100 Pct FDI In Telecom To Spur Interest In Upcoming Auctions: Bofa-ML
New Delhi: Government's decision to fully open the cash-starved telecom sector is expected to renew interest from foreign players in the upcoming spectrum auctions, global financial major Bank of America Merrill Lynch says in a report.
Last week, the government permitted 100 per cent foreign direct investment in telecom, versus the 74 per cent ownership cap earlier.
"The policy initiative offers fresh hope of capital availability for an industry whose indebtedness is steep and equity-options were hitherto constrained by ownership complications," the Bank of America Merrill Lynch (BofA-ML) report said.
Moreover after two failed spectrum auctions in last 12 months, "the 100 per cent FDI move offers hope of renewed interest from foreign majors in upcoming spectrum auctions," the report added.
In November 2012 and March 2013, the government had put on auction more than half of the spectrum that was freed after the Supreme Court in February last year cancelled 122 mobile permits issued by the then Telecom Minister A Raja in 2008.