Goal: ₹1,625
CMP: ₹1,335.70
Bharti Hexacom (Hexacom), the licensed operator of wi-fi and fixed-line companies beneath the Airtel model in Rajasthan and North East circles, gives pureplay publicity to the 2 high-growth companies of Airtel – India wi-fi and Dwelling broadband. Furthermore, given decrease teledensity and decrease web penetration in Hexacom circles (vs. pan-India), we consider Hexacom can probably develop a couple of proportion factors quicker than Airtel on each subscribers and ARPU.
Additional, with considerably decrease penetration of fastened broadband in Hexacom’s circles and the latest ramp-up of Fastened Wi-fi Entry (FWA) choices, we consider Hexacom’s wired broadband enterprise might additionally develop at a quicker clip.
We provoke protection on Hexacom with a Purchase score and a TP of ₹1,625, premised on 13x FY27E EV/EBITDA (on par with our Airtel’s India wi-fi a number of). Our desire for Hexacom over Airtel is basically pushed by decrease capital misallocation issues.
Our state of affairs evaluation signifies a beneficial risk-reward for Hexacom with about 41 per cent upside in our bull case TP of ₹1,875, premised on a 20 per cent tariff hike in Dec’25, adopted by about 7 per cent ARPU CAGR over FY27-34 and a modest 13 per cent draw back in our bear case TP of ₹1,150, which is premised on 10 per cent tariff hike in Dec’25, adopted by round 5 per cent ARPU CAGR over FY27-34.
