Aircel lines up Rs 1,100 cr for Mumbai foray

MUMBAI: Aircel, the country���s fifth-largest GSM operator, will invest nearly Rs 1,100 crore for its foray into the Mumbai cellular circle. Aircel, the Indian subsidiary of Malaysia���s Maxis Communications, is expected to launch its operations in Mumbai later this month. This will complete Aircel���s rollout across the metros.

To date, Aircel has already made an investment of Rs 600 crore in Mumbai. Mumbai, where the penetration levels are close to 80%, is the highest revenue-generating circle. Aircel will be up against eight competitors, including Vodafone Essar, BPL Mobile, Bharti Airtel, Reliance, Tata Teleservices and Idea Cellular. The existing operators together have a subscriber base of over 19 million.

���In the first phase, we have invested Rs 600 crore in networks, IT, customer care and start-up distribution that will include our own stores. The next phase will see an investment of around Rs 500 crore by December for enhancing networks capabilities, expanding coverage and providing in-building solutions,��� Aircel COO Gurdeep Singh told ET.

Aircel���s planned nation-wide capex is around $10 billion by 2011 with half of that already having gone into rollouts. Today, Aircel has just under 15 million subscribers across its 15 circles. The Mumbai launch will be followed by Maharashtra in May that will take its footprint to 17 out of 22 circles. ���By June 2010, we will complete our pan-India rollout,��� said Mr Singh.

Aircel was originally promoted by C Sivasankaran before Maxis acquired a 74% stake. The balance 26% is held by the Reddy family of the Chennai-based Apollo Hospitals. Referring to the fierce levels of competition in Mumbai, Maxis��� chief executive Sandip Das said the company will come up with a number of innovative schemes and value added services.
���Customers will experience a network devoid of congestion,��� he said. Meanwhile, Mr Singh ruled out the possibility of a tariff war, saying, ���We believe affordability is not the issue anymore. Pricing will be competitive and ours will be a total value offering.���

For its passive infrastructure, Aircel has opted for a mix of owning and renting towers in Mumbai. ���We will have over 1,000 towers on the launch day, of which 650 will be shared with other operators,��� he added.