Telecom stocks decline after aggressive bidding for telecom spectrum

Three telecom stocks fell by 1.48% to 1.83% at 11:15 IST on BSE after aggressive bidding was witnessed on day four for auction of 2G and 3G telecom spectrum Saturday, 7 March 2015.

Meanwhile, the S&P BSE Sensex was down 387.47 points or 1.32% at 29,061.48

Among telecom stocks, Bharti Airtel (down 1.48%), Idea Cellular (down 1.83%), and Reliance Communications (down 1.8%) declined.

The auction of spectrum in 2100 MHz, 1800 MHz, 900 MHz and 800 MHz bands continued and 24 rounds of bidding completed at the end of day four on Saturday, 7 March 2015. The bidding has taken place in all bands. At present, a value of approximately Rs 86000 crore has been committed by bidders in respect of provisionally won spectrum. There is still spectrum, which is yet to be sold. Bidding recommenced today, 9 March 2015. Aggressive bidding for telecom spectrum auction could adversely affect the operating profits of telecom companies.

The government plans to sell 380.75 megahertz (MHz) of spectrum in three bands the premium 900 MHz band, 1800 MHz and 800 MHz, besides 5 Mhz in the 2100 Mhz band across 17 out of 22 telecom areas in the country. Validity of spectrum in this auction shall be 20 years.

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