New Delhi: Continuing to fall for the second straight session on Tuesday, Idea Cellular stock plunged nearly 8% after it agreed to merge with Vodafone India to create the country’s largest mobile phone operator worth more than $23 billion.
Even after a positive opening, the stock failed to hold on the momentum and lost 7.63% to Rs90.15 as the trade progressed on BSE.
On NSE, shares of the company tanked 7.77% to Rs90.10. In the previous session also, the stock had lost nearly 10%.
The British firm will own 45.1% of the merged entity while the Aditya Birla group, Idea’s parent company, will own 26% after paying Rs3,874 crore cash for a 4.9% stake, the two firms announced at a press conference on Monday.
The remaining 28.9% will be held by other shareholders.
The Idea-Vodafone merger will create a strong player, but multiple challenges from the deal, including breach of spectrum holding and revenue marketshare cap, will have to be resolved in a fixed timeframe, ICRA said on Monday.
Analysts are of the view that the competition in the industry is unlikely to subside in the medium term despite the mega merger.