Bids for spectrum surpass Rs 60,000 crore; nil for 700 mhz

The spectrum auction has received bids of Rs 60,969 crore at the end of third day of bidding. Analysts are expecting it to end in 2-4 days due to slow demand from operators.

On Tuesday, six rounds of bidding were held. Since Saturday when auctions started, 17 rounds of auctions have been completed.

However, even after three days of auction, no bid was made for the most costlier spectrum band 700mhz.

The premium 700 MHz band is being auctioned at a reserve price of Rs 11,485 crore per Mhz. It seems that operators have decided to stay away from this band. If no bids came for the 700 Mhz band then government may fail to achieve the target to Rs 5.63 lakh crore from the current spectrum auction.

The 900 MHz spectrum also didn’t receive any bid till now.

“The spectrum auction is already tapering with additional bids worth Rs 31 billion received on day three. Bid worth Rs 600 billion have come in thus far and over thirds of the spectrum remaining unsold. This clearly underscores operators’ reluctance to trade on exorbitant reserve prices.

“Going by the numbers, the 2016 spectrum auction may last only a day or two,” said Prashant Singhal, global telecommunications leader, Ernst and Young (EY).

He said that traction continues in 1800 MHZ band only limited to 1/3 of total circles. “The premium over reserve price is largely in the range of 1-5 per cent, except for Mumbai, which indicates that operators are not intensely bidding and are looking to augment their holdings,” added Mr Singhal.

As much as 2,354.55 Mhz of frequencies are being put up for auction in seven bands - 700 MHz, 800 MHz, 900 MHz, 1800 MHz, 2100 MHz, 2300 MHz and 2500 MHz. The radiowaves can be used for 2G, 3G and high-speed 4G services.

Reliance Jio, Vodafone, Airtel, Idea Cellular, Tata Teleservices, RCom and Aircel are in the fray for the spectrum auction.