By mid-afternoon on 2 March, Airtel Africa’s (LSE:AAF) shares were one of only eight risers on the FTSE 100. Following the killing of Iran’s leader and subsequent retaliation, the Footsie’s energy and military stocks were also up.
But what’s causing the African telecoms group to buck the trend? Could it be a stock to consider buying during these uncertain times? Let’s see.
On the defensive
Although Africa’s only separated from the Arabian Peninsula by the Red Sea, the continent is sufficiently far away from the epicentre of the trouble to not be a target. Also, most customers in the telecoms sector are under contract and they tend to pay fixed monthly rates. In addition, mobile phones are seen as an essential part of modern life.
Generally speaking, this means revenues and earnings in the industry tend to be reliable and reasonably predictable. That’s why the sector has defensive characteristics that can make it attractive during times of geopolitical uncertainty.
And with its rapidly growing population, I reckon Africa’s the perfect place to sell mobile communications and money services. Indeed, during the nine months ended 31 December 2025, the group reported a 28.3% increase in revenue and a 41.3% rise in operating profit.
And it’s not alone. Vodafone, its FTSE 100 cousin, reported organic service revenue growth of 13.5% on the continent during the three months to the same date. And MTN Group, Africa’s largest telecoms provider, saw its year-on-year service revenue rise by 22.6% during the nine months to 30 September 2025. It looks as though the territory’s a great place to do business at the moment.
Providing access to banking products
Interestingly, all three companies have reported that their financial services divisions are doing particularly well. And this is where I see huge potential for Airtel Africa.
In many parts of the 14 countries in which the group operates, there are no banks. Customers are therefore able to load money on to their phones — and obtain cash — via the group’s network of agents, branches, and kiosks.
In addition, it’s expanding its services to include loans, savings, and international money transfers. The group plans to separately list its mobile money division in the first half of 2026.
Pros and cons
But there are a couple of areas to keep an eye on. Despite its impressive cash generation, Airtel Africa’s net debt increased during 2025. Although, it’s now lower relative to its EBITDA (earnings before interest, tax, depreciation, and amortisation), its double-digit effective interest rate is a reminder that it’s vulnerable to higher borrowing costs.
Also, many of Africa’s currencies, economies, and governments can be unstable.
However, I think the group’s well positioned to cope with these threats. While I appreciate the defensive properties of Airtel Africa’s stock, I like it more for its growth potential. I reckon it’s operating in the right place at the right time. I believe both of its service offerings – telecoms and mobile money – are likely to become increasingly important to more and more African consumers.
And in December 2025, the group announced a partnership with SpaceX to expand its network coverage without having to invest heavily in telecoms infrastructure.
For these reasons, irrespective of what happens in the Middle East over the coming weeks, I think Airtel Africa’s a stock for long-term investors to consider.
