Bharti Airtel up 2% as Carlyle Grp to buy 25% stake in Co's Data Centre biz

Bharti Airtel shares rose as much as 2.56 per cent to Rs 574 on the BSE on Wednesday after the Carlyle Group announced it will invest $235 million for approximately 25 per cent stake in Nxtra Data Ltd, a wholly-owned subsidiary of Bharti Airtel engaged in the data centre business.

The post-money enterprise valuation of Nxtra is approximately $1.2 billion and Carlyle will hold a stake of approximately 25% in the business upon completion of the transaction, with Airtel continuing to hold the remaining stake of approximately 75%, Bharti Airtel said in a statement. CLICK TO READ FULL REPORT
 

"Rapid digitisation has opened up a massive growth opportunity for data centres in India and we plan to accelerate our investments to become a major player in this segment. We are delighted to have Carlyle as a strategic partner in this exciting journey, particularly given their experience in this industry, and look forward to working with them," said Gopal Vittal, MD & CEO (India and South Asia), Bharti Airtel.

For the quarter ended March 2020, the telecom operator posted a consolidated loss of Rs 5,237 crore, mainly on account of provisions for statutory dues. The company had posted a profit of Rs 107.2 crore in the same period a year ago.

It registered a consolidated revenue of Rs 23,722.7 crore during the reported quarter. The company had posted revenue of Rs 20,602.2 crore in the corresponding quarter of 2018-19. 

Geojit Financial Services, in a report dated June 30, said that rising average revenue per user (ARPU) and customer base should provide support to company valuations. "Additionally, the increased demand for broadband connections amidst Covid-19 will further improve topline. We reiterate our BUY rating on the stock with a revised target price of Rs 693 based on sum-of-the parts (SOTP) methodology," they wrote. 

At 12:33 am, the stock was trading over 0.5 per cent higher at Rs 562.70 on the BSE as compared to 1 per cent rise in the S&P BSE Sensex.