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<ul><li>The IPO of state-run RailTel Corp will remain open till February 18.</li><li>The shares were trading at a premium of <a href="https://www.ipowatch.in/2020/11/railtel-ipo-gmp-grey-market-premium-today.html">₹35-40</a> in the grey market, ahead of the IPO.</li><li>Nearly all the brokerages have given a ‘subscribe’ rating for the issue citing long term as well as listing gains.</li><li>Its net profit margin of 13% in FY 2020 was the highest among the Key Telecom Companies and Key IT/ICT companies in India.</li></ul>The ₹819 crore ($112 million) initial public offering (IPO) of state-run RailTel Corp of India is now open for public subscription. The IPO will remain open till February 18. RailTel is a government-owned information and communications technology (ICT) infrastructure provider firm and one of India's largest neutral telecom infrastructure providers. This would be the seventh initial public offerings this year, and second by the Ministry of Railways after it recently pared stake in Indian Railway Finance Corporation IPO— which listed at a 4% discount last month. Nearly all the brokerages have given a ‘subscribe’ rating for the issue citing long term as well as listing gains. According to investment experts about the RailTel business, the best thing is its exclusive right of generating additional revenues by creating nationwide broadband and multimedia networks by laying optical fibre cable by using the right of way along railway tracks. Per red herring prospectus, as of January 31, the company had the exclusive right of way along 67415 route kilometres connecting 7321 railway stations for laying optical fibre cable. Streets View: <keyword id="7626629" type="UNKNOWN" weightage="20" keywordseo="RailTel-IPO">RailTel IPO</keyword> <table style="border-width: initial; border-style: none;"></colgroup><tbody><tr><td style="border-left:solid #000000 0.9907650000000001pt;border-right:solid #000000 0.9907650000000001pt;border-bottom:solid #000000 0.9907650000000001pt;border-top:solid #000000 0.9907650000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Brokerage </td><td style="border-left:solid #000000 0.9907650000000001pt;border-right:solid #000000 0.9907650000000001pt;border-bottom:solid #000000 0.9907650000000001pt;border-top:solid #000000 0.9907650000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Recommendation </td></tr><tr><td style="border-left:solid #000000 0.9907650000000001pt;border-right:solid #000000 0.9907650000000001pt;border-bottom:solid #000000 0.9907650000000001pt;border-top:solid #000000 0.9907650000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Angel Broking </td><td style="border-left:solid #000000 0.9907650000000001pt;border-right:solid #000000 0.9907650000000001pt;border-bottom:solid #000000 0.9907650000000001pt;border-top:solid #000000 0.9907650000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Subscribe </td></tr><tr><td style="border-left:solid #000000 0.9907650000000001pt;border-right:solid #000000 0.9907650000000001pt;border-bottom:solid #000000 0.9907650000000001pt;border-top:solid #000000 0.9907650000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">ACMIIL </td><td style="border-left:solid #000000 0.9907650000000001pt;border-right:solid #000000 0.9907650000000001pt;border-bottom:solid #000000 0.9907650000000001pt;border-top:solid #000000 0.9907650000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Subscribe </td></tr><tr><td style="border-left:solid #000000 0.9907650000000001pt;border-right:solid #000000 0.9907650000000001pt;border-bottom:solid #000000 0.9907650000000001pt;border-top:solid #000000 0.9907650000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">ICICI Direct </td><td style="border-left:solid #000000 0.9907650000000001pt;border-right:solid #000000 0.9907650000000001pt;border-bottom:solid #000000 0.9907650000000001pt;border-top:solid #000000 0.9907650000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">None </td></tr><tr><td style="border-left:solid #000000 0.9907650000000001pt;border-right:solid #000000 0.9907650000000001pt;border-bottom:solid #000000 0.9907650000000001pt;border-top:solid #000000 0.9907650000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Hem Securities </td><td style="border-left:solid #000000 0.9907650000000001pt;border-right:solid #000000 0.9907650000000001pt;border-bottom:solid #000000 0.9907650000000001pt;border-top:solid #000000 0.9907650000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Subscribe </td></tr></tbody></table> RailTel Corp of India IPO: All you need to know <ul><li>The company is engaged in the modernisation of the existing telecom system for train control, operation and safety and generates additional revenues by creating nationwide broadband and multimedia networks by laying optical fibre cables along railway tracks.