Spectrum auction gets tepid response on Day 2

The second day of spectrum auction continued to witness tepid response from telecom operators with a marginal rise of Rs 3,261 crore in bidding amount as 700 MHz and 900 MHz bands remained untouched by players.

At the end of 11 rounds on Monday, telecom operators have placed bids worth Rs 56,792 crore with a fight going on in a few circles in the 2,300 MHz and 1,800 MHz bands. Mumbai, Maharashtra and Gujarat remained active circles for the operators.

At the end of five rounds on Saturday, the worth of bids had stood at Rs 53,531 crore.

According to sources, Bharti Airtel and Idea were fighting it out for 1,800 MHz band for Mumbai and Maharashtra circle, whereas Airtel was in a battle with Reliance Jio in Gujarat for 2,300 MHz band. A couple of circles in 2,100 MHz and 2500 MHz also drew bids from telecom operators.

The activity level remained at 92 per cent. According to analysts, the incumbent operators are bidding rationally to complete their 3G and 4G footprints and build data capacity to effectively compete with Jio. “In this endeavour, Idea and Vodafone are also possibly adding 2,300/2,500 MHz to their spectrum portfolio to complete 4G footprint,” IDFC Securities said in a report.

According to IDFC, it is too early to conclude but given the lack of interest in the 700 MHz band, the government could miss the budgeted upfront receipts of Rs 64,000 crore in the current financial year. It also maintained its estimate of total commitment from operators at Rs 75,000-80,000 crore (upfront Rs 30,000-32,000 crore).

Bidders will have to pay 25 per cent of the amount upfront; for spectrum above the 1 GHz band, they will have to pay 50 per cent upfront.

The government has put up airwaves worth Rs 5.66 lakh crore for sale. Seven mobile operators including Reliance Jio, Bharti Airtel, Vodafone, Idea Cellular, R-Com, Aircel and Tata Teleservices are participating in the auction.
CLASH OF THE TITANS

• Telecom operators have placed bids worth Rs 56,792 crore with fight going on in a few circles in the 2,300 MHz and 1,800 MHz bands
   
• Bharti Airtel and Idea were fighting it out for 1,800 MHz band for Mumbai and Maharashtra circle
   
• Airtel was in battle with Reliance Jio in Gujarat for 2,300 MHz band
   
• The incumbent operators are bidding rationally to complete their 3G and 4G footprints and build data capacity to effectively compete with Jio