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On day 9 of India’s 2014 2G auctions, bidders seems to have shifted their focus to the 1800MHz band with Delhi circle witnessing excess demand in the 1800MHz band while Assam is continuing to witness excess demand in the same band during the day.
In contrast, the demand and the spectrum prices remained unchanged in all the three circles in 900MHz band. This however isn’t indicative of any future trends since the bidders usually change their strategy in every round. Here’s a lowdown from Day 9:
900 MHz (Block size is 1 MHz)
– All the three circles continued to be in deficit demand by the end of round 56.
-The price of spectrum in Delhi remained unchanged at Rs 748.36 crore, which is 107.9% higher than its base price. The provisional winning price for the circle also remained the same at Rs 740.96 crore due to deficit demand in the last (49th) round yesterday.
– Price of spectrum in Kolkata remained unchanged at Rs 196.57 crore, 57.3% higher than the base price while the price of spectrum in Mumbai also remained the same at Rs 568.72 crore, 73.4% higher than the base price. Its worth noting that Kolkata’s spectrum price has remained unchanged for the second consecutive day while Mumbai’s spectrum price has remained the same for the fifth consecutive day.
1800 MHz (Block size is 200 KHz)
– Interestingly, the price in Mumbai increased the most in absolute terms on a day-to-day basis: by Rs 5.56 crore per block to Rs 50.33 crore, 21.6% higher than its reserve price and 12.6% higher from previous days close.
– Price in Assam increased the most in percentage terms on a day-to-day basis: by 13.91% to Rs 6.14 crore, which is 338.6% higher than its reserve price.
– For round 57, price is being increased for three circles due to excess demand: Delhi by Rs 1.45 crore per block, Maharashtra by Rs 0.57 crore per block and Assam by Rs 0.12 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 56, the circles with the lowest demand for spectrum remained the same: Tamil Nadu, followed by Orissa and Haryana.
As per MediaNama’s calculations (provisional winning price/block x number of blocks available), the bids would amount to Rs 23,589.62 crore in the 900 MHz band, and Rs 42,473.19 crore in the 1800 MHz band, which makes it a total of Rs 66,062.81 crore bid at the end of round 56.
Telecom secretary MF Farooqui said they have received total bids worth Rs 58,980.29 crore, which is 23% more than the total value of spectrum put up for auction at the reserve price. They received bids worth Rs 35,390.67 crore in the 1800MHz band, which is 0.6% higher than the total value of the spectrum put up for auction at base price while the total bid amount in 900MHz band remained unchanged at Rs 23,589.62 crore, 85% higher than the total value of spectrum put up for auction at the reserve price.
What They’re Saying
– Telecom Regulatory Authority of India (TRAI) chairman Rahul Khullar has told PTI that the 3G spectrum in 2100MHz band should be made available by June this year and it should be auctioned immediately after the new central government takes charge. He also added that the ongoing spectrum auction is witnessing aggressive bidding may be because companies are not sure when they will be able to next secure available spectrum for commercial use.
– The Free Press Journal quotes an industry official involved in conducting the auction who says no further bidding will happen in 900 MHz band as bidders might have exhausted their eligibility points, unless a bidder decides to shift from 1800MHz to 900 MHz in a significant manner in the Delhi circle.
– The Economic Times says investors sold telecom stocks on Monday, due to heightened fears of a further increase in the sector’s debt burden. It also quotes a brokerage firm which says at the current bid prices, Airtel would have to pay Rs 25,600 crore and Idea would have to pay Rs 21,200 crore to retain its spectrum in 900MHz and 1800MHz band.
– 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
– Day 6: 2G Auctions Day 6: Delhi & Kolkata In 900MHz Cross 3G Spectrum Price
– Day 7: 2G Auction Day 7: 5 Circles In 1800MHz Cross 3G Spectrum Price
Our 2G Auctions 2014 coverage
– SC Reject Telcos Plea To Stay 2G Auctions; DoT Reduces Available 1800MHz Spectrum
– Vodafone Seeks 1% Uniform Spectrum Usage Charges For 3G & BWA Spectrum
– 5% Spectrum Usage Fee For New Spectrum in 2014 2G Auctions Pre-Qualified Bidders
– 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