Bharti Airtel share price down 3% on reports of promoter stake sale, volume surge

Bharti Airtel share price was down almost 4 percent intraday on May 26 after the company promoters are likely to sell USD 1 billion worth of shares in the company, CNBC Awaaz has reported.

Bharti Telecom will reportedly sell shares via a block deal on May 26.

Sources told Awaaz that the company’s promoters may sell nearly 15 crore shares as part of the block deal. JP Morgan is the banker to the deal. The deal is likely to be at a 6 percent discount to the closing price.

With this latest block deal for a 2.75 percent stake sale, the promoter and promoter group shareholding in the telco would come down to 56.23 percent from the current 58.98 percent, as per the information available on the BSE website.

Bharti Airtel on May 18 reported a net loss of Rs 5,237 crore for the quarter ended March 2020. It had posted a consolidated loss of Rs 1,035.3 crore in the December quarter and profit of Rs 107.2 crore in March quarter 2019.

The stock price has gained over 60 percent in the last 9 months and was quoting at Rs 570.20, down Rs 22.80, or 3.84 percent. It has touched an intraday high of Rs 576.00 and an intraday low of Rs 561.10.

The stock witnessed a spurt in volume by more than 248.96 times and was trading with volumes of 166,030,537 shares, compared to its five day average of 947,129 shares, an increase of 17,429.87 percent.

It is the most active stock on NSE with 3,89,60,962 shares being traded.

Global research firm Morgan Stanley, however, has an overweight call on the stock with a target at Rs 725 per share, according to a report by CNBC-TV18. It is of the view that proportionate holdings of SingTel and Bharti Enterprises will remain same post share sale adding that stake sale proceeds may be used to pay down debt in Bharti Telecom.

According to Moneycontrol SWOT Analysis powered by Trendlyne, Bharti Airtel’s promoter holding decreased by more than 2 percent QoQ while it has reported a decline in net profit with falling Profit Margin (QoQ). However, Moneycontrol technical rating is very bullish with moving averages and technical indicators being bullish.

—Money Control