Bharti Hexacom IPO: Company explains the reason for reducing the issue size

It has set aside not less than 75% of the offer for qualified institutional buyers (QIB), not more than 15% of the offer for non-institutional institutional investors (NII), and not more than 10% of the offer for retail investors.

The Red Herring Prospectus of the firm states that the Bharti Hexacom IPO consists only of an offer-for-sale (OFS) and does not include a fresh issue component. Telecommunications Consultants India, the company’s sole selling shareholder intends to sell off 7.5 crore equity shares, or 15% of the OFS.

Also Read: Bharti Hexacom IPO: Price band set at ₹542-570 apiece; check issue details, key dates, more

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The government-owned business Telecommunications Consultants initially planned to sell up to 10 crore equity shares, according to the company’s draft red herring prospectus (DRHP).

Bharti Hexacom IPO size

Sanjeev Kumar, Chairman & Director of Telecommunications Consultants India Ltd (TCIL), explained to the media today at a press conference that the final issue structure had been decided after consulting with the book running lead managers (BRLMs) and considering investor feedback.

He went on to say that the Government chose to sell just 15% of the shares in the IPO through TCIL. A six-month lock-in period applies to TCIL holdings after the date of allocation. The decision on additional offloading will be made later, at a suitable time, and will take into consideration the overall condition of the market, existing environment, and other factors at that particular moment.

The book running lead managers for the offer are SBI Capital Markets Limited, Axis Capital Limited, BOB Capital Markets Limited, ICICI Securities Limited, and IIFL Securities Limited.

Also Read: Bharti Hexacom IPO: Airtel arm’s public issue to open on April 3, TCIL to offload 15% stake; Details here

Bharti Hexacom – Will they explore new geographies?

Bharti Hexacom Ltd is a communications solutions provider that serves customers in Rajasthan and the North East telecommunication circles in India, which include the states of Arunachal Pradesh, Manipur, Meghalaya, Mizoram, Nagaland, and Tripura. It also provides fixed-line telephone and broadband services. It uses the “Airtel” brand to provide services.

When questioned by the media about their ambitions to explore new regions, Soumen Ray, Director of Bharti Hexacom Ltd, stated that their current priorities are to increase the coverage of their network in existing areas.

In order to grow its client base and improve the customer experience, Ray continued, the firm will keep extending its network coverage throughout the regions in which it operates, concentrating on important revenue-generating cities and high-value catchment areas.

Also Read: Bharti Hexacom IPO likely to launch in April, seeks valuation over ₹28,000 crore: Report

“The expansion of our rural coverage has allowed us to gain a reasonable number of 4G/5G customers, as seen by the fact that as of December 31, 2023, our 4G/5G data client base grew from 13,348 thousand on March 31, 2021 to 18,839 thousand.

In the recent three fiscal years and the nine months that ended on December 31, 2023, we have spent ₹71,033 million on increasing our network coverage and infrastructure. We have continuously been able to grow our market share and average revenue per user (ARPU) in our circles as a consequence of these measures,” added Soumen.

Also Read: Airtel’s unit Bharti Hexacom gets SEBI approval to float IPO

Disclaimer: The views and recommendations above are those of individual analysts, experts and broking companies, not of Mint. We advise investors to check with certified experts before making any investment decisions.

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Published: 26 Mar 2024, 05:43 PM IST