Shares of telecom companies such as Idea Cellular, Bharti Airtel, Reliance Communication and Tata Communication are trading higher by up to 5% in early morning deals on the bourses.
Idea Cellular is the largest gainer up 5% at Rs 138 on the Bombay Stock Exchange. Bharti Airtel and Reliance Communications are up nearly 3% each at Rs 311 and Rs 122 respectively, while Tata Communications up 1.5% at Rs 295 at 0930 hours.
After 10 days of intense bidding, eight telecom companies, including Bharti Airtel, Vodafone India and Idea Cellular, on Thursday, bought spectrum worth a total of Rs 61,162 crore against the government’s estimate of Rs 47,933 crore.
The companies are required to pay 33% of 1800MHz spectrum and 25% of 900MHz spectrum price upfront and rest can be paid in ten installments along with an interest component after two years moratorium period.
Bharti Airtel and Idea Cellular are required to shell out Rs 5,425 crore and Rs 3,240 crore respectively in FY2014 for which they will have to raise funds.
Majority of spectrum won by incumbent players in recent auctions is to protect their current revenues as against grabbing new revenues. We believe increased financial pressure on these companies would lead to increase in vice base rates for telecom industry, says analyst at Angel Broking in a client note.
Idea Cellular is the largest gainer up 5% at Rs 138 on the Bombay Stock Exchange. Bharti Airtel and Reliance Communications are up nearly 3% each at Rs 311 and Rs 122 respectively, while Tata Communications up 1.5% at Rs 295 at 0930 hours.
After 10 days of intense bidding, eight telecom companies, including Bharti Airtel, Vodafone India and Idea Cellular, on Thursday, bought spectrum worth a total of Rs 61,162 crore against the government’s estimate of Rs 47,933 crore.
The companies are required to pay 33% of 1800MHz spectrum and 25% of 900MHz spectrum price upfront and rest can be paid in ten installments along with an interest component after two years moratorium period.
Bharti Airtel and Idea Cellular are required to shell out Rs 5,425 crore and Rs 3,240 crore respectively in FY2014 for which they will have to raise funds.
Majority of spectrum won by incumbent players in recent auctions is to protect their current revenues as against grabbing new revenues. We believe increased financial pressure on these companies would lead to increase in vice base rates for telecom industry, says analyst at Angel Broking in a client note.