RBI allows FIIs to buy up to 49% stake in Idea Cellular

The FII limit in the company was 24 percent earlier.

Mumbai: Foreign institutional investors (FIIs) can now purchase up to 49 percent stake in telecom operator Idea Cellular Ltd.

The FII limit in the company was 24 percent earlier.

"... FIIs, through primary market and stock exchanges, can now purchase up to 49 percent of the paid up capital of Idea Cellular Limited under the Portfolio Investment Scheme (PIS)," the Reserve Bank of India (RBI) said in release on Friday.

The decision to increase the FII limit in the company has come after passage of resolution at the board of directors' level and a special resolution by the shareholders for enhancing the limit from 24 percent to 49 percent.

As per the data available on the BSE, FIIs held 19.51 percent share in the company as of quarter ended March 2014.

Having agreed to increase the FIIs shareholding limit to 49 percent, the downstream investment in the company would continue to remain on Idea Cellular, in compliance with FDI (foreign direct investment) policy and FEMA (Foreign Exchange Management Act) regulations.

FIIs, NRIs and PIOs (Persons of Indian Origins) can invest in primary and secondary capital markets in India through Portfolio Investment Scheme (PIS).

RBI monitors the ceilings on FII/NRI/PIO investments in Indian companies on a daily basis.

Shares of Idea slumped 4.32 percent to close at Rs 135.10 apiece on BSE.