Asian stock indices are trading mixed today. The Shanghai Composite is lower by 0.29% while the Hang Seng is even. The Nikkei 225 is trading higher by 0.46%. US stocks ended higher on Tuesday as lawmakers’ comments on tax reform and the debt ceiling boosted investor optimism.
Back home, share markets in India have opened the day on a positive note. The BSE Sensex is trading higher by 100 points while the NSE Nifty is trading higher by 45 points. The BSE Mid Cap and BSE Small Cap index both opened the day up by 0.6%.
Telecom stocks opened the day on a mixed note with GTL Ltd and Himachal Futuristic witnessing maximum buying interest. As per an article in a leading financial daily, Idea Cellular has sought the telecom department’s nod for its proposed US$23-billion merger with Vodafone India, which will create the country’s largest telco by subscriber and revenue market share.
Vodafone and Idea have already received approval of anti-monopoly watchdog Competition Commission of India.
One must note that, the telecom department (DoT) typically takes 45-60 days for giving necessary approvals for merger, unless complications or clarifications are needed from merging parties.
Post-merger, UK’s Vodafone Group will have 50% stake in the merged entity while Idea promoters Aditya Birla Group will have 21%. Under the terms, Aditya Birla Group will have the right to gradually increase its stake in the combined entity, while Vodafone will reduce its holdings, with both partners eventually owning equal stakes.
Notably, Indian telcos are facing a tough time matching up to rock bottom tariffs offered by newcomer Reliance Jio Infocomm, which disrupted the market with free voice and data offers for about six months after it started services in September last year.