With the much awaited spectrum auction over and the winner announced - it is interesting to note a few points.
1. The govt. to prove the CAG and SC wrong made all its attempts in keeping this auction as least represented as possible. The number of bidders was less than 12 WHEREAS back in 2007-08 when the 2G scam happened, there were more than a 100 applicants !
2. The PE of Bharti at a price of 575/- back then 92007-08) was over a 100 whereas today it is at a PE of only 20 at a price of 300/- ERGO the CAG loss estimate has to be reduced by 80% which will give us a figure of 35200 crores. WE got 61000crores+ ie a premium of 75% on the loss figure of the CAG !!
Just imagine if the same number of bidders were there and more importantly all the BIG foreign companies which lined up in 2008 BUT missing now (etisalat, etc) were also present?
Also consider that back in 2007-08 telecom was still in its nascent stage of growth - people were willing to pay a premium to capture the market BUT today with near saturation levels it is more about RETAINING your base rather than getting more subscribers!!
If all the above is considered and properly accounted for EVEN the figure of 176000/- crores (USD 40Bn) estimated by the CAG will pale in comparision!!
So much for a Zero loss MrSibal.
1. The govt. to prove the CAG and SC wrong made all its attempts in keeping this auction as least represented as possible. The number of bidders was less than 12 WHEREAS back in 2007-08 when the 2G scam happened, there were more than a 100 applicants !
2. The PE of Bharti at a price of 575/- back then 92007-08) was over a 100 whereas today it is at a PE of only 20 at a price of 300/- ERGO the CAG loss estimate has to be reduced by 80% which will give us a figure of 35200 crores. WE got 61000crores+ ie a premium of 75% on the loss figure of the CAG !!
Just imagine if the same number of bidders were there and more importantly all the BIG foreign companies which lined up in 2008 BUT missing now (etisalat, etc) were also present?
Also consider that back in 2007-08 telecom was still in its nascent stage of growth - people were willing to pay a premium to capture the market BUT today with near saturation levels it is more about RETAINING your base rather than getting more subscribers!!
If all the above is considered and properly accounted for EVEN the figure of 176000/- crores (USD 40Bn) estimated by the CAG will pale in comparision!!
So much for a Zero loss MrSibal.
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