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India’s equity markets are experiencing a major shift in investor preference, with telecom heavyweight Bharti Airtel overtaking HDFC Bank to become the country’s second most valuable listed company by market capitalisation. Shares of Airtel surged more than 2 per cent on the BSE to touch Rs 1,943, taking the company’s valuation close to Rs 11.8 lakh crore. In comparison, HDFC Bank shares declined over 2 per cent during the trading session, dragging its market capitalisation to nearly Rs 11.7 lakh crore.

Despite the reshuffle, Reliance Industries continues to hold the top spot among India’s listed firms, with a market capitalisation of roughly Rs 18 lakh crore.

The latest development highlights a broader trend on Dalal Street, where telecom companies are increasingly attracting investor confidence compared with traditional banking giants.

Over the last five years, Airtel’s stock has delivered a massive 270 per cent return, significantly outperforming HDFC Bank, which has gained around 49 per cent during the same period. Market experts believe the divergence reflects the telecom sector’s improving earnings visibility, expanding digital opportunities, and strong cash flow outlook.

Meanwhile, HDFC Bank has faced multiple challenges in recent years, including post-merger integration pressures, intensified competition from state-owned lenders, and governance concerns following the resignation of its chairman.

Apart from Reliance Industries, the country’s top market-cap companies currently include ICICI Bank, SBI, TCS, Bajaj Finance, Larsen & Toubro, Hindustan Unilever, and LIC.

Brokerages Remain Bullish On Airtel

Global brokerages continue to maintain a positive stance on Bharti Airtel, citing multiple growth drivers beyond mobile services.

BofA Securities has assigned a target price of Rs 2,320 to the stock. "We see Bharti witnessing good market share gains, healthy momentum in non-cellular business segments and an upside optionality from data centre business," the bank said. "We expect Bharti's FCF to continue to inch up going ahead as competition is stable-to-declining and we don't foresee any material capex increase ahead."

JP Morgan has projected a March 2027 target price of Rs 2,250 and identified several catalysts for future upside. "Growth in adjacencies, deleveraging and rising dividends should be the key catalysts for the stock."

Goldman Sachs has also retained its Buy recommendation while slightly reducing its 12-month target price to Rs 2,210 from Rs 2,250 due to weakness in the towers and DTH businesses.

Strong Q4 Performance Supports Investor Confidence

Investor optimism has also been supported by Airtel’s fourth-quarter FY26 earnings performance, which largely exceeded market expectations.

According to UBS estimates, consolidated revenue and EBITDA were ahead of both consensus and brokerage projections by 1–3 per cent. Airtel Africa emerged as a major growth engine, posting a 41 per cent year-on-year rise in revenues, or 17 per cent in constant currency terms.

The company’s India Home broadband segment also delivered strong momentum with 9.5 per cent quarter-on-quarter growth. However, India’s mobile business recorded relatively modest expansion, with revenue growth of 8 per cent year-on-year and 0.6 per cent sequentially.

Airtel also announced a dividend of Rs 24 per share for FY26, higher than the Rs 16 declared in FY25 and above street expectations of Rs 20 per share, indicating growing confidence in the company’s free cash flow generation.

Additionally, the telecom operator unveiled a share swap agreement to acquire ICIL’s 16.31 per cent stake in Airtel Africa. Under the arrangement, Airtel will issue 146.7 million new shares to ICIL, resulting in an estimated dilution of about 2.4 per cent.