Avoid Bharti Infratel IPO: Ambit Capital

Bharti Infratel’s initial public offer opened on Tuesday in the price band of Rs 210 to Rs 240. Brokerage Ambit Capital has advised investors to avoid the issue at current valuations. The issue closes on December 14.
“At 10-12 times FY14 EV/Ebitda and 38-44 times FY14 earnings, the valuation is expensive,” the brokerage said.
However, it said the valuations are fair compared with global peers, but peers such as American Towers and Crown Castle enjoy superior economics.

The revenue growth of the company is expected to slow down on a drop in tenancies and weak uptake in 3G/4G services, the brokerage said.

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