
Global investment bank UBS has released its latest ratings and target prices for key telecom stocks, highlighting the sector’s potential and challenges.
Bharti Airtel: Neutral with TP of Rs 1595
UBS has maintained a neutral rating on Bharti Airtel with a target price of Rs 1595. The brokerage believes Airtel shares are fully valued at a forward EV/EBITDA multiple of 10.1x for FY26, which is higher than the regional telecom average of 7x.
Indus Towers: Neutral with TP of Rs 440
UBS has also assigned a neutral rating to Indus Towers with a target price of Rs 440. The merged entity, formed by the amalgamation of Bharti Infratel and Indus Towers, is now the second-largest telecom tower infrastructure operator globally.
Vodafone Idea: Buy with TP of Rs 19
In contrast, UBS has issued a buy rating on Vodafone Idea with a target price of Rs 19, the highest on the street. This implies a potential upside of over 70% from the current market price. The brokerage believes Vodafone Idea has the maximum leverage to benefit from potential tariff hikes and government relief measures.However, UBS cautions that the market could be disappointed by the actual ARPU (average revenue per user) flow-through of tariff hikes. The brokerage’s Evidence Lab survey suggests a risk of consumer downgrades, especially in the most common 1.5GB/day plan, which may be higher than what is implied in consensus estimates.Investors should closely monitor these developments and the telecom sector’s performance in the coming quarters as it navigates challenges and seeks growth opportunities.
Disclaimer
This article is for informational purposes only and does not constitute financial advice, investment recommendations, or an offer to buy or sell any securities. The information provided is based on reports from UBS and other sources believed to be reliable, but its accuracy and completeness cannot be guaranteed. The views expressed by UBS analysts are their own and may not reflect the views of this publication or its authors. Readers should conduct their own research and consult with a qualified financial advisor before making investment decisions.