Telecom stocks on Tuesday rose by as muchas 6% after telecom regulator TRAI recommended a sharp 60% cut in the floor price of mobile phone spectrum for an upcoming auction after two previous sales drew lukewarm response because of high reserve price.
Bharti Airtel's scrip surged 5.86%, while Idea Cellular rose by 4.74% and Reliance Communications moved up by 3.15% on the BSE.
TRAI made recommendations to the government for the start or base price of auction of spectrum in 900 per megahertz (MHz) and 1,800 MHz bands used by GSM players to offer 2G, which remained unsold after two rounds of auctions in November and March.
It suggested a pan-India reserve price of Rs. 1,496 crore per MHz in the 1800 band, down 37% from the base price set in the previous auction, TRAI chairman Rahul Khullar had said.
The reduction in reserve prices follow the failed March auction, which drew just one bidder.