Bharti Infratel Q1 net falls 4% to ₹638 cr

Mobile tower firm Bharti Infratel has reported a consolidated net profit of ₹638 crore for the first quarter ended June 30, down 4 per cent as compared with ₹664 crore in the corresponding period last year.

However, revenue of the company rose by 4 per cent to ₹3,674 crore during the April-June quarter from ₹3,524 crore in the same quarter last year.

The Indian telecom industry is now witnessing an integration phase as operators consolidate their networks and spectrum before the next phase of rollouts, Akhil Gupta, Chairman, Bharti Infratel, said. “We remain confident of the long-term growth potential of the Indian telecom sector driven by rising user demand, availability of cheaper handsets, introduction of new technologies and availability of rich content to the customers. This would necessitate rapid network rollouts,” he said.

Meanwhile, the tower arm of Bharti Airtel said it has received clearance from stock exchanges for its merger with Indus Towers. It will now approach the National Company Law Tribunal for its approval, the company said.

“We are pleased to inform you that “no adverse observation” letter has been received from the stock exchange for the proposed merger of Bharti Infratel Ltd and Indus Towers Ltd. The company will file the first motion petition before the NCLT in due course,” Bharti Infratel said in filing at both BSE and NSE.

In April this year, Bharti Airtel, Idea Cellular and Vodafone Group had announced an agreement for the merger of Indus Towers and Bharti Infratel to create the largest mobile tower operator in the world outside China. It will have over 1,63,000 towers across 22 telecom service areas in India.

The combined company will own 100 per cent of Indus Towers — jointly owned by Bharti Infratel (42 per cent holding), Vodafone (42 per cent), Idea Group (11.15 per cent) and Providence (4.85 per cent).

Post the deal, Bharti Airtel and Vodafone will jointly control the combined company, and the transaction is expected to close before the end of 2018-19, subject to statutory approvals.

As per the deal structure, Vodafone will be issued 783.1 million new shares in the merged entity in exchange for its 42 per cent stake in Indus Towers, and this could take its holding to 29.4 per cent in new company depending on the options finally taken by Idea and Providence.

Similarly, Airtel’s stake in new combined tower behemoth may be diluted to 37.2 per cent in the combined entity from 53.5 per cent it currently holds in Bharti Infratel. The transaction values Indus Towers at an enterprise value of ₹71,500 crore.