Bharti Hexacom Homes adds customers but remains cash-flow negative

Bharti Hexacom Limited’s Homes, Office and Other Services segment added 428,000 customers in the year to September 30, 2026, reaching 989,000, while Rs 149.8 crore of Q2 FY27 capital expenditure exceeded Rs 53.1 crore of EBITDA and left operating free cash flow at negative Rs 96.7 crore.

Why did Bharti Hexacom Homes add 428,000 customers?

Bharti Hexacom added 428,000 Homes, Office and Other Services customers year on year through September 2026, as Wi-Fi and Internet Protocol Television, or IPTV, offerings expanded. The segment’s customer base rose 76.1% from 561,000 in September 2025 to 989,000 in September 2026, while the company reported 29.957 million total customers at the end of the quarter.

The segment added 71,000 customers in Q2 FY27, compared with 60,000 in Q2 FY26 and 75,000 in Q1 FY27. The sequential additions were 4.8% lower than the preceding quarter, but the customer base increased from 843,000 at March 2026 to 918,000 at June 2026 and 989,000 at September 2026.

Bharti Hexacom expanded its Homes footprint to 122 cities, including local cable operators, from 117 cities a year earlier and 121 cities in June 2026. Its Homes offering includes fixed-line telephone, broadband, fibre and voice connectivity, and IPTV, with broadband speeds of up to 1 gigabit per second.

How did Bharti Hexacom Homes revenue and margins change?

Bharti Hexacom’s Homes revenue increased 49% year on year to Rs 131.2 crore in Q2 FY27, while EBITDA increased 79% to Rs 53.1 crore and the EBITDA margin rose to 40.5% from 33.7%. Revenue was Rs 88 crore in Q2 FY26 and Rs 126.5 crore in Q1 FY27, making Q2 FY27 revenue 3.7% higher sequentially.

The margin expansion occurred despite a decline in average revenue per user, or ARPU, to Rs 475 from Rs 484 a year earlier and Rs 482 in Q1 FY27. The reported figures indicate that revenue growth was associated with a larger customer base rather than higher ARPU.

For the six months ended September 2026, Homes revenue rose 55% to Rs 257.7 crore from Rs 166.4 crore in the comparable period a year earlier. EBITDA increased 89% to Rs 103.3 crore, and the EBITDA margin reached 40.1%, compared with 32.8% in the six months ended September 2025.

Why was Bharti Hexacom Homes operating free cash flow negative?

Bharti Hexacom’s Homes operating free cash flow was negative Rs 96.7 crore in Q2 FY27 because its Rs 149.8 crore capex exceeded segment EBITDA of Rs 53.1 crore. The company defines operating free cash flow as EBITDA minus capex, making it a reported operating measure rather than the statutory cash-flow statement.

The Q2 FY27 deficit narrowed from negative Rs 109.7 crore in Q1 FY27 but was close to negative Rs 95.7 crore in Q2 FY26. Homes capex increased 19% year on year from Rs 125.4 crore, while EBITDA increased 79%, meaning the larger EBITDA offset most, but not all, of the additional investment.

For the six months ended September 2026, capex increased 36% year on year to Rs 309.7 crore, above EBITDA of Rs 103.3 crore. The resulting negative operating free cash flow widened to Rs 206.4 crore from negative Rs 173.2 crore in the six months ended September 2025.

Cumulative Homes investments stood at Rs 1,406.1 crore at September 2026, up 67% from Rs 843.3 crore a year earlier. They also increased from Rs 1,270.6 crore at June 2026, reflecting continued spending while the company expanded Wi-Fi and IPTV services across 122 cities.

How does Bharti Hexacom Homes compare with Mobile Services?

Bharti Hexacom’s Homes business grew faster than Mobile Services in Q2 FY27, but Mobile generated higher EBITDA and positive operating free cash flow. Homes revenue increased 49% year on year to Rs 131.2 crore, compared with a 10% increase in Mobile Services revenue to Rs 2,461 crore.

Homes EBITDA of Rs 53.1 crore represented a 40.5% margin, compared with Mobile EBITDA of Rs 1,363.5 crore and a 55.4% margin. The 14.9-percentage-point margin difference reflects the separate segment results disclosed for the September 2026 quarter.

Mobile Services generated Rs 117.7 crore of operating free cash flow in Q2 FY27 after Rs 18.7 crore of capex, whereas Homes recorded negative Rs 96.7 crore after Rs 149.8 crore of capex. Mobile capex declined 23% year on year from Rs 24.2 crore, while Homes capex increased 19% from Rs 125.4 crore.

The customer and ARPU trends also differed. Mobile customers declined by 16,000 sequentially to 28.968 million at September 2026, although they were 3.3% higher year on year, while Homes customers increased 7.8% sequentially. Mobile ARPU rose 5.4% year on year to Rs 264, whereas Homes ARPU declined 1.9% to Rs 475.

Conclusion

Bharti Hexacom’s Homes business paired rapid customer expansion with revenue and EBITDA growth in Q2 FY27: its 989,000 customer base was 76.1% larger year on year, revenue rose 49%, and EBITDA margin increased 6.7 percentage points. However, capex of Rs 149.8 crore remained above EBITDA of Rs 53.1 crore, keeping the segment’s EBITDA-minus-capex measure negative.

The unresolved issue is whether customer growth can continue while the cash deficit reduces. Bharti Hexacom disclosed a Rs 475 Homes ARPU in Q2 FY27, a 122-city footprint and Rs 309.7 crore of first-half capex, so subsequent results can show whether revenue and EBITDA growth increasingly covers the investment required for Wi-Fi and IPTV expansion.