TRAI recos to be accepted despite DoT reservations: Expert

Vikash Mantri of ICICI Securities is confident that the recommendations on spectrum reframing will be accepted despite the Department of Telecommunications (DoT) questioning the spectrum pricing. The suggestions have been clearly explained and the move is positive for the entire telecom sector, he tells CNBC-TV18 in an interview. The final outcome from the recommendations is not going to be a matter of worry, he adds. 

He picked Bharti Airtel and Idea Cellular from the space. Reliance Communications needs to deliver in terms of asset monetisation, Mantri adds.  Also read: Telecom Comm seeks clarity from TRAI on spectrum price Below is the edited transcript of his interview to CNBC-TV18. Q: How are you approaching the two big telecom names after this latest salvo from Department of Telecommunications (DoT)? Are you already marking down Bharti Airtel? A: No. We continue to remain positive on both Bharti and Idea Cellular. These are just comments from the various government bodies. We don't see any reason for the Telecom Regulatory Authority of India (TRAI) recommendations to not to be accepted. The regulator has put up with comprehensive recommendations and has clearly explained the rationale for the same. It is positive for the entire sector in general. The telecom commission and others would have certain queries about the same. We have seen this happen in the past too where we have had the telecom commission or the DoT going back to the TRAI and asking for reasons for the same or more detailed calculations. We see these as steps towards the process. However, the outcome; whether the entire recommendations are accepted or not which will be something we will watch out for. As of now, we are not so worried about these new news flows that are coming in; in terms of the DoT asking them to relook at things. Q: It is possible that DoT has only asked for a relook at the TRAI’s recommendations and may be the telecom commission could settle closer to the TRAI than to the DoT. In the event that spectrum reserve price is raised, what would be the call on Bharti and Idea? Relatively would one of them become less attractive? A: Given Bharti is a bit more diversified player and has presence in both enterprise business and mobility, and has a lot of Africa assets. The overall impact positive or negative is relatively lower in case of Bharti and Idea which is a pure mobility play. Either ways if the recommendations were to be positive or negative will move the needle more for Idea cellular per se. Frankly, we are not worried of what would finally come up from these recommendations. We have clearly seen discipline on the ground so at the point of time when recommendations were not favourable in terms of spectrum pricing we have seen rational behaviour where we did not see bidding for many of the circles. So, in case things come out to be irrational in nature, the discipline will be maintained. So it is not something that worries us a lot in terms of what would finally come out. Though we are clearly liking the stand taken by the regulator now.