American private equity firm Carlyle is looking to sell its 24% stake in Nxtra Data Ltd, the data centre unit of Bharti Airtel Ltd. Carlyle is looking at a valuation of $850-900 million against its acquisition valuation of $235 million, global broking firm Macquarie said while assigning a 'Neutral' rating on the stock with a target price of ₹1,060 per share.
Carlyle acquired a stake in Nxtra for $235 million or about ₹1,800 crore in 2020.
According to Macquarie, the enterprise business accounts for 16% of the target based on 10 times FY25 to FY26 enterprise value and EBITDA, against this reported deal valuation for Nxtra data centre implied at 20-23 times FY25 EV and EBITDA.
A possible sale of Carlyle's stake in the company would be its fourth exit this financial year after it sold part of its stake in YES Bank through a block deal for ₹1,160 crore.
Carlyle also sold its 2.5% stake in Delhivery for ₹709 crore in June. In August, it sold its 2.17% stake in Piramal Pharma.
Nxtra by Airtel has 12 large and 120 edge data centres across the country. It had previously said it would invest over ₹5,000 crore over the next few years to build six new hyperscale data centres across key metro cities in the country and expand its capacity by 2 times to over 400 MW.
Nxtra’s revenue has grown at an average annual pace of around 13% over the past five years (from ₹852 crore in FY19 to ₹1,601 crore in FY23), driven by robust demand for its services, according to Care Ratings. The rating agency noted that Nxtra has strong links with parent Airtel, making it an important subsidiary for the parent.
Airtel shares opened nearly a percent lower to trade at ₹1,122.90 apiece on NSE. The scrip is up 11% so far this year and has gained nearly 50% in the last one year.
(Edited by : Amrita)
First Published: Feb 23, 2024 9:57 AM IST
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