CORRECTED-UPDATE 1-Piramal raises stake in Vodafone India unit

* To buy 5.5 pct stake from Essar for $616 million

* Piramal's stake in Vodafone rises to about 11 pct

* Transaction marks exit of Essar as Vodafone's JV partner

By Swati Pandey

Feb 4 (Reuters) - India's Piramal Healthcare Ltd said on Saturday it would buy a 5.5 percent stake in Vodafone's India unit from Essar for 30 billion rupees ($616.14 million), taking its total stake in the mobile company to about 11 percent.

The sale will mark the exit of Essar as Vodafone's joint venture partner in India after the London-listed company last year sealed a long awaited deal to buy out Essar in July.

Vodafone last year bought 22 percent of Essar and Piramal bought 5.5 percent.

The world's biggest cellular carrier by revenue, Vodafone is the largest overseas corporate investor in India.

Vodafone, which entered India in 2007 when it bought control of Hong Kong-based Hutchison Whampoa Ltd's India phone business, is the second-largest player by revenue market share behind Bharti Airtel.

The transaction contemplates various exit options for Piramal, including both participation in a potential IPO of the unit and a sale of its stake back to Vodafone, the Indian firm said in a statement.

Vodafone has said it plans to take its India unit public but has not set a timeframe.

The Vodafone stake purchase is the cash-flush drugmaker's second unrelated investment after it bought private equity firms IndiaReit Fund Advisors and IndiaReit Investment Managers.

The company, which last year bought about 5.5 percent in Vodafone from Essar, was sitting on a cash pile of 100 billion rupees, it said last August.

Piramal sold its Indian formulations business to U.S.-based Abbott Laboratories in 2010.

It has been looking for investments outside the pharmaceutical sector and had recently announced a foray into the financial services segment.