Grameenphone warned investors in March that Q1 would be weak. Revenue would fall roughly 2%. EBITDA margins would contract around 3 percentage points. The language was careful but unmistakable — Bangladesh’s largest mobile operator was telling the market to lower expectations. The market obliged: GP shares slid from Tk 251 on the warning date to Tk 242 by the close of April 21, touching their lowest levels since the March 9 market crash.
Then the Q1 numbers landed. Revenue did fall. But profit rose. EPS climbed 4.48% year-on-year to Tk 4.90 from Tk 4.69. Net profit reached Tk 662 crore, up from Tk 633.93 crore a year earlier. A company that told you to expect worse delivered something better — and the explanation of how it did so reveals more about GP’s current trajectory than the headline number alone.
Where the Profit Came From
Revenue declined approximately 2% from Q1 2025’s Tk 38.35 billion, consistent with GP’s own guidance. The top line is still shrinking. Data pricing pressure, subdued consumer spending, and the persistent drag of currency depreciation continue to erode what 84.33 million subscribers generate per quarter.
So how does a company grow profit on falling revenue? Three levers, all on the cost side.
First, depreciation and amortisation charges declined. GP’s heavy spectrum investment cycle — one of the primary factors behind its lowest annual profit in eight years in FY2025 — is now cycling through the books. The capital spending happened; the depreciation is fading. Second, finance expenses fell, reflecting either debt reduction or more favourable terms in a gradually stabilising rate environment. Third, GP reported improved operational efficiency across the business — the kind of line that typically means headcount optimisation, renegotiated vendor contracts, or both.
The result: Tk 662 crore in quarterly profit. Not transformative, but directionally important. After FY2025 saw annual profit crash 19% and Q1 2025 saw a 53% year-on-year EPS collapse, any quarter that moves the trajectory upward matters — especially one achieved against revenue headwinds.
But there is a number in this filing that should temper the optimism. And most investors will miss it.
The Cash Flow Signal You Should Not Ignore
Net operating cash flow per share fell 11.6% to Tk 12.48 from Tk 14.11 in Q1 2025. That is a meaningful deterioration in a metric that measures the actual cash the business generates from operations — stripped of accounting adjustments that can flatter an income statement.
GP attributed the decline to higher customer collections in the comparative period and lower payments to suppliers in the current quarter. The explanation is technical, and the directional implication is straightforward: the business collected less cash relative to its operating activity than it did a year ago, even as reported profit rose.
When profit and operating cash flow diverge — one rising, the other falling — it warrants attention. It does not mean the profit is illusory. Depreciation is a real cost that flows through the income statement but not the cash flow statement, so lower depreciation lifts profit without affecting cash generation. But it does mean that the quality of earnings is mixed. GP is earning more profit per share while generating less cash per share. That tension will resolve in one direction eventually. The earnings call scheduled for 11:00 AM today may offer the first signals of which.
What the Market Is Pricing
GP closed at Tk 245.20 on April 22 — up 1.32% on a day when the DSEX surged 41 points and turnover topped Tk 1,000 crore for the first time in two months. The stock sits 25% below its 52-week high of Tk 328.00 and just 3% above its 52-week low of Tk 237.90. The trailing P/E ratio stands at 11.05 on annual EPS of Tk 21.90. The dividend yield is 8.34%, based on FY2025’s total payout of 215% — Tk 21.50 per share on a Tk 10 face value stock.
Those are defensive valuations by any standard. A beta of 0.51 means GP moves roughly half as much as the DSEX in either direction. For investors who watched the March energy shock and Hormuz crisis shred cyclical portfolios, a stock yielding 8.34% with half-market volatility and growing earnings is a rare thing on today’s DSE.
But the technicals tell a different story. GP’s 20-day exponential moving average has turned bullish, yet the 50-day, 100-day, and 200-day EMAs all remain bearish. Every simple moving average from 20-day through 200-day points down. The stock may be cheap, but the trend has not turned. Short-term momentum conflicts with longer-term direction — and that conflict will need a catalyst to resolve.
What the Earnings Call Must Answer
Q1 2026 confirms that GP can defend profitability through cost discipline when revenue declines. That is valuable information. It is not, however, a growth story. Revenue is still falling. Cash flow per share is deteriorating. The stock is trading near its lowest level in a year. Cost cuts buy time. They do not replace top-line growth indefinitely.
Today’s earnings call at 11:00 AM is the next data point. The market already knows what GP earned. What it needs to know is whether management sees revenue stabilising, what the subscriber ARPU trajectory looks like, and whether the cost levers that saved Q1 are repeatable or one-off. The difference between those answers is the difference between a stock that has found its floor and one that is still looking for it.
Disclaimer: This analysis is for informational purposes only and does not constitute investment advice. Grameenphone Ltd. is listed on the DSE under trading code GP. Past performance does not guarantee future results. Investors should conduct their own research or consult a licensed financial advisor before making investment decisions.