Idea Cellular plans to go public

By : |December 31, 2003 0

NEW DELHI: Idea Cellular Ltd, India’s third biggest private mobile phone operator, is planning a public offering to take advantage of a booming stock market and strong investor appetite for new equity, a top company official said


“We are evaluating an initial public offering (IPO),” the official told Reuters, declining to be named. “We would like to do it as soon as possible.”

The official declined to give details on the size of the proposed IPO or the time of its listing.

Three-year-old Idea provides GSM-based mobile phone services to 2.2 million customers spread over five of the 23 circles making up the flourishing telecoms sector — one of the fastest growing markets globally.

Idea, owned by powerful business groups, the Tatas and Birlas, as well as U.S.-based AT&T Wireless Services Inc, has a 7.9 percent share of India’s expanding mobile market that has 28 million users.

Another official, who also refused to be identified, said the firm would like “to take advantage of the rising markets”.

Idea’s bigger rival, the Indian mobile unit of Hong Kong conglomerate Hutchison Whampoa, is also contemplating a local listing next year.

Indian stock markets have been on a roll with the 30-issue benchmark Bombay Stock Exchange index surging 71 percent so far in 2003 to trade near four-year highs, making it Asia’s second best performer this year.

The sharp rise has been fuelled by foreign fund inflows that have hit a record $6.5 billon this year on hopes of a strong corporate performance from Asia’s third largest economy following the best monsoon rains in a decade.

Apart from old economy stocks that have led the rally, investors have also made a beeline for IPOs, some of which have given spectacular returns after being hugely oversubscribed.

On Friday, energy firm Indraprastha Gas Ltd jumped 130 percent on its trading debut with an opening quote of 110.25 rupees against an offer price of 48 rupees.

The IPO, worth 40 million shares, was oversubscribed 35.6 times and the stock closed 4.95 percent higher at 149.55 rupees on the Bombay Stock Exchange on Tuesday.


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