Tag: Bharti Airtel

Lucky 3! These Nifty50 stocks outperformed in 2019; time to book profits?

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Love them or hate them! Well, you will probably love these three stocks if you had invested in them say in January 2019, and probably hate them if you missed out on the opportunity.

These three stocks have been among the top return generators across three-month, six- month and YTD basis as well. Three stocks which top the charts include names like Bharti Airtel, Bajaj Finserv, and from the private banking space, ICICI Bank.

They have delivered more than 40 percent return each to investors so far in 2019, and if commentary from experts is something to go by then there is still more upside left.

Data suggests that markets are favouring “turnaround” performers such as Bharti Airtel, and Reliance Industries. However, the past month’s trend is showing the market move towards companies with lower sales growth, higher capital intensity, and higher leverage, Elara Capital said in a report.

After rallying by over 40 percent each – does it make sense to put money in ICICI Bank, Bajaj Finserv, and Bharti Airtel? Well, experts remain constructive on all the three names, but do not rule out consolidation in the near-term which could be used as an opportunity to buy.

“The momentum may continue in the stocks as it’s about buying winners and you sell the losers and these stocks are the leaders in their own space that are seeing liquidity coming and hence the premium that is attached to them reflects the same,” Lovelesh Sharma, Head of Research, Epic Research told Moneycontrol.

“The momentum in these stocks may continue as long as investors are less willing to take a risk with profit,” he said.

Ajit Mishra, VP Research, Religare Broking told Moneycontrol that Bajaj Finserv and ICICI Bank are leaders and consistent performers in their respective sectors. Further, both companies have sound management and bright future growth prospects, which can deliver healthy returns to investors.

“Nonetheless, some consolidation can be expected in the near term given the stretched valuation however future outlook looks stable. Conversely, we remain cautious on Bharti Airtel due to on-going issues in the telecom sector,” he said.

Stocks which were outperformers from YTD, six-month, and three-month perspective include names like BPCL which rose 49 percent so far in 2019, Reliance Industries which had rallied 39 percent on a year-to-date basis, and Bajaj Finance which was the top Nifty50 gainer, up 54 percent in the same period.

Elara Capital in its report mentioned that they read these signs as the beginning of market broadening from the narrow set of “high quality” performers and expect the trend to continue among Nifty 50 stocks and more broadly across broader markets as well.

(Source: Moneycontrol.com)

Disclaimer: Network18, the parent company of CNBCTV18.com, is controlled by Independent Media Trust, of which Reliance Industries is the sole beneficiary.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Private equity players eye stake in Bharti Airtel; SingTel may invest up to $1 billion

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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While Bharti Airtel is looking at multiple modes to raise funds, sources told CNBC-TV18 that financial investors and PE players have also expressed interest in investing in the company.

Bharti Airtel is in the process of undergoing one of its largest fundraising drives to date. To that effect, the board last week cleared fundraising of up to $3 billion via debt-equity.

The names that are interested include marquee investors like Warburg Pincus and Carlyle, according to the sources.

“Warburg Pincus has had a long association with Airtel and is confident of the long-term story. While talks are at a very exploratory stage right now, Warburg is keen on the deal. Other PE players have also sounded of Airtel’s investment bankers on their interest in the deal,” said a source aware of the talks.

The sources added that Singapore Telecommunications (SingTel ), which currently holds 35 percent in Bharti Airtel, directly and indirectly, is exploring investing anywhere between $700 million to $1 billion in the telecom major.

“The quantum of investment is yet to be decided. The board of SingTel will be meeting soon to finalise,” added another source involved in the transaction.

Airtel’s board approved raising $2 billion via the launch of one or more QIPs or OFS or a combination of both and $1 billion via debentures and bonds. It has authorised a Special Committee of Directors for taking necessary steps for implementing the fundraising plans.

The company will use the proceeds to pay liabilities to the Department of Telecom (DOT), bring down debt and to expand operations and upgrade network infrastructure to prepare for 5G auctions and launch next year. Bharti Airtel’s last reported net debt stood at Rs 1.18 lakh crore.

