(Im)Mobile Ipo
Opens on : November 7, 1996
Listing at : Ahmedabad and Mumbai
Lead manager : Aryaman Financial Services
It will be difficult for the company to survive in a market where multinational giants already have a presence.
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Mobile Telecommunications is setting up an assembling unit in collboration with Pantech, a Korean based company. The assembling unit will have a facility for assembling pagers, cellular phones and fax phone switches and the installed capacity of the unit will be 50,000 pagers and cellular phones per annum respectively.
Pantech will provide technical information for both making and assembling purposes.
The unit will be located in Silvassa, a backward area. Hence the company can avoid MAT -- it is exempt from income tax for five years as Silvassa is a notified tax holiday area. It is also entitled to 15 years exemption from sales tax.
The total cost of the project is Rs 13.65 crore. The promoter is contributing Rs 5.15 crore and Rs 6.75 crore is proposed to being raised from public. The remaining Rs 1.75 crore is coming in the form of term loan and dealer deposits. The project has not been appraised by any bank or any financial institution.
The promoters have no experience in the telecom sector. The group companies, Bharat Laboratories Suppliers and Unitrade Agencies have been shown profits consistently. Both the companies are not listed.
The pager market is dominated by multinational companies like Motrola..After the introduction of cellular phones in the metros, the number of pager users has steadily declined and both these segments are witnessing a cut-throat competition on the price front. With such a competition and the presence of international players, the going will be tough for Mobile Telecommunications.
Moreover there are few listed companies in this segment and they enjoy poor discounting. The issue should be avoided.