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Telenor exit may portend trend

Published

9 years ago

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Telenor exit may portend trend

[vc_row][vc_column][vc_column_text]No longer wise to wait for valuations to rise before selling out; market reset likely to yield three main players

By Sindhu Bhattacharya

The valuation at which Norwegian telecom operator Telenor agreed to sell off its Indian operations to Bharti Airtel last week reveals a lot more besides just the seller’s desperation to cut losses and run. It shows why all other small telecom operators still braving it out in the world’s second largest telecom market may need to also hasten their exits.

This is no longer a game for the weak hearted, and as the Telenor deal shows, it is also no longer wise to wait for valuations to rise before the small guys start thinking of selling out. Yes, the changed telecom market reality has partly been engineered by the arrival of Reliance Jio Infocomm last September in an already crowded market. Another reason could also be the abundant spectrum availability for major telcos after the last round of auctions which has cooled the appetite of big operators to pay any premium to acquire the smaller rivals. Telenor did well to absorb its losses and exit while there was still a taker. And Bharti has gained not just in money terms but also by stocking up on spectrum for future wars with RJio on the data front.

According to analysts, the Bharti-Telenor deal was concluded at just about Rs 2,000 crore when they were expecting the deal size to be up to four times more for Bharti to acquire Telenor’s spectrum, customers and employees. Telenor had said while announcing the deal that Bharti would only acquire outstanding spectrum payments and other operational contracts including tower lease, which led analysts to conclude that Bharti will invest just Rs 2,000 crore in the deal.

Analysts from brokerage Motilal Oswal said in a note to clients this morning that after the recently-concluded auction, there were limited takers for incremental spectrum in the market. This made it difficult for Telenor to get any premium whatsoever for its significant spectrum holding in some of India’s most populous telecom circles.  Given the impending merger of number two and three telecom operators, Vodafone and Idea Cellular; the already inked RJio-RCom spectrum sharing terms; and the fact that no sizeable operator was willing to take its spectrum, Telenor was anyway left with limited options. This may have led to the low valuation in its deal with Bharti. The bottomline is that the deal worked in Bharti’s favour because it came so cheap.

These analysts further said that at a potential investment of about Rs 2,000 crore for Bharti, generating operating cash flow of Rs 32,000 crore and net debt of Rs 102,000 crore, “the investment would add hardly 2% to net debt, which would be offset by the EBITDA contribution from the merger.”

Also read: Telenor’s painful exit and the writing on the wall

This piece points out that as consolidation has picked up pace in India’s telecom market, sellers are settling for lower and lower valuations. “Telenor even settled for nothing, despite having 44 million customers and nearly Rs 5,000 crore in annual revenues; leave alone the value of its spectrum.”

The Motilal analysts quoted earlier said the Bharti-Telenor deal bolsters Bharti’s defence against RJio. While the incremental spectrum Bharti gets as part of this deal may not be presently required, given the large-scale data traffic on RJio’s network, holding high quantum of spectrum would allow Bharti to compete with RJio in a fixed-cost-driven market. “We believe Bharti’s strategy to remain ahead of the curve in data-rich spectrum investments should hold it in good stead”.

Not just the Bharti-Telenor deal, smaller telcos need to also take a lesson from other M&As being lined up. Already, the number two and three telecom operators in India. Vodafone and Idea Cellular, are in merger talks. If this merger happens, then the merged entity and Bharti will together control over 70% of India’s telecom market share by revenue. This obviously spells doom for remaining small players. Industry estimates peg post-merger market share for Tata Teleservices at 6.5%, BSNL and MTNL combine at 5%, Aircel at 5.7% and Sistema at 4%. Reliance Communications (RComm) is estimated to be close to Sistema’s share at 4.2%.

Also read: Vodafone, Idea merger plans leave Tata Tele in a fix

The market has space for four or at best five strong operators to play. Any more and it will become a very uneven playing field. Already, RJio’s freebies have spurred others to enter a bruising price war. As RJio’s commercial launch nears its April one deadline, competitors like Bharti and Vodafone will start offering competing plans – RJIo has promised voice calls for free and no charges for national roaming and there are already indications that at least Bharti will match these offers.

Also read: Tata in early talks to join RCom-Aircel-MTS combine to take on Jio

This piece speaks of a possible merger of Tata Teleservices with the RComm, Aircel, MTS combine and goes on to say that such a move could create a strong number three telco behind the proposed Vodafone-Idea combine and Bharti Airtel.[/vc_column_text][/vc_column][/vc_row]

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Xbox announces 3,200 layoffs as Asha Sharma outlines major restructuring plan

Xbox has announced plans to lay off 3,200 employees over the next year while introducing a major restructuring programme that includes management changes, studio restructuring and cost-cutting measures.

Published

3 weeks ago

on

July 7, 2026

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XBOX layoff

Xbox has announced plans to reduce its workforce by 3,200 employees, representing around 20 per cent of its total staff, over the coming year as part of a broader restructuring programme linked to Microsoft’s increased investment in artificial intelligence.

According to an email shared with employees by Asha Sharma, the company will begin the process immediately, with 1,600 employees leaving on Monday, while the remaining job reductions will take place during FY27. The company also plans to divest four gaming studios and is preparing to separate from another.

Business reset planned amid financial challenges

In her message to employees, Sharma said the company’s current financial position required significant changes, stating that Xbox’s business was operating at substantially lower margins than comparable platform and publishing companies.

She said the layoffs were not a reflection of employees’ commitment or abilities but were part of a wider effort to strengthen the company’s long-term business.

The workforce reduction comes as Microsoft continues implementing AI-focused cost-cutting measures across its operations. Overall, the technology company is reportedly cutting 4,800 jobs, with Xbox accounting for the largest share.

