NEW DELHI: Following the release of details around the fifth generation spectrum auction to be held next week, analysts are of the view that Adani Group is not so keen on entering the consumer mobility space.
According to the analysts, its earnest money deposit (EMD) of Rs 100 crore is only suitable to acquire spectrum for specific use (private network) but not enough to enter the consumer mobility space.
“It is evident that Adani group is not so keen on entering the consumer mobility space. EMD of Rs 100 crore is suitable to acquire a limited spectrum for a specific use but not enough to enter the consumer segment. At this stage, spectrum acquired through upcoming auctions is likely to be utilised for setting up private networks,” said Charu Paliwal, research analyst at Counterpoint Research.
Reliance Jio Infocomm (RJIO) has submitted EMD of Rs 14,000, while Bharti Airtel and Vodafone Idea (Vi) have submitted Rs 5,500 crore and Rs 2200 crore, respectively, for the upcoming 5G auction. Surprisingly, Adani Data Networks, the Adani group company that sparked speculation in the sector about its entry into the consumer mobility space, has put in just Rs 100 crore.
“Consumer mobility is a competitive space in the Indian telecom market and it is a capital-intensive business with low returns. ARPU (average revenue per user) of the leading operators is still below Rs 180, therefore, it does not appear as a lucrative business opportunity,” added Paliwal.
EMD numbers reveal a player’s appetite, strategy and plan for purchasing spectrum during an auction. “This is very clear that Adani has no interest in entering the consumer mobility market as we expected. With an EMD of Rs 100 crore, Adani is aimed at limited quantities of spectrum in distinct circles of operations,” said Tapse. The government expects to mop up nearly Rs 70,000 to Rs 10,0000 crore from this auction.