IIFL in a Report Released on
Bharti Infratel has the Following View,
BIL has contractually determinate revenue and almost exclusive relationships with the top three telcos in India, making for good cash flow visibility. However, 1) low annual rental escalation of 2.5% (compared with positive real escalator in the US market); 2) modest rental upsides from the data opportunity in India; 3) competing towercos having spare capacity; and 4) high valuations (1.8x FY14 P/B; 6% ROE) with
respect to India utilities and US tower cos make us cautious.
Valuation And Stock Target Price of Bharti InfratelIIFL initiate coverage with SELL. IIFL project rental revenue based on equalization accounting as a result of which DCF-based and a Target Price of Rs184.
So it can be Bought at lower than this level or Wait for Reliance Infratel another Tower Company to List.
