The positive is that there is relatively more spectrum now (for key existing operators), which should allow telcos to plan their current and future requirements better (as was the case in Feb-14 auctions).
The issue, in our view, is that reserve prices are still high. So the cash outlays will still be significant and now (some) telcos are likely to spend more to buy more than what is coming up for their renewals. Again this could be limited to a handful of telcos (mainly incumbents) that have the cash capacity.
The other problem in the Indian telco spectrum/ licensing structure is that spectrum auctions will happen every few years (and total spectrum holding by Indian telcos is still relatively low vs global/ regional peers) and although there may be some concessions such as more supply or deferred payments etc, prices will still be high ? so cashflows will be lumpy. In the release the government refers to five objectives from these auctions, and one of them being ?maximise revenue proceeds from the auctions within the set parameters?.
The payment structure still allows for 25-30% upfront payment and the rest over 10-12 years (including interest).
