Fwd message on Vodafone ( please do your own due diligence)
Idea Cellular
If one look at the total spectrum portfolio of VIL and its total worth and the expiry date and compare that with Airtel and Jio, then one will buy this at this cheap rate. This is where all the TV analysts and news paper stock analysts are hiding the big truth about VIL`s debt. Reason is simple...it is the instructions given to them by big sharks to accumulate this at low valuation. Once it is done the same analysts will ask people to buy in high prices. VIL is the market leader in holding highest quantities in 900, 1800, 2100 and 2500 MHz ranges. It holds 143, 178, 195, 370 mhz respectively in each band. Airtel and Jio have less spectrum than VIL. Most important thing is validity of VIL`s spectrum. Most of them has starts expiring from 2030 onwards only. Lot of them are expiring around 2035 to 2036. It has very less spectrum expiring in next 10 years. VIL can balance that without even renewing them thanks to the merger. So their 4G spectrum capex going to be very minimal in next 15 years compared to Jio and Airtel. But if you look at Jio which is using RCOM`s spectrum in 800 MHz band and it`s own 800 MHz is expiring in 2021. It is almost 81.5 MHz 800 MHz band it needs to buy again in the auction this year. This band is costlier one. I just did a small computation using base price set for 800 MHz band in each circle and it gave me a total of Rs 27251 crore. Just imagine this is based on base price only and that to based on 2016 price. So now this will be more and it will have to pay more in the larger market circles. So I am expecting jio to spend around 40k crore minimum this year for its 4G spectrum only. Airtel also need to buy out around 52 MHz of 1800 MHz band which is expiring in 2021 and it might cost around 12 to 15k. It also need to buy some more extra 4g spectrum in few circles which is expiring in 2022 to 2024 and also need to add some more to support growing data demand. So I am expecting Airtel to spend around 20 to 30k crore minimum in this year auction. VIL will hardly spend anything in that auction due to its merger spectrum holdings. If you compare the debt level of each of these companies, then you will come to know who has better balance sheet. So just accumulate this for longterm which is what I am doing. Hold this for few years to get multi fold returns. Telecom is going to be the future. With only 3 companies and growing data and subscribers this will have immense growth in the coming years. Price war is almost over and it`s their turn to get back everything they gave it in the last few years for free. AGR is just a drama. That will continue that till it leads to set the floor prize for Tariff. Just do your own analysis and invest. Happy investing.