Airtel’s 4.49 % stake sale in Bharti Infratel is credit positive: Moody

There is no immediate impact on Airtel’s ratings and outlook

By Priyanka

    According to the new report by rating firm Moody's, Airtel's 4.49 percent stake sale in Bharti Infratel is credit positive.

    Airtel’s 4.49 % stake sale in Bharti Infratel is credit positive

     

    However, there is no immediate impact on Airtel's ratings and outlook, the report said

    The stake sale in Bharti Infratel is credit positive as it is in line with the management's commitment to strengthen the telco's balance sheet and reduce debt, but there is no immediate impact on Bharti's ratings and outlook, the report added.

    We are cautious on Bharti's operating performance over the next 12 months as we expect heightened competition, revamping of pricing plans and ongoing pricing pressures to persist in the Indian telecom sector. Also, lower interconnect usage charges, implemented on 1 October 2017, will have a negative impact on Bharti's profitability over the next 12-24 months," Moody's further added.

    The telco has recently announced that it sold over 83 million shares of its tower arm Bharti Infratel, worth Rs 3, 325 crores($510 million).

    The sale was for a total consideration of over Rs 3,325 crore ($510 Million) and was executed at a price of Rs. 400.6 per share, representing a discount of
    3.6 percent to the previous day's closing price. The allocation was done to global investors, fund managers and long-only funds, including many repeat investors. Led by healthy investor appetite, the deal was upsized by over 25 percent.

    "Bharti Airtel will primarily use the proceeds from this sale to reduce its debt. Following the closure of this transaction, Bharti Airtel and its wholly owned subsidiaries together have an equity holding of 53.51 percent in Bharti Infratel," the company said in a filing to the Bombay Stock Exchange.

    Read More About: airtel telecom news
    Opinion Poll
    X

    Stay updated with latest technology news & gadget reviews - Gizbot

    Notification Settings X
    Time Settings
    Done
    Clear Notification X
    Do you want to clear all the notifications from your inbox?
    Yes No
    Settings X
    We use cookies to ensure that we give you the best experience on our website. This includes cookies from third party social media websites and ad networks. Such third party cookies may track your use on Gizbot sites for better rendering. Our partners use cookies to ensure we show you advertising that is relevant to you. If you continue without changing your settings, we'll assume that you are happy to receive all cookies on Gizbot website. However, you can change your cookie settings at any time. Learn more