Fitch Ratings has affirmed the outlook on its long-term foreign currency issuer default rating (IDR) and senior unsecured rating of India-based Bharti Airtel at ‘BBB-‘, maintaining a stable outlook.

The affirmation is grounded in Fitch’s expectation of Bharti’s continuous improvement in earnings before interest, taxes, depreciation, and amortisation (EBITDA) net leverage, driven by robust cash flow growth, and its capacity to fund considerable 5G-related capital expenditure (capex) alongside shareholder returns.

Fitch expects Airtel’s EBITDA net leverage to decrease to around 1.2 times by the end of the financial year 2024 (FY24) and a further drop of one-fold by FY25, underpinned by heavy cash generation capabilities sufficient to support high 5G capex and shareholder remunerations.

Furthermore, forecasts suggest a deceleration in consolidated EBITDA growth in FY24 to 7 per cent 9 per cent, as robust Indian mobile business growth counterbalances a slower rise in the African segment. FY25 is anticipated to see a recovery with EBITDA growth rates between 10 per cent-11 per cent.

Furthermore, Airtel and Reliance Jio Limited are expected to dominate 83-85 per cent of private telcos’ revenue during FY24-FY25, with an increasing market share, projecting Airtel’s position and resilience in the competitive landscape.