The biggest Ugandan and individual stock investor on the Uganda Stock Exchange, a millionaire businessman, Dr Sudhir praised the Airtel Uganda IPO, calling it a smart investment.
On the occasion of Airtel Uganda's IPO prospectus launch, he made the statements to the CEO of East Africa Magazine. According to Dr. Sudhir Ruparelia, the Airtel IPO is worthy of consideration due to the company's historically outstanding performance and the expanding significance of communication technology.
"What I've seen here, for example, in the prospectus, is forecasted earnings per share of UGX22 per share this year—for an IPO price of UGX100, it's a really good prospect." "I'm definitely going to invest; I'm just going to study and figure out how much," he informed this reporter.
Telecom has put up 8 billion shares for UGX100 apiece (20% of the outstanding 40 billion shares). The initial public offering (IPO) will end on October 13, 2023, at 4:00 p.m. The allocation results will be revealed on October 30, 2023, at 4:00 p.m., and the business will thereafter list the whole 40 billion issued shares on the Main Investment Market Segment of the Uganda Securities Exchange (USE) on October 31, 2023.
As of the end of December, the businessman owned 330,723,247 shares in Stanbic Uganda Holdings Ltd. (0.65%), making him the 7th largest shareholder and the largest individual holder. He is also the second-largest stakeholder in Bank of Baroda, with 2.5% (62,527,250 shares), and owns 2,165,575 shares in DFCU Limited, worth 0.3%. He is also a shareholder in NIC Holdings Limited and Umeme Limited.
"Today, telecommunications is a necessity, not a luxury." Communication, like food, shelter, and clothes, has become a fundamental requirement. The Internet has evolved into a need. Most economically engaged people and enterprises need it. "This makes investing in a telecom worthwhile," he says.
He also said that as Uganda's economy recovers from the COVID-19 shock, returns on equity investments on the market are improving.
"The Ugandan economy is reviving and expanding." Yes, there may be a liquidity shortage in some industries, but telecom businesses are unquestionably growing and developing. The profitability of the majority of the listed corporations have increased. Except for a few equities, stock market returns are typically performing well, and very excellent dividends are being paid out," he noted.
Airtel is a subsidiary of the USD64.3 billion Bharti Airtel Group, which has 518 million subscribers worldwide and has been profitable for the past five years and beyond. According to publicly available financials, the company's net profit for 2018, 2019, 2020, 2021, and 2022 was UGX268 billion, UGX216 billion, UGX277 billion, UGX393 billion, and UGX326 billion, respectively.
This was in comparison to gross revenues of UGX1 trillion, UGX1.087 trillion, UGX1.294 trillion, UGX1.505 trillion, and UGX1.594 trillion.
The telecom has existed in Uganda since 1995 and is the second biggest, with a close-to-call 49% revenue share and a 47.3% subscriber market share. Airtel Uganda has 13.8 million active members spread throughout 146 districts in Uganda, according to Manoji Murali, the company's managing director.
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