Fitch Affirms Bharti Airtel’s Credit Rating At ‘BBB-’ With Stable Outlook

Ratings agency Fitch Ratings Inc. has affirmed Bharti Airtel Ltd.'s credit rating at 'BBB-' with stable outlook, citing around 31-33 percent revenue market share despite intense competition from Reliance Jio Infocomm Ltd. and Vodafone Idea Ltd. and expectations of recovery in its mobile business.

Fitch expects Bharti Airtel to repay debt using the proceeds from the Airtel Africa IPO and a stake sale in Indus Towers and Bharti Infratel Ltd., which are in the process of a merger. Both asset monetisation plans are scheduled for the second half of 2019-20.

"Bharti Airtel's ratings are supported by its diversified and integrated business profile, with operations spanning the mobile, fixed line, Digital TV, tower and enterprise sectors in India as well as mobile operations in 14 African markets. It has held on to its Indian mobile revenue market share of around 31-33 percent despite intense competition," Fitch said in a statement.

A BBB ratings indicate that expectations of default risk are currently low. The capacity for payment of financial commitments is considered adequate, but adverse business or economic conditions are more likely to impair this capacity. The suffix minus indicates chances of a rating downgrade.

For stable outlook, it said that it expects recovery in Bharti Airtel's Indian mobile segment and continued growth in Africa and the enterprise segment.

"We believe that Bharti's management is committed to an investment-grade rating and we expect the company to further reduce debt through an equity issuance by its African subsidiary and the sale of a stake in its tower subsidiary," Fitch said.