Japan-based brokerage firm Nomura Equities Research has lowered Bharti Airtel?s rating and has brought down the operator?s stock from neutral to reduced.
Nomura has reduced Bharti Airtel?s share price by almost 25 per cent by pegging it at Rs 210. Taking Bharti Airtel?s financial result for the quarter ended June 30, 2012 as the benchmark the brokerage firm has expressed concern about the operator?s domestic wireless strategy, business potential in Africa, capital needs, and regulatory impact on operations.
Bharti Airtel reported a 37 per cent decline in its net profit from Rs 12.15 billion for the quarter ended June 30, 2011 to Rs 7.62 billion for the quarter ended June 30, 2012. For the corresponding period, the operator?s losses from South Africa widened from Rs 3.02 billion to Rs 6.69 billion.
Nomura is however saying that the potential listing of company?s towers business ? Bharti Infratel could be positive.
Since June 2012, Bharti’s stock has been downgraded by several institutions, including Credit Suisse, Daiwa Capital Markets and HSBC. However, Bharti is not the only one taking a financial beating other telecom operators are also facing rough weather following the 2G spectrum controversy.
