According to a recent report by ICICI Securities, earnest money deposits (EMDs) submitted by Reliance Jio, Bharti Airtel and Vodafone Idea (Vi) show that operators are unlikely to bid for the 700 MHz spectrum band in the upcoming auction, starting March 1, 2021.

Jio, Airtel and Vi’s respective EMDs of Rs 100 billion, Rs 30 billion and Rs 4.75 billion cap their potential spectrum payouts at Rs 700 billion, Rs 210 billion and Rs 33 billion respectively in the upcoming sale, the report added. According to the brokerage, Airtel’s Rs 30 billion EMD is higher than expectations, while Vi’s modest sum is in line. Operators can buy spectrum worth 5-7x of the EMD, and the deposits, which help understand maximum spectrum payout show they are unlikely to bid for the 700 Mhz spectrum band, said ICICI Securities.

ICICI Securities expects Airtel to buy sub-GHz spectrum in the 900 Mhz band only in Tamil Nadu and Madhya Pradesh in the upcoming auction, and fill gaps in the six circles in this sub-GHz band in future auctions. It also expects the telco to buy 1800 MHz spectrum to complete at least five carriers in each circle and strengthen airwave holdings in the 2300 MHz band, which would help it make a smooth transition to 5G using dynamic spectrum-sharing technology. On Vi, ICICI said that the telco may renew five units of spectrum in its expiring 900 MHz band in Tamil Nadu and also potentially target five units in the 1800 MHz band each in Andhra Pradesh and UP-East. Further, it added that Jio’s significantly higher EMD underlines its need to renew expiring airwaves in the 800 MHz band that it owns and those of Reliance Communications that it uses. It is likely to be the most aggressive buyer as it needs to both renew expiring airwaves and add airwaves to cater to a rising user base consuming more data.