Bharti Airtel's Subsidiary Bharti Hexacom Gets SEBI Nod for IPO

20 Mar 2024 , 09:33 AM

Telecom giant Bharti Airtel’s subsidiary, Bharti Hexacom, has secured the green light from the Securities and Exchange Board of India (SEBI) for its forthcoming Initial Public Offering (IPO) endeavour.

The IPO solely consists of an offer-for-sale (OFS) of 10 Crore equity shares by the solitary public stakeholder, Telecommunications Consultants India, without any fresh issue element. Consequently, the entirety of the proceeds from the IPO (excluding expenses) will funnel back to the selling shareholder.

As per the details outlined in the draft red herring prospectus (DRHP) submitted by the communication solutions provider to the market regulator on January 19, Bharti Airtel, the promoter, maintains a 70% stake (35 Crore equity shares), while the remaining 30% (equivalent to 15 Crore equity shares) is held by non-promoter Telecommunications Consultants India.

SEBI furnished an observation letter on March 11 regarding the IPO draft documents, indicating that the company can initiate its IPO within the forthcoming year.

Bharti Hexacom, renowned for delivering consumer mobile services, fixed-line telephone, and broadband services under the Airtel brand in Rajasthan and the North East, reported a net profit of ₹549.2 Crore in FY23, marking a decline of 67.2% compared to the previous fiscal year. Notably, its profit in FY22 was bolstered by exceptional gains amounting to ₹1,951.1 Crore. Despite the profit dip, revenue from operations showcased resilience, ascending by 21.7% to ₹6,579 Crore.

In the half-year period ending September of FY24, net profit witnessed a year-on-year decrease of 64.6% to ₹69.1 Crore, influenced by elevated tax costs and exceptional losses. However, during the same duration, revenue experienced an 8% surge, reaching ₹3,420.2 Crore.

SBI Capital Markets, Axis Capital, BOB Capital Markets, ICICI Securities, and IIFL Capital Services have been enlisted as book-running lead managers for the IPO.