Cellular operator Spice Communications has fixed the price band of its proposed public issue between Rs 41 and Rs 46 per equity share of Rs 10 each.
MUMBAI: Cellular operator Spice Communications has fixed the price band of its proposed public issue between Rs 41 and Rs 46 per equity share of Rs 10 each.
"We have recently concluded a pre-IPO placement of 24,837,889 shares at Rs 45 per share, thereby raising about Rs 112 crore. A clutch of investors led by Lehman Brothers and Sinnaker Investments have picked up a small stake in Spice Telecom," company Chairman and Managing Director Dilip Modi said.
Following the IPO, the stakes of the both the promoters, B K Modi and Telekom Malaysia, would come down by 10 per cent each.
Presently, B K Modi holds 51 per cent and Telekom Malaysia, the remaining 49 per cent.
Post-IPO, Modi will have around 41 per cent stake while Telekom Malaysia 39 per cent, with the public holding the remaining 20 per cent.
"We are the second largest operator in Punjab with approximately 1.91 million subscribers and the fifth largest operator in Karnataka, with approximately 0.82 million subscribers," Modi said.
The company intends to consolidate and boost its presence in both the markets by expanding its coverage with a view to increase its market share, he said.
"We also plan to work with our roaming partners to improve and expand our coverage and to provide consistent products and services to our subscribers," he added.
Currently, the company has an allocation of 7.8 MHz and 6.2 MHz in the 900 MHz bands in Punjab and Karnataka respectively. It has applied for an additional spectrum of 2 MHz in Punjab, based on its subscriber base.
The company expects that additional spectrum will be granted to it in the 1,800 MHz since there is no availability in the 900 MHz band. The 1,800 MHz band generally requires more capital expenditure than the 900 MHz, company sources said.
Spice Telecom has also applied for licences for 21 additional cellular circles in India, including Delhi, Mumbai, Kolkata and Chennai, Modi said.
"We recently received a Letter of Intent for providing non-exclusive NLD and ILD services. We are also waiting for 3G spectrum allocation from DoT."
There is tremendous competition in the fast-growing Indian cellular industry.
"With the increase in foreign direct investment limit from 49 per cent to 74 per cent (in telecom sector), we expect competition to intensify as new entrants and existing operators, with fresh capital infusion or consolidation, begin to compete against each other," Modi stated.
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