Sharma also described the gaming sector as experiencing one of its most challenging hardware periods and said the company needed to “reset Xbox” to improve its future performance.

Company to streamline operations and reduce management layers

As part of the restructuring strategy, Xbox plans to simplify its organisational structure, revise its content portfolio and improve platform operations.

According to Sharma, the company currently loses 64 cents for every dollar invested annually, making operational efficiency a key priority.

She said Xbox would increasingly support independent game creators by offering open development tools and broader audience access.

The restructuring will also see Mojang and King report directly to Sharma. She said both studios have evolved into major gaming platforms with large monthly active player bases and will play a central role in Xbox’s future strategy.

To improve decision-making, the company plans to significantly reduce its management hierarchy. Sharma said some departments currently have as many as 14 management layers, which slow down operations. Xbox aims to reduce this to no more than five layers, and in some cases, only three.

The company will also reduce vendor spending by 50 per cent as part of its cost-saving measures.

Helen Chiang promoted to Chief Operating Officer

Alongside the restructuring announcement, Sharma confirmed the promotion of Helen Chiang to the newly created position of Chief Operating Officer.

Chiang will oversee profit and loss responsibilities across Xbox’s content, hardware, platform and services divisions while reporting directly to Sharma.

According to Sharma, the new operating structure is intended to improve investment decisions, strengthen accountability and better integrate the company’s various business units.

Despite the ongoing restructuring and job cuts, Sharma said Xbox remains committed to long-term growth and plans to continue investing heavily in the business, while placing greater emphasis on disciplined spending and strategic priorities.

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India News

Bank holiday today: Are banks open or closed on June 29? Here’s what RBI calendar says

Banks in Himachal Pradesh and Mizoram will remain closed on June 29, 2026, due to regional holidays, while banking operations will continue normally in most other states.

Published

4 weeks ago

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June 29, 2026

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Bank Holidays

As June comes to an end, many customers are wondering whether banks across the country are open on June 29, 2026. According to the Reserve Bank of India’s (RBI) holiday calendar, bank operations will not be affected nationwide, but branches in some states will remain closed due to local holidays.

Banks closed in these states on June 29

Banks will remain shut in Himachal Pradesh on Monday, June 29, on account of Sant Guru Kabir Jayanti. In addition, bank branches in Mizoram will remain closed to observe Remna Ni, a regional public holiday.

However, bank branches in most other states and Union Territories are expected to function normally as June 29 is not a nationwide banking holiday.

Will online banking services remain available?

Even when physical branches remain closed, customers can continue using digital banking facilities. Services such as internet banking, mobile banking, UPI transactions, ATM withdrawals and cash deposits at ATMs will remain operational.

Customers planning to visit a bank branch are advised to check with their local branch beforehand, as holiday schedules may vary depending on the state and local observances.

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India News

Union Budget 2026 highlights: Nirmala Sitharaman Raises Capex to Rs 12.2 Lakh Cr, West Bengal Gets Major Allocation

Finance Minister Nirmala Sitharaman is presenting the Union Budget 2026 in Parliament today. Follow this space for live updates, key announcements, and policy insights.

Published

6 months ago

on

February 1, 2026

By

Finance Minister Nirmala Sitharaman arrives to present Union Budget 2026

Finance Minister Nirmala Sitharaman will shortly present the Union Budget 2026 in the Lok Sabha, marking her ninth consecutive Budget. The annual financial statement is expected to outline the government’s policy priorities, reform agenda and spending plans for the coming year. Stay tuned for live updates, key announcements and immediate reactions as the Budget speech unfolds.

Finance Minister Nirmala Sitharaman tabled her ninth Union Budget today, beginning her speech at 11 am.

Nirmala Sitharaman is set to present her ninth Union Budget today, with the finance minister scheduled to begin her speech at 11 am.

Budget 2026 live updates: Presenting the Union Budget for 2026–27, Finance Minister Nirmala Sitharaman said the occasion coincided with Magh Purnima and the birth anniversary of Guru Ravidas. She noted that over the past 12 years, India’s economic journey has been defined by stability, fiscal discipline, sustained growth and moderate inflation.

The budgeted fiscal deficit for fiscal 2026 is estimated at 4.4 per cent of gross domestic product (GDP)

Planned capital expenditure this fiscal year Rs 11.2 lakh crore

Rare earth corrdiors in Odisha and Kerala

Hi-tech tool rooms to be set up by PSUs

Construction equipment scheme to be launched

Container manufacturing scheme for Rs 10,000 crore over 5 years

Rs 10,000 crore SME Growth Fund

Semi-conductor mission to get Rs 40,000 crore

Rs 12.2 lakh crores for infrastructure development

Dedicated RITES to repurpose land of Central PSUs

20 new waterways over next 5 years to be connected

7 high-speed corridors on rail

High-level committee on banking for next phase of Viksit Bharat

Capital expenditure hike of to ₹12.2 lakh crore in Budget 2026, with West Bengal receiving a significant share of allocations.

Mahatma Gandhi Gram Swaraj Initiative aimed at boosting the khadi, handloom, and handicrafts sectors.

High-speed rail corridors: Mumbai-Pune, Pune-Bengaluru, Hyderabad-Bengaluru, Chennai-Bengaluru, Delhi-Varanasi, Varanasi-Siliguri, Pune-Hyderabad

Five university campuses to be established near industrial corridors

Lakpati Didi program expanded in Budget 2026 to reach more beneficiaries across India.

Fiscal deficit for FY26 revised to 4.4%; Budget Estimate for FY27 set at 4.3%.

TCS on overseas tour packages cut to 2% to ease travel costs

Tax holiday to foreign companies that provide cloud services by setting up data centres in India till 2047

17 cancer drugs exempted from import duties

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