Prakash said the government garnered Rs 77,814 crore after a total of 6 rounds of bidding.
The Department of Telecommunications said that it will get upto Rs 20,000 crore upfront payment for auctioned spectrum in this financial year from all three telecom operators. The DoT secretary Anshu Prakash said that Spectrum Usage Charge levied on the spectrum sold will be 3%.
“We believe Jio may have largely closed its gap with Bharti and Vodafone Idea on total spectrum, but Bharti may likely have participated aggressively in sub-GHz spectrum bands maintaining its lead vs. Jio,” Goldman Sachs said in its report. “However, we note that data carried on Jio’s network is almost 2x that on Bharti’s network, and thus adjusted for that, Bharti’s spectrum holding remains materially higher versus that of Jio.”
“While quantum of spectrum bids at $10.5 billion looks high (comparable to past spectrum auctions), $5.3 billion of it could be renewal. While Jio had spectrum worth $3.2 billion expiring this year, the number stood at $2 billion for Airtel,” Credit Suisse said in a report.
It added that within the around US$5 billion additional bidding, a bulk of it – by value – is likely to have been driven by Jio in the 800MHz band which has received bids worth around 50% of the total US$10.5 billion bid.
“While Jio had around 99MHz spectrum due for renewal in 800MHz, the band has seen bidding for nearly 150MHz. Further as expected, Airtel seems to be acquiring additional spectrum in the 900MHz band as it looks to complete pan India footprint in sub-GHz band. This is evident from the 900MHz band seeing bids for 38MHz of spectrum even as Airtel had only 12.4MHz of spectrum up for renewal,” the brokerage said.
It also estimates Airtel and Jio to be strategically adding spectrum in the 1800MHz – in addition to Airtel’s expiring spectrum – and 2300MHz bands as they look to bolster capacity in view of growing data traffic.
Axis Capital added that the interest in 2,300 MHz spectrum can be attributed to increasing popularity of the band for 5G deployment due its better coverage. While used to increase 4G capacity, it can also play a role in 5G deployment.
ICICI Securities, though, estimates Airtel to possibly bought some airwaves in the 800 MHz band as well to complete 5MHz spectrum holding in circles where it has received airwaves from the Tata Tele merger, which will only strengthen its offering in key circles”, such as Delhi, Mumbai, Maharashtra, Andhra Pradesh and Haryana.
The brokerage also expects Airtel to have “bought 900 MHz spectrum in circles where such airwaves will be up for renewal in calendar year 2024”.
“Notably, all bidding has been at reserve price as a natural consequence of consolidation in the sector and is indicative of benign competitive environment (over longer term from perspective of spectrum auctions),” Credit Suisse said.
The 2300 MHz band saw the most interest on Day 1, with 89% of the bandwidth on offer being taken up, with interest likely from Jio and Airtel, while around 65% of the 800 MHz band on offer was sold. Jio needed to renew its permits in 18 circles in this band to be able continue to offer services without disruption, analysts said.
Communications minister Ravi Shankar Prasad had said on Monday that if 700 Mhz and 2500 Mhz bands are excluded, the Day 1 bidding represented 60% of the spectrum put to auction. Telecom secretary Anshu Prakash, in turn, had said the government would get an upfront payment of Rs12,000-13,000 crore in FY21 and a similar amount in FY22.