Bharti Airtel mulling international listing of its Africa business shares surge

India's largest telecom operator Bharti Airtel is considering an international listing of its Africa operations, it said on Wednesday. Bharti Airtel International Netherlands will begin non-binding discussions with banks and intermediaries. India’s largest telecom operator Bharti Airtel is considering an international listing of its Africa operations, it said on Wednesday.

Bharti Airtel International Netherlands, the umbrella company for Bharti Airtel’s operations in 14 African countries, will begin non-binding discussions with banks and intermediaries to explore listing its shares on an international stock exchange, Bharti Airtel said in a regulatory filing. Following the announcement, the stock of Bharti Airtel jumped as much as 3.2% to the day’s high of Rs 437.65 before closing up 1.76% at Rs 431.5 on BSE.

A heavy trading volume was observed in the shares Bharti Airtel, as at 3:20 pm, more than 95 lakh shares exchanged hands on both NSE and BSE with about 93 lakh on NSE alone. A proposal to list its overseas operations opens up monetisation avenues for Bharti Airtel at a time when hyper-competition at home is hurting earnings and profitability. Since the beginning of this year, shares of Bharti Airtel have been on a declining trend. The stock of Bharti Airtel had plunged about 18.53%.

“This is to inform you that the board of directors of BAIN NV on February 12, 2018, has authorized its management to initiate non-binding exploratory discussions with various banks/intermediaries to evaluate the possibility/feasibility of listing of its shares on an internationally recognized stock exchange,” Bharti Airtel said in an exchange filing. The discussions are at an exploratory/preliminary stage and at this juncture and there is no certainty of any decision or outcome, Bharti Airtel added.

Earlier in January, telecom major Bharti Airtel reported a decline of 39% in the net profit to Rs 305 crore for the October-December period of the financial year 2017-2018, majorly due to the rate cut in the interconnections usage charges. On the other hand, in Africa, Bharti Airtel reported a profit of $76 million as against a loss of $93 million in the corresponding period a year ago on the back of a spike in data traffic and transactions made through Airtel Money. 

A regulatory fiat in the form of a cut in domestic IUC rates had exacerbated industry ARPU (average revenue per user) decline in the December quarter, and the recent reduction in international termination rates will further accentuate this decline,” Gopal Vittal, MD & CEO, India & South Asia, Bharti Airtel said in the statement. At the end of 31 December 2017, Bharti Airtel’s consolidated net debt was at Rs 91,714 crore marginally up from Rs 91,480 crore in the second quarter of FY18.