Bharti shares up 3% after 3-day slide

Shares of Bharti Airtel (BHARTIARTL.BO : 283.65 +2.65) bounced 3 per cent on Thursday, as investors saw value in the firm after news of its renewed merger talks with South Africa's MTN pushed shares down over 10 per cent in the past three sessions.

"Leaving aside the merger, and the lack of clarity surrounding it, fundamentally the stock has no problem," R.K. Gupta, managing director at Taurus Mutual Fund, said.

"The company is doing well in India, its business is diversified, and cellular growth in the rural market is still quite good."

Bharti shares were up 3 per cent at 791.80 rupees by 0626 GMT, while the broader 30-share BSE (^BSESN : 16632.01 -222.92) index was up 0.8 per cent.

Bharti and MTN are working on a deal worth $23 billion in cash and stock, under which the Indian firm would get 49 per cent of MTN, after MTN and its shareholders get a 36 per cent stake in Bharti, with a full merger the long-term goal.

Under Indian regulations, the purchase of 15 per cent in a listed company triggers an automatic open offer to buy a further 20 per cent from the open market.

Four of MTN's top 25 shareholders would reject a tie-up with Bharti based on terms unveiled this week and other big investors are unsure about the deal to create a telecoms giant.

"There is a lot of confusion about the proposed merger," Gupta said.

But investors who are looking at the company from a longer-term perspective may have seen the three-day fall as an opportunity to buy, he said.