Telecom spectrum auctions to start today

Its higher eligibility point allows Jio to bid for a greater chunk of the spectrum in a circle in the initial bidding

Auctions will start for seven bands on Monday but the government has kept 5G spectrum out of the sale.: Shutterstock

R. Suryamurthy   |   TT    |   New Delhi   |    01.03.21  :  Reliance Jio has obtained the most eligibility point among the bidders of telecom spectrum auction that is scheduled from Monday by paying the highest amount of earnest money deposit.

Jio has put earnest money deposit of Rs 10,000 crore earning 73,007 eligibility points. Bharti Airtel has deposited Rs 3,000 crore and it has earned 24,924 eligibility points, while Vodafone has 6,153 eligibility points on deposits of Rs 475 crore.

Its higher eligibility point allows Jio to bid for a greater chunk of the spectrum in a circle in the initial bidding.

Auctions will start for seven bands on Monday but the government has kept 5G spectrum out of the sale.

However, brokerages have forecast that over 80 per cent of the spectrum would remain unsold and the operators would preserve cash for the 5G auction likely in the latter half of the year.

The auction of 2,251.25 megahertz of spectrum will be in 7 frequency bands between 700 megahertz and 2,500 megahertz. The government can earn Rs 3.92 lakh crore at the floor price.

“This auction is critical for RJio, with renewal of 800MHz that is expiring in July-21. Bharti Airtel renewals are mainly in 1,800MHz and in 8 of 22 circles,” brokerage CLSA said. 

“With significant spectrum unsold, there would be a follow-on crash in reserve prices and this will be a big positive for 5G auctions, as there will be good supply with 275MHz available in 3.3-3.6GHz,” CLSA said in its  research report.