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    Bharti Airtel shares rally as Bharti Telecom set to acquire 3.3% stake in telco from Singtel

    Bharti Airtel shares rally as Bharti Telecom set to acquire 3.3% stake in telco from Singtel

    Bharti Airtel shares rally as Bharti Telecom set to acquire 3.3% stake in telco from Singtel
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    By CNBCTV18.com  IST (Updated)

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    Bharti Airtel promoter Bharti Telecom will buy a 3.33 percent stake from Singtel for about Rs 12,895 crore in 90 days, the telecom operator said on Thursday.

    Bharti Airtel promoter Bharti Telecom will buy a 3.33 percent stake from Singtel for about Rs 12,895 crore in 90 days, the telecom operator said on Thursday.
    Bharti Airtel shares rallied 4 percent in early deals following the development, and investors on Dalal Street welcomed Bharti Telecom's move to acquire a stake in the telco.  At 9:47 am, the stock was trading 0.9 percent higher at Rs 745.80 on BSE.
    Bharti Group chairman Sunil Bharti Mittal's family and Singtel own Bharti Telecom (BTL). Following the stake buy, the direct shareholding of Singtel and Bharti in Airtel will be at around 10 percent and 6 percent respectively, according to the telco’s regulatory filing.
    "Bharti and Singtel have agreed to work towards equalising their stake in Airtel over a period of time," the filing said. BTL will spread such acquisitions to maintain a comfortable level of leverage.
    Bharti Enterprises and Singtel have been in a partnership for over 20 years. “Over these years, Bharti Airtel Limited (Airtel) has not only acquired a strong pan-India leadership position but has also expanded to 16 more countries in Africa and South Asia,” the firm said in its filing.
    Naveen Kulkarni, CIO, Axis Securities, said it was a fairly large block, and the promoter buying it is positive.
    “Bharti promoters have been with the company for a very long period, and the support has been very consistent. So their increasing stake is definitely a positive, which means they are here for a much longer term,” he told CNBC-TV18.
    According to him, Bharti is a consistent compounded, and this is a market which has just two players, and there is Vodafone Idea. "From a long-term perspective, the telecom industry will grow at a certain pace and Bharti will keep benefiting from that," he said.
    He sees Airtel as a fairly defensive stock and expects it to compound at 12-15 percent over the long term. The risk-reward from current levels still looks attractive, he said.
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