Spectrum Auction 2022 Day 1 Saw Jio pushing for 700 MHz spectrum
The second day of bidding for 5G spectrum in India should have already started by the time you read this. Let’s recap what happened on the first day. According to ICICI Securities, Jio lobbied for the 700 MHz spectrum. For those unaware, the 700 MHz spectrum can be very useful in providing better network coverage for consumers. Reliance Jio submitted the highest bid, worth 801 billion rupees, the analyst said. Jio probably opted for 10 MHz of spectrum in the 700 MHz band. So far, telecom operators have stayed away from the 700 MHz band spectrum because it was quite expensive.
Bharti Airtel may have opted for spectrum worth Rs 450 billion on the first day of the 5G spectrum auction, while Vodafone Idea is expected to spend Rs 184 billion on spectrum, ICICI Securities said. On day one, bids were received for spectrum in multiple bands, including the 700 MHz, 800 MHz, 900 MHz, 1800 MHz, 2100 MHz, 2500 MHz, 3300 MHz and 26 GHz bands. This will not only help telecom operators to launch 5G, but also allow them to fill the gaps of 4G.
The sale of 700 MHz spectrum is a surprise due to its high price
Adani Data Networks should have bid for 5G waves in mmWave length frequency on pan-India basis. What is interesting is the absorption of frequencies in the 700 MHz band. Many analysts predicted that it would not be sold. ICICI Securities said first-day spending by telecom operators is quite unexpected because the ROIC (return on invested capital) decreases if purchased spectrum is expensive. Operator spending is higher than analysts had expected.
Jio spent 2 times more than the base estimate of ICICI titles
In a note, ICICI Securities said Jio may have spent Rs 810 billion, which is 2 times his base estimate. The most expensive purchase for Jio would be the 700 MHz spectrum (10 MHz PAN-India) for Rs 393 billion. The analyst said that Jio also bought 2200 MHz in the 3300 MHz band (100 MHz per circle) for Rs 317 billion. The telco would also have purchased a volume of 17,600 MHz in the 26 GHz band (800 MHz per circle) for Rs 56 billion. In addition to this, Jio is also said to have purchased 20 MHz in the 800 MHz band (4 circles) for Rs 10.6 billion and 20 MHz in the 1800 MHz band (4 circles) for Rs 25 billion.
Bharti Airtel’s Estimated Spending on Day 1 of the 2022 5G Spectrum Auction
ICICI Securities said its analysis shows that Airtel bought 13 MHz of waves in the 900 MHz band in “C” circles for Rs 3.6 billion. Apart from this, the telco may have opted for an amount of 44 MHz in the 1800 MHz band in nine circles, worth Rs 47 billion. Then, Airtel would have chosen 30 MHz of spectrum in the 2100 MHz band in six circles for Rs 27 billion.
In the 3300 MHz band, Airtel reportedly bought 2200 MHz (100 MHz each circle) for Rs 317 billion and 17600 MHz in the 26 GHz band (800 MHz per circle) for Rs 56 billion. Airtel’s total expenditure was estimated at 380 billion rupees, 20% more than what Airtel was expected to spend.
Vodafone Idea should have spent 184 billion rupees
Cash-strapped Vodafone Idea (Vi) is estimated to have spent Rs 184 billion. The telco may have purchased 50 MHz of spectrum in the 3300 MHz band in 17 circles for Rs 152 billion. Additionally, Vi probably spent Rs 26 billion to get 400 MHz of spectrum in the 26 GHz band. The telco appears to have added 10 MHz of spectrum in the 2500 MHz band in Punjab and Andhra Pradesh for Rs 6.5 billion.
Adani spent an estimated 9 billion rupees
ICICI Securities said that Adani Data Networks probably spent Rs 9 billion to get 3350 MHz amount in 26 GHz spectrum band in 20 circles (except Delhi and Kolkata). But this is not the complete data for the purchase made by Adani Group, the analyst said.