We see material upside potential on the stock from: a) incremental ARPU improvement opportunity through market share gains, tariff hikes and customer upgrades, b) growth in non-mobility businesses including value unlocking in multiple digital/enterprise segments and c) re-rating of valuation multiple backed by improving ROCE/FCF profile due to ARPU growth and higher share of non-mobility business, raising customer stickiness.

While 5G-led increase in capex intensity remains a red flag, our channel checks indicate lower spectrum pricing as well as moderate capex as a % of revenue over 3-5 years coupled with the Rs 160 bn uncalled Rights issue will ensure that FCF and net debt numbers would be well managed.

Maintain buy with a target price of Rs 910, implying 28% potential upside.

News Source:- Moneycontrol