2G auction: Bids top Rs44,600 crore on Day 1

The government has so far received bids worth around Rs44,610 crore ($7.12 billion) since the 2G spectrum auction kicked off on Monday, against the government's expectation of raising around Rs40,874.50 crore from the spectrum sale, including the upfront auction amount, during the current fiscal.

Thanks to the entry of billionaire Mukesh Ambani in the 2G spectrum auction to arm his Reliance Jio with precious airwaves to compete with big rivals and market leaders Bharti Airtel Ltd and Vodafone Group Plc the prices of airwaves are expected to see new highs.

Even if he bids modestly, Reliance Jio would corner enough airwaves that would allow it to compete in the cut-throat Indian market for basic phone services.

Reliance Jio, which plans to offer 4G services, is yet to launch any mobile phone services.

All top 8 telecom firms are in the fray as the third auction of 2G spectrum opened on Monday.

The auction began on a promising note with excess demand for the 900 MHz band in the Mumbai circle with the provisional winning amount per block being Rs473.24 crore at the end of the seventh round of the spectrum auction.

Provisional figures put the bid amount for 900 MHz band spectrum in the Delhi circle at Rs428.92 crore per MHz against the reserve price of Rs360 crore while for the Kolkata circle the provisonal bidding amount was Rs173.16 crore.

However, bidding in the 1800 MHz band is yet to pick up pace with excess demand coming in only for the Gujarat circle.

The reserve price for a pan-India licence is Rs1,765 crore per MHz, about 26-per cent lower than in the March sale.

A total of over 385 MHz of spectrum has been put up for auction in the 1800 MHz band while in the 900 MHz band 46 MHz of spectrum has been put up for auction.

Reliance Jio Infocomm is reported to be fighting hard with Bharti Airtel and Vodafone to win spectrum in select circles.

Others such as Tata Teleservices, Telewings and Reliance Communications are also bidding fiercely for select circles.