Bharti Airtel recently announced hiking tariffs to reduce the stress on its balance sheet. It hiked tariffs from 25-40 percent on an average and up to 40 percent on some of its lower plans. The company, along with COAI and other telecom operators, has been stressing on the need for relief from the government to alleviate the stress in the balance sheet.

Not only do most telecom operators have a high debt burden, but they also need capital for network expansion and to be able to participate in the upcoming 5G auctions.

The government recently announced a 2-year moratorium on spectrum payments. COAI and telecom operators have stressed on the spectrum relief, while important, not being enough to alleviate the severe stress in the sector.

Bharti Airtel’s decision to raise capital via debt and equity is a strategic initiative to remain competitive and at the same time manage its debt levels.

In the last quarterly result, Bharti Airtel reported a net loss of Rs 23,044 crore and provided Rs 28,450 crore as the charge for AGR dues.

In Oct, the Supreme Court passed a verdict allowing the Centre to recover dues from telecom operators for adjusted gross revenue (AGR). The liability on Bharti Airtel from the AGR verdict is at Rs 43,000 crore. The move is a massive blow for the incumbent players, especially Bharti Airtel and Vodafone Idea. A heady cocktail of troubles will lead to these players needing to raise capital via multiple modes to stay relevant and competitive.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Government warns telcos against delay in AGR dues, says report

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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The government has warned all telecom licence holders against any delays in the payment of dues related to adjusted gross revenue (AGR), Economic Times reported.

According to the report, the Department of Telecommunications (DoT) has asked all telecom licence holders, including non-telecom companies, to speed up the process of self-assessment of AGR-based dues and their payments.

In a letter written last week, the DoT also has asked them to seek clarifications by December 13 on any doubts that may not have been covered in the recent Supreme Court judgment, the report added.

The government has said that around 15 telcos need to pay over Rs 1.47 lakh crore, which could rise further.

“Any issues should be pointed out in the comprehensive representation to be submitted, but in no case the self-assessment and payment of dues are to be delayed,” said the December 5 DoT letter, which ET has seen.

“The comprehensive representation shall be submitted within a week (latest by December 13),” the letter said.

The Supreme Court had given companies three months to make the payments in its October 24 order.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Sanjay Dutt of Quantum Securities believes PSUs will be the next big theme over couple of years

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Sanjay Dutt, director at Quantum Securities is of the view that there is phenomenal opportunity in the market and that investors need to look at that rather than be obsessed by these 5-10 stocks, which take the index up or down.

Sharing further details on where this opportunity lies, he said, “ For the entire B group and the smallcap (excluding the A group), the marketcap at this point of time is Rs 9.2 lakh crore and the marketcap of Reliance Industries Ltd (RIL) alone is Rs 9.9 lakh crore. So it clearly shows that we have a problem somewhere. Markets are totally disconnected from realities.”

“Therefore, it is impossible to believe that 8,000-9,000 or 5,000 companies, all doing business in the same country total up to a marketcap of Rs 9.2 lakh crore versus one company on one side, which is Rs 9.9 lakh crore. So it shows that there is phenomenal opportunity in the market,” he said in an interview with CNBC-TV18.

According to him, the big theme over the next two years  is going to be public sector enterprises. PSUs have been beaten down to nothing but it is matter of time before they will get re-rated. There is immense value there, he said.

When asked about the auto space, he said, “The feedback that I get from the channels is that the excess inventory has been pushed out, it has come down substantially but one cannot say that demand is going to come up and things are going to be gung-ho from next month onwards.” It is possible that there are early green-shoots but would still prefer to wait a month or two or maybe a quarter to see auto stabilising, he added.

“Early signs are there so for people who want to take a risk and be bold and catch it early, maybe they could take a call. I won’t be surprised if the numbers are down next month again,” said Dutt.

According to him, one can find opportunities across the sectors – there are good quality companies in consumption, in pharmaceuticals, in infrastructure construction, banking and financial services.

