Spectrum auction Day 6: Bids reach Rs 56,554 cr after 42 rounds

Written by PTI | New Delhi | Updated: Feb 9 2014, 03:35am hrs
LoopGovt is also auctioning radiowaves in 900 Mhz band which are held by Vodafone, Airtel and Loop Mobile.
Telecom firms offered bids totalling Rs 56,554.92 crore for 900 Mhz and 1800 Mhz bands after 42 rounds at the end of sixth day of spectrum auction today.

"A total of 42 rounds are over. Bids worth around Rs 33,082.58 crore are received for 1800 Mhz and Rs 23,472.34 crore for 900 Mhz. A total of Rs 56,554.92 crore. Auction will continue on Monday," Telecom Secretary MF Farooqui said.

He said there will a realisation of atleast Rs 16,750 crore in the current fiscal if the operators opt to pay in installments.

The bidders can pay the part of the money upfront and the remaining amount over a maximum of 10 yearly installments. The sixth day of auction today started off with the 36th round this morning. At the end of 35 rounds yesterday, bids worth around Rs 54,600 crore were received by the government. The price in Delhi for 900 Mhz has more than doubled to Rs 733.63 crore per MHz from the base price of Rs 360 crore.

Mumbai was up 71.67 per cent to Rs 563.09 crore per MHz from Rs 328 crore per MHz. In Kolkata, price was up 55.70 per cent to Rs 194.63 crore per MHz from a base price of Rs 125 crore.

As per the Department of Telecommunications (DoT), there was bidding for 11 blocks out of 16 put up for sale in Delhi, 5 out of 16 blocks in Mumbai and 12 out of 14 blocks in Kolkata for the premium 900 Mhz band at the end of sixth day.

For 1800 Mhz band, Assam witnessed over tripling of the the base price to Rs 22.1 crore per MHz from Rs 7 crore. Assam witnessed an excess demand of 5 blocks whereas Maharashtra saw an excess demand of 10 blocks for 1800 Mhz.

The budget for 2013-14 set a total target of Rs 40,874 crore from spectrum revenue in this fiscal. A bumper collection from airwaves auction would help the government keep rising fiscal deficit under control.

The country's fiscal deficit at Rs 5.16 lakh crore has already crossed 95 per cent of budget target in the first nine months of 2013-14.

The auction for the 900 Mhz and 1800 Mhz bands, which have been used for 2G services so far, have received a strong response. The government's two previous auctions flopped because the floor price discouraged bidders.

Out of five online spectrum auctions, the present auction is largest in terms of quantum of airwaves put for sale and third longest till date in terms of duration.

3G auction in 2010 lasted for 34 days, broadband wireless airwaves ended in 16 days while 2G auction in November ended in two days and CDMA auction in March concluded the same day. In November 2012, bids worth Rs 9,407 crore were received

for spectrum worth Rs 28,000 on offer. In March 2013, no GSM operator bid at the auction and only CDMA operator Sistema Shyam bought spectrum for about Rs 3,600 crore in eight of the 21 service areas.

There is no time limit for the sale of spectrum.The duration of the current auction will depend on the appetite of the eight companies in the fray -- Bharti Airtel, Vodafone, Idea Cellular, Reliance Jio Infocomm, Aircel, Tata Teleservices, Telewings (Uninor) and Reliance Communications. The government has put on the block about 385 megahertz of spectrum in the 1800 Mhz band. The auction started on February 3, following the cancellation of 122 licences by the Supreme Court in the 2G spectrum allocation case two years ago.

The government is also auctioning radiowaves in the 900 Mhz band in Delhi, Mumbai and Kolkata, which are held by Vodafone, Airtel and Loop Mobile, as their licences are expiring in November.