Global brokerage Jefferies has retained Bharti Airtel as its top pick in the telecom sector, citing revenue growth, market share gains, and early signs of stabilisation at rival Vodafone Idea.
The brokerage believes the company is benefiting from better subscriber quality, stronger revenue growth and continued market-share gains.
Let’s take a look at the three key factors why the brokerage is bullish on this stock
Telecom revenue growing without tariff hike
The telecom sector continued to expand during the quarter ended June 2026.
Annualised sector revenue reached around US$33 billion, rising 8% year-on-year. Subscriber additions increased 4%, while average revenue per user (ARPU) rose 4%.
The brokerage expects the industry to maintain high-single-digit revenue growth even without immediate tariff increases. It expects the next major tariff hike in April 2027.
Jefferies said, “Sector revenue growth remained steady.”
The brokerage expects telecom sector revenue to grow at a 12% compound annual growth rate (CAGR) between FY27 and FY29.
Why Bharti Airtel is the preferred pick
Bharti Airtel delivered 10% year-on-year revenue growth in the June quarter, ahead of the overall industry.
Its average revenue per user rose 7%, while subscribers increased 3%. The company also contributed nearly 45% of the industry’s incremental revenue during the quarter.
The brokerage also pointed to Airtel’s focus on premiumisation, which means attracting customers who use higher-value plans and services.
Jefferies on telecom sector: Market share gains
As per Jefferies report, Bharti Airtel gained 20 basis points of revenue market share compared with FY26, taking its share to around 40% of industry revenue.
The gains were particularly visible in Tamil Nadu, Maharashtra and the eastern and western Uttar Pradesh circles.
However, Airtel did lose some share across eight of the 22 telecom circles.
Furthermore, the brokerage report noted that Vodafone Idea (VIL) is showing some signs of stabilisation, although challenges remain.
Its revenue increased 3% year-on-year despite a 3% decline in active subscribers. A 6% rise in ARPU helped offset some of the subscriber losses.
Jefferies believes improving subscriber trends could help the company stabilise its position. However, VIL still lost market share in 13 of 22 circles.
Why Bharti Airtel remains Jefferies’ top pick
The brokerage expects industry revenue growth to remain healthy even before the next tariff increase. It also sees Airtel continuing to benefit from premiumisation and better-quality subscribers.
Jefferies said, “Bharti Airtel remains our top pick.”
Disclaimer: This article is based on research reports from one or more brokerage firms and is for informational purposes only. The views, target prices, and recommendations expressed are those of the respective brokerage firms and do not reflect the official policy or position of Financial Express. This should not be construed as an offer, solicitation, or recommendation to buy or sell securities. Investors must conduct their own independent due diligence and seek advice from a SEBI-registered financial advisor before making any investment decisions.