Rcomm, Kribhco May Ink Jv For Telecom Retailing

[savramesh 37]

NDTV Profit

Wednesday, April 15, 2009

With saturated growth, there can only be one mantra for telecom companies, go rural. So, rather than reinventing the wheel in terms of distribution network, Anil Ambani-led Reliance Communications is all set to exploit fertilizer cooperative company Kribcho's huge distribution network.

While several telecom companies like Idea cellular, Tata Teleservices and Vodafone were also in talks with Kribcho, NDTV has learnt that the company has finally decided to go with Reliance communications.

Sources suggest that Krishak Bharati Cooperative Ltd (Kribhco), India’s second-largest urea maker, will hold a controlling stake of 60 per cent in the joint venture and the JV will start retail operation by offering RCom's telecom products like pre-paid cards, handsets and also DTH services.

Kribhco's marketing offices in 16 states is expected to come handy and later depending on the response the JV may also offer other non-telecom products.

Though Reliance Communication and Kribhco were not available for comments, analysts believe, that with just 13 per cent telecom penetration in rural India – a huge market is waiting to be explored through tie-ups with companies like Kribhco.

It is business of complementing each other leading to a win-win situation for both for Kribhco's diversification and retail venture.

It will get a readymade bouquet of telecom products from Rcom and for Reliance Comm it will be able to encash the huge opportunity in rural India through Kribhco's network.