Continuing to fall for the second straight session on Tuesday, Idea Cellular stock ended nearly 5 per cent lower after it agreed to merge with Vodafone India to create the country's largest mobile phone operator worth more than USD 23 billion.
The stock slipped 4.76 per cent to settle at Rs 92.95 on BSE. During the day, it tumbled 7.63 per cent to Rs 90.15. On NSE, shares of the company went down by 4.86 per cent to close at Rs 92.95.
In terms of volume, 178.77 lakh shares of the company were traded on BSE and over 8 crore shares changed hands on NSE during the day. In two days, the company's market valuation plummeted by Rs 5,367.49 crore to Rs 33,494.51 crore.
In the previous session also, the stock had lost nearly 10 per cent. The British firm will own 45.1 per cent of the merged entity while the Aditya Birla group, Idea's parent company, will own 26 per cent after paying Rs 3,874 crore cash for a 4.9 per cent stake, the two firms announced at a press conference on Monday.
The remaining 28.9 per cent will be held by other shareholders. The Idea-Vodafone merger will create a strong player, but multiple challenges from the deal, including breach of spectrum holding and revenue marketshare cap, will have to be resolved in a fixed timeframe, ICRA said yesterday. Analysts are of the view that the competition in the industry is unlikely to subside in the medium term despite the mega merger.