Mumbai: Idea Cellular, which listed on 9 March to close at Rs85.55 on the Bombay Stock Exchange (BSE) at a 14% premium to its IPO (initial public offering) price of Rs75, has added almost 40% to the Aditya Birla Group’s market capitalization, which ended the day at Rs73,354 crore.
The listing of India’s sixth-largest mobile service operator has helped reduce the gap between one of the country’s oldest business houses and Reliance-Anil Dhirubhai Ambani Group (R-ADAG).
In comparison, other groups with a presence in the telecom business such as the Tatas and R-ADAG have a market cap of Rs2,22,381 crore and Rs1,13,971 crore, respectively.
Idea Cellular accounts for over 11% of the Aditya Birla Group’s total sales of Rs26,417.65 crore, and the group expects the telecom business to play a larger role in its future.
In line with this, the group announced plans to invest almost $750 million in its telecom business in the next one year. According to analysts, the telecom business is gaining importance for the group. “Earlier resource allocation was not great, but that has changed since the group consolidated its stake in the company,” an analyst with an equity research firm said.
Idea Cellular closed on 9 March with a market cap of Rs22,181.96 crore, despite declining from its listing price of Rs92 per share.
In comparison, Bharti Airtel, India’s largest mobile services operator, closed with a market cap of Rs1,42,228.17 crore, while Reliance Communications, India’s number one CDMA service provider, closed with a market cap of Rs86,446 crore.
Idea Cellular’s shares topped the value chart with a turnover of Rs559.2 crore. It also led the volume chart with trades of around 6.36 crore shares on BSE.
Idea, which was the first public offering from the Aditya Birla Group in over a decade, raised $480 million to invest in the world’s fastest growing market for cellular services.
Idea Cellular is the largest initial offering this calendar year, till date.
“Idea Cellular is central to the Aditya Birla Group’s plans and we will be providing unflinching support to it,” chairman Kumar Mangalam Birla said. “Idea plans to invest under $2 billion (Rs8,800 crore) in infrastructure over a two- year period,” said Sanjeev Aga, managing director of Idea.