Tuesday, February 5, 2008

Reliance Infratel IPO - Analysis

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Reliance Infratel is coming out with issue of nearly 9 crore shares which constitutes only 10% of the post issued equity. It is going to be the second IPO from the Anil Ambani Group, the first one being Reliance Power which got a thunderous response from investors. The company is basically into passive infrastructure in the telecom space. It has part payment option for retailers and HNI as was the case in Reliance Power IPO as well.

The company plans to have roughly around 36,849 towers by the end of March 2008. It currently owns nearly 23400 towers as of now, so the remaining ones are in the process of being built and is expected to be completed by March 2008. The company has a firm roll out order of 16,000 towers for which it’s going to come to the market and these have to be delivered by March 2009 at an estimated cost of Rs 4,623 crore.

Six months back, they made a private placement of 5% to various investors, that came into a valuation of nearly USD 6.75 billion and it was done at a price of Rs 334. The price range for this IPO might be in the range of Rs 500 to Rs 600.

Watch this blog for more news and updates on Reliance Infratel IPO!
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