Iranian mobile company plans to float 10 per cent stake

08 August 2011

TCI planning further flotations for mobile subsidiary

State-owned Telecommunications Company of Iran (TCI) has indicated it is willing to float a further 10 per cent of subsidiary Mobile Company of Iran (MCI), also known as Hamrah-e-avval, on the Tehran Stock Exchange (TSE).

“They have said they will sell another 10 per cent, but no timeline has been set for this, it could be in the next few months or few years,” says Ali Mashayekhi, head of investment research at Iran-based brokerage Turquoise Partners.

MCI is planning to float 1.5 per cent this year, according to its Iran-based advisers Teyf Sharif Consultants, but the decision will come down to market demand.

While the TSE has been experiencing an upward trajectory this month, it has experienced a turbulent past few months. It grew by 11 per cent at the start of the Iranian year in March, losing 8 per cent over April and May and another 8 per cent in June before rising by about 5 per cent in July.

Iraq telecoms subscribers
f=Forecast. Source: Informa Telecoms & Media

In December 2010, TCI floated 5.5 per cent of MCI shares in an initial public offering (IPO) at IR34.950 ($3.5) each, raising $396m. A further 5 per cent of the shares were floated in 1 per cent blocks with the latest taking place in March this year with 20 million shares floated at IR43.000 each.

MCI’s market capitalisation is currently about $9bn. Parent company TCI’s market capitalisation stands at $12bn.

MCI is one of the most lucrative companies on the exchange. Net profit in the first quarter of the Iranian year (March-June) grew by 36 per cent since the same period the previous year. The company reported net profit of IR690bn for this first quarter.

 It has 43.5 million mobile subscribers, making it the largest mobile operator in the Middle East. It aims to gain 10 million new subscribers this year alone.

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