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2G Auctions Day 6: Delhi & Kolkata In 900MHz Cross 3G Spectrum Price


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Day 5 and day 6 of India’s 2014 2G auctions saw an excessive demand for spectrum in the Assam circle while the Delhi circle saw excessive demand in the 1800MHz band on day 5 and Maharashtra circle saw excessive demand in the 1800MHz band on day 6. However, note that these may not be indicative of future trends since there is typically a change in the bidding strategy in every round.

Here’s a quick on lowdown on the current status of the 2G auction after the completion of 42 rounds:

900 MHz (Block size is 1 MHz)

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- Price of spectrum in Delhi has increased by Rs 380.96 crore per block, 105.8% above its base price, to Rs 740.96 crore. The provisional winning price for the circle was however a bit lower at Rs 733.63 crore due to deficit demand in the last (42nd) round on Saturday. Note that the price of spectrum in Delhi is now more than double its base price.

Delhi recorded the highest increase during the day, of Rs 49.44 crore, up by 7.15% from the previous days close.

- Price of spectrum in Kolkata increased by Rs 71.57 crore per block to Rs 196.57 crore, which is 57.3% higher than the base price.

- Price of spectrum in Mumbai remained the same as the previous day: Rs 568.72 crore, which is 73.4% higher than the base price.

- All the three circles were in deficit demand by the end of round 42.

1800 MHz (Block size is 200 KHz)

- Price in Delhi increased the most in absolute terms: by Rs 7.02 crore per block to Rs 63.48 crore, 44.9% higher than its reserve price.

- Price in Assam increased the most in percentage terms: by 75.71% to Rs 4.22 crore, which is 201.4% higher than its reserve price.

- For round 43, price is being increased for two circles due to excess demand: Maharashtra by Rs 1.04 crore per block and Assam by 0.04 crore per block.

- Price in 11 Circles is now higher than the reserve price: Gujarat, Jammu & Kashmir, Madhya Pradesh, Bihar, UP (East), UP (West), West Bengal, Assam, Delhi, Maharashtra and Mumbai. Price in 11 circles remained at the reserve price.

- At the end of round 42, the circles with the lowest demand for spectrum was Tamil Nadu, followed by Orissa and Mumbai.

As per MediaNama’s calculations (provisional winning price/block x number of blocks available), the bids would amount to Rs 23,472.34 crore in the 900 MHz band, and Rs 39,326.40 crore in the 1800 MHz band, which makes it a total of Rs 62,798.74 crore bid at the end of round 42. PTI says the cumulative bids were Rs 56,554 crore.

2G Auction Day 6

- In a written reply to the Lok Sabha, Minister of State for Finance Namo Narain Meena has said successful bidders in the spectrum auction can raise foreign loans of up to $750 million (about Rs 4,671 crore) through the external commercial borrowings (ECB) route to pay the spectrum price.

- The Economic Times says the spectrum prices of Delhi and Kolkata in 900MHz has crossed the bid amount paid by telcos for 3G spectrum in 2010. It also says the government will make at least Rs 16,000 crore in FY14 from the spectrum auction, much higher than its target of Rs 11,300 crore.

- ET cites company executives, government officials and analysts to say telcos are adopting the strategy of switching from one band to another to avoid aggressive bidding. Read more.

Auction Daily

- Day 1: Mumbai 900MHz Price Up 44.28% From Reserve; Bids In 1800 MHz Low
- Day 2: 2G Auctions Day 2: More Activity In 1800 MHz; Mumbai In 900 MHz Up 68.3% Above Base
- Day 3: 2G Auctions Day 3: Bihar & Assam Cross 3G Spectrum Price
- Day 4: 2G Auction Day 4: Delhi Up 79.3% Above Base In 900 MHz

Our 2G Auctions 2014 coverage

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2014 2G Auctions: 8 Telcos Submit Bids; Videocon, Loop & SSTL Not Participating
DoT Modifies 2014 2G Auction Guidelines: Rollout Obligations, Performance Guarantees
India’s 2014 2G Auction Postponed: To Begin On 3rd February 2014
The Lowdown: DoT’s Guidelines For 2G Spectrum Auction In January 2014