The competition among mobile service providers in the lucrative Mumbai market may hot up with the Aditya Birla Group's Idea getting the licence for the circle, where it could launch new service by mid-2007.
The Government granted two licences for the Mumbai and Bihar circles to Idea, which is expected to hit the market with its Initial Public Offer in February to mop up Rs 2,500 crore, earlier this month, sources said.
While no official comment could be obtained from the company, sources in the know said that Idea would strive to offer services to subscribers in these two circles in 6-8 months and investment for the purpose could be upwards of Rs 1,500 crore.
This is part of the Rs 6000 crore investment the company has lined up for its pan-Indian expansion over the next two to three years.
Idea, currently operating in 11 circles, including Delhi, had earlier obtained Letters of Intent for Mumbai and Bihar circles, which would give the company access to approximately 70 per cent of the cellular market. The company has also applied for new licenses for another nine circles.
The company will hit the capital market in February next year to raise Rs 2,500 crore. The proceeds from the IPO would be used for expansion of services in the existing circles, roll out of new network in Mumbai, start National Long Distance (NLD) operations and redemption of preferential share.