Map sale

Mukesh Ambani | Gautam Adani: Ambani vs. Adani: 5G is about to become a battleground for two of India’s richest people

The battle for India’s fifth-generation airwaves is attracting some of the country’s wealthiest tycoons, with billionaires Mukesh Ambani and Gautam Adani joining a group of players who are expected to offer up to $14 billion for frequency rights that could decide that dominates the digital age.

While Reliance Jio Infocomm Ltd. d’Ambani has paid the highest pre-bid deposit, signaling that he is likely to be the most aggressive bidder in the sale which begins today is surprise entrant Adani Data

. whose bids will be closely watched as rivals try to define its telecommunications ambitions.

wireless carriers

., led by billionaire Sunil Mittal, and . – a joint venture between Vodafone Group Plc and Kumar Mangalam Birla Group – are the other bidders.

Selling the airwaves could fetch up to 1.1 trillion rupees ($14 billion), according to a June estimate from the local ratings firm. Adani’s empire, which overtook Ambani as Asia’s richest man earlier this year, is playing down his foray into a new playing field for the group. He said his interest in 5G airwaves was for “private network solutions” and improving cybersecurity at corporate airports and ports, with no intention of entering the currently dominated consumer mobile space. by Ambani.

Yet the move comes as the two men increasingly tread the same ground, with Adani in particular investing in sectors traditionally associated with Ambani, which disrupted India’s telecoms industry nearly six years ago with

Jio’s super cheap services. India is at a crucial moment in its digital development, with many companies – including multinationals like Amazon.com Inc and Walmart Inc – vying for a slice of the intersection between mobile and the nascent commerce landscape. electronic.

Speculation that 5G is about to become a flashpoint between Ambani and Adani was somewhat quelled, however, when Adani Data only paid one billion rupees as a deposit for the auction. Payout is widely regarded by brokerages as a key indicator of a bidder’s level of interest.

Adani Data’s small filing, which was in line with its announcement to only create a private 5G network and not become a full-fledged wireless carrier, helped ease some of the incumbents’ anxiety. Reliance Jio deposited 140 billion rupees, far more than Bharti Airtel’s 55 billion rupees and Vodafone Idea’s 22 billion rupees, according to data provided by the government.

“Whether it’s Adani or Ambani, India will benefit from a massive rollout of 5G,” said Utkarsh Sinha, managing director of Bexley Advisors, a boutique investment bank. “Adani’s entry has shaken Reliance Jio and the massive commitment of serious money shows they see the 5G value proposition and cannot afford to lose it.”

The auction will be a financial boost for Prime Minister Narendra Modi’s government, which is trying to tame inflation and bring the budget deficit under control. The South Asian nation plans to sell 72 gigahertz of waves for 20 years in various frequency bands ranging from 600 megahertz to 26 gigahertz.

India has also allowed companies to pay in 20 equal installments with no upfront payment as it tries to catch up with other countries, such as South Korea and China, which have had 5G networks for years.

What analysts think

Nomura Holdings Inc. (Aditya Bansal)

Worries over Adani Group’s entry into the telecommunications sector eased after it posted a modest earnest money; expenditure will probably be around 8 billion rupees to 10 billion rupees

Reliance Jio has submitted a much higher earnest money deposit in past auctions; expect potential spending of around Rs 405 billion to Rs 600 billion

Bharti Airtel’s overall expenditure could be around Rs 400 billion and Vodafone Idea’s around Rs 184 billion.

Credit Suisse Group AG (led by Varun Ahuja)

Reliance Jio’s high earnest money deposit is a catalyst and does not necessarily mean significantly higher auction spend

Bharti Airtel will likely limit its offerings to 5G spectrum – 100 MHz in the 3.5 GHz band and 500 MHz in the 26 GHz band; can selectively add spectrum in the 900 MHz and 1800 MHz bands in circles such as Delhi, Mumbai and Kolkata, among others

Vodafone Idea deposit sufficient to acquire a minimum of 5G spectrum

Morgan Stanley (led by Gaurav Rateria)

Given sufficient spectrum availability, strong aggression or auctions above the reserve price seem unlikely

Reliance Jio’s earnest money deposit allows you to go beyond 5G bands and bid either for the existing bands it has or for new bands

CLSA (led by Deepti Chaturvedi)

The main surprise is Adani’s low earnest money deposit, lower even than Vodafone Idea

Reliance Jio and

will likely lead the auction

Vodafone Idea’s earnest money deposit is not enough to bid on pan-India 5G spectrum or even all of its established markets