New Delhi, Jan 8 (): Telecom shares shot up on news of reduced base prices for March spectrum auction. Many telecom companies which were on the verge of quitting the sector are now hopeful of a good market in the existing base prices. The previous auction base prices were unrealistic, feels the telecom sector.
The Empowered Government Ministry, headed by finance minister P Chidambaram, decided that auction for the 800 MHz spectrum which was not sold in November will be auctioned at 50% of the base price.
The Finance Minister has decided to auction the CDMA spectrum in March for all telecom zones, said telecommunication minister Kapil Sibal. The EGoM has also decided to conduct auctions for 1800 MHz band and 900 MHz band simultaneously.
Department of Telecommunication (DoT) would ensure that telecom companies which were to shut down due to Supreme Court order on January 18 will continue operations till the auction.
1800 Mhz airwaves will be auctioned at 30% less than previous rates for Delhi, Mumbai, Karnataka and Rajasthan. 900 MHz band price will be more than 1800 MHz base price for Delhi, Mumbai and Kolkata.
800 MHz spectrum band which had no takers will be at 1.3 times higher than the reserve price of the November auction. 5 MHz of spectrum in 1800 MHz band on a pan-India base price would be Rs 14,000 crore.
Tata Teleservices will discontinue CDMA operations in J&K, North East and Assam. Uninor will continue operations in Mumbai telecom zone. Sistema intends to continue operations in India.
900-MHz band high-speed data services will auction 34 blocks of 1.25 MHz each in Delhi, Mumbai and Kolkata circles. A new entrant bidding would get 5 MHz, or four blocks of 1.25 MHz each.
Rs 693.06 crore is the reserve price of 10 MHz of the radio waves and Rs 678.45 crores in the 1800 MHz band were offered, respectively in November but it has been reduced and 15 Mhz spectrum prices is of Rs 485.15 and 10 Mhz dipped to Rs 474.92 crore for auction in Delhi and Mumbai. 10 MHz each would be auctioned in Karnataka and Rajasthan.