Competition is always welcome, but it was becoming excessive: Analjit Singh

Interview with Chairman, Vodafone India

Vodafone Plc's trusted ally, Analjit Singh of Max India, has been appointed non-executive chairman of its India operations. He talks to Business Standard in the backdrop of the two recent Supreme Court verdicts. Edited excerpts:

Do you feel Vodafone has reached an inflection point in India?
There are various elements to this. The company was up against a lot of pressure. There was the tax case hanging for far too long, and that always forced Vodafone to manage its investments in India. So, now there is a lot of relief, also from the shareholding and governance point of view. Post the Supreme Court order, there is also clarity on the operating platform and a lean environment. So, all that’s good. But more clarity is required from the regulatory side. That picture is not clear and will be keenly watched.

Are you pre-supposing exits and consolidation after the recent SC verdict on the cancellation of licences?
I am not saying that. But there will be discipline and only serious investors will stay on.

Will Vodafone participate if there’s a rebid? There is still confusion over refund of the licence fee.
Exactly. It’s really too early to comment. We don’t know yet how the dynamics will pan out. I read that the prime minister has sought the Attorney General’s views. So, it’s still a fluid situation.

Many are hinting that the earlier licences will now come under scrutiny.
We are all still studying the verdict. I don’t want to comment much on that.

But do you fear such an eventuality? Already, there are whispers of the 2001 licences coming under a scanner, too. That could mean more legal battles. And, incumbents like Bharti or Vodafone may also get dragged in.
I will not comment on that. But no fear; we will deal with it if the situation so arises. The country is strong, telecom is a serious business and Vodafone is a serious player.

How do you see pricing and competition then, post the SC verdict?
Competition is always welcome. But it was becoming excessive. In a hyper-competitive environment, you tend to do crazy things.

Coming back to the operations of Vodafone India. Will the next big step be the IPO?
That’s the thinking. It’s still a work in progress. Things should crystallise a lot more towards the end of the year.

Is it the time to actually tap the markets with a big public issue? The global uncertainty is still making the markets choppy.
Let’s see. As I said, it’s still a work in progress.

Will you, like Mr Piramal, look at raising your stake before the IPO?
My shareholding is currently a little over five per cent. There is no headroom for raising that. You must understand Mr Piramal’s investment. He is buying out part of the Essar shareholding from the earlier joint venture. But Vodafone has headroom to hike its stake and we have already approached the Foreign Investment Promotion Board. So, Vodafone should hike their stake.

Where will the next growth come for Vodafone? Data, mobile banking, other value added services?
That’s a strategy decision and the company has already made its intentions clear on these. Data and mobile banking is big for Vodafone globally. But I am not in a position to articulate the India plans. Maybe in a few months.