Is Idea Cellular buying Videocon Telecom?

Idea Cellular MNP
Indian telecom network operator Idea Cellular is one of the front runners to buy Videocon Telecom, according to a report in Economic Times.

Earlier, there was speculation that Carlos Slim-owned America Movil will be acquiring Videocon Telecom. America Movil is a leading telecom operator in Latin America.

Facts about Videocon Telecom

# 41% growth in revenue for GSM business in Q2 FY 2015-16
# targets Rs 3,000 crore revenue in fiscal 2015-16
# net subscriber addition of 313,000 in 4 Punjab, Haryana, MPCG and Gujarat
# to acquire 10 mn new subscribers in these circles in current fiscal
# 23% improvement in its NRPM
# 12% growth in minutes of usage
# 137% increase in data consumption
# almost doubled data revenues in Q2
# data contribute to approx 12 percent of revenue
# fastest EBITDA positive in Punjab circle
# targets EBITDA positive in MP and Haryana circles
# 42% reduction in operating loss

The report said Videocon Telecom, which has been exploring spectrum trading arrangements with rivals, is likely to announce the deal shortly. This is can be share swap deal indicating that Idea Cellular will not be paying any money to the promoters of the $10.7 billion Videocon Group.

Recently, Reliance Communications acquired small rival MTS India or Sistema Shyam Teleservices, setting the consolidation drive in the India telecom market. Reliance Communications acquired MTS due to its rich spectrum available in 9 telecom circles. The Videcon spectrum will enable Idea Cellular to expand its 4G presence. At present, Idea Cellular has plans to launch 4G in 600 towns in the first half of 2016.

Fitch Ratings recently said the consolidation move in the Indian telecom market will reduce the number of mobile operators to 6-7. The loss making Videocon Telecom, Aircel and Tata Docomo will be exiting from the market due to pressure from Bharti Airtel, Idea Cellular, Reliance Jio Infocomm, etc.

Baburajan K
[email protected]