Billionaire Sudhir Ruparelia endorses Airtel IPO, urges Ugandans to take part

Businessman, Dr. Sudhir Ruparelia (right) at the launch of Airtel's IPO. On his right is Mr Keith Kalyegira, the Chief Executive Officer of the Uganda’s Capital Markets Authority (CMA).

Billionaire businessman as well as the largest Ugandan and individual equities investor on the Uganda Stock Exchange has endorsed Airtel Uganda’s Initial Public Offering (IPO), saying that it is a good buy.

Speaking to a local media outlet, CEO East Africa as Airtel Uganda launched its IPO prospectus, Dr Sudhir Ruparelia said that the historic good performance of the telco, coupled with the growing role of communication technologies, makes the Airtel IPO, worthy of consideration.

“What I’ve seen here, in the prospectus, for example, forecasted earnings per share of UGX22 per share this year⏤ for a price of UGX100 at IPO, it is a really good prospect. I am definitely putting (investing) in,” the businessman revealed.

” I’m just going to study and see how much am going to invest,” he said.

Tycoon Sudhir (far left) in a group photo with Airtel officials at the launch of the Telco’s IPO

Airtel IPO shares have gone on sale today at UGX100 per share.

The telco has put up 8 billion shares (20% of the issued 40 billion shares) for UGX100 each. The IPO shall close on 13th October 2023 at 0400pm. Results of the allocation shall be announced on 30th October 2023 at 04:00 pm and thereafter the company shall on 31st October 2023, list the entire 40 billion issued shares on the Main Investment Market Segment of the Uganda Securities Exchange (USE).

The businessman, as of the end of December held 330,723,247 shares of Stanbic Uganda Holdings Ltd (0.65%0 and is the 7th largest shareholder and the biggest individual holder.

He is also the second largest shareholder in Bank of Baroda with 2.5% (62,527,250 shares) as well as holds 2,165,575 shares in dfcu Limited equivalent to 0.3%. He also has shares in NIC Holdings Limited and Umeme Limited.

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“Today, telecommunications is not just a nice-to-have but a must-have. Communication has become a basic need just like food, shelter and clothing. The Internet has become a necessity. It is a must-have for most economically active individuals and businesses. This makes investing in a telecom worth considering,” he said.

He also said that with the Ugandan economy recovering from the COVID-19 shock, returns from equity investments on the exchange are also looking north.

“The Ugandan economy is recovering and growing. Yes, there might be a liquidity crunch here and there, in some sectors, but definitely, telecom companies are growing and expanding. Profits of most of the listed companies have done well. Returns on the stock exchange are generally doing well except for a few stocks, but by and large, very good dividends are being paid out,” he added.

Airtel is part of the USD64.3 billion Bharti Airtel Group, with 518 million customers globally, and has also been profitable for the last 5 years and beyond. According to released financials, the company made a net profit of UGX268 billion, UGX216 billion, UGX277 billion, UGX393 billion and UGX326 billion for 2018, 2019, 2020, 2021 and 2022 respectively.

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This was against gross revenues of UGX1 trillion, UGX1.087 trillion, UGX1.294 trillion, UGX1.505 trillion and UGX1.594 trillion respectively.

The telco which has been present in Uganda since 1995 and is the second largest with a close-to-call 49% revenue share and 47.3% subscriber market share, respectively. According to Manoji Murali, the company’s Managing Director, Airtel Uganda has 13.8 million active subscribers across 146 districts in Uganda.

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