Bharti Airtel Rights Issue Subscribed 1.44 Times

Bharti Airtel Rights Issue, the exercise to raise almost Rs. 21,000 crore by the telco, was subscribed 1.44 times. Notably, the telco's rights issue opened on October 5th at Rs. 535 per share.

Bumper Bidding on Bharti Airtel Rights Issue

In a regulatory filing, Airtel said, "we wish to inform you that the Rights issue has been subscribed approximately 1.44 times, overbid by both public and promoter/promoter groups".

It added, "the applications received in the rights issue are subject to verification and clearing payments, as applicable, and finalization of the basis of allotment". The telco had opened its rights issue back on October 5, after the board had approved the same on August 29.

The telecom sector's recent financial struggles have seen telcos such as Airtel and Vodafone Idea, who do not have financial backing as sound as Jio, looking to raise cash. Goldman Sachs said that the telco has to pay about Rs 4,100 crore in AGR dues by March 2022. Moreover, it has further spectrum obligations worth Rs 8,500 crore coming up in FY23. This does not include the significant capex Airtel needs to invest in its 4G network, to remain competitive. The brokerage also estimated "an annual cash shortfall of at least Rs 2,000 crore ($270 million) if tariffs stay at current levels", in FY23. Furthermore, Motilal Oswal estimated that the telco needs to spend around Rs 1.3-2.3 lakh crore to upgrade network to support 5G. Out of this, Rs 78,800 crore-1.3 lakh crore will go to upgrade network in metro cities and ‘A’ circles.

Vi has been in the works for the same for over an year now. Airtel will look to invest the capital raised towards its 4G networks and 5G rollout, when it happens.