Overview

• Singtel sold 0.8% of its Airtel stake worth Rs. 10,300 crore as part of the asset recycling strategy to strengthen its balance sheet.

• Bharti Airtel shares fell 4.04% to Rs. 2,010.30 as over 63 million shares exchanged hands in heavy institutional activity.

• Despite the short-term decline, analysts are optimistic about Airtel’s long-term growth on strong fundamentals, high ARPU, and expanding 5G services.

Bharti Airtel share price dipped 4.04% at press time after Singapore Telecommunications (Singtel) sold a part of its stake in the telecom major. The stock was trading at Rs. 2,010.30 on NSE against the previous close of Rs. 2,094.90. Bharti Airtel shares opened the session at Rs. 2,048. 

It touched an intraday low of Rs. 1,997.90 after investors reacted to the large block deal. Let’s see an in-depth analysis of Bharti Airtel share price based on Moneycontrol data.  

Singtel Stake Sale worth Rs. 10,300 crore

Singtel said Pastel, its investment arm, sold 51 million Bharti Airtel shares or a stake of 0.8% at about S$1.5 billion ($1.16 billion). The shares were sold at Rs. 2,030 apiece, representing a 3.1% discount to Thursday’s closing price. The sale is part of Singtel’s broader S$9 billion asset recycling programme that seeks to redeploy the capital toward digital infrastructure and service-related businesses.

The move continues Singtel's gradual reduction of its stake in Airtel, which has fallen from 31.4% in 2022 to 27.5% currently. The company said the divestment supports its balance sheet optimization and will help shore up shareholder returns. Singtel has been an investor in Bharti Airtel since 2000 and has seen substantial returns, with Airtel's stock quadrupling in value since the end of 2019, supported by consistent earnings growth and rising average revenue per user (ARPU).

Singtel's own shares surged as much as 5% in Singapore after the announcement, before settling around 3% higher at S$4.65, reflecting positive investor sentiment toward its restructuring strategy.

Heavy Volumes as Institutional Investors Step In

Trading volumes of Bharti Airtel stock jumped on the day, with over 63 million shares against the 20-day average of 5.26 million. The high turnover was largely on account of institutional block deals, indicating that global and domestic funds were substantial players in absorbing the stake sale.

Bharti Airtel share price chart on Moneycontrol shows a dip of 4.03% at 1.42 PM:

Bharti Airtel shares’ market capitalization stood at Rs. 11.65 lakh crore, making it one of India’s largest telecom companies. The volume-weighted average price or VWAP was reported at Rs. 2,028.15, indicating that most trades occurred near the deal price.

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Key Technical and Valuation Metrics

Bharti Airtel share price’s immediate support is placed at Rs. 2,000, while resistances are seen at Rs. 2,100-Rs. 2,140, according to the pivot point analysis. The beta value of the stock, which measures its volatility with respect to the broader market, stood at 0.94.

On the fundamentals side, Airtel continues to trade at a P/E ratio of 30.25 below the sector average of 52.05 and a P/B ratio of 13.39, indicative of the premium investors are willing to pay for its strong financial performance. The earnings per share for the trailing twelve months stood at Rs. 66.45, up a sharp 214% year-on-year. The dividend yield remains modest at 0.8%, while book value per share comes at Rs. 150.17.

Analyst Sentiment Remains Positive

Despite this decline in the short term, most analysts continue to be very optimistic about the long-term prospects for Bharti Airtel. Of the 36 analysts tracking the stock, 61% rate it as a 'Buy', and 19% as 'Outperform', citing sustained growth in data consumption, expansion in 5G services, and improving ARPU as key growth drivers.

While the sale of a stake in Singtel triggered some temporary pressure, experts say the transaction was largely non-disruptive to Airtel's fundamentals. This highlights that institutional demand for its shares underlines investor confidence in the Indian telecom space.

Also Read: IndiGo Share Price Rises 1.82% to Rs. 5,739.50 on Market Optimism Despite Quarterly Loss

Investor Outlook

The fall of Bharti Airtel share price shows short-term supply from Singtel's divestment rather than a deterioration in company performance. With robust earnings growth, solid balance sheet metrics, and strong market leadership, the telecom giant remains well-positioned for long-term investors despite near-term volatility.

FAQs

1. What drove down Bharti Airtel's share price today? 

Bharti Airtel's stock declined approximately 4% after Singtel divested a 0.8% stake through a large block transaction worth Rs. 10,300 crores. This sale led to selling pressure in the short term, although analysts feel the underlying fundamentals at Bharti remain unchanged. 

2. How big was Singtel's stake sale, and why did they sell?  

Singtel, via its unit Pastel Ltd and in a single sale, sold 51 million Airtel shares worth Rs. 10,300 crore. The sale represents part of Singtel's asset recycling programme of S$9 billion to reinvest in digital infrastructure and raise shareholder returns.  

3. Is there a reason for investors to be worried about this fall in Airtel stock?  

Analysts do not believe that investors should be alarmed. The price decline was largely related to the temporary supply from Singtel's block deal. Bharti Airtel is still showing strong growth in earnings, rising ARPU, and promising long-term growth prospects. 

4. What is Bharti Airtel's current valuation and outlook?

Airtel is currently valued at a P/E of 30.25, which is below the average for the sector, indicating potential for growth. The company experienced an EPS growth of 214% YoY, and experts expect further upside due to the continued adoption of 5G and data consumption trends.

5. What is the remaining stake of Singtel in Bharti Airtel following this transaction?

After the divestment, Singtel's stake in Bharti Airtel is approximately 27.5%, having decreased from 31.4% in 2022. Despite this reduction, Singtel continues to be one of the largest strategic shareholders in Airtel.