Bharti Hexacom, a unit of Bharti Airtel, has got the approval of SEBI (Securities and Exchange Board of India) to proceed with its IPO (Initial Public Offer). But this is not an IPO where Bharti Hexacom will receive fresh proceeds. The IPO is completely an offer for sale (OFS) of up to 10 crore shares by Telecommunications Consultants India (TEC). TEC, a major body inside the Department of Telecommunications (DoT) is looking to sell its stake in the company.
Thus, the issue will only change the ownership structure, and there won't be any fresh proceeds for the company. For the unaware, Bharti Hexacom runs mobile services business in Northeast India and Rajasthan. Bharti Airtel is the majority stakeholder in Bharti Hexacom and will continue to be even after the stake sale from TEC.
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Bharti Hexacom operates business in the states of Manipur, Arunachal Pradesh, Manipur, Meghalaya, Nagaland, Mizoram, and Tripura (all the Northeast states) along with Rajasthan. The company's average revenue per user jumped from Rs 135 in FY21 to Rs 195 during the first six months of September 2023.
The company has about 29.1 million customers. Bharti Hexacom also has mid-band spectrum that allows it to offer 5G Plus services to customers. For the six months ended September 2023, Bharti Hexacom's revenues were Rs 3,240 crore, a little higher than Rs 3,167 crore in the same period last year.
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However, the company's profits dropped from Rs 195 crore to Rs 69 crore YoY during the same period. For the first half of 2024, the total mobile towers under Bharti Hexacom reached 23,748 from 19,965 during the same period last year. The company has been investing in 5G and its 5G presence was in 486 census towns as per last reported.
