Reliance Jio and Airtel's net worth surges ahead of 5G auction; Vodafone Idea struggles

New Delhi: Reliance Jio and Bharti Airtel’s net worth has improved sharply since the last spectrum auction in August 2022 even as Vodafone Idea’s negative net worth widened amidst its continuing financial struggles.

In the upcoming auction, scheduled to start on June 6, the three private telecom players will be competing for Rs 96,317.65 crore worth of 5G airwaves.

As per details submitted by the companies to the Department of Telecommunications (DoT), Reliance Jio’s net worth at the end of March 31, 2023, stood at Rs 2,15,992 crore. In the last auction, the wholly owned subsidiary of Jio Platforms, had a net worth of Rs 1,97,790 crore. Similarly, Airtel’s net worth has risen to Rs 86,260 crore as on December 31, 2023, from Rs 75,886 crore in the last auction.

Vodafone Idea’s net worth as on December 31, 2023, stood at a negative of Rs 1,16,886 crore. The company has also shared its figures as on March 31, 2023, wherein its net worth stood at a negative of Rs 93,320 crore. In the last auction, Vodafone Idea’s net worth was a negative Rs 80,918 crore.

The Government of India is the largest shareholder in Vodafone Idea with 24.27% stake. The promoters Vodafone Group and Aditya Birla Group hold 36.87% stake in the company.

All the companies participating in the auction are required to submit ownership and net worth details to the DoT.

Airwaves in 800 MHz, 900 MHz, 1,800 MHz, 2,100 MHz, 2,300 MHz, 2,500 MHz, 3,300 MHz and 26 GHz bands will be put on sale.

The sale, however, is likely to be a muted affair as the telcos have adequate spectrum for their 5G needs for the time being. Bharti Airtel and Vodafone Idea though have to renew spectrum in some circles.

Airtel needs to renew airwaves in J&K, Odisha, Bihar, UP (East), West Bengal and Assam. Vodafone Idea, which has been bolstered by the Rs 20,000 crore it raised recently through equity, needs to renew spectrum in West Bengal and UP West circles.

Brokerage Jefferies estimates that Airtel and Vodafone Idea merely need to renew airwaves worth about Rs 4,200 crore and Rs 1,950 crore, respectively, while market leader Reliance Jio does not have any spectrum renewals coming up this year.

Some analysts expect the government to mop up a maximum of around Rs 18,000 crore, meaning around 19% of spectrum on offer being sold.

In the last spectrum sale in July 2022, which was India’s maiden 5G auction, the government had mopped up over Rs 1.5 lakh crore. It had offered over 72 GHz of airwaves for 20 years across 10 5G bands, worth Rs 4.3 lakh crore at reserve prices.