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Activity Level Raised As BWA Auction Loses Steam On Day 8; Price Increase Per Round Down To Rs. 66.11 Cr


The pan-India price for Broadband Wireless Access spectrum has gone beyond our guess of Rs. 8375.33 crore (around 379% higher than base price), to close at Rs. Rs. 8604.14 crore (391.67%) higher than the base auction price of Rs. 1750 crore, and the end of 62 clock rounds of bidding. But what is telling is that the rate of increase in price, even in absolute terms, is declining.

Now a day-to-day comparison for the BWA auction, though valid, isn’t an accurate enough indicator of how the auction has been proceeding, since some days have witnessed 5 rounds of bidding, and some 6, 8 or even 10 rounds. We looked at the average increase per round on a day to get a better sense of trends, and it is apparent that there was a significant decline in the increase in base price per round on Day 8 – the lowest yet. Therefore, the auctioneer has raised the minimum activity requirement to 90%, starting round 65. Expect price increase to recover.

Auction Trends

- 10 rounds of auction were completed on Day 8, bringing the total number of rounds to 62.
- Pan-India BWA Auction price is Rs. 8604.14 Crore, which is Rs. 6854.14 (391.67%) higher than base price, increasing at the rate of Rs. 110.55 cr per round of auction
- On Day 8, the auction price went up by Rs. 661.08 crore, up 8.32% for the day


- The pan-India auction price for BWA spectrum is, at the end of day 8 (62 rounds), where the pan-India 3G auction price was at the end of 15 days. The 3G auction continued for 34 days and 183 rounds.
- Total government revenue from the auction stands at Rs. 25812.42 crore, with Rs. 17208 crore from private telecom operators alone

- Price for 9 circles did not increase during the day: West Bengal, Himachal Pradesh. Bihar, Orissa, Assam, North East, Jammu & Kashmir, Karnataka, Kerala
- Price for Delhi & Mumbai (each) went up Rs. 131. 70 crore, up 11.23% for the day
- Delhi and Mumbai account for 30.33% of total BWA bid price
- Delhi, Mumbai, Karnataka and Tamil Nadu account for Rs. 4755.19 cr of the pan-India price, around 65.66%

- Delhi, Mumbai, Gujarat, Andhra Pradesh, Kolkata, Haryana, Uttar Pradesh (West), reported par demand for the day
- Only Tamil Nadu, Punjab and Rajasthan reported reported excess demand

- Price for Tamil Nadu went up 113.42 crore, up 10.46% for the day, for Gujarat was up Rs. 50.05 cr, 10.45%, and Andhra Pradesh: up Rs. 84.66 crore, 10.46%.
- Price for Rajashtan increased for the second time in the auction, up Rs. 5.69 crore, 9.3%, at Rs. 66.89 crore

Related:

- Download the BWA results for day 7 here
- An explanation on the auction process here
- View 3G Auction results here