TELECOM STOCKS FALL AFTER AIRTEL SAYS 'NOT IN ANY DISCUSSION' TO BUY VODAFONE UK'S STAKE IN INDUS TOWERS

Shares of telecom companies Indus Towers Ltd and Vodafone Idea fell up to 8 percent on April 24 after Bharti Airtel denied reports that it was in talks to buy Vodafone Group's stake in Indus Towers.

In a regulatory filing, the telco said it had no plans no raise its stake beyond what is required for financial consolidation of Indus Towers in the company.

A media report claimed that Bharti Airtel was in talks to buy UK-based Vodafone Group's 21.05 percent stake in Indus Towers, potentially giving it a controlling stake. If the deal fructifies, the British carrier could infuse some of the proceeds into its debt-ridden Indian arm Vodafone Idea, the report said, citing unnamed sources.

"The company has no desire to raise its stake beyond what is required for financial consolidation of Indus in the Company, which shall be done as and when appropriate with compliance of applicable disclosure requirements," Bharti Airtel said.

Also Read | Airtel says 'not in any discussion' to buy Vodafone UK's stake in Indus Towers

Billionaire Sunil Mittal-led Airtel is Indus Towers' largest shareholder with a 47.95 percent stake.

"Indus is a provider of critical infrastructure services to the telecom industry and Airtel relies heavily on it. Airtel will therefore always ensure that Indus remains in robust health and financially stable," Airtel told exchanges .

Following the development, the Indus Towers share fell more than 3 percent to hit an intraday low of Rs 348 on the National Stock Exchange (NSE). Vodafone Idea slumped nearly 8 percent to hit a low of Rs 13.25. Bharti Airtel was trading flat.

As of March 31, 2024, Bharti Airtel owned 129.2 crore shares, or a 47.95 percent stake, in Indus Towers. Promoters held a total 69 percent stake.

In a recent report, Nuvama Institutional Equities said it has turned positive on the telecom sector as it believes that a combination of tariff hikes and government support shall boost the operators’ financials and returns profiles.

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Nuvama raised its target price on Bharti Airtel, which is its sectoral pick. It has also raised Vodafone Idea's price target and upgraded the stock to a "hold" rating.

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2024-04-24T07:53:04Z dg43tfdfdgfd