber, that’s the best type of customer for us. The wireless strategy is augmenting reach a little bit. So wherever we can’t get, we put in there. But we will stay fiber first. Sanjay. I think we can. And as Gopal said, on the way we measure it is slightly differently, but we’ll stay focused on just building as much business as possible through fiber.
Gopal Vittal
There’s one other thing that is happening which is the, you know, I think Shashwat alluded to this, the rising prices of chipsets and memory, particularly on fixed wireless access. And you can recall like a year ago when we doubled down on fixed wireless access, the cost to connect the home was more or less the same as fiber. That has fundamentally changed in the last three to four months. The fixed wireless access has now become very much more expensive. So we’ve pivoted the whole company back to a dramatic obsession on fiber.
In fact, a lot of digital tools have been rolled out to minimize the leakage that we are seeing of installing a fixed wireless connection where a fiber is available. And that has almost come to zero now because of the digital tools that have been launched. That has actually been triggered in the month of April and that will play out over the course of the next couple of months before we sort of really ramp this up in a very big way.
Sanjesh Jain
That’s very clear. Thanks. Just one bookkeeping question. Probably see the EPS translation from the EBITDA has been little weaker in my view. The interest and finance cost has been quite sticky at 4,000 crore while our net debt keep coming down. Even I was just looking at India business. Our interest and finance cost continues to remain little sticky while the deleveraging effort continues. Shuman, can you help us understand what’s, what’s stopping the finance cost to fall in the same pattern as our nitpick.
Soumen Ray
When should
Sanjesh Jain
We see the transition?
Soumen Ray
I’ll answer that quickly. The two parts, the console and India in console there has been a bit of one off in Africa which will unwind and in India a large part of debt reduction actually happened towards the end of the quarter. The money of the rights also came in around end of mid of March. The payment of the AGR dues happened on the last day. So you there is reduction and you will see reduction going forth. Thanks Sanjish.
Sanjesh Jain
Thank you sir. Thanks for all those answers and best of luck for the coming process.
Vaidehi Sharma
Next question comes from Mr. Vivekanand Subaraman. Mr. Subaraman, you may please unmute your side. Introduce yourself and ask your question now.
Vivekanand Subbaraman
Yeah, I hope I’m audible. Thank you so much for the opportunity. Mr. Mittal, you shared certain aspirations like your desire to see BTL stake in Airtel rose to 51%. In the past you also mentioned about a subscriber target of around 800 million. Now with this new bet in lending, what are the other growth areas that you may be looking at perhaps which could be growth engines for the group, let’s say in the next decade. That’s my first question. I’ll ask the other ones for someone later. Thank you.
Sunil Bharti Mittal
Yeah, you know Airtel and India, the combination offers a once in a lifetime opportunity to any corporation anywhere in the world. You know, with a billion and a half people, young, hungry for more services and products, a growing country, it’s an opportunity which is very rare. I mean there are opportunities that have been available to companies in China of this scale. I mean I can’t really think of any others other than OTT players like Meta and Google and all of that globe to play with. And China as you know has been having restrictions that have been confined locally home.
So going into Africa 15 years back was a very, very, you know, forward looking, visionary move that we made. And today that is paying dividends. And as Gopal earlier alluded, Africa is there probably India was 10, 12 years back. You got another billion plus young people growing at rapid clip. And what India saw in the last 10 years, in Africa seen the next 10 years. So it’s really a very strong two play market for us in a very, very densely populated young population. And as more AI, as more technology takes roots, we become more and more relevant by the day.
And in most African countries there are only two operators somewhere. There are three, but mostly two. India has really got three private operators amongst which two are having a very large dominant market share. It’s a once in a lifetime opportunity and we should add whatever we can add that makes sense. We have been very disciplined. We have not gone into areas that do not meet with the core of a business and we never had this good problem to solve for more cash coming than what we need for our core business.
Allocate everything to core, allocate more and what is required for growing areas like data center and cloud. Also look at adjacencies, but with a very, very strong, disciplined lens. Financial services has been much talked about in the analyst community and investors. Fact is we are looking for a very small controlled financial services business at the moment. If it starts to yield great results and you come back and encourage us to do more, we’ll do more. Otherwise what are we saying? We want to give small ticket lending to our own customer base who we understand deeply well.
