The government is expected to earn around Rs 1lakh crore from the much awaited 5G spectrum auction, which kicks off on Tuesday.

A total 72 GHz (gigahertz) of radiowaves worth at least Rs 4.3 lakh crore will be put on the block. Analysts expect the bidding to be muted as there was enough spectrum available, with the telcos selective in their bidding.

The four players — Reliance Jio, Bharti Airtel, Vodafone Idea and Adani Data Networks — have in all deposited Rs 21,800 crore. Reliance Jio submitted earnest money of Rs 14,000 crore, and new entrant Adani put in a notional Rs 100 crore.

Bharti Airtel has forked the second highest amount as earnest money deposit (EMD) at Rs 5,500 crore, a little under 40 per cent of the amount paid by its biggest competitor, Jio.

Cash-strapped Vodafone Idea has furnished EMD of Rs 2,200 crore, despite a net worth of negative Rs 80,918 crore.

Based on the earnest money, the government could mop up a maximum of Rs 1.95 lakh crore from the auction.

Analysts estimate the collections will be much lower.

ICRA said that the telecom industry is likely to spend Rs 1.1 lakh crore on purchasing 5G airwaves from the government.

This would result in increasing the sector’s debt. The Indian telecom industry is already under financial stress because of high debt.

Analysts at IIFL Securities said the telcos could go for only four out of the 10 bands, with Jio and Airtel topping up their sub-GHz holdings.

The telcos are likely to focus on the crucial 850MHz and 900MHz frequencies, while the more expensive 600MHz and 700MHz frequencies might not see any action, the report said.

The mid-range, where telcos already hold over 670MHz spectrum, may see muted demand.

Overall, the report concludes that telcos could bid for spectrum worth Rs 71,000 crore – considerably lower than the Rs 78,000 crore that the government scooped up from 4G spectrum auctions a year ago, it said.

Nomura expects Adani’s participation to be restricted to the 26GHz band largely for the group’s captive usage. Vodafone Idea could bid for pan-India spectrum in the 26GHz spectrum band and in the 3,300MHz bands in Metros, Circle A and Circle B, which account for nearly 95 per cent of VI’s access revenue.

Reliance Jio could bid for pan-India spectrum in 3,300MHz band, 26GHz band and some spectrum top-ups in the 800MHz band to complete at least 10MHz pan-India spectrum in the sub GHz band.

Despite the successive sharp cuts in the reserve price, the 700MHz spectrum band has not had any takers so far in the past few auctions. Brokerage Jefferies expects limited demand for 600MHz, 2100MHz and 2500MHz bands.