Dec 31, 2012, 09.21 AM IST
The department of telecommmunications (DoT) may propose to a ministerial panel next week to either seek sectoral regulator Trai's views on auction of telecom spectrum in the CDMA band or auction the radiowaves after the GSM spectrum auction due this fiscal.
"It has been discussed that for the 800Mhz band (CDMA spectrum) there can be two scenarios. First, refer it to Trai for making recommendations and second, hold auction of spectrum in 800Mhz band in succession to the forthcoming auction of 1800Mhz and 900Mhz band (both being used for GSM services)," an official source said.
The proposal will go to an empowered group of ministers (EGoM), headed by finance minister P Chidambaram, for a final decision only after approval of top authorities at the telecom ministry. The EGoM is likely to meet next week.
On December 7, the DoT has sought EGoM's decision on action to be taken in the matter of 800 Mhz spectrum but it was deferred by the panel. The government failed to auction CDMA spectrum at 1.3 times the price to that of GSM spectrum in 1800Mhz band in the auction process that was concluded in November.
The pan-India price for 5Mhz of spectrum in the 1800Mhz band was fixed at Rs 14,000 crore. The Supreme Court in February cancelled a total of 122 licences in the 2G spectrum allocation scam. It included CDMA licences of Sistema Shyam Teleservices in 21 telecom circles and Tata Teleservices ' in three circles.
It was mandatory for these companies to win spectrum in the auction to continue operations in the circles where validity of their licences will end on January 18, 2013; but due to high spectrum prices the two companies did not bid for the auction.
Tata Teleservices has announced a shutdown of its CDMA operations in Jammu and Kashmir, the Northeast and Assam. Services of SSTL, which operates under brand name of MTS, will be impacted if the CDMA spectrum issue is referred to the Trai now as it may take four to six months time to get its recommendation.
SSTL has informed the customers of its intention to continue operations beyond January 18, 2013. Though there is no clarity on company's operation beyond the deadline set by the apex court, SSTL said it is taking further steps to ensure continued service in India.
SSTL had filed a curative petition before the apex court seeking reinstatement of its licences in May, and the plea is yet to come for hearing.
Russian conglomerate Sistema JSFC, which holds a 56.68-percent stake in the company, has already issued notice to the Indian government to resolve the SSTL licence issue.
In a recent communication to the Indian government, Sistema has warned to seek "billions of dollars" in damages from India if licence cancellation issue of SSTL was not resolved in time.
TataTeleservice stock price
On December 12, 2013, at 13:55 hrs Tata Teleservices (Maharashtra) was quoting at Rs 7.42, up Rs 0.56, or 8.16 percent. The 52-week high of the share was Rs 11.79 and the 52-week low was Rs 4.38.
The latest book value of the company is Rs -8.88 per share. At current value, the price-to-book value of the company was -0.84.
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