On telecom space, he said, “Reliance standalone is an excellent company, excellent investment but till one doesn’t get clarity on how to take a telecom exposure on Reliance, I think the only option left is Bharti Airtel right now or for some real brave people there is Vodafone and i am one of those.”

On the financial side, he is not upbeat on Yes Bank, he said.

When asked about the possibility of the goods and services tax (GST) rates going up, Dutt said, “The fact is that when the corporate tax rates went down, we rallied for two days and we forgot about it. We never realised that that was the seminal change that happened in Indian macro and corporate history but the market forgot about it and we moved on. Yes, economy has a problem, we do have a problem, GST rate tinkering happens, go up 2 percent here, 3 percent there but is that going to change consumption anywhere? It is not. It is going to change for about a month or two or three months, we will absorb it and move on. I am not going re-balance my portfolio based on GST rates but would look at much deeper fundamentals and other important issues that are going to reflect on my portfolio for the next two-ten years.”

“My view is going to change when I see some fundamental shifts happening. If the GST rates goes up 2 percent on something, goes down on something, it is not going to impact me in my portfolio as such. It will have a short-term impact,” he said, adding that fundamentally, if we have a problem in the economy, we need to sort that out.

“More than the economy, we have a problem in the financial system today. The single-most problem that we are all living with is trust issue. There is no trust in the financial system. Till that is not restored, no amount of work can be done,” he further mentioned.

Disclosure: RIL, the promoter of Reliance Jio, also controls Network18, the parent company of CNBCTV18.com.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Bharti Airtel picks Axis Capital, JP Morgan, Citi as advisors for FY20’s biggest QIP

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Sunil Bharti Mittal-led telecom major Bharti Airtel has kicked off a mega $2 billion (roughly Rs 14,500 crore) fundraising exercise and shortlisted merchant banks Axis Capital, JP Morgan and Citi for FY20’s biggest qualified institutional placement (QIP) yet, sources with knowledge of the matter told Moneycontrol.

Earlier in the fiscal, Axis Bank and Bajaj Finance had raised Rs 12,500 crores and Rs 8,500 crores, respectively via the QIP route.

“Axis Capital has been engaged as the left lead book-running manager for the QIP. JP Morgan and Citi are also on board. More merchant bankers are likely to be appointed at a later stage prior to the launch,” a source said

“Law firm AZB & Partners has been engaged as the counsel for the issuer company i.e Bharti Airtel. The roadshows will begin shortly, maybe as early as this week and the QIP is likely to be launched in early January 2020,” added a second source.

Last week, Bharti Airtel’s board had given the nod to raise a combined $3 bn (around Rs 21,500 crores) through a mix of equity and debt.

The funds will be used to pay Bharti Airtel’s dues to the Department of Telecommunication (DoT). The dues were triggered by an adverse ruling by the Supreme Court that rejected the definition of adjusted gross revenue (AGR) proposed by telcos and excluded revenue from non-core telecom operations like rent, dividend, and interest income.

The additional provisions required to pay these dues led Bharti Airtel to post a whopping Rs 23,045 crore loss in Q2 from a net profit of Rs 118 crore the year ago. Vodafone Idea also reported a net loss of Rs 50,922 crore for the same quarter.

To provide some respite from the mounting losses, the government on November 20 granted a two-year moratorium on the repayment of the dues. Finance Minister Nirmala Sitharaman announced that the years of deferment of payments will be spectrum auctions for years 2020 to 2021 and 2021 to 2022.

“These deferred amounts will be equally spread over the remaining installments to be paid by the TSPs without any increase in the existing time period specified for making the installment payment,” said Sitharaman.

However, telecom firms Bharti Airtel and Vodafone Idea have sought further relief from the government. Recently, Vodafone Idea Chairman Kumar Mangalam Birla said that his company would have to shut shop if relief doesn’t come through.

According to brokerage firm CLSA, AGR risks for Bharti Airtel can likely lead to payments of Rs 34,300 crore or $4.7 billion, of which around 75 percent is interest and penalties.

Morgan Stanley has maintained an overweight rating on Bharti Airtel saying the recent tariff hike by the company is a step in the right direction. “FY21 ARPU will likely see substantial improvement,” the brokerage added.

