At the end of 16 days and 94 rounds of bidding, the provisional winning price for pan-India 3G spectrum stands at Rs89bn, +155% over the reserve price of Rs35bn, led by strong demand in the Mumbai and Delhi circles. At the current provisional winning bids, the Government is assured of Rs360bn from auctioning 3G licenses alone, already above our estimate of Rs329bn.

The high bid prices reflect the anxiousness among the operators to gain access to the scarce spectrum, particularly in the metro and A circles. Also, the uncertainty surrounding the allocation of the 2G spectrum, which has been held up for more than a year now and is currently awaiting recommendations from the Telecom Regulatory Authority of India, is also driving higher bids.

The following chart shows the Bids in each of Telecom Circle in India.