Affordable & Enough 2G /3G /4G Spectrum Auction in 2014 for Voice & Data

2G 3G 4G Spectrum Auction IndiaThe Department of Telecom (DoT) has released Notice Inviting Applications (NIA) for spectrum auctions in the 900MHz & 1800MHz bands to be conducted in January 2014. Analysis of the NIA reveals that the quantum of spectrum to be auctioned in the 1800MHz band is much higher than market expectations. Additionally, in most circles, large tracts of liberalized contiguous spectrum are available in the 1800MHz band, implying that operators will have greater choice for building their data arsenal in addition to 2G Voice Services.

1,800 MHz spectrum will be auctioned in all 22 circles. The quantum of spectrum varies from as low as 2.4 MHz (paired) in UP (West) to as high as 30.2 MHz in the Tamil Nadu (including Chennai) circle. 1,800 spectrum being put up for auction includes the current 1,800 spectrum holdings of (more…)

Lack of M&A Telecom Policy will hurt new entrants and benefit incumbents

Indian Telecom Policy Lacks Mergers AcquistionIn an attempt to capture the possible Revenue Market Share gains, we perform a circle-wise analysis to capture the possible gains for the company. We expect incumbents RMS to improve in established circles.

We highlight that we have relied on incremental market share as a key criteria to determine the steady revenue market share for all circles. Separately, we assume that new GSM entrants will continue to lose market share given their stretched balance sheets and inability to benefit from any meaningful Mergers & Acquisitions (we don’t expect any near-term clarity on M&A policy and this will prevent new entrants being disruptive/gaining scale).

In addition, we expect the (more…)