Recently, all three major private telcos, Bharti Airtel, Reliance Jio and Vodafone Idea also hiked their respective tariffs leading to a rally in stock prices. On December 3, Bharti Airtel increased the charges of its prepaid voice and data services by up to 47 percent. Reliance Jio and Vodafone Idea also raised charges by up to 40-42 percent.

“With pricing sanity back in the telecom sector, this is a good time for Bharti Airtel to raise money,” added another source. The company’s share price has surged by 20 percent in a month, between November 6 and December 6. During the same period, rival Vodafone Idea’s share price has surged by 79 percent.

Bharti Airtel, Citi, and JP Morgan declined to comment in response to an email query and Moneycontrol is awaiting a response from Axis Capital and AZB & Partners.

(Source: Moneycontrol.com)

Disclaimer: Reliance Industries Ltd. is the sole beneficiary of Independent Media Trust which controls Network18 Media & Investments Ltd. 

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Bharti Telecom seeks Rs 4,900 crore FDI nod; infusion to make Airtel foreign firm

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Bharti Telecom, a promoter of Bharti Airtel, has sought government nod for the infusion of Rs 4,900 crore investment from Singapore-based Singtel and other foreign entities, a move that would make the country’s oldest private telecom operator a foreign entity.

The fund infusion will enhance foreign stakeholding in Bharti Telecom to over 50 percent that will make it a foreign-owned entity, an official source aware of the development told PTI. Currently, Sunil Bharti Mittal and his family own around 52 percent stake in Bharti Telecom.

Bharti Telecom holds around 41 percent stake in Bharti Airtel while foreign promoter entities hold 21.46 percent stake in the telecom firm. Public shareholders have around 37 percent stake in the company.

“Bharti Telecom has applied for infusion of Rs 4,900 crore in the company which includes investments from Singtel and some other foreign investors. With this Bharti Telecom will become a foreign entity as majority stake will be held by overseas investors. DoT is expected to approve this investment this month,” the source said.

The Department of Telecom had earlier this year rejected Bharti Airtel’s FDI application as the company had not provided clarity on the foreign investor.

Total foreign shareholding is 43 percent in Bharti Airtel, at present. With promoter firm Bharti Telecom becoming a foreign entity, foreign shareholding in the company will cross 84 percent, the source said.

Bharti Airtel has already been in discussion with Singtel and other entities for fund infusion.

The company in August had informed stock exchanges that Bharti Telecom in order to retire some debt may seek equity from its existing promoter group which may include overseas entity and Singtel in proportionate to its holding.

Bharti Airtel has said that even a marginal increase in foreign equity would take the foreign investment in Bharti Telecom above 50 per cent making it a foreign owned entity.

Bharti Airtel has already applied to raise FDI limit to 100 percent in the company.

Bharti Airtel board last week approved a proposal to raise $3 billion through QIP, stake sale and debt papers as the company owes adjusted gross revenues (AGR) dues of Rs 43,000 crore to the government.

The company will launch one or more QIPs or offer for sale of equity shares or a combination of similar offers to raise $2 billion. Rest $1 billion will be raised through debentures and bonds.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

For pre-paid customers, Airtel removes cap on free outgoing call to other networks

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Telecom operator Bharti Airtel has removed the cap from free outgoing calls on other networks under its new plans for pre-paid customers that came into effect from December 3.

The company had earlier capped outgoing calls to network of another telecom operator to 1,000 minutes in case of plans with 28 days validity, 3,000 in 84 days validity plans and 12,000 in 365 days validity plan.

Also here: Airtel releases new tariff plans effective December 3. Check details here

Beyond this limit, customers were required to pay 6 paisa per minute for outgoing calls. “From tomorrow, enjoy unlimited calling to any network in India with all our unlimited plans. No conditions apply,” Bharti Airtel said in a tweet on Friday.

The company on December 1 announced new plans under which call and data charges became dearer for its pre-paid customers by up to 50 percent from December 3.

