ICICIdirect has recommended 'Buy' on Bharti Airtel with target price of Rs 480 against current market price Rs 401.

Commenting on the investment rationale, the stock broker said, "Airtel had about 15,000 towers across 17 continents in Africa, which it plans to divest. Deals for about 6600 towers have materialized so far. We may see further deals for the remaining 8400 towers, going ahead. Though Airtel will have to incur an additional operating expenditure for tower rentals it will save considerably on depreciation and interest. The entire tower portfolio could fetch Airtel Rs 150-180 billion (USD 2.5-3 billion) the proceeds of which could be used for its debt reduction which stands at hefty levels of Rs 64688.5 crore (net debt as of FY14). This can lead to significant yearly interest cost savings to the tune of Rs 9.90-11.88 billion. We will, however, factor this in our estimates once clarity on the deal valuations is available. Thus using the DCF methodology we maintain Buy on Bharti Airtel."

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