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regular-article-logo Wednesday, 29 May 2024

Bharti Hexacom to get valuation of more than Rs 28,000 crore in initial public offer

IPO will not have any fresh issuance of equity shares, and since it is an offer for sale, company will not receive any proceeds from issue

Our Bureau And Agencies Mumbai Published 21.03.24, 10:15 AM
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Bharti Hexacom could reportedly get a valuation of more than Rs 28,000 crore in its initial public offer.

The Bharti Airtel arm has received capital markets regulator Sebi’s nod to mobilise funds through an initial public offering (IPO).

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The IPO will not have any fresh issuance of equity shares, and since it is an offer for sale or OFS, Bharti Hexacom will not receive any proceeds from the issue.

Under the OFS, 10 crore equity shares will be offloaded by Telecommunications Consultants India Ltd. The offer represents 20 per cent of the paid-up equity share capital of Bharti Hexacom.

Bharti Hexacom, which filed draft papers with the markets regulator in January, obtained its observation letter on March 11, an update with the Securities and Exchange Board of India (Sebi) showed on Tuesday.

In Sebi’s parlance, obtaining the observation letter means its go-ahead to float the public issue.

Bharti Hexacom provides telecommunication services in Rajasthan and the Northeast.

A CNBC-TV18 report on Wednesday said the IPO is expected to be launched in the first week of April. while the IPO size is expected to be around Rs 1,300 crore, it could come at a valuation of Rs 28,000 crore.

According to the company’s website, Bharti Airtel holds 70 per cent of the equity share capital of the company and the government through Telecommunications Consultants India holds 30 per cent.

SBI Capital Markets Ltd, Axis Capital, BOB Capital Markets, ICICI Securities and IIFL Securities are the book-running lead managers to the issue.

Bharti Hexacom is a communications solutions provider offering consumer mobile services, fixed-line telephone and broadband services to customers in the Rajasthan and the North East telecommunication circles which include Arunachal Pradesh, Manipur, Meghalaya, Mizoram, Nagaland and Tripura. Its services are offered under the Airtel brand.

According to its DRHP, as of September 30, 2023, it had invested Rs 20,300 crore in infrastructure. Its revenue market share for the Rajasthan circle was 40.3 per cent during the six-month period ended September 30, 2023.

The company added that it also occupied the top position in the North East circle during the period.

5G data

5G users in India are consuming 3.6 times more mobile data as compared to 4G users since its rollout in October 2022, according to a report by telecom gear maker Nokia.

In the report titled ‘Mobile Broadband Index’, released on Wednesday, Nokia said that 5G contributed to 15 per cent of all data traffic in 2023.

“5G users are using approximately 3.6 times as much mobile data traffic compared to 4G since its launch in October 2022. In 2023, users consumed 17.4 exabytes per month with a CAGR (compound annual growth rate) of 26 per cent over the past five years.

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