Why Institutional Investors are bullish on Bharti Airtel?

Bharti Airtel has seen institutional shareholding rising to 39.29% as at 30-9-20, against 38.52% as at 30-6-20, an increase of 77 bps, in last quarter, as evident from the disclosures made on 21-10-20. Maybe, sensing this, Bharti Airtel share price rose by Rs. 40, about 10%, in the last 1 week.

Stock saw unchanged close yesterday, when broader market was showing good weakness. African operations have shown good performance for Q2, while market is expecting better Q2 numbers from the company today as well, with positive outlook and commentary.

EV of the stock is comforting now at Rs. 3.75 L cr. (Market cap Rs. 2.37 L cr. & Net Debt Rs.1.38 L cr). Africa Business of Bharti, which had an income of Rs. 24,220 cr. and EBIT of Rs. 6,450 for FY 20, is given an EV of  Rs. 1.25 L cr. Hence, India and South Asia Business, with infra investment is at an EV of Rs. 2.50 L cr. Jio Platform is being given an EV of Rs. 6.25 L cr. with RIL holding 67% stake in Jio Platform, capturing an EV of Rs. 4.20 L cr.

Jio had a total subscriber of 401 million at the end of July, 2020, with active users (as measured by users on date of peak VLR) being 78% at 313 million. But Airtel having a total subscriber of 320 million has active users of 97% being at 310 million, due to their policy to actively flush non active users from their subscriber base.

Bharti is seen having trigger of Singtel, its Singapore promoter, raising its stake in the company, through Bharti Telecom, which can make Bharti a Foreign company, if  it crosses the threshold. FDI in Telecom is permitted 74% via Automatic route, while 100% is permitted on seeking permission, while such permission is held by Bharti.

Can these moves keep Institutional investors' interest alive in the stock, as valuations are grossly loaded in favour?