Telecom operator Bharti Airtel’s chairman Sunil Mittal on Monday said the company won’t shy away from raising tariffs.
Mittal was speaking with investors a day after Airtel’s board approved raising up to Rs 21,000 crore by way of rights issue, at a price of Rs 535 per share.
The mega fundraising is bound to give more firepower to Airtel, as the company takes on rivals in the fiercely-competitive Indian telecom market.
India, which is the world’s second-largest telecom market and the biggest data consumer, is now gearing up for 5G that will significantly scale up connectivity pipes, enabling ultra-high-speeds and new-age applications for users, and new revenue streams for players.
Mittal said the company has been loaded with “extraordinary debt”.
“We want to improve our debt leverage and have access to growth capital. We hope that the spectrum pricing auction will be made attractive,” said Mittal.
He further said that the company remains committed to monetisation of assets but “at right time”.
The terms of payment of issue price envisage 25 per cent on application and balance in two more additional calls as may be decided by the board or its committee based on the company’s requirements within an overall time-horizon of 36 months, Airtel said on Sunday.
Promoter holding in the company stands at about 55.8 per cent, while public holds 44.09 per cent.
The shares of Airtel had closed at Rs 625 apiece on Monday, 5 per cent higher than the previous close.
In its note last week, Jefferies had said that any capital raise by Bharti Airtel that aims to enhance capacity in anticipation of large market share shifts from Vodafone Idea could be seen “positively”.
Sunil Mittal-led Bharti Airtel is the second largest telco in the three private player market and as per subscriber data released by telecom regulator recently, Airtel added 3.8 million wireless subscribers in June, pushing up its mobile user base to 352 million.
Reliance Jio, which has been cementing its lead, gained 5.4 million users in June, as its mobile subscriber base swelled to 436 million during the month.