SSTL to bid at 800 Mhz spectrum auction: CEO Dmitry Shukov

Written by Rhik Kundu | Updated: Mar 28 2014, 23:40pm hrs
SSTLSSTL is a serious telecom operator with close to 10 million customers in 9 circles.
Telecom operator Sistema Shyam Teleservices (SSTL), which operates under MTS brand name, lost all its 21 licenses in 2012 after a Supreme Court order but later won back permits in eight of these circles for Rs 3,639 crore. It's Chief Executive Officer, Dmitry Shukov, tells FE that the company plans to consolidate its position in the country byacquiring more spectrum in the 800 Mhz band. An excerpt from the interview:

1. The Capex figure for MTS India stood at about $ 35 million during 2013. What can be expected in 2014

The Capex investments of about $35 million in 2013 included those made to launch our 3G Plus network across 9 circles (where we have presence). Given that bulk of those investments, we expect relatively lower CAPEX investments in 2014. Having said this, due to strategic reasons, it would not be possible for SSTL to give an absolute number for the current calendar year.

2. Will you be participating in the 800 MHz airwaves auction

SSTL is a serious telecom operator with close to 10 million customers in 9 circles. We are also amongst the leading data players in the country and have already have invested over $3.5 billion in India. Given this background, we would naturally like to further consolidate our position by acquiring more spectrum in the 800 Mhz band. To do the same, we are hopeful that reserve price of spectrum would be such that it would make a good business sense to participate in the auctions.

3. What is the realistic reserve price for 800 Mhz for you Are you happy with the reserve prices for 800 Mhz spectrum which have been proposed at Rs 2,685 crore per unit, over 50 % higher than price set for the 1800 MHz band

We do not want to comment on this as SSTL is part of a working group to engage with the relevant government authorities on the spectrum pricing issue.

4. Do you have any plans to expand to pan-India level, from the existing 9 circles, if you bid successfully at the 800 MHz spectrum auction

SSTL has always maintained that the key to successful auctions is always a realistic reserve price which is in sync with market realities. We are hopeful that like in the case of 900 Mhz and 1800 Mhz auctions, when it comes to auction of 800 Mhz, the adopted pricing formula should encourage serious telecom operators to not only bid and acquire spectrum within their current circle footprint but also get them to acquire more number of circles.

5. What are the options you would resort to, if the 800 Hz auction doesn't work in your favor

If spectrum pricing is right then bidding in the 800 Mhz auctions is clearly the first priority. We continue to be optimistic that SSTL would be able take this route to enhance its current spectrum holdings.

6. What are the various opportunities you are exploring to increase your spectrum basket

In-addition to participation in auctions, acquiring spectrum through trading is also an additional option for us.