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RCom decision to sell 5% stake in tower co draws investors’ attention

Arushi Sen

Mumbai, July 23 Telecom stocks have been drawing a lot of investor interest and continue to perform well on the bourses following Reliance Communications’ announcement to sell 5 per cent of its telecom tower company, Reliance Telecom Infrastructure Ltd, for Rs 27,000 crore.

The Reliance Communication stock touched its 52- week high after the announcement on Friday to reach Rs 583.60.

The news had a positive impact on other stocks as well as most telecom operators have announced plans to hive off their tower businesses into separate companies .

“Infrastructure sharing is a new trend. It will also help to increase population coverage by ensuring a faster roll out of services,” said an analyst tracking the sector.

Reliance Communication acquiring US-based Yipes Holding has also positively impacted the sentiment in the sector.

The shares of Bharti Airtel have risen 14.33 per cent for the month and 7.23 per cent for the week. The stock touched its 52-week high today at Rs 940.95. Idea Cellular also reached its 52-week high today at Rs 132.75. The stock soared 13.46 per cent month on month and 6.20 per cent week on week.

“There has been a lot of positive news about this sector which is leading to the rise in stock prices. The stocks have also been rising on the expectation of good results,” said Mr Harit Shah, telecom analyst, Angel Broking.

Idea Cellular Ltd will be announcing its first quarter results on July 24, followed by Bharti Airtel and Reliance Communications which would be announcing their numbers on July 27 and July 31 respectively.

The sector has started the first quarter of the financial year well, by adding around 12 million subscribers in the first two months of the quarter itself.

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