S&P Global Ratings has upgraded Bharti Airtel’s long-term issuer credit rating to ‘BBB’ from ‘BBB-‘, citing strong earnings growth and expected continued deleveraging. The outlook is positive, reflecting expectations of further improvements in leverage. The ratings on senior unsecured debt were also raised to ‘BBB’. This upgrade indicates confidence in Bharti Airtel’s financial health and market position, driven by its performance in the Indian market and rational industry competition.
Credit Rating Upgrade
S&P Global Ratings raised its long-term issuer credit rating on Bharti Airtel to ‘BBB’ from ‘BBB-‘ on November 17, 2025. This reflects the company’s strong earnings growth and cash flow, expected to drive continued deleveraging over the next 12-24 months. The outlook remains positive.
Key Factors Behind the Upgrade
The upgrade is supported by Bharti Airtel’s strong position in the Indian telecom market and expectations of a stable, three-player market focused on improving returns. S&P anticipates robust earnings growth fueled by the Indian operations, with 2%-4% annual subscriber additions and 6%-8% growth in average revenue per user (ARPU).
Earnings and Subscriber Growth
Bharti Airtel has successfully increased its ARPU in the Indian mobile segment, reaching INR 256 in Q2 FY26, a 21% increase from the previous quarter. The company has also been gaining wireless subscribers, partly due to churn from Vodafone Idea Ltd.
Financial Projections
S&P forecasts consolidated adjusted EBITDA to increase by 23%-25% to about INR 1.2 trillion in fiscal year 2026, with a further 7%-8% annual increase thereafter. The company’s ratio of funds from operations (FFO) to debt is projected to be 37%-40% in fiscal 2026 and slightly above 45% in fiscal 2027, compared to 27.5% in fiscal 2025.
Outlook and Potential Scenarios
The positive outlook reflects the expectation that Bharti Airtel’s expanding earnings, driven by rational industry competition, will improve financial flexibility over the next 12-24 months. S&P forecasts the company’s FFO-to-debt ratio to improve toward 45% over this period. The outlook could be revised back to stable if the company’s FFO-to-debt ratio does not improve as expected due to debt-funded investments or increased competition.
Source: BSE
