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June 29, 2001
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Money > Business Headlines > Report June 29, 2001 |
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Bharti group plans Rs 10 billion investment in basic servicesThomas K Thomas The Bharti group will be pumping in around Rs 5 billion as equity in its basic services and will raise up to Rs 5 billion as debt from financial institutions. The company has applied for eight basic circles including Haryana, Delhi, Karnatka, Tamil Nadu, Punjab, AP, Maharashtra and Kerala. Top sources said that Rs 10 billion investment was only for the initial phase, during which the company would roll out basic services in four circles. The company will raise additional funds with further expansions. According to sources, each circle will call for an initial investment of Rs 2.50 billion to Rs 3 billion. The group has estimated an equity component of Rs 1.20 billion for each circle, which would be leveraged to raise debt. Though Bharti has applied for eight circles, it has fructified its plans only for Haryana, Delhi, Tamil Nadu and Karnataka circles. The company, beginning with Delhi and Haryana where it already has set up its network, expects to launch services in these four circles by September. Sunil Mittal, chairman and managing director of Bharti Group, had earlier said since the company had been able to successfully raise funds, it was then looking at the possibility of starting basic services in all the eight circles. Sources said that even if the company decided to start operations in the remaining four circles, things would get in order only around the second phase. Bharti would be raising another Rs 5 billion from FIs at that stage, apart from pumping in Rs 5 billion as equity, according to the sources. The company is targeting to break even on cash profits by the second year of operations and on net profits in the third year. Powered by YOU MAY ALSO WANT TO READ:
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