Bharti Hexacom IPO  - Complete Overview

Founded in 1995, Bharti Hexacom Limited stands as a telecommunications powerhouse, serving Rajasthan and the North East regions of India with fixed-line telephone and broadband services. Operating across states like Rajasthan, Arunachal Pradesh, Manipur, Meghalaya, Mizoram, Nagaland, and Tripura, the company has solidified its presence.

With a commitment to staying ahead in the digital age, Bharti Hexacom has invested a hefty Rs.206 billion in digital infrastructure capital expenditures by December 31, 2023. This investment ensures the company's readiness for the future, supporting its extensive customer base of 27.1 million spread across 486 census towns.

As of the same date, Bharti Hexacom boasted 616 distributors and 89,454 retail touchpoints in its distribution network. In the digital realm, the company showcased its strength with 19,144 thousand data customers, with a significant portion utilising advanced 4G and 5G services.

Supported by its parent company Airtel, Bharti Hexacom leverages extensive digital experience to stay at the forefront of innovation. With a growing customer base and soaring data consumption, the company continues to connect homes and businesses, driving a brighter digital future in the region.

 

Bharti Hexacom IPO Overview

Bharti Hexacom IPO date is slated to be open for subscription from April 3, 2024, to April 5, 2024. This BSE NSE IPO follows a Book Built Issue IPO.

Bharti Hexacom IPO price is fixed at Rs. 542 - Rs. 570 per share. 

The total issue size of this IPO amounts to Rs. 4,275.00 CR. The company has reserved 75% for institutional investors, 15% for non-institutional investors, and 10% for retail investors. 

 

 

 

Company Financial

Comparison of Company Financials: FY23 shows fluctuating figures compared to FY22.

(Amount in Crore)

Period	Dec 31 FY 23	Mar 31 FY 23	Mar 31 FY 22
Total Assets	19,603.00	18,252.90	16,674.30
Total Revenue	5,420.80	6,719.20	5,494.00
PAT	281.80	549.20	1,674.60
Net worth	3,978.80	3,972.20	3,573.20
Reserve & Surplus	4,166.10	3,959.50	3,410.50
Total Borrowings	6,253.00	6,269.30	7,198.30

 

Geographical presence: 

(as of Fiscal 2023)

Players	Wireless services	5G presence — Fiscal 2023
BSNL	All India (except Delhi and Mumbai)	N.A
Bharti Airtel	All India (22 circles)	3,500+ cities/towns
Bharti Hexacom (Airtel)	Rajasthan and Northeast (2 circle)	486 census towns
Vodafone Idea	All India (22 circles)	N.A.
Reliance Jio	All India (22 circles)	2,300+ cities/ town

Revenue By Operations

 Revenue from operations increased steadily from FY22 to FY23, with notable growth in both core revenue and other operating income.                                           

 (amount in crore )

Particulars	Dec 31 FY 23	Mar 31 FY 23	Mar 31  FY 22
Revenue from operations	5,220.8	6,579.0	5,405.2
Other Operating Income	200.0	140.2	88.8
Total Revenue from operations	5,420.8	6,719.2	5,494.0

 

The objective of the Issue

The company intends to use the net proceeds for the following objectives.

1. Conduct Offer for Sale of 75,000,000 Equity Shares by Selling Shareholder.

2. Obtain benefits of listing Equity Shares on Stock Exchanges.

 

 

 

Peers of Bharti Hexacom IPO

Bharti Hexacom's IPO positions it favourably with a competitive P/E ratio and EPS compared to its peers.

Name of the company	Face value (Rs. per share)	P/ E	EPS (Basic) (Rs.)
Bharti Hexacom Limited	5	51.92	10.98
Bharti Airtel Limited	5	82.16	14.80
Vodafone Idea Limited	10	-1.63	-8.43
Reliance Jio Infocomm Limited	10		4.05

Evaluation

The IPO is priced within the range of Rs. 542 to Rs. 570 per share.

Evaluation of P/E Ratio:

- Considering the FY23 EPS of Rs 10.98 from the last year, the resulting P/E ratio is 51.92x.

- Taking into account the weighted EPS of Rs 13.21 for the last three years, the P/E ratio amounts to 43.14x.

    

Comparative Analysis with Listed Peers:

- Bharti Airtel Limited has a P/E ratio of 82.16x (the highest).

- Vodafone Idea Limited has a P/E ratio of 1.63x (the lowest).

- The industry's average P/E is 40.27x.

 

As a result, the IPO price range, with a P/E ratio ranging from 51.92x to 43.14x, seems slightly overvalued in comparison to the industry average of 40.27x.

IPO's Strengths

1. Strong Parentage and Established Brand.

2. Experienced Management Team.

3. Established Leadership and Large Customer Base in our area of operations.

4. Presence in Markets with High Growth Potential.

5. Extensive Distribution and Service Network.

6. Building a Future Ready Network.

 

IPO's Weaknesses

1.Their business relies on mobile services in specific regions, susceptible to local developments.

