As of June 12, 2025, Airtel Africa PLC has a Discounted Cash Flow (DCF) derived fair value of $287.00 per share. With the current market price at $176.60, this represents a potential upside of 62.5%.
| Key Metrics | Value |
|---|---|
| DCF Fair Value (5-year) | $224.49 |
| DCF Fair Value (10-year) | $287.00 |
| Potential Upside (5-year) | 27.1% |
| Potential Upside (10-year) | 62.5% |
| Discount Rate (WACC) | 7.2% - 9.7% |
Revenue is projected to grow from $4977 million in 03-2025 to $8354 million by 03-2035, representing a compound annual growth rate of approximately 5.3%.
| Fiscal Year | Revenue (USD millions) | Growth |
|---|---|---|
| 03-2025 | 4977 | 0% |
| 03-2026 | 5202 | 5% |
| 03-2027 | 5571 | 7% |
| 03-2028 | 5761 | 3% |
| 03-2029 | 6254 | 9% |
| 03-2030 | 6434 | 3% |
| 03-2031 | 6749 | 5% |
| 03-2032 | 7089 | 5% |
| 03-2033 | 7396 | 4% |
| 03-2034 | 7964 | 8% |
| 03-2035 | 8354 | 5% |
Net profit margin is expected to improve from 7% in 03-2025 to 8% by 03-2035, driven by operational efficiency and economies of scale.
| Fiscal Year | Net Profit (USD millions) | Profit Margin |
|---|---|---|
| 03-2025 | 328 | 7% |
| 03-2026 | 411 | 8% |
| 03-2027 | 440 | 8% |
| 03-2028 | 456 | 8% |
| 03-2029 | 495 | 8% |
| 03-2030 | 509 | 8% |
| 03-2031 | 534 | 8% |
| 03-2032 | 561 | 8% |
| 03-2033 | 585 | 8% |
| 03-2034 | 630 | 8% |
| 03-2035 | 661 | 8% |
with a 5-year average of $965 million. Projected CapEx is expected to maintain at approximately 20% of revenue.
Depreciation is based on an average useful life of 5 years for capital assets.
| Fiscal Year | D&A (USD millions) |
|---|---|
| 03-2026 | 992 |
| 03-2027 | 1070 |
| 03-2028 | 1046 |
| 03-2029 | 1094 |
| 03-2030 | 1182 |
| 03-2031 | 1245 |
Net working capital is expected to increase gradually, with projected changes affecting free cash flow.
| Components | Average Days |
|---|---|
| Days Receivables | 10 |
| Days Inventory | 5 |
| Days Payables | 108 |
| Fiscal Year | EBITDA | Tax | CapEx | Change in NWC | FCF |
|---|---|---|---|---|---|
| 2026 | 2542 | 280 | 1052 | 178 | 1032 |
| 2027 | 2729 | 299 | 1127 | (50) | 1354 |
| 2028 | 2763 | 310 | 1165 | (64) | 1353 |
| 2029 | 2957 | 336 | 1265 | 15 | 1341 |
| 2030 | 3099 | 346 | 1301 | (25) | 1477 |
| Valuation Method | Fair Price (USD) | Potential Upside |
|---|---|---|
| 5-Year DCF (Growth) | 224.49 | 27.1% |
| 10-Year DCF (Growth) | 287.00 | 62.5% |
| 5-Year DCF (EBITDA) | 252.74 | 43.1% |
| 10-Year DCF (EBITDA) | 310.54 | 75.8% |
Is Airtel Africa PLC (AAF.L) a buy or a sell? Airtel Africa PLC is definitely a buy. Based on our DCF analysis, Airtel Africa PLC (AAF.L) appears to be significantly undervalued with upside potential of 62.5%. The company's strong projected growth in revenue and profitability, coupled with consistent capital expenditure, supports our positive outlook on its intrinsic value.
Key investment drivers include:
Investors should consider a strong buy at the current market price of $176.60.