Big company can sell stake worth ₹ 8500 crore in Bharti Airtel:

Singapore Telecommunications Limited (SingTel) is reportedly planning to divest a portion of its stake in Bharti Airtel, India's leading telecom operator, through a block deal valued at approximately ₹8,500 crore (about US$1 billion). This move aligns with SingTel's ongoing strategy to optimize its investment portfolio and reallocate capital towards growth areas.

Details of the Proposed Stake Sale

Stake Reduction: SingTel currently holds a 28.9% stake in Bharti Airtel, which includes a 9.5% direct stake through its subsidiary, Pastel Limited. The proposed sale would reduce SingTel's direct holding, though specific post-sale figures have not been disclosed.

Capital Recycling Strategy: This transaction is part of SingTel's broader capital recycling efforts, aiming to unlock value from its assets. Since its strategic reset in 2021, SingTel has recycled approximately S$8 billion (about US$5.9 billion) in capital, which has been utilized to fund growth initiatives in data centers and IT services, as well as to reduce net debt by S$3.2 billion as of September 2023.

Historical Context

Previous Stake Sales: In March 2024, SingTel sold a 0.8% stake in Bharti Airtel to U.S.-based investment firm GQG Partners for around ₹5,885 crore, pricing the shares at ₹1,193.70 each. Prior to that, in 2022, SingTel divested a 3.3% direct stake in Airtel for approximately S$2.54 billion.

Implications for Bharti Airtel

Market Dynamics: While such a significant stake sale could influence Bharti Airtel's stock performance in the short term, the long-term impact will depend on how the market perceives the company's growth prospects and operational performance.

Shareholding Structure: The sale may lead to a shift in Bharti Airtel's shareholding pattern, potentially introducing new institutional investors if the block deal attracts significant market interest.

As SingTel continues to streamline its investments and focus on core growth areas, this planned divestment reflects its strategic approach to capital management. Stakeholders and market observers will be keenly watching the developments to assess the potential impact on both SingTel's financial positioning and Bharti Airtel's market dynamics.