Shares of Bharti Airtel climbed over 3%, in line with the broader market, on Thursday amid a report that Singapore Telecommunications (Singtel) has sold around 1.76% stake in the telecom company through block deals. As per the NSE block deal data, Pastel, an affiliate of Singtel, sold 9.31 crore shares, or 1.58% stake in the telco at ₹687.31 per share for an aggregate amount of ₹6,399 crore.
The exchange data showed that most of these shares were acquired by Bharti Telecom Ltd (BTL), a key promoter company of billionaire Sunil Mittal-led company. Bharti Telecom is the promoter of Airtel and a joint venture between Bharti Enterprises and Singtel.
Following the announcement, Bharti Airtel shares opened 1% higher at ₹760.50, against Wednesday’s closing price of ₹753.05 on the BSE. The telecom heavyweight gained as much as 3.04% to hit an intraday high of ₹776. The m-cap climbed to 4,29,231 crore as 3.19 lakh shares changed hands over the counter as compared to the two-week average volume of 6.03 lakh stocks.
At the time of reporting, the stock was trading 2.46% higher at ₹771.55, 2.89% away from its 52-week high of ₹792.65 on the BSE. Meanwhile, the BSE Sensex was quoting at 59,421 levels, up 392 points or 0.66%.
Last month, Singtel announced it would sell a 3.33% stake in Airtel to BTL for about ₹12,900 crore, in the next three months, as part of its strategy to boost shareholder returns and increase return on invested capital. Following this, the Singtel Group's ownership in the company will come down to 29.7%, from 31.4% earlier. This comprises a 19.2% indirect stake through Bharti Telecom and a 10.5% direct stake.
The stake sale will further strengthen the Bharti family’s shareholding in the company as Bharti Telecom eyes acquiring the shares from Singtel and its affiliates. After this stake purchase, the direct shareholding of Singtel and the Bharti family in Airtel will stand at 10% and 6%, respectively.
Bharti Enterprises and Singtel have had over 20 years of a solid partnership and both the companies have decided to work towards equalising their stake in Airtel over a period of time.
In a separate development, Airtel chief executive officer Gopal Vittal has said that Bharti Airtel is looking to roll out 5G services in a month and cover key metro cities in the country by December 2022. “We expect to launch our 5G services within a month. By December, we should have coverage in key metros. After that, we will expand rapidly to cover the entire country. We expect to cover all of urban India by the end of 2023,” says Vittal.
In the recently concluded 5G spectrum action, Airtel, the country’s second-largest telecom operator, acquired 19,800 MHz spectrum for ₹43,084 crore. The spectrum has been acquired in the spectrum bands - 900 MHz, 1800 MHz, 2100MHz, 3300 MHz and 26 GHz frequency bands through the auction for 20 years.