Final 900 MHz spectrum price may not top 2x reserve: HSBC

Trade

• Watchlist
• Portfolio
• Message
• Set Alert

 

 

Choose Stock Exchange: BSE LIVE NSE LIVE

26 Aug, 2025 12:21

Volume

Todays L/H

More

×

Moneycontrol Bureau

Brokerage house HSBC Equities feels that the final price of 900 MHz spectrum is unlikely to exceed two times the reserve price, even if a strong contender like Reliance Jio were to bid in the upcoming auction next month.

News reports that the Mukesh Ambani promoted Reliance Jio may bid for both the 900 and 1800 spectrum bands caused shares of rival telecom firms Bharti Airtel and Idea to tumble on Thursday.

“We note there is still a possibility that Reliance may not have applied for 900 band and we await clarity. That said serious participation by Reliance Jio in 900 in our view would put definite pressure on 900 MHz pricing,” said the HSBC note to clients.

Also Read: This spectrum auction round to be more aggressive, says Experts

“However the final price may not exceed 2x the reserve price, in our view assuming Vodafone and Bharti decide not to retain beyond 5 MHz,” said the note.

The brokerage has shortlisted the options that Reliance Jio has before it, and the possibility of each of the options.

From the HSBC note:

(a)  Deployment of 3G on 900 MHz-(This would come with the challenge that 3G rollout using 900 cannot commence before the end of 2014 and will take 18-24 months to have 3G services in top 10-15 markets.  One big advantage of using 900 for 3G will be its superior indoor coverage vs 2100 spectrum band.

(b)  Use 900 for LTE - Unlikely approach in our view as 4G ecosystem in 900 MHz is less developed (versus 1800 and 800).

(c) Only bid for 1800 (contiguous only) - FD deployment in 1800 and TD in 2300. With such an approach Reliance would be able to offer voice but a 3G deployment by incumbent players in lower bands like 900 could limit prospects for Reliance Jio in our view.