HomeTelecom NewsBharti Airtel buying stake in Bharti Infratel may be a bet on long-term story, says SBICAP Securities

Bharti Airtel buying stake in Bharti Infratel may be a bet on long-term story, says SBICAP Securities

Rajiv Sharma, head of research of SBICAP Securities on Wednesday said Bharti Airtel buying stake in Bharti Infratel may be a bet on long-term story.

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By Reema Tendulkar   | Nisha Poddar  December 2, 2020, 5:06:33 PM IST (Updated)

Bharti Airtel buying stake in Bharti Infratel may be a bet on long-term story, says SBICAP Securities
Rajiv Sharma, head of research of SBICAP Securities on Wednesday said Bharti Airtel buying stake in Bharti Infratel may be a bet on long-term story.


Earlier today Bharti Airtel had purchased a 4.9 percent stake in Bharti Infratel, the group's tower infrastructure arm.

The purchase was carried out via block deals and are within norms for creeping acquisition -- which limit promoter purchases at 5 percent of equity in a year.

He said, "Bharti Airtel is definitely trying to set a reference value, a downside support in terms of share price of Bharti Infratel."

"Irrespective of what happens to telecom market structure, 5G will need a lot of telecom infrastructure. So maybe Airtel is taking a bet on the longer-term story as well. At the same time, Bharti is a stellar in the tower company. Airtel has suggested in the past the company would like to bring down their stake and improve their own balancesheet," Sharma said.

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