Posts Tagged ‘telecom’

Bharti Airtel’s Scrip Fell 6% Down !



Bharti Airtel’s scrip Friday fell 6.38 percent

Bharti Airtel’s scrip Friday fell 6.38 percent lower at the Bombay Stock Exchange (BSE)

Telecom major Bharti Airtel’s scrip Friday fell 6.38 percent lower than its previous close at the Bombay Stock Exchange (BSE) as investors dumped the stock because of disappointing second quarter results.

The scrip, which had fallen to an intra-day low of Rs. 290.30 from Thursday’s closing figure of Rs. 312.05, ended the day at Rs. 292.15.

Bharti Airtel said its net profit, according to US accounting rules, increased 13.4 percent to Rs. 2,321 crore (495 million) for the quarter ended Sep 30 from Rs. 2,046 crore in the like quarter of previous fiscal.

This was, however, a decline of 8 percent over the previous quarter of current fiscal.

Revenues were up 9 percent to Rs. 9,846 crore from Rs. 9,020 crore reported a year earlier.

“The industry is seeing entry of many players and this is bound to have a bearing on the fortunes of existing companies,” said Jagannadham Thunuguntla, equities head of brokerage and capital markets consultancy SMC Capital.

“In the short term, the stock could see some more pressure, though it is coming within range of a good buy, at least for the long term investor,” Thunuguntla added.

The Bharti scrip has lost as much as 30.2 percent over October and at current levels is the lowest in seven  months.

Bharti Airtel Shares Shot Up, Ended 4% Higher :)

Bharti Scrip ended 4 percent higher, a day after the firm had to terminate the proposed $24-billion equity-swap-cum strategic tie-up with South Africa’s telecom major MTN.

Bharti Scrip ended 4 percent higher, a day after the firm had to terminate the proposed $24-billion equity-swap-cum strategic tie-up with South Africa’s telecom major MTN.

Bharti Airtel shares, which opened on a firm note Thursday, ended 4 percent higher than its previous close, a day after the firm had to terminate the proposed $24-billion equity-swap-cum strategic tie-up with South Africa’s telecom major MTN.


The deal, if it had materialized, would have created the world’s third largest mobile phone firm, but had led to analysts worrying that the consequent debt burden would have made its stock unattractive.

Upon collapse of the talks, the company’s shares opened at Rs. 435 Thursday on the Bombay Stock Exchange (BSE) as against the previous day’s close at Rs. 418.55.

It shut shop at Rs. 435.35, a gain of Rs.16.80 or 4.01 percent over the previous day’s close.


The scrip had shot up to an intra-day high of Rs.467, moving up Rs.27.30 or 6.52 percent.

It had hit a 52-week high of Rs.990 on May 19 and an annual low of Rs.360.10 on Aug 11.

The company has been a laggard on the stock exchanges over the past month, falling 3.74 percent on the BSE even as the benchmark index of the bourse, the Sensex, rose 7.56 percent during the same period.

Analysts had been viewing the stock negatively owing to Bharti’s persistent sweetening of its offer for MTN.

In the last quarter, the scrip fell 4.36 percent, while the Sensex rose 18.17 percent.


However, with the deal off, the scrip is back in favour with traders and is expected to take off.

‘In a way this is good news for the Bharti scrip; had this deal happened it would have burdened the company’s balance sheet which is currently low on leverage,’ said SMC Capitals equity head Jagannadham Thunuguntla.

‘Analysts have been wary of the deal because of past acquisitions like the Tata Corus deal, which turned Tata’s balance sheet into a heavily leveraged one,’ added Thunuguntla.


Late Wednesday, Bharti Airtel and South Africa’s MTN said they were terminating their talks for the proposed deal that could have created a large mobile phone entity, just behind China Mobile and Vodafone Group, with a subscription base of 207 million.


According to Bharti, the proposed deal was called off after the South African authorities declined to accept certain regulatory constraints on the part of both sides.


QIPs Outstripped PE Funding & IPOs in Fund Raising Process ;)


Qualified institutional placements (QIPs) have outstripped private equity (PE) funding since January by at least eight times, making it by far the most popular fund-raising route for firms this year.


QIPs raised at least Rs. 21,209 crore since January this year, while PE funds invested only Rs. 2,574 crore in listed firms.


QIPs have almost raised more than twice of initial public offerings.

A QIP is a private placement by a listed company of shares or securities convertible to equity with qualified institutional buyers approved by market regulator Securities and Exchange Board of India(SEBI).


Data from Delhi-based investment bank SMC Capitals Ltd shows another 48 QIPs worth Rs.43,891 crore are in the pipeline.

But analysts do not expect a significant rise in the number of, or funds through, PE deals this year.


Typically, PE investments take up to six months to complete, whereas a QIP can be done in up to four weeks, making the fund-raising process faster and more reliable since the institutional buyers are selected carefully.


Also, in a QIP, the institutional buyers rarely seek a seat on the company board, or management control, a common practice in large PE deals.


Since PE is perceptionally intrusive for promoters, QIP serves as a good alternative.

However this QIP structure is liked by investors and firms as in a QIP the window is shorter and money can be raised quickly.


While real estate firms typically prefer QIPs for their need of capital at short notice, the companies currently waiting to do QIPs are across sectors, including telecom, entertainment, retail and information technology.


In line for QIPs are Reliance Communications Ltd, Pyramid Saimira Theatre Ltd, Pantaloon Retail (India) Ltd  and few more.


Some firms, though, have taken both routes for their funding needs.

Historically, PE investments in India have been in the form of private investments in public enterprises, or PIPEs, which also happen to the only firms eligible for QIPs.


“Private equity investors have missed the boat,” Jagannadham Thunuguntla, head of SMC Capitals, said in a statement.

Companies that are in the pipeline for QIPs may also look for American depository receipts or global depository receipts for funds, he  added.


India Telecom to cross 30bn revenue by 2013.

India telecom to cross 30bn revenue by 2013.

India telecom to cross 30bn revenue by 2013.

India will continue its robust telecom story with the revenue of the sector expected to be more than $30 billion by 2013, according to a global IT research and advisory firm.

”Total mobile services revenue in India is projected to grow at a compound annual growth rate (CAGR) of 12.5 percent during 2009-2013 to exceed $30 billion,”” the US-based Gartner Inc said in a statement.

The study also found that the growth will be triggered by the increased adoption of value-added services.

The mobile market penetration is projected to grew to 63.5 percent in 2013 from 38.7 percent in 2009 on the back of increased focus on the rural market as well as entry of consumer durable and electronic companies into the mobile handset segment, and cheaper handsets.

Moreover, the number of people with prepaid connections will continue to swell to exceed 96 percent by 2013.

Along with this, the postpaid subscriber base will exceed 29 million subscribers by 2013 growing 2.5 percent from 2008, Gartner said.

The Indian mobile industry has now moved out of its hyper growth mode, but it will continue to grow at double-digit rates for next three years as operators focus on rural parts of the country