Bharti Tele-Ventures launches maiden IPO

Circuit EC/Mumbai

Mittal says the IPO will help the company capitalise on growth opportunities in the telecom space

Bharti Tele-Ventures (BVTL) has announced a floor price of Rs 45 (face value Rs 10 per share) for its eagerly awaited initial public offering (IPO) through 100 percent book building. The company said it would offer 18.53 crore equity shares representing ten percent of the post equity share capital. Of this, a minimum of 60 percent have to be subscribed by qualified institutional buyers (QIBs). Says Sunil Bharti Mittal, chairman and managing director, Bharti Tele-Ventures, “In a short span of time, BVTL has emerged as a frontrunner in the Indian Telecom sector. With our proven track record, we intend to capitalise on the growth opportunities we believe are available in the Indian telecommunications market.”

The cash raised from the IPO will be partly used to fund the large expansion plan chalked out by the Bharti group which includes operations in nine new cellular circles and building a national long distance network. BVTL is embarking on a major expansion plan in the next few years and will be setting up cellular services in nine additional circles, four fixed line circles and national and international long distance services. With the launch of the IPO, BVTL also announced that it would open bidding centres in all the 20 cities that have a stock exchange. Bids for more than 1000 equity shares would be considered for allocation under the non-institutional investor category. Also, in order to participate in the bidding process, it would be mandatory for the investor to hold a dematerialised account.

Adds Nimesh Kampani, chairman, JM Morgan Stanley, the book running lead manager, “BVTL’s IPO heralds the entry of telecom majors in the Indian primary market. The telecom industry promises to be highly vibrant and has been attracting substantial equity investment even during difficult times. The inherent advantages of 100 percent book building route has found acceptance with all categories of investors including retail investors as this would facilitate early listing of the shares on the exchanges.” The book building would open for bidding from January 28, 2002 for six days and will close on February 2, 2002.