BT Group (LON: BT. A): Should you buy shares of telecom major now?

FTSE 100 listed telecom service provider BT Group Plc’s (LON: BT. A) stock ended higher by over 6% in the last trading session. At one point of time, the shares of the company were up by around 10%, becoming the top gainer of the blue-chip index following the media report that India-based Reliance Industry is planning to bid for the telecom group.

According to reports, one of India’s largest companies and top telecom service provider, Reliance Industry, might put an unsolicited bid for the UK-based BT Group Plc or may also partner with its fibre-optic business division, Openreach to expand its network offering.

However, the Reliance Group has denied the media speculation in its exchange filing, leading to some consolidation in the BT Group share price.

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Other than the latest speculation, the company’s stock has performed well in the current month, gaining over 17% since 1 November 2021. Let us, deep-dive, into some of the factors that led to an upsurge in November 2021:

Half-Yearly Earnings

For the six months ended 30 September 2021, the company reported a revenue of £10,305 million, while its profit before tax was £1,009 million. Its adjusted EBITDA was at 3,748 million, while basic earnings per share were at 10.2p per share. The company’s 5G ready consumer base improved to 5.2 million, while the fibre-optic business Openreach reported a client base of six million and revenue of £2,707 million. The company’s long term FTTP national pricing offer received a good response from its clients, and around ten communication service providers had already signed up for the offer. Backed by the good performance of all business divisions, the company declared an interim dividend of 2.31p per share for its shareholders.

Gross annualised savings

In its previous earnings announcement, the company had set a target to save £1 billion by March 2023. However, the company achieved the target 18 months ahead of the deadline reporting a gross annualised savings of £1 billion. In addition, the company has brought forward its £2 billion gross savings target to FY2024 from FY25. Also, the company has brought forward its net-zero emission target. It aims to make its operations carbon emission-free by 2030.

Earlier, the media group reported that the BT Group Plc board may consider selling a stake in the fibre-optic business division, Openreach, to the potential private investors. Also, there are reports of potential takeover offer by the billionaire telecom investor Patrick Drahi, who already owns a 12.1% stake in the company and will be able to raise his stake further after the 11 December lock-in period is over.