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Shares of Indus Towers Ltd and Vodafone Idea Ltd fell up to 5 per cent in Wednesday's trade after Bharti Airtel Ltd said it was not eyeing Vodafone Idea's 21.05 per cent stake in Indus Towers, as suggested by a media report. In a filing to BSE, Bharti Airtel said it has no desire to raise its stake beyond what is required for financial consolidation of Indus Towers in the company that it said should be done as and when appropriate with compliance of applicable disclosure requirements. "Indus is a provider of critical infrastructure services to the telecom industry and Airtel relies heavily on it. Airtel will therefore always ensure that Indus remains in robust health and financially stable, it said. Following the development, Indus Towers shares fell 1.93 per cent to hit a low of Rs 352.70. Vodafone Idea declined 5.42 per cent to hit a low of Rs 13.61. Bharti Airtel was up 0.39 per cent at Rs 1,347.50. Bharti Airtel owned 1,29,22,61,364 shares or 47.95 per cent stake in Indus Towers at the end of March quarter. Promoters held a total 69 per cent stake in Indus Towers as on March 31. Vodafone Idea shares were recently in focus after the telecom operator's Rs 18,000 crore follow-on public offer (FPO). An ET report earlier suggested that if Vodafone Plc sells its Indus stake to Bharti Airtel, it could infuse some of the proceeds into Vodafone Idea. Nuvama said the chain of events expected post the Vodafone Idea FPO make for an inflection point for the telecom sector. "These events should enable telecom operators to reclaim fair share of the telecom sector value triangle—ceded over the last decade," it said. The brokerage said it has turned positive on on the telecom sector, and reckon a combination of tariff hikes and government support shall boost the operators' financials and returns profiles. While Nuvama sees Bharti Airtel Ltd as the best way to play this event in the sector, and raise its target price. It has also upped Vodafone Idea's price target, upgrading it to 'Hold' rating, as it sees the company finally becoming a 'going concern'. Disclaimer: Business Today provides stock market news for informational purposes only and should not be construed as investment advice. Readers are encouraged to consult with a qualified financial advisor before making any investment decisions.
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