Bharti Airtel’s proposed mega rights issue will help it cut debt, improve liquidity: Moody’s

Telecom operator Bharti Airtel’s proposed rights issue is “credit positive” as it will enable the company to pare debt and improve liquidity, according to Moody’s.

Airtel’s Board had last week approved fund-raising plans of up to Rs 32,000 crore through a combination of rights issue and bond — a move that will help the company take on market competition intensified by Reliance Jio, and cut debt.

“The proposed rights issue, if completed, is credit positive for Bharti because it will allow the company to reduce debt and improve its liquidity,” Moody’s Investors Service said in a statement.

Airtel’s fund-raising plans entail rights issuance of up to Rs 25,000 crore and Perpetual Bond with equity credit of up to Rs 7,000 crore.