Led by Bharti Airtel, telecom stocks today gained as much as 8.15% as sector regulator TRAI recommended a sharp 60% cut in the floor price of mobile phone spectrum for an upcoming auction after two previous sales drew lukewarm response on high reserve price.
Shares of Bharti Airtel jumped 8.15% to Rs 339.10, while Idea Cellular jumped 5.56% to Rs 167 and Reliance Communications rose by 1.65% to Rs 141.80 on the BSE.
"There was a strong buying interest in telecom majors such as Bharti (up 8%) and Idea (up 6%) as TRAI recommended a cut of up to 60% in base prices for upcoming mobile phone spectrum auction," said Milan Bavishi, Head Research, Inventure Growth and Securities.
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It suggested a pan-India reserve price of Rs 1,496 crore per MHz in the 1800 band, down 37% from the base price set in the previous auction, TRAI Chairman Rahul Khullar had said.
The reduction in reserve prices follow the failed March auction, which drew just one bidder.