</li><li>It is worth noting that RailTel will not receive any proceeds from the offer for sale and the same will go to the Government of India, the promoter of the company.</li><li>Once the IPO is concluded, the equity shares will be listed on both the exchanges — BSE and NSE.</li><li>ICICI Securities, IDBI Capital Markets &amp; Securities and SBI Capital Markets are the book running lead managers for its public offering IPO.</li></ul>Strong financials, healthy business growth, soaring grey market premium — here’s all that excites investment experts Excited investors are ready to pay more for its shares The public issue received positive reviews from the brokerages, making the grey market pay a hefty premium for its shares. The shares were trading at a premium of <a href="https://www.ipowatch.in/2020/11/railtel-ipo-gmp-grey-market-premium-today.html">₹35-40</a> a piece in the grey market, ahead of the IPO. However, the grey market is not an official measure of the market premium. But it is a fair indicator of demand for the shares in the market. Outlook and Valuations According to Hem Securities, the company’s valuation is fully priced. But looking after the industry dynamics of telecom and telecom data services where the broadband market is gaining pace this will boost the company's performance in the future. “Also the edge which company holds over its peers in terms of financial performance makes this issue attractive to deploy the funds in,” the brokerage added. Assessment of the key telecom service companies in India <table style="border-width: initial; border-style: none;"></colgroup><tbody><tr><td style="border-left:solid #000000 0.9907650000000001pt;border-right:solid #000000 0.9907650000000001pt;border-bottom:solid #000000 0.9907650000000001pt;border-top:solid #000000 0.9907650000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">As of March 20 </td><td style="border-left:solid #000000 0.9907650000000001pt;border-right:solid #000000 0.9907650000000001pt;border-bottom:solid #000000 0.9907650000000001pt;border-top:solid #000000 0.9907650000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Airtel </td><td style="border-left:solid #000000 0.9907650000000001pt;border-right:solid #000000 0.9907650000000001pt;border-bottom:solid #000000 0.9907650000000001pt;border-top:solid #000000 0.9907650000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">BSNL </td><td style="border-left:solid #000000 0.9907650000000001pt;border-right:solid #000000 0.9907650000000001pt;border-bottom:solid #000000 0.9907650000000001pt;border-top:solid #000000 0.9907650000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">MTNL </td><td style="border-left:solid #000000 0.9907650000000001pt;border-right:solid #000000 0.9907650000000001pt;border-bottom:solid #000000 0.9907650000000001pt;border-top:solid #000000 0.9907650000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Rail Tel </td><td style="border-left:solid #000000 0.9907650000000001pt;border-right:solid #000000 0.9907650000000001pt;border-bottom:solid #000000 0.9907650000000001pt;border-top:solid #000000 0.9907650000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Jio </td><td style="border-left:solid #000000 0.9907650000000001pt;border-right:solid #000000 0.9907650000000001pt;border-bottom:solid #000000 0.9907650000000001pt;border-top:solid #000000 0.9907650000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Vodafone Idea </td></tr><tr><td style="border-left:solid #000000 0.9907650000000001pt;border-right:solid #000000 0.9907650000000001pt;border-bottom:solid #000000 0.9907650000000001pt;border-top:solid #000000 0.9907650000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Compounded annual revenue growth rate in the 5 years ending March 2020 </td><td style="border-left:solid #000000 