The combined entity of Vodafone India and Idea Cellular, which are now India's number 2 and 3, respectively, would dislodge Bharti Airtel to counter the bruising price war in the world's second-largest telecom market.
At 9.33 am, the stock was trading 3.81 per cent lower at Rs 93.35 on BSE.
Idea said that the broadband data usage (3G+4G) has almost doubled to 413 billion MB in the second quarter from 228.8 billion MB in the first quarter.
"Both Vodafone India and Idea as customers, and ATC as a mobile network infrastructure provider have agreed to treat each other as long-term preferred partners, subject to existing arrangements".
"The operating environment for Indian mobile operators remained challenging with unrelenting pressure on pricing, introduction of Goods and Services Tax at 18 per cent (compared to service tax at 15 per cent) and need for large investments to support the exploding data demand", Idea said in a statement.
Earlier this year, Vodafone India and Idea had agreed to merge their operations to create the country's largest telecom operator worth of more than United States dollars 23 billion with a 35 per cent market share. And also counter the bruising price war triggered by Mukesh Ambani-owned Reliance Jio Infocomm. In 2014-15, ICIS reported total income of Rs238 crore, according to filings with the Registrar of Companies. The merger is expected to be completed in 2018.
The incumbent operators have blamed competitive pressures triggered by the free and disruptive offers of Jio, for the financial stress in the sector. The company's consolidated revenue for the quarter came in at Rs 7,460.5 crore, registering 19.7% yoy decline.
The company had a net debt of Rs 54100 crore at the end of September quarter.
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