Thursday, December 27, 2012

Bharti Infratel IPO

Bharti Infratel, the telecommunications tower arm of top Indian mobile phone carrier Bharti Airtel, has come out with its IPO with an issue size of 18.89 crore shares comprising of fresh issue of 14.62 crore shares and 4.2 crore shares from existing investor shareholders. Bharti Infratel and four private equity investors are selling shares in the offer. The company is expected to raise between Rs 4000 crore to Rs 4700 crore.

Bharti Infratel has over 34,000 towers across 18 states covering 11 telecom circles and also holds 42 per cent stake in Indus Towers which has around 1,10,000 towers. Based on the number of towers that Bharti Infratel owns and operates, the company is one of the largest tower infrastructure providers in India.

The IPO shall open on 11 December, 2012 and shall close on 14 December, 2012. The company has fixed the issue price at a band of Rs 210 to Rs 240 per share. Retails investors will get 10% discount to the issue price.

Bharti Infratel IPO will get listed on both NSE and BSE. This IPO should create some buzz in the IPO market and should help revive some IPO sentiment.

Recommendation:

CRISIL has graded 4 to the IPO indicating above average fundamentals. The company is the leading tower infrastructure providers in India and has long term contracts with its customers which brings stability to revenue. We would recommend investors to subscribe to this IPO with a medium term view though if there are good listing gains, one should encash it.

Subscription:

Bharti Infratel IPO has got only subscribed by 1.3 times at the close of the IPO. This also largely due to QII support.

At the close of the day,
QII segment got subscribed by 2.84 times
NII segment got subscribed by 0.29 times
Retail segment got subscribed by 0.19 times

Allotment:

The company has fixed the issue price at Rs 220 per share. Retail investors will get the share at a discount of Rs 210 per share. Click here to check Bharti Infratel IPO Allotment Status!

Listing:

Bharti Infratel IPO got listed on 28 December, 2012. The stock touched intra-day low of Rs 188.65 and intra-day high of Rs 200.85 before closing the day at Rs 191.65, a 8.7% discount against the issue price of Rs 210 for retail investors.


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