Tuesday, 18 November 2008

Analysts Picks: Bharti Airtel

Bharti Airtel
cmp: Rs 650.15
target price: Rs 843

HSBC Global Research has assigned an ‘overweight’ rating to the stock saying the company’s strong balance sheet and infra-sharing models will allow it to consolidate its revenue market share leadership further. “We value the core business at 12.5 times FY10 (estimated) EPS (earnings per share) at Rs 660 per share and tower valuations of Rs 183 per share,” said HSBC Global Research in a note to its clients.

The research firm is positive on Bharti based on a combination of expected sharp growth in the Indian wireless market, execution of a low-leverage, low-cost business model with a high return on invested capital, and a close alignment of majority and minority shareholder interests. However, it views higher regulatory charges and aggressive international expansion as key downside risks.

Source: EconomicTimes

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