Telecom companies are likely to commit USD 13 billion or over Rs 80,000 crore in the ongoing spectrum auction with Idea Cellular being the “most exposed” in the race as a bulk of its licences are getting expired soon, global ratings agency Fitch has said. Also Read - Best Vodafone-idea (Vi) prepaid plans under Rs 100: List of plans, unlimited data, voice calls, more
The much awaited spectrum auction, wherein eight companies are bidding to acquire radiowaves in four bands, started today. Also Read - Vi prepaid recharge plans July 2021: List of all Vi recharge plans under Rs 500 with benefits, validity
Fitch said: “The auction is likely to see intense bidding by telcos to retain their existing spectrum and to acquire new spectrum as supply is limited. Telcos are likely to commit at least USD 13 billion in the auctions.” Also Read - Airtel vs Jio vs Vi: Best prepaid plan offering 2GB of daily data and other benefits
The government has set a base price of Rs 82,395 crore for the 2G and 3G spectrum across various frequencies.
Sources in the government have said that it expects bids to top Rs 1 lakh crore.
The bids are expected to ease pressure on the rising fiscal deficit, which has already overshot the budget estimate and was at 107 per cent as of January.
Over three fourths of the bids will come from the top four operators including Bharti Airtel, Vodafone and Idea Cellular, while Reliance Jio – slated to make pan-India entry this year – will also be bidding, the agency said.
Among the lot, the Aditya Birla Group-promoted Idea may have to bid most aggressively as over 70 per cent of its annual revenue is at stake, it said.
“Idea is most exposed in the auctions as it needs to retain its expiring spectrum in circles which contribute around 70 per cent of its annual revenue,” it said, adding that it is the same for Vodafone and Airtel at 45 per cent and 35 per cent, respectively.
Each of the three said companies’ total bids will be between USD 2.5 to 4.5 billion, including acquiring spectrum getting expired as well as new spectrum for serving the growing data usage. .