And we have demonstrated over the last year and a half, two years that that lending that we do is significantly superior to the best in class in the industry. And even people like Bajaj Finance and many others come to us to do the LSP program because we identify customers who pay significantly better than the industry benchmark. So there is a clear method behind what we are doing and the total amount that we are looking at allocating the next five years we have stated 20,000 crores, of which 14,000 has to come from Airtel.
It looks like it’ll be probably significantly less than that. As for the work that we have been doing, it may be much less than that number. So we talk about a very small amount over five years being allocated to financial services and after one and a half years, if we don’t show you a demonstrator proof of the success that we are getting, then you will be sure that we will not be throwing in money behind business that is not making sense for us. We have spoken in the past about expanding in the other geographies.
We are very mindful that we have tasks to do. This Africa exchange of shares that was announced yesterday is akin to acquiring another company of a large size. A $3 billion transaction means you’re making an acquisition and you’re making an acquisition of a business that you know deeply well. A business in which all of us are working day and night adding value. We need to own more of it. Thankfully the UK regulations allow you to go up to 90% with this move in one fell swoop. We have gone up to now 78%.
Ambition for Airtel should be whatever is allowed to go up to 90% one day should get there. And that is being ably helped by Airtel Africa’s own buyback program. They have been doing buybacks from time to time, hopefully in the next few years with the buyback program and if some other block comes from any other investor to Airtel, the tension, we will probably in the next several years get to the point of owning more of Africa so that we can get more income flowing back to the mothership Bharti Airtel and reward our shareholders even more.
And then after giving allocation to all this, if we are still left with more money, as I mentioned, we’ll do more dividends, we’ll do buyback programs, but we’ll never become like IT companies who have done nothing but just taken money out as dividends and buybacks, dividends and buybacks and they become a shadow of themselves. Many of those companies should have been buying leading edge businesses in their own industry in the last 10, 15 years. They would have been in a different position today.
You will probably come back and encourage us go buy some more good value telecom assets around the globe. But I think that as Gopal said, nothing on the table today. It’s probably a medium to longer term horizon. We’ll come back to you, but I think we’ll get to 800 million customers by way of Mobile home broadband, our digital services, our financial services, and both between India and Africa, getting to 500 million here and 300 million in Africa is a dream which is visible. I mean you can look at that, it’s not too far.
Vivekanand Subbaraman
That was very helpful. Sashwath and Gopal, standing on your question on the pricing architecture. What will it really take for the industry to move to usage based pricing? Because we’ve also seen that since the time the leading to Telcos rolled out 5G there is still an unlimited offer going on. And the two of you perhaps have not yet decided to move even 5G to meter data. Is there a path that you have in mind to moving to meter data or is it just an aspiration still? Thank you.
Gopal Vittal
I’m mindful of time so probably this will be the last question before I hand it to Vaidehi. You know, as of now there is, you know, this requires it’s a competitive market. We will not do anything that will hurt our business. I have just mentioned that, you know, this architecture doesn’t make sense. Let’s see how this plays out over time. Back to you.
Vaidehi Sharma
Thank you very much Gopal. Thank you everyone and thank you for joining us, Mr. Mittal. We will now begin with the Bharti Hexacom earnings call. I would like to hand over the call to Mr. Soman Ray for his opening remarks on Bharti Hexacom performance. Over to you Mr. Sawman.
Soumen Ray
Thank you and good afternoon everyone. Welcome to the Bharti Exacom Q4FY26 earnings call. I have with me Karthik and Naval on the call. I’ll start with our FY26 performance. We delivered strong results with continued operating leverage led by razor sharp execution and operational excellence. Revenues and EBITDA growth came in at about 9.4% and 17.9% respectively. Margins expanded by 3.4% to 47.6%. Strong operating leverage is attributable to the continued efforts on portfolio premiumization and our war on waste agenda.
The company further strengthened its position in both markets with sustained revenue and market share improvement. The homes and office business saw stellar performance with 51% revenue growth and the highest ever net adds of 395,000. Our IPTV services launch is seeing strong traction and strengthening our convergence strategy. During the year our CapEx spends were directed towards 5G densification, network modernization and growing our homes and IPTV business rapidly. Despite that, our operating free cash generation which is Ebital -capex came in at about 2,935 crores, a solid 27% increase over last year.
Balance sheet is robust with a net debt excluding leases at about 2000 crores. The board recommended a dividend of rupees 18 per share as compared to rupees 10 per share last year in line with our philosophy of progressive payout. Moving to a quick Update on our Q4 performance we delivered another quarter of strong performance with revenue of rupees 2414 crore growing 2.3% sequentially. EBITDA for the quarter came in at over 1155 crores with a margin of 47.9%. We ended the quarter with mobile customer base of 28.8 million.
