The Hindu Business Line : Indiabulls applies for tele licence; DLF to follow

Real estate companies seem to have caught a fancy for telecom sector. After Unitech and Parsvnath, now Indiabulls and DLF Ltd are making plans to foray into the telecom services sector. While Indiabulls has put in its applications with the Department of Telecom for acquiring licence for offering telecom services across the country, DLF said that it will join the line of applicants by the end of the week. This takes the total number of new applications to over 200 from about 15 different companies.

Mr Gagan Banga, spokesperson, Indiabulls, said that while the applications have been made under its real estate company, a strategic partner may be inducted once the Department of Telecom issues the licence. “We think theres a lot of synergy between our existing business and telecom. Telecom is a profitable business and we want to leverage that. We are sitting on more than Rs 10,000 crore so we have no problem in investing in a capital intensive sector such as telecom.” DLF sources said that their applications would be made under one of its subsidiary before the October 1 deadline set by DoT for receiving applications for new licences.

Tele Rush

The past few months has seen a host of companies applying for new licences. Others in the fray include HFCL, BPL, Shyam Telelink, Spice, Datacom, Swan, ByCell, Cheetah, Idea Cellular, STel and Tata Teleservices. While HFCL, Shyam, Idea Cellular, Spice and Tata Teleservices are existing operators wanting to expand their network to all the 23 Circles in the country, Parsvnath has floated a special purpose vehicle in partnership with a foreign player to foray into telecom. STel and Cheetah are Reliance Communication subsidiaries.

High valuation

However, with DoT finding it difficult to make available adequate spectrum to accommodate all these operators, no fresh licences have been issued. Analysts said that the rush for licence is primarily due to high valuations that cellular operators are getting in the country. They also pointed out that since TRAI has recommended giving 3G spectrum to only existing operators, these companies could also be lining up for such an eventuality.

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