India’s Union Cabinet has approved the waiver of the bank guarantees related to spectrum acquired by the operators before 2022. Vodafone Idea was the key beneficiary of this news as it owed INR 247bn versus Bharti (INR 30bn) and Jio (INR 40bn). As a result, VIL shares rose sharply today. Our brief thoughts below.
Bharti crossing $100bn market cap makes us address the question of which parts of the Bharti/Singtel/Airtel Africa capital structure are most attractive. Bharti has the momentum, but the valuation gap is now extreme. Reversion to the mean will likely happen at some point which means sensible investors in Bharti should now be switching into Singtel (for yield) or Airtel Africa (for growth).
Q3 was a slightly slower quarter overall for the Indian telco market. However, the market continued to post double digit growth and we started to see in this quarter’s ARPU the benefits from the late November/early December price revisions.
Not unexpectedly VIL has chosen to swap INR 160 ($2.1bn) of incremental interest created by the moratorium on AGR/spectrum payments which it owes the govt into equity. Based on the terms of the relief package this happens at INR 10 /share. As a result, the govt moves to a 35.8% shareholding, and all other holders are commensurately diluted This short note gives thoughts and implications.
Full Article at IIR has reaffirmed its Recommended rating for PIA after undertaking a review post the appointment of a new Portfolio Manager, Harding Loevner. The full report can be found on the IIR website. On 26 July 2021, Pengana International Equities Limited (PIA) announced a fully franked dividend of 1.35 cents per share for the June quarter. This represents an 8% increase on the March quarter dividend and takes the total dividends declared for FY21 of 5.1 cents per share, fully franked....
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