Airtel Africa (LSE:AAF) isn’t the FTSE 100‘s most famous name. But it’s been making headlines because the blue-chip share index’s best riser within the yr up to now.

At 144.9p, Airtel Africa’s share price has risen a formidable 23.7% since 1 January. It shot up 9% on Thursday (30 January) alone because of an upbeat response to its newest financials.

So what’s all the excitement about? And may the FTSE agency proceed its northwards march?

A booming market

A mix of low market penetration, rising disposable incomes, and speedy inhabitants progress is supercharging telecoms and monetary providers demand in Africa. And Airtel has proven it has the instruments to capitalise on this chance.

The corporate — which offers voice, information, and cell cash providers throughout 14 African nations — noticed revenues at fixed currencies rise a whopping 20.4% within the 9 months to December, to $3.6bn, it introduced at present.

Buyer numbers grew 7.9% between April and December, to 163.1m. And information utilization per buyer elevated by 32.3%, to six.9 gigabytes, as smartphone adoption continued to rise.

The amount of information and cell cash prospects rose 13.8% and 18.3% respectively over the 9 months.

Revenues had been boosted by Airtel’s sustained funding throughout its markets. Knowledge capability rose by simply over a fifth between April and December.

Good and unhealthy

It wasn’t all sunshine for Airtel throughout the interval, nonetheless. Turnover continues to be impacted by adversarial forex actions, and extra particularly forex devaluations in Nigeria, Malawi, and Zambia.

At precise currencies, gross sales dropped 5.8% within the 9 months.

However largely talking this was one other rock-solid assertion from Airtel. With forex stress starting to reasonable, and demand for its providers nonetheless rocketing, the longer term seems to be vibrant for the FTSE agency.

Analyst Neil Shah of Edison Group notes that “with sustained funding in community growth, a rising buyer base, and rising information and cell cash penetration, Airtel Africa stays well-positioned for long-term progress“.

This might pave the way in which for additional vital share price positive factors. Airtel shares have virtually doubled in worth over the past 5 years.

Enticing worth

After this yr’s gorgeous positive factors, Airtel Africa trades on a pumped-up price-to-earnings (P/E) ratio of 31.7 occasions for this monetary yr (to March 2025). This might, at first look, counsel restricted price upside, a minimum of within the close to time period.

However look somewhat nearer and the enterprise really appears to supply actual worth. For the brand new yr starting in April, it’s P/E slumps to 10.6 occasions, starting in April. This displays Metropolis expectations of a 198% earnings leap.

What’s extra, its price-to-earnings progress (PEG) ratio is simply 0.1 for the upcoming fiscal interval. Any studying beneath one implies {that a} share is undervalued.

It’s essential to do not forget that earnings forecasts are recognized to overlook their mark. If this occurs, a share price can fall sharply in worth.

Whereas this can be a threat, Airtel’s sturdy momentum and substantial structural drivers counsel it’s in good condition to fulfill — or probably even exceed — analyst estimates. I totally anticipate the FTSE agency’s share price to proceed its long-term ascent.