The Hindu Business Line : Idea Cellular plans $2-b investment for pan-India presence

Idea Cellular Ltd, the Aditya Birla Group company, is planning about $2 billion (Rs 9,000 crore) investment over the next two to three years for a pan-India footprint and consolidation of its existing circles.

Though the initial public offering (IPO) is one of the options that the company is weighing for quite some time, its Managing Director, Mr Sanjeev Aga, refrained from elaborating on the timeline.

Recently, Providence Partners of the UK picked up about 15 per cent stake in the company but the deal size is not clear. The Aditya Birla Group owns about 66 per cent equity.

Speaking about Idea Cellular, Mr Aga said the company now has a footprint across 50 per cent market in India, through presence in eight circles. It has added three more circles of Himachal Pradesh, Rajasthan and Uttar Pradesh East in the last 60 days and now covers 11 circles.

Services launch

Today, Idea received letter of intent (LoI) for Bihar and clearance for Mumbai circle. It had earlier received clearance (LoI) for national long distance (NLD) services. Based on this, Idea expects to secure licences within 15 days. Subject to clearance of base spectrum in Bihar and Mumbai, it is likely that these services would be launched by early 2007.

"We are working for a pan-India presence and expect to cover it gradually phase-wise. In the case of Bihar, the spectrum would be about 4.4 mega hertz and in Mumbai it could be 6.2 mega hertz. Based on this, we expect to later ramp up," he explained.

On the entry of already crowded market of Mumbai, Mr Aga said, "We relish challenges and one of the option could be infrastructure sharing. We do this in several circles and Mumbai would be no exception."

Though Idea offers services across 11 circles in about 3,500 towns, it effectively covers a population of about 70 per cent in the country. Idea now accounts for about 11.4 million subscribers, and in the last four months added about one million subscribers every month.

Asked if they would also look at offering international long distance, Mr Aga said that NLD is at advanced stage, but there are no plans as yet to offer ILD services.

Would they look at acquisitions within the country, he said that the company is now concentrating on expanding into new circles and the rollout plans are quite engaging.