Bharti Airtel: A Top Diwali Recommendation by HDFC Securities Backed by Rising ARPU and Growth Potential

October 17, 2025: As part of its investor-friendly initiatives, HDFC Securities has shortlisted the top ten Diwali picks, which you can include in your portfolio. The top ten picks were finalised after intensive research and analysis, using both fundamental and technical indicators to evaluate these stocks.

One such recommendation is Bharti Airtel Limited, one of the pioneers in telecommunications in India and across fifteen different countries. The shares of the company have grown significantly, showing a strong performance. The positive movement is mostly fueled by the company’s strategic moves, like leveraging the rising ARPU (Average Revenue Per User).

Company Overview

Bharti Airtel is one of the leading telecommunication companies in India and has its presence in more than 15 countries in Asia and Africa. The company is listed on BSE and NSE and is at the forefront of the telecommunication revolution. Some of the most popular offerings include 5G mobile connectivity, mobile broadband, Airtel Xstream Fiber, streaming services, digital payments, and financial services.

Recent Stock Performance

The stock has performed reasonably steadily in the past few weeks and the price has increased by 3.86% in the past month. The stock has risen by close to 16% in the past year, and with a market capitalisation of more than 11 lakh crores, the growth rate is quite phenomenal. It is one of the most traded stocks with heavy volumes. The company’s PE ratio is 27.91 compared to the sectoral average of 41.98.

Fundamentals and Valuations of the Stock

The company has also achieved an industry-leading average revenue per user (ARPU) of ₹250 in Q1FY26, along with potential tariff hikes in H2FY26, which support higher EBITDA margins and free cash flow. The only things to watch out for are the tariff adjustments, 5G adoption, and enterprise service growth.

These strategic efficiencies and industrial support have positioned BAL in a favourable position. The company is expected to have sustained revenue growth and easily reach its target ARPU of ₹300.

Key Price Levels to Watch For

While the LTP is ₹1,955, and the target price is ₹2244, the recommended buy range by HDFC Securities is ₹1,935-1,985.

What Makes Bharti Airtel a Preferred Stock

Bharti Airtel has benefited strongly from India’s strong telecom fundamentals. India leads the world in mobile data usage at 32 GB per smartphone per month. The Indian telecom industry has strong roots even in rural areas. The rural tele-density has reached 59.43% as of June 2025, while wireless data usage grew 9.36% QoQ to 65,009 Petabyte in Q1FY26.

The country has a strong 5G subscriber base, which is projected to reach 980 million by 2030. The potential growth in the sectors also provides a significant opportunity for the company to expand. Further, the company has solid economic support, as the industry benefits from policy support through production-linked incentives and increased budget allocations.

On a micro level, the company has made several strategic collaborations with Apple, Google, Oracle, Hughes Airtel JV, Lavelle, and Aquiliz, which have enabled it to expand in digital services, CPaaS, data centres, and cybersecurity. The company has also consolidated Indus Towers and expanded into African markets, which has further strengthened the company’s operational and financial profile.

Risks to Consider

While Bharti Airtel has shown exceptional growth with an overall positive outlook, investors should stay cautious of a few things. The first thing to look out for is tariff adjustments, followed by a slow 5G adoption rate. Other concern areas of the company are difficulty in servicing substantial debt, and elevated capex/regulatory payouts.