Bharti Hexacom IPO - Investment Rationale, Issue Details, Financials, Strategies, Risks And More: Anand Rathi

Anand Rathi's Report

Bharti Hexacom Ltd. launched its initial public offering today and the offer will conclude on April 05. The communications solutions provider has fixed the price band in the range between 542-570 apiece.

The Rs 4,275 crore IPO comprises only of fresh issue. The minimum order lot is 26.

Objects of the Issue

• To carry out OFS of up to 7,50,00,000 equity shares by selling shareholder.

• Achieve the benefits of listing equity shares on stock exchanges.

Valuation

Bharti Hexacom boasts a well-established leadership and a sizable customer base within its operational domain. Delivering consumer mobile services, fixed-line telephone, and broadband services primarily in Rajasthan and the Northeast telecommunication circles of India, the company benefits from strong parentage and brand recognition, with Airtel holding a significant 70% stake in its outstanding equity share capital.

The company's strategy entails bolstering revenue through a dual approach: prioritising the acquisition and retention of high-value customers while concurrently expanding network coverage.

At the upper price band company is valuing at price/earning ratio of 52.3 times of its FY23 earnings with a market cap of Rs 2,85,000 million post issue of equity shares and return on net worth of 13.8%.

We believe that valuations of the company is fairly priced and recommend 'Subscribe – Long Term' rating to the IPO.

Click on the attachment to read the full IPO report:

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