Idea Cellular jumped 7.59% to Rs 151 at 15:28 IST on BSE after the company said that the Department of Telecommunications transferred the licenses for Punjab and Karnataka service areas held by Spice Communications to the company on 1 February 2014.
The company made the announcement during trading hours today, 4 February 2014.
Meanwhile, the BSE Sensex was down 9.48 points, or 0.05%, to 20,218.74.
On BSE, so far 5.56 lakh shares were traded in the counter, compared with an average volume of 5.90 lakh shares in the past one quarter.
The stock hit a high of Rs 153.30 and a low of Rs 136.30 so far during the day. The stock hit a record high of Rs 188.35 on 15 October 2013. The stock hit a 52-week low of Rs 101.10 on 8 April 2013.
The stock had underperformed the market over the past one month till 3 February 2014, sliding 13.63% compared with the Sensex's 3.08% fall. The scrip had underperformed the market in past one quarter, falling 17.68% as against Sensex's 4.85% decline.
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The large-cap company has an equity capital of Rs 3318.75 crore. Face value per share is Rs 10.
The Department of Telecommunications (DoT) has on 1 February 2014, transferred the licenses for Punjab and Karnataka service areas held by erstwhile Spice Communications (erstwhile Spice) to Idea. This is subject to final outcome of Idea petition at the Telecom Disputes Settlement and Appellate Tribunal (TDSAT) challenging penalties imposed by DoT in connection with acquisition of erstwhile Spice which remain stayed, Idea Cellular said in a statement.
Spice Communications was merged with Idea Cellular with effect from 1 March 2010. The merger was reconfirmed vide a Delhi High Court Division Bench order dated 13 July 2012.
The above action of DoT is result of order passed by the Supreme Court on 29 January 2014, wherein the DoT was directed to endorse the erstwhile Spice licenses to Idea, pursuant to Idea submitting an undertaking to the Court as well as to the DoT to the effect that in case Idea is held liable by TDSAT to pay the penalty as imposed by DoT and other dues, then the DoT would be at liberty to invoke the bank guarantees furnished by Idea to it and in such eventuality, Idea would replenish the bank guarantees to the extent of their encashment. The court order also states, inter alia, that all remedies available to Idea are specifically kept open. The long pending issue of transfer of Punjab and Karnataka licenses of erstwhile Spice, pending since March 2010, thus now stands resolved, the company said.
The transfer of licenses would also enable Idea, the commercial use of 3G spectrum won by it in 2010 auction conducted by DoT and for which it had paid Rs 322 crore to the DoT, Idea Cellular added.
In December 2013, the DoT slapped Rs 600 crore penalty on Idea Cellular for its alleged violation of licence conditions in its merger deal with Spice Communications. Idea was asked to pay the amount to take on record the merger of the operational Spice licences of Punjab and Karnataka in the parent company.
As per the rules, a telecom operator cannot hold more than 10% stake in another operator in the same circle. In 2008, Idea Cellular acquired 41.09% stake in Spice Communications. The companies merged in 2010, which resulted in overlapping of licences in six telecom circles. At the time of the merger, both companies had licences for Andhra Pradesh, Delhi, Haryana, Maharashtra, Punjab and Karnataka.
Meanwhile, the Supreme Court in its February 2012, order cancelled Idea Cellular's licences for Punjab and Karnataka circles, while Spice lost its licences for Andhra Pradesh, Delhi, Haryana and Maharashtra.
Therefore, the only two licences that remained out of Spice's circles, which were taken over by Idea, were Punjab and Karnataka.
Idea Cellular's net profit declined 0.07% to Rs 398.10 crore on 4.64% growth in total revenue to Rs 6610.50 crore in Q3 December 2013 over Q2 September 2013. EBITDA (earnings before interest, taxation, depreciation and amortization) rose 4.04% to Rs 1813.50 crore in Q3 December 2013 over Q2 September 2013. EBITDA margin declined to 27.4% in Q3 December 2013, from 27.6% in Q2 September 2013. The Q3 result was announced on 27 January 2014.
Idea Cellular's net profit jumped 108.32% to Rs 398.10 crore on 17.8% growth in total revenue to Rs 6610.50 crore in Q3 December 2013 over Q3 December 2012.
On a consolidated basis, Idea Cellular's net profit rose 4.49% to Rs 467.70 crore on 4.58% growth in total revenue to Rs 6613.10 crore in Q3 December 2013 over Q2 September 2013. EBITDA rose 4.27% to Rs 2055.70 crore in Q3 December 2013 over Q2 September 2013. EBITDA margin stood at 31.1% in Q3 December 2013, lower than 31.2% in Q2 September 2013.
Ideal Cellular's consolidated net profit jumped 104.6% to Rs 467.70 crore on 18% growth in total revenue to Rs 6613.10 crore in Q3 December 2013 over Q3 December 2012. EBITDA surged 39.5% to Rs 2055.70 crore in Q3 December 2013 over Q3 December 2012. EBITDA margin on YoY basis improved 4.7% to 31.1% in Q3 December 2013.
The growing consumer demand and brand affinity, expanding infrastructure and strong cash flows of Idea reaffirms the company's ability to remain on course with its stated mission of consistent, competitive, responsible and profitable growth and meet all volatile, uncertain, complex and ambiguous developments, as it consolidates its market standing both in mobile voice and data market, Idea Cellular said in a statement.
Idea Cellular, part of the Aditya Birla Group, is the third largest listed wireless operator in India.
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