Bharti Airtel share price rises over 6% on stake sale report in tower arm Bharti Infratel

The Bharti Airtel share price rose in trade today after a report said the telco would lower its direct stake in the telecom tower company Bharti Infratel by more than a half. Bharti Airtel share price rose 6.08% to 354 level compared to the previous close of 333.70 on BSE. Bharti Airtel share price has been gaining for the last two days and risen 12.19% during the period. More volume of the Bharti Airtel stock was being traded close to the high price of the day.

Bharti Airtel stock has lost 17.67% during the last one year and gained 10.71% since the beginning of this year. 19 of 25 brokerages rate the stock "buy" or 'outperform', four "hold" and two "underperform", according to analysts' recommendations tracked by Reuters.

Bharti Airtel share price was trading above its 50-day and 200 day moving average of 309 and 321 levels, respectively. Bharti Airtel stock clocked turnover of Rs 51.56 crore with 14.91 lakh shares changing hands on BSE. On the other hand, Bharti Infratel share price fell 3.13% intra day to 309.35 compared to its previous close of 319.35 on BSE.

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Bharti Airtel's unit Nettle Infrastructure Investments will buy an up to 32% stake in Bharti Infratel by March 18, Infratel said.

Airtel will own an 18.3 percent stake in Infratel after the transfer, down from its current stake of 50.33 percent.

Nettle will buy Infratel shares for up to Rs 362.45 each, a premium of up to 13.4 percent to the stock's closing price on Monday. Nettle already owns a 3.18 percent stake in Infratel.

Mustafa Nadeem, CEO at Epic Research said, "The impact on the stock is seen positive as it has made a kind of decisive bottom at lower levels of 300-320. It has been consolidating there for almost two quarters and that's a big period for telecom giant like Bharti Airtel. These are historically proven to be very good support for the stock and has always seen short term to medium term bounce that has generated two digits return. We believe this stake sale would help Bharti Airtel to shrug some debt and improve its margins as the competition is getting tougher in the telecom space post entry of Jio and Merger of Voda-Idea. This is likely to be seen in stock price and we expect 330 to prove as immediate support for an upside to 385 - 400."

Bharti Airtel says promoters will take part in rights issue

In a related development, Airtel promoter Singapore Telecommunications (Singtel) last week said it would take part in the Rs 32,000-crore capital infusion plan by subscribing to the telco's Rs 25,000-crore rights issue.

Singtel and Airtel's major shareholders - Bharti Group and Bharti Telecom - intend to subscribe to their full entitlement, except for a renunciation by Bharti Telecom in favour of GIC Singapore, Singtel said. Singapore government's investment arm GIC Private Ltd will also subscribe to shares worth Rs 5,000 crore in the rights issue.

On March 1, Airtel's board approved plans for a rights issue to raise up to Rs 25,000 crore through issuance of fully paid up shares at a price of Rs 220 per share and to raise an additional Rs 7,000 crore through Foreign Currency Perpetual Bond Issue.

Meanwhile, the Sensex was trading 483 points higher at 37,537. The Nifty too surged  136 points to 11,304 level in afternoon trade.

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Edited by Aseem Thapliyal