SingTel – BT
Proposal to raise spectrum rates sinks telco stocks
Regulator wants ten-fold rise from the controversial 2008 sale prices
The Indian telecoms regulator's proposal for a near 10-fold increase in basic mobile phone spectrum prices and switching of radio spectrum given to older carriers knocked down shares of leading operators on fears that the big potential payouts will further hurt an already bleeding industry.
Shares in top mobile operator Bharti Airtel fell as much as 7.5 per cent yesterday morning to their lowest level since July 2010, while fourth-ranked Idea Cellular fell as much as 9.8 per cent, before cutting some losses. Second-ranked Reliance Communications fell as much as 3.4 per cent.
The country's telecoms sector, the world's second-biggest by subscribers, has been battered by ferocious competition and a scandal over below-market price sale of lucrative mobile phone permits in a 2008 state sale process.
The Supreme Court has ordered 122 permits granted to eight operators in the 2008 sale be revoked in early June and asked the government to redistribute radio airwaves through an open bidding process.