The price band has been fixed between Rs. 65 and Rs. 75
MUMBAI: The Aditya Birla-owned Idea Cellular, a leading mobile operator with operations in 11 circles, has announced that it will enter the capital market with an initial public offering (IPO) aggregating Rs. 2,125 crore of equity shares of Rs. 10 each for cash at a premium to be decided through the 100 per cent book-building process.
The price band for the issue has been fixed between Rs 65 and Rs 75 per equity share and the issue will remain open for subscription between February 12, and February 15. The shares are to be listed on the Bombay and National stock exchanges.
Idea recently concluded pre-IPO placement of Rs 375 crore with some of its promoters, directors and certain high net worth individuals, which include Rs. 225 crore from Aditya Birla Nuvo and Rs. 137.10 crore from Birla TMT Holdings Pvt. Ltd. both existing promoters of the company.
This placement has been made at the top end of the price band. The company also proposes a greenshoe option not exceeding Rs. 318.75 crore in excess of the equity shares not included in the issue. The issue, with the green shoe option, aggregates Rs 2,443.75 crore.
The company reported a net profit of Rs. 301 crore on a total income of Rs. 3,071 crore for the nine month period ended December 31, 2006.
The funding requirement is based on the business plan for the expansion in the three new circles where Idea has recently rolled out services. The company is in the process of preparing its business plan for roll-out in Mumbai.
Addressing the media here on Monday, Kumarmangalam Birla, Chairman, Aditya Birla Group, said, "Across the industry we will see that the average revenue per user (ARPUs) will either remain stable or go down marginally. The IPO is indicative of our aggressive growth plans. We will have the networks in place in the Mumbai and Bihar circles in 2007. Idea was earlier undercapitalised and could not grow at industry pace and became an Aditya Birla Group company only in June 2006. Between March 2006 and December 2006, there has been an 80 per cent growth in the number of cell sites.''