The Hindu Business Line : Idea Cellular eyes pan-India footprint

The Aditya Birla Group promoted Idea Cellular has applied for 12 more GSM-based cellular licences. The move will give the cellular company a pan-India footprint to compete with the likes of Bharti Airtel, Hutch and Reliance Communications.

The company at present has licences for 11 Circles of which eight are operational. The expansion comes after the Birla Group got management control of the cellular company following the exit of the Tata Group. Idea Cellular has also taken the letter of intent for a long distance telephony licence and is set to become an integrated telecom services player.

Major expansion

Senior company sources confirmed that applications on behalf of Idea cellular have been sent to the Department of Telecom for offering mobile services across the country. Company officials said that Idea Cellular was embarking on a major expansion plan over the next six months, to be funded through an Initial Public Offering.

Analysts pointed out that the move to go pan-India will give the company a lot of advantage, as it will not have to depend on other operators to carry its telephone calls. It will also give Idea access to lucrative markets.

For instance, the company at present does not have operations in any of the metros, except Delhi. The bigger size will also give it more leverage in negotiating deals with equipment vendors and revenue sharing business arrangement with other operators.

Competitive market

The long distance licence is also part of the company's strategy to become competitive in a market dominated by large integrated operators such as Bharti Airtel and BSNL. Market watchers pointed out that small operators such as Escotel, BPL and Spice have been acquired or are on the lookout for a merger with larger operators.

Idea has nearly 10 million subscribers across Delhi, Maharashtra, Gujarat, Kerala, Uttar Pradesh (East and West), Rajasthan and Madhya Pradesh.