Friday, 19 July 2013

Removal of FDI Limit Positive for Indian Telcos

The Indian government's decision to remove foreign direct investment limit in the telecom sector can encourage foreign investors who have been put off previously. It the medium term the measure would help reduce leverage and strengthen balance sheets, said Fitch Ratings. "(The move) will allow existing foreign investors to increase their stake in (their) subsidiaries to 100%. Taking complete ownership would remove the burden of dealing with a local partner," said Fitch. Vodafone, Telenor, Maxis and Sistema may be among the first to take advantage of the change as they are already at the current 74% holding limit. (Bernama)

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