Bharti Airtel concludes spectrum trading agreement with Jio
Published On: Friday, August 13, 2021 | By: Team KnowMyStock
Shares of Bharti Airtel hit a new record high of Rs 638.60, on the BSE in the intra-day trade today(13th August 2021), after the company announced the closure of its agreement with Reliance Jio Infocomm to transfer the 'Right to Use' of Airtel's 800 MHz spectrum in three circles to Jio. Bharti Airtel in a statement said the company has received Rs 1,004.8 crore from Jio for the proposed transfer. In addition, Jio will assume future liabilities of Rs 469.3 crore relating to the spectrum, the company said. In the past month, the stock of Bharti Airtel has outperformed the market by surging 20 percent, as compared to a 4.8 percent rise in the S&P BSE Sensex.
Bharti has a clear advantage to further gain high-quality subscribers in both pre-paid and post-paid categories, considering Vodafone Idea’s weak financial position. Despite high India capex in June 2021 quarter (Q1FY22), management reiterated its unchanged annual capex guidance of around Rs 24,100 crore for FY22.
The company management doesn’t expect average revenue per user (ARPU) to be more dilutive from the current levels i.e Rs 146 and will gradually pick up from Q2FY22 as it has got a better customer mix. The management continues with an ARPU trajectory of Rs 200 and ultimately Rs 300 going ahead, aided by strong customer conversion from 2G to 4G and other services.
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