Net customer addition for the quarter came in at about 370,000. Smartphone customer addition was strong at almost 5 lakh about 4,78,000 highest in the last four quarters. ARPU for the quarter was 252 rupees impacted by two days less whilst on a EDB basis it would be closer to about 257 58. Our homes business continues to see strong momentum with record high net adds of 148,000 driving a revenue growth of about 21%. Sequentially this momentum is underscored by our FWA expansion to newer PIN codes, continued deepening of FTTH footprint footprint and the rollout of IPTV.
Capex for the quarter was 586 crores. Acceleration was as planned. Operating free cash generation which is Ebital minus Capex came in at about 570 crores. With that I will hand over to Vahi to open the floor for questions.
Vaidehi Sharma
Thank you very much Souman. We will now begin the Q and A interactive session. Due to time constraints we would request if you could limit the number of questions to two per participants to enable more participation. Interested participants may click on raise hand option on the Zoom application to join the Q and A queue. With this the first question comes from Mr. Sanjesh Jain. Mr. Jain you may please unmute your side, introduce yourself and ask your question now.
Sanjesh Jain
Thanks thanks Shomen for taking the question. I got too. First on the comparison of mobile growth of Hexacom versus Airtel in this year on both levers Exacom has performed lower than Airtel. On revenue we were 8.3. Airtel was close to 12 on and EBITDA we were 15. Airtel was 17. Oh I thought we had a lever to grow faster than Airtel under penetration and all those the liver we had. What changed in this quarter and how should we see it for the next coming year? Should should this accelerate, what are the corrective measures we have taken?
That’s number one. Number two, on the utilization of cash flow, all the peripherals. What we are doing is at Airtel level. Hexacom largely restricts itself to mobile and FTTH where it is fully funded. Should we see a much sharper payout ratio in Hexacom in the coming years? These are my initials. Thank you.
Soumen Ray
Thanks, Sanjish. Sanjish, I think our impression that Hexacom is under penetrated the two circles that it operates has borne out well. I mean, of course we can cut the data the way we want, but we have done reasonably well. The ARPU gap is much closer. We have been able to close the ARPU gap, as I had told earlier. Also, the postpaid penetration bit and the IR bit is, will be a little differential, as you know, and was I think mentioned earlier in the call. The smartphone upgrade will see a bit of stress and hence we might lag a little bit because that’s a very strong, that’s a very strong indicator.
We will be launching some of driving convergence and we will see how best we can accelerate the growth of Bharti Hexacom. I would say it is competitive, it is not lagging the market and we continue to look at opportunities as to how to grow faster. ARPU has certainly come out well. We will continue to look at customers as well. On the next question around utilization of cash flow, yes, some of the growth engines that the parent has is not available to Hexacom. Now. It has two challenges, Sanjish.
One challenge is, of course the requirement of investment is not there. But on the flip side, the growths and the new growths will be to that extent restricted. We have increased the dividend payout significantly and we have been committed that we will be looking at a progressively increasing dividend payout and we continue to remain on that. I think we have moved from 3 to 4 to 10 to 18. So I think we have been sticking to our word around progressively increasing the dividend payout.
Sanjesh Jain
Thanks. Thanks, Shuman. That’s, that’s very clear. Just one, if I may squeeze on the fwa, considering the all the issues around chips which Gopal spoke, do you see home growth can slightly decelerate until this entire chip situation get resolved. For Hexacom,
Soumen Ray
That was
Sanjesh Jain
One big lever for us.
Soumen Ray
Yeah, yeah, yeah. So, you know, how do you look at fwa? The way we look at FWA is what is the cost of a connected home? What is the cost of connecting a home
Sanjesh Jain
Now
Soumen Ray
In difficult terrains with fiber, cost of connecting a home is, is much higher than, let’s say in a plane. Let’s say if you are in Maharashtra, it is much easier to lay fiber. Or in Tamil Nadu or in such places if you go to nisa. Actually, FWA creates an opportunity to go around and connect more homes, which it will be difficult with fiber. So I do not think that while prices will go up and we will pivot to fiber wherever we can, we are going to give up on the opportunity of acquiring more homes and offices through either FWA or fiber in Bharti Hexagon.
No, we will not let up on that opportunity.
