Last week Batelco agreed to buy a 49% stake in Indian new mobile entrant S Tel for $225 million. S Tel is licensed to operate a network in six Indian circles and is expected to launch operations by the end of 2009. We think India is a tough market for new entrants despite its massive growth potential, and Batelco is in for an enormous challenge to establish itself, and more importantly, make money.
At first sight, India is the most attractive telecoms market today. It is the second most populous country in the world with over 1 billion people, but its mobile penetration is low at around 30% (much lower than China\'s).
Furthermore, its economy seems resilient to the downturn, with the IMF predicting that its growth will slow to "