Spectrum auction in the 900 MHz band intensified on the second day with the bid price rising 68 per cent of the reserve price in Mumbai and by 47 per cent in Delhi and Kolkata.

14 rounds At the end of 14 rounds of bidding Government stands to get at least ₹44,600 crore compared with ₹42,000 crore on day one.

This is 20 per cent higher than what the Government would have got if it sold all the spectrum put on the block at reserve price.

Bid for 900 MHz band in Mumbai has reached ₹552 crore for 1 MHz compared to the base price of ₹327.5 crore.

In Delhi, the bid amount is ₹530 crore.

Any operator would need at least 5 MHz of spectrum to offer any meaningful service for which it will have to cough up over ₹2,500 crore. In Kolkata, the price has gone up to ₹183 crore. While this is still lower than what operators paid for 3G spectrum in 2010, analysts said that the bids could hurt the players.

“Judging by the way the auction is progressing, we believe that the auction may turn out to be a 'winner’s curse' – i.e., the telco winning spectrum may not be able to have an adequate RoE on the acquired spectrum, given the higher pricing of the spectrum.

“The more time the auction takes to end, the more risks we see to overbidding by telcos to acquire spectrum, in our view,” said analysts at Goldman Sachs.

For the 1800 MHz band, the bidding has almost got over in 16 of the 22 circles. Bidding for Gujarat and Uttar Pradesh (west) continued.

Total bid amount for 1800 MHz across all 22 circles so far is at ₹24,741 crore which is just 1.4 per cent higher than what the Government would have got if the airwaves was sold at reserve price.

In contrast, the total bid amount for the 900 MHz band is at Rs 19,894 crore from three circles, which is 56 per cent higher than the reserve price.

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