To say that UK shares had a good 2025 is a massive understatement. The FTSE 100, in particular, delivered one of its strongest performances since 2009, with index investors reaping a massive 21.2% total return since January.
To put that into perspective, a £5,000 investment 12 months’ ago is now worth close to £6,060. By comparison, the usual stock market average is closer to 8%, or £5,400.
But even with a double-digit return that could make billionaire investor Warren Buffett blush, it still pales in comparison to the investment gains some stock-pickers have enjoyed. Particularly those who bought shares in Airtel Africa (LSE:AAF).
Turning £5,000 into £13,950
Most investors have been so focused on popular stocks like Lloyds and Rolls-Royce, they’ve overlooked this African telecoms and mobile money services enterprise.
Airtel Africa had been struggling in recent years as the collapse of the Nigerian naira slashed its reported earnings in its 2024 fiscal year (ended March). But since then, the currency has stabilised and even started to recover.
As such, in its fiscal 2026 half-year results, the group enjoyed a massive $90m gain entirely from foreign exchange rates boosting profits. At the same time, management successfully restructured its debts to use local currencies, preventing future exchange rate volatility from compromising company solvency.
To top it all off, smartphone penetration in its African markets has now reached 46.8%, translating into snowballing demand for mobile data packages. So much so that data revenues for the first time are now greater than mobile calling revenues.
Combined, revenues across the six months leading to September jumped 25.8%, operating profits surged 35.9%, and, thanks to favourable currency exchange rates, after-tax profits skyrocketed 375.3%. Throw in the added bonus of leverage risk reduction, and it’s no wonder the stock’s delivered a 179% total return since January.
Too late to buy?
Despite all of its recent momentum, Airtel Africa could be just getting started. Institutional analysts tracking this business have identified that its fintech Mobile Money division could be worth billions by itself. And with a spin-off IPO approaching in 2026, investors could soon wake up to this suspected hidden value.
Even with its core telecommunications business, Africa remains one of the few regions in the world with a rapidly growing youth population, all rushing to get smartphones.
That means over the next few years, the company could see an influx of millions of new customers. And with the expensive infrastructure already in place, this wave of new recurring revenue could come paired with higher margins.
Of course, while this all sounds promising, that doesn’t mean success is guaranteed. The naira could decide to take another nosedive. And while the impact is mitigated by management’s localisation of debt, it can nonetheless disrupt profits and capital spending plans.
It’s also important to remember that, as a telecoms business, Airtel has to comply with strict regulations to renew its spectrum licenses and operating permits. And management has previous had to pay hefty fines to keep regulators happy.
Nevertheless, underestimating Airtel Africa has proven to be a costly mistake. And with supportive long-term tailwinds, it seems worthwhile to investigate this business further. But there are also other UK shares on my radar today.