0.9907650000000001pt;border-right:solid #000000 0.9907650000000001pt;border-bottom:solid #000000 0.9907650000000001pt;border-top:solid #000000 0.9907650000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">0% </td><td style="border-left:solid #000000 0.9907650000000001pt;border-right:solid #000000 0.9907650000000001pt;border-bottom:solid #000000 0.9907650000000001pt;border-top:solid #000000 0.9907650000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">-11% </td><td style="border-left:solid #000000 0.9907650000000001pt;border-right:solid #000000 0.9907650000000001pt;border-bottom:solid #000000 0.9907650000000001pt;border-top:solid #000000 0.9907650000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">-12% </td><td style="border-left:solid #000000 0.9907650000000001pt;border-right:solid #000000 0.9907650000000001pt;border-bottom:solid #000000 0.9907650000000001pt;border-top:solid #000000 0.9907650000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">19% </td><td style="border-left:solid #000000 0.9907650000000001pt;border-right:solid #000000 0.9907650000000001pt;border-bottom:solid #000000 0.9907650000000001pt;border-top:solid #000000 0.9907650000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">64% </td><td style="border-left:solid #000000 0.9907650000000001pt;border-right:solid #000000 0.9907650000000001pt;border-bottom:solid #000000 0.9907650000000001pt;border-top:solid #000000 0.9907650000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">7% </td></tr><tr><td style="border-left:solid #000000 0.9907650000000001pt;border-right:solid #000000 0.9907650000000001pt;border-bottom:solid #000000 0.9907650000000001pt;border-top:solid #000000 0.9907650000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Net profit margin </td><td style="border-left:solid #000000 0.9907650000000001pt;border-right:solid #000000 0.9907650000000001pt;border-bottom:solid #000000 0.9907650000000001pt;border-top:solid #000000 0.9907650000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">-66% </td><td style="border-left:solid #000000 0.9907650000000001pt;border-right:solid #000000 0.9907650000000001pt;border-bottom:solid #000000 0.9907650000000001pt;border-top:solid #000000 0.9907650000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">-83% </td><td style="border-left:solid #000000 0.9907650000000001pt;border-right:solid #000000 0.9907650000000001pt;border-bottom:solid #000000 0.9907650000000001pt;border-top:solid #000000 0.9907650000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">-167% </td><td style="border-left:solid #000000 0.9907650000000001pt;border-right:solid #000000 0.9907650000000001pt;border-bottom:solid #000000 0.9907650000000001pt;border-top:solid #000000 0.9907650000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">13% </td><td style="border-left:solid #000000 0.9907650000000001pt;border-right:solid #000000 0.9907650000000001pt;border-bottom:solid #000000 0.9907650000000001pt;border-top:solid #000000 0.9907650000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">10% </td><td style="border-left:solid #000000 0.9907650000000001pt;border-right:solid #000000 0.9907650000000001pt;border-bottom:solid #000000 0.9907650000000001pt;border-top:solid #000000 0.9907650000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">-164% </td></tr></tbody></table>*Source: Hem Securities Strong Financials The company has established a consistent track record of financial performance and growth. Its net profit margin of 13% in FY 2020 was the highest among the Key Telecom Companies and Key IT/ICT companies in India. <div type="image" title="RailTel Financials" msid="80974790" hostid="261"></div> As of January 31, the company had 3 lakh users of ‘RailWire’ service. The number of subscribers has increased 2.55 times since April 30 last year. SEE ALSO: <a href="https://www.businessinsider.in/thelife/news/jaguar-land-rover-plans-to-go-fully-electric-by-2039-and-said-it-would-spend-3-5-billion-on-the-goal-each-year/articleshow/80925836.cms">Jaguar Land Rover plans to go fully electric by 2039, and said it would spend $3.5 billion on the goal each year</a> <a href="https://www.businessinsider.in/defense/news/list-of-10-latest-defence-deals-that-india-has-signed-in-the-last-six-months/slidelist/80926534.cms">List of 10 latest defence deals that India has signed in the last six months</a>