The company had announced new plans in “unlimited” category with 2 days, 28 days, 84 days, 365 days validity which on the back of the envelope calculations showed the higher price of up to 50 percent.

Also read: Bharti Airtel board approves raising up to $3 billion via debt, equity

Bharti Airtel increased its entry-level unlimited plan with a year-long validity by about 50 percent to Rs 1,499, with 24 GB of data, in place of Rs 998 plan which comes with 12 GB data usage limit. The price of 365-days validity plan in the same category with a daily data usage limit of 1.5 GB per day now costs 41.2 percent more at Rs 2,398.

The company also announced three new plans – Rs 219 with 28 days validity offering 1 GB per day, Rs 399 and Rs 449 plan with 56 days validity each, offering 1.5 Gb and 2 GB data usage, respectively.

With the removal of limit, Airtel’s new 399 plans with 56 days validity become cheaper than that of Reliance Jio plan at the same price. The move from both companies follows the Supreme Court judgement on adjusted gross revenue.

Bharti Airtel has posted a staggering Rs 23,045 crore net loss for the second quarter ended September 30, due to provisioning of Rs 28,450 crore in the aftermath of the Supreme Court ruling on statutory dues.

According to government data, the liabilities in the case of Bharti Airtel add up to nearly Rs 35,586 crore, of which Rs 21,682 crore is licence fee and another Rs 13,904.01 crore is the SUC dues (excluding the dues of Telenor and Tata Teleservices).

The government is currently not considering any proposal on waiver of penalties and interest on outstanding licence fee based on adjusted gross revenue (AGR), or on extending the timelines for telecom companies to pay up their statutory dues.

Disclaimer: RIL, the promoter of Reliance Jio, also controls Network18, the parent company of CNBCTV18.com.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Subscriber losses at Vodafone Idea to benefit Jio more than Bharti, says Fitch Ratings

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Kumar Mangalam Birla at the Hindustan Times Leadership Summit in New Delhi said said they would shut Vodafone Idea if they don’t get relief. He said it was important for the government to find a solution for the telecom sector.

Nitin Soni of Fitch Ratings who tracks the telecom space said there is no doubt that Vodafone Idea has been facing lot of challenges with low cash generation amidst shrinking base and they have struggled to pay some of the bank loans which they disclosed in last quarterly results. On top of this the  AGR dues of over Rs 44,000 crore would be a big challenge for Vodafone Idea, he added.

“It will be a real challenge for them to raise such a large amount of money from banks given that they are in financial distress. So we have to see what kind of relief Supreme Court judge in the review petition or the government can provide to the sector, especially when 75 percent of the total amount is interest and penalties and that is the real issue now,” he added.

According to him, any relief will be positive for the telecom sector and especially for Vodafone Idea. “As a rating agency we are conservative and have factored in a full amount that they will pay in the next three months,” he added.

Bharti Airtel is rated at – BBB and they are at rating watch negative, said Soni.

With regards to Vodafone Idea, he said, “We believe 25-30 percent tariff hike for them will not be sufficient to recover their cash generation to such a level at which they will start paying their bank loans in a proper manner.”

From industry perspective if Vodafone Idea were to shut shop then industry would definitely suffer in the form of job losses and there would be some repercussions on the tower industry including Indus- Infratel, which is in merger stage awaiting regulatory approvals. So their valuation could also beget if Vodafone Idea were to exit given large number of tenancies are with Indus- Infratel, said Soni.

According to him, it would not be in the national interest to have two private telcos and so government may provide some relief to continue having at least three private telcos.

“Jio has a really good momentum right now to gain subscribers. They have been gaining about 6-7 million subscribers. So it’s not as if Vodafone Idea is not losing subscribers at the moment, they are already losing about 4-5 million subscribers a month, but that is not going to Bharti, it is mostly going to Jio’s network,” Soni added.

However, in case Vodfone Idea were to rapidly lose market share and come down from 300 million to 100 million subscribers, then Bharti may benefit and the house would revise their forecast for Bharti, said Soni.

Disclosure: Reliance Industries, the parent company of Reliance Jio, owns Network 18 that publishes CNBCTV18.com.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow