Telecom clash: Ambani, Mittal plan Rs 365 billion war chest

Mittal-controlled Bharti Airtel Ltd, which sold its first-ever rupee bond of Rs 30 billion last month, has approval to raise Rs 165 billion, according to a March 12 filing. 

Reliance Jio Infocomm Ltd announced days later that it plans to sell as much as Rs 200 billion of notes, marking the disruptive upstart’s return to the onshore bond market after 20 months. 

The fundraising amount – about 78 percent of the total outstanding bonds of India’s top four telecom firms – signal that the largest carrier and its rival Jio are gearing to roll out next-generation services and manage about Rs 320 billion of debt due in the next five years. 

Jio stormed into the mobile-phone market in 2016 with free services that set off a tariff war and forced smaller players to merge or exit. “After four years of intense price pain, the India telecom battle could be in its last stretch,” said Raj Kothari, head of trading at Jay Capital Ltd in London. 

“It’s down to the big boys and they are piling up funds for that.” Emails to Bharti and Jio spokesmen seeking details on use of funds went unanswered. Bharti said in the filing that the money would be used for treasury activities, including refinancing, and for paying off spectrum dues. 

Jio hasn’t specified end use, though it has significant repayments due in the next few years, data compiled by Bloomberg show.