Shares of Aditya Birla Group's telecom company Idea Cellular crashed more than 8% to an 8-year low on Friday as major telecom companies slump on the 'Zero Touch' post-paid plan announced by Mukesh Ambani's telecom firm Reliance Jio Infocomm.
Shares of Aditya Birla Group’s telecom company Idea Cellular crashed more than 8% to an 8-year low in the morning deals on Friday as telecom companies slump on the ‘Zero Touch’ post-paid plan by Mukesh Ambani’s telecom firm Reliance Jio Infocomm. Shares of major domestic telecom players such as Bharti Airtel, Reliance Communications slipped considerably in the early deals on Friday. The stock of Sunil Mittal-controlled Bharti Airtel was the biggest loser among the components of BSE Sensex while shares of Anil Ambani’s telecom firm RCom dropped more than 4%.
The stock of Idea Cellular nosedived as much as 8.05% to an 8-year low of Rs 53.65 after opening marginally down at Rs 58.25 on NSE on Friday. This was the lowest level for the share of Idea Cellular in nearly last eight years. Idea Cellular shares made a low of Rs 53.15 on 23 June 2010 on NSE. High trading volumes were seen on the counters of Idea Cellular on Friday, up until 10:38 am, more than 1.95 crore equity shares exchanged hands on both NSE and BSE with about 1.77 crore equity shares of NSE alone. Also, shares of Idea Cellular were the biggest losers among the ‘A’ group on BSE on Friday.
Following the huge decline in the share prices of Idea Cellular, the telecom company lost about Rs 2,134 crore was wiped off from the market capitalisation. As per the 8-year low share price of Rs 53.45, Idea Cellular held a market capitalisation of Rs 23,280 crore as against a market capitalisation of Rs 25,414 crore on the basis of Thursday’s closing price of Rs 58.35 on BSE.
Mukesh Ambani-backed Reliance Jio Infocomm Ltd on Thursday announced a new post-paid plan with monthly rental of Rs 199, and an ISD calling service at a beginning price of 50 paise per minute. “‘Zero-Touch’ postpaid plan to offer unlimited benefits at Rs 199 per month, international calling starting at 50 paise per minute and international roaming at Rs 2 for voice, data & SMS for all Jio customers,” Reliance Jio said in a statement. Reliance Jio will be offering international roaming service with outgoing calls at Rs 2 per minute onwards.
Earlier yesterday, The telecom department asserted that clearances related to the mega-merger of Vodafone and Idea Cellular are being expedited. In April last month, following the Q4 results announcement, Idea Cellular said that merger of Idea and Vodafone India is in the final leg of regulatory approvals and expected to be completed by June. Idea and Vodafone announced last year that they would combine their operations to create the country’s largest telecom operator worth over $23 billion, with about 35% market share.