Mumbai, May 29, 2020.
Shares of Vodafone Idea jumped 35 per cent in Friday’s trade after a Financial Times report on Thursday said Alphabet Inc’s Google is exploring an investment in Vodafone Group Plc’s struggling India business.
Vodafone Idea shares surged 34.87 per cent to hit intraday high of Rs 7.85 on the BSE. The stock has risen nearly 80 per cent in last one month, while Sensex dropped 2 per cent in the same period.
Google is considering buying a stake of about 5 per cent in Vodafone Idea, the FT reported, people familiar with the matter.
For a 5 per cent stake, Google will have to shell out $110 million. Its Nasdaq-listed parent Alphabet has a market cap of $968.05 billion.
“Amidst reports of Google picking up 5% stake in Vodafone Idea, it appears that the Indian telecom and online space is set to witness a spur of activity, which is always welcome. It would offer consumers a better deal and competition in this space is definitely required as the digital space has gained massive importance post COVID-19 and is set to witness multifold growth in coming years,” said Aamar Deo Singh, Head Advisory, Angel Broking.
The FT report said Google’s parent Alphabet was in talks to buy a stake in Reliance Industries Ltd’s Jio Platforms but lost out to Facebook in closing the deal. “Pursuing Vodafone Idea instead would potentially pit Google against Facebook and an increasingly dominant Jio but the company could also make multiple investments in India,” the report said.