Tata Teleservices (Maharastra) (up 14.56%), Idea Cellular (up 2.61%), Reliance Communication (up 2.92%), and Bharti Airtel (up 3.45%), moved higher. Spice Communication, however, was down 1.09%.Stocks also got boost on the reckoning that the recent stake sales by telecom players indicates that the domestic telecom market will not reach a saturation point anytime soon.
NTT DoCoMo Inc, on Wednesday (12 November 2008) acquired a 26% stake for $2.7 billion (Rs 13,070 crore) in Tata Teleservices (TTL), to expand into the world's fastest-growing major wireless market, valuing the company at $10.4 billion. NTT DoCoMo and Tata Sons have announced a 20% open offer for the shareholders of Tata Teleservices Maharashtra (TTML), a 37.65% owned unit of TTL, at Rs 24.70 a share. The offer is priced at 37% premium over TTML's closing price of Rs 17.99 on Wednesday (12 November 2008).
As growth opportunities abounded, foreign players have ramped up the valuations that they paid for their India foray. In early 2007, foreign firm Vodafone paid a whopping $10.8 billion for a 52% stake in another unlisted entity Hutchison Essar, which had 23 million subscribers Indian subscribers.
Similarly, stake sale by realty firm Unitech's unlisted telecom unit Unitech Wireless (60% for Rs 6,120 crore) and unlisted Swan Telecom (45% for Rs 4,100 Crore) to Telenor and Etisalat respectively, indicate that foreign firms are positive about growth in the Indian telecom industry.
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