Sanjesh Jain
That’s. That’s quite clear. So mean. Thanks very much for answering all those questions and best of luck for the coming quarters.
Soumen Ray
Thank you, Sangesh.
Vaidehi Sharma
The next question comes from Mr. Pranav Kshatriya. Mr. Kshatriya, you may please unmute your side, introduce yourself and ask your question now.
Pranav Kshatriya
Yeah. Hi. Thanks for the opportunity. My first question regarding the of the arpu. If I look at this quarter’s result, we had a fairly good growth in the subscriber base as well as post. However, ARPU growth has not happened. You partly explained in the opening remarks that, you know, there was some impact of international roaming. Uh, is that the only factor which impacted the ARPU in this quarter or there is something else which is playing out?
Soumen Ray
Well, yes, there is something else which is played out which is the whole, you know, eat as much as you can on 5G packs. That is the more adoption happens, that will clearly create a headwind. However, having said that, you know, the ARPU that we give is the average for the quarter. I mean the exit for the quarter. The quarter plays out there at three months. But Pranav, there is no red flags per se on ARPU in terms of. Is there a cause of concern? The. The headwinds that we have are similar to any other player in any other geography, which is lower international roaming, handset prices slightly going up and hence having a pressure on 2G to 4G upgrades and the fact that we now have a pack which doesn’t, which destroys the whole price ladder which any company should have.
You know, if you are selling something, the more you consume, the more you pay. Not necessarily in the same ratio, but certainly in absolute terms with that getting broken. So those are the headwinds which are there for this organization as well as for any player in this country.
Pranav Kshatriya
Okay, thank you. My second question is there has been a good action in the homes subscriber edition. Should we Expect, you know, the pace of addition to continue or, you know, there could be some headwind.
Soumen Ray
Pranav, first of all, I cannot give you forward looking statements. We don’t give guidance. But see, the objective is to continue to grow. As of now. There is no reason for me in an earnings call to flag off that there is a concern. But it’s a competitive market, so the competition part always exists. But there is no fundamental reason why we are letting up on our effort to grow homes as much or even more. So the effort will continue. Two months from now we will meet again. Three months from now we’ll meet again and we’ll see.
As I said, whilst the chipset prices have gone up, we are not relenting on our effort on acquisition. We are pivoting. If the fiber is available, we would like to go fiber first and also trying to see how much we can lay fiber. As mentioned to the previous question and for participants, Sanjesh it’s difficult to. It’s a difficult terrain. And so to that extent the pivoting in this two geographies would be a little less than some other geographies where it is much easier.
Pranav Kshatriya
Okay, thank you so much. That’s it from my side. Wish you all the very best.
Soumen Ray
Thank you, Pranav.
Vaidehi Sharma
The next question comes from Mr. Vivekanand Subaraman. Mr. Subaraman, you may please unmute your side, introduce yourself and ask your question now.
Vivekanand Subbaraman
Thank you very much for the opportunity. I’m Vivekanand from Ambit. Just one question. What does the regulatory charge this quarter pertain to? Is there any new demand from the government which, which has affected you this quarter? If you could clarify on this.
Soumen Ray
Well, you know, as any prudent organization, we look at all the basket of charges and whatever is happening in the ecosystem and we follow a very prudent accounting policy that. And we do it from time to time. There’s a regular cadence that we do as guided by, along with the auditors and by the board and audit committee. So we have felt that there is something that we should in a prudence take provision for which has been disclosed. There is nothing new, exceptional or unearthly which has come. It is just interpretation of issues as.
As time progresses and various things happens in the ecosystem, but nothing new.
Vivekanand Subbaraman
Okay, Shaman, just to understand better, this charge was earlier, perhaps part of contingent liabilities and as now been provided for. Is that how one should think about it since you are saying that there is no new demand?
Soumen Ray
Well, I’ll not get into specific details but it was. It was not. It is not a new thing. It was an existing thing. The interpretation of that existing thing has been changed and accordingly, it has been provided for.
Vivekanand Subbaraman
All right, thank you and all the best.
Soumen Ray
Thank you.
Vaidehi Sharma
Thank you everyone. Now I would like to pass it back to Mr. Soman Ray for his closing remarks.
Soumen Ray
Thanks a lot everyone for joining the call for Key4FY26. Look forward to catching up with all of you in the next quarter. Thank you.
Vaidehi Sharma
Thank you everyone for joining us today. The recording of this webinar will be available on our company website. Have a great day ahead. Bye.