Telecom operators, Reliance Jio, Bharti Airtel, and Vodafone Idea, on Tuesday placed bids worth Rs 11,164 crore, which was the first day of spectrum auctions, against airwaves worth Rs 96,000 crore which are up for sale. This means out of a total spectrum of 10,523 MHz on sale, only 131 MHz 1.2% — got sold on the first day, which saw five rounds of bidding.
However, with demand seen in the 1800 MHz band in West Bengal, Bihar, MP, and UP (East) circles; 900 MHz in Punjab, Rajasthan, UP (E) and West Bengal; and in 2100 MHz in Assam, J&K, and north-east, the auction is expected to continue for a few more days.
While the proceeds on the first day is higher than government’s internal estimate of around Rs 10,000 crore, it’s nearer the lower band estimate of around Rs 14,000 crore by analysts.
The maximum bidding took place in the 900 MHz band with total bids worth Rs 7,004 crore followed by Rs 3,614 crore in1800 MHz band, and Rs 546 crore in the 2100 MHz band. In the 900 MHz band, a total of 60.4 MHz spectrum was sold. In the 1800 MHz band, 50.6 MHz spectrum was sold, whereas 20 MHz was sold in 2100 MHz.
All the spectrum was sold at reserve price except for circles Bihar, West Bengal, Madhya Pradesh, and Uttar Pradesh East — in the 1800 MHz band. In the 900 MHz band, Punjab, Rajasthan, Uttar Pradesh East, and West Bengal saw spectrum prices exceeding reserve prices. In the 2100 MHz band, Assam, Jammu and Kashmir, and North East saw bidding above the reserve price.
Uttar Pradesh East saw the highest demand in the 900 MHz followed by Bihar in the same band. In the 1800 MHz band, the bidding intensity was also higher in Bihar followed by West Bengal and Kolkata circles. In the 2100 MHz band, telcos bid for spectrum largely in the UP West circle.
Bharti Airtel had 42 MHz of spectrum in the 1800 MHz and 900 MHz bands up for renewal in six circles – Uttar Pradesh (East), Uttar Pradesh (West), West Bengal, Assam, Bihar, Jammu and Kashmir, and Odisha. At reserve prices, this would result in a spending of Rs 3,800 crore.
Vodafone Idea, which had renewal for 12 MHz of spectrum in the 1800 MHz and 900 MHz bands in two circles, has renewed its spectrum only in the 900 MHz band, industry sources said.
In March, the company had surrendered 5 MHz spectrum in 1800 MHz band in two circles West Bengal and Uttar Pradesh West.
“Auctions will catalyse the rapid rollout of 5G services across the country, leading to enhanced coverage and vastly improved connectivity,” SP Kochhar, director general of Cellular Operators Association of India (COAI), said.
Going by the earnest money deposit by telecom operators, Reliance Jio’s deposit was the highest at Rs 3,000 crore. It was three times that of Bharti Airtel’s Rs 1,050 crore and 10 times higher than Vodafone Idea’s Rs 300 crore, taking the total to Rs 4,350 crore.
EMD indicates the bidding intensity of the operators concerned and the amount of spectrum they intend to acquire. Going by it, Jio has the option to spend up to Rs 36,000 crore or 37.4% of the total value of spectrum on sale. Airtel can spend up to Rs 12,500 crore or 13% of the total value of spectrum, whereas Vodafone Idea can spend up to Rs 3,600 crore.
In the last spectrum auction held in July-August, 2022, Reliance Jio spent Rs 88,078 crore, followed by Bharti Airtel at Rs 43,084 crore, and Vodafone Idea at Rs 18,799 crore.