2.Legal issues involving their Promoter or Company could harm reputation and finances.

3.Unaccounted liabilities could hurt their financial stability.

4.Pricing regulations or competition may reduce their revenue.

5.Their debt and reliance on funding pose financial risks.

6.They need extra capital for ongoing expenses.

7.High customer turnover is a challenge.

8.Protecting intellectual property is crucial.

9.Unpaid bills from customers could affect finances.

10.Negative publicity can harm their image.

11.Complying with regulations is essential.

12.Difficulty in tracing historical records poses legal risks.

 

 

IPO GMP Today 

The Latest GMP of Bharti Hexacom IPO is Rs.140.

 

Bharti Hexacom IPO timetable (Tentative)

 Bharti Hexacom IPO is scheduled to open on April 3, 2024, and close on April 5, 2024, with allotment on April 8, 2024, refund initiation on April 10, 2024, and listing on April 12, 2024.

Events	Date
IPO Opening Date	3 April 2024
IPO Closing Date	5 April 2024
IPO Allotment Date	8 April 2024
Refund initiation	10 April 2024
IPO Listing Date	12 April 2024

 

Bharti Hexacom IPO Details

Bharti Hexacom's IPO, with an issue price range of Rs. 542 to Rs. 570 per share, opens from April 3 to April 5, offering a lot size of 26 shares and listing on BSE and NSE.

IPO opening & closing date	3 April to 5 April
Face value	Rs.5 per share
Issue Price	Rs. 542 - Rs. 570 per share
Lot Size	26 Shares
Price of 1 lot	Rs. 14,820
Total Issue Size	75,000,000 shares (aggregating up to Rs. 4,275.00 Cr)
Offer for sale	75,000,000 shares of Rs.5 (aggregating up to Rs.4,275.00 Cr
Fresh issue	-
Listing at	BSE NSE
Issue Type	Book Built Issue IPO
Registrar	Kfin Technologies Limited

 

Bharti Hexacom IPO Lot Details

Bharti Hexacom IPO offers varying lot sizes for both retail and HNI investors.

Application	Lot	Shares	Amount
Minimum Lot Investment (Retail)	1 lot	26	Rs. 14,820
Maximum Lot Investment (Retail)	13 lot	338	Rs. 192,660
Minimum Lot Investment (HNI)	14 lot	364	Rs. 207,480
Maximum Lot Investment (HNI)	67 lot	1,742	Rs. 992,940

 

Bharti Hexacom IPO Reservation

Bharti Hexacom IPO offers reservation for QIBs at a maximum of 75%, while a minimum of 10% is reserved for retail investors and a minimum of 15% for non-institutional investors (NHIs).

QIB Shares Offered	Maximum 75%
Retail Shares Offered	Minimum 10%
NHI Shares Offered	Minimum 15%

 

 

 

Promoters and Management of Bharti Hexacom IPO

1. Bharti Airtel Limited

Pre-issue Promoter Shareholding	70.00%
Post-issue Promoter Shareholding

 

Bharti Hexacom IPO Lead Managers

• SBI Capital Markets Limited

• Axis Capital Limited

• Bob Capital Markets Limited

• ICICI Securities Limited

• Iifl Securities Ltd

 

Dividend Policy

The company's dividend policy, adopted on January 17, 2024, allows dividends based on various financial parameters and factors, while previous dividends include an interim dividend of Rs.1.5 per share for the nine months ended December 31, 2023, with no guarantee of future dividends. Whether we can pay them in the future depends on factors like profits, past dividend trends, capital needs, legal restrictions, and other relevant considerations evaluated by our Board.

 

 

 

Conclusion

In conclusion, Bharti Hexacom Limited's forthcoming IPO presents an opportunity for investors to engage with a telecommunications leader poised for further growth. Scheduled to run from April 3 to April 5, 2024, with an issue price range of Rs. 542 to Rs. 570 per share and a total issue size of Rs. 4,275.00 CR, the IPO aims to attract a diverse investor base. However, prospective investors should carefully evaluate various factors, including valuation, strengths, weaknesses, and dividend policy, against industry standards and market dynamics.

Bharti Hexacom's strengths lie in its robust parentage, experienced management team, extensive market presence, and investment in a future-ready network. Conversely, challenges such as regional reliance, legal issues, financial risks, regulatory compliance, and customer turnover warrant thorough consideration.

Furthermore, the IPO's valuation, with a P/E ratio ranging from 51.92x to 43.14x, appears slightly overvalued compared to the industry average of 40.27x. While this indicates potential risks, it also suggests an optimistic outlook for growth.

 

Finowings IPO Analysis

Hope you enjoyed the Finowings IPO Analysis. We tried our best to give every required detail about the company that you should know before applying to the IPO. 

You must consult your financial advisor before making any financial decisions. 

To Apply for the IPO, Click Here.

 

To Read the Prospectus of the Company Click Here to Download the DRHP.

 

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