The $112 million IPO of Indian Railways owned RailTel is now open for subscription — Here’s why analysts think the IPO is attractive

<ul><li>The global investment bank is essentially advising investors to put more money in India compared to other markets.</li><li>The money will move from the funds withdrawn from China and Thailand, which <keyword id="48085" type="CITY" weightage="20" keywordseo="Credit-Suisse">Credit Suisse</keyword> has downgraded.</li><li>Credit Suisse expects faster credit growth and lower interest rates in times to come. </li></ul>International investment bank Credit Suisse just upgraded its rating on the Indian market to “overweight”. It essentially means that it advises investors to put more money in India compared to other markets. The money will move from the funds withdrawn from China and Thailand, which Credit Suisse has downgraded to “Market Weight”. This could lead to further bolstering the bull run in the Indian stock market where the Sensex and Nifty have gained nearly 10% since the beginning of 2021. <div type="image" title="sensex" msid="80980519" hostid="261" caption="&amp;lt;p&amp;gt;Credit Suisse is essentially advising investors to put more money in India compared to other markets.&amp;lt;/p&amp;gt;"></div> There are many reasons for this upgrade. “The upgrades reflect our expectation that economic and earnings recoveries are just starting their most rapid phases for the two markets,” the report said, adding that “the pandemic is no longer a major factor.” The rationale cited above would hold good for both India and Australia. "India looks much better positioned cyclically and relative to the pandemic. India suffered a severe outbreak but has seen a dramatic drop in infections, likely due at least in part to achievement of herd immunity in some locations," it added. A couple of other projections that may be significant, include: <ul><li>The credit cycle is at an earlier stage than, perhaps, all other APAC markets.</li><li>The scope for rate cuts is greater than in perhaps every other market save Indonesia.</li></ul>Faster growth in credit is good for both banks and non-banking financial companies, where the stocks have already run up significantly. <keyword id="151330" type="COMPANY" weightage="20" keywordseo="Bank-Nifty">Bank Nifty</keyword> is up 21.5% since the budget proposals were announced. More loans invested in productive businesses also lead to a virtuous cycle of economic growth. In India, credit growth had slowed down sharply even before the pandemic had hit. <div type="image" title="Credit to industry" msid="80980736" hostid="261" caption="&amp;lt;p&amp;gt;Credit cycle is at an earlier stage than perhaps all other APAC markets, says a global investment bank while upgrading the rating on India.&amp;lt;/p&amp;gt;"></div> While the <keyword id="6354335" type="ORGANIZATION" weightage="20" keywordseo="reserve-bank-of-india">Reserve Bank of India</keyword> has interest rates intact in recent monetary policy reviews, Governor Shaktikanta Das has reiterated that the central bank will keep its stance “accommodative”. In other words, push for more economic growth via more money supply and credit, and worry less about the resultant inflation. If the <keyword id="30067" type="ORGANIZATION" weightage="20" keywordseo="RBI">RBI</keyword> does cut rates, as projected by Credit Suisse, then it will result in cheaper cost of funds for the lenders and lower interest rates for businesses and consumers. ALSO WATCH: India Becomes The First Asian Country To Allow Small Investors To Directly Lend To The Government <h1 style="background: rgb(249, 249, 249); max-height: calc(2 * var(--yt-navbar-title-line-height, 2.4rem)); overflow: hidden; font-weight: 400; line-height: var(--yt-navbar-title-line-height, 2.4rem); font-family: Roboto, Arial, sans-serif; font-size: var(--ytd-video-primary-info-renderer-title-font-size, var(--yt-navbar-title-font-size, inherit)); transform: var(--ytd-video-primary-info-renderer-title-transform, none); text-shadow: var(--ytd-video-primary-info-renderer-title-text-shadow, none);"></h1> <div type="Youtube" id="kzIBDVVnVxQ" title="India Becomes The First Asian Country To Allow Small Investors To Directly Lend To The Government" thumbUrl="https://i.ytimg.com/vi/kzIBDVVnVxQ/mqdefault.jpg"></div> SEE ALSO: <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/stock-market/news/the-8-billion-ipo-of-indian-railways-owned-railtel-is-now-open-for-subscription-heres-why-analysts-think-the-ipo-is-attractive/articleshow/80974550.cms">The $8 billion IPO of Indian Railways owned RailTel is now open for subscription — Here’s why analysts think the IPO is attractive</a><a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/stock-market/news/the-8-billion-ipo-of-indian-railways-owned-railtel-is-now-open-for-subscription-heres-why-analysts-think-the-ipo-is-attractive/articleshow/80974550.cms"></a> <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/finance/banks/news/bank-of-india-central-bank-of-india-indian-overseas-bank-and-bank-of-maharashtra-rally-by-over-10-on-hopes-of-privatisation/articleshow/80971254.cms">Bank of India, Central Bank of India, Indian Overseas Bank, and Bank of Maharashtra rally by over 10% on hopes of privatisation</a><a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/finance/banks/news/bank-of-india-central-bank-of-india-indian-overseas-bank-and-bank-of-maharashtra-rally-by-over-10-on-hopes-of-privatisation/articleshow/80971254.cms"></a> <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/tech/news/one-plus-co-founder-carl-pei-picks-android-creator-andy-rubins-essential-to-put-the-giant-reset-button-in-consumer-tech/articleshow/80970965.cms">One Plus co-founder Carl Pei picks Android creator Andy Rubin’s Essential to put the “giant reset button” in consumer tech</a>

Credit Suisse just went ‘overweight’ on India⁠ — says the pandemic is “no longer a factor”

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The $112 million IPO of Indian Railways owned RailTel is now open for subscription — Here’s why analysts think the IPO is attractive

Navdeep Yadav

Credit Suisse just went ‘overweight’ on India⁠ — says the pandemic is “no longer a factor”

Sriram Iyer

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