AIRTEL1PPT

8/8/2019 AIRTEL1PPT

http://slidepdf.com/reader/full/airtel1ppt 1/19

TELECOM SECTORTELECOM SECTOR--AIRTEL AIRTEL

DEEPNADEEPNA

NEETHANEETHA

SHRUTHISHRUTHI POOJAPOOJA

JINCY JINCY

NIJISHANIJISHA

8/8/2019 AIRTEL1PPT


Telecom IndustryTelecom Industry

The Indian telecom market is characterized by lowThe Indian telecom market is characterized by lowpenetration and high growth potential. The wirelesspenetration and high growth potential. The wirelesssegment of the industry has been the major growthsegment of the industry has been the major growth

driver.driver.

The total number of subscribers has increased from 54.1The total number of subscribers has increased from 54.1mn in 2002mn in 2002--03 to 256.5 mn as at the end of October03 to 256.5 mn as at the end of October

2007. The wireless subscriber base increased to 217.12007. The wireless subscriber base increased to 217.1mn,whereas the fixed line subscriber base dipped andmn,whereas the fixed line subscriber base dipped andreached 39.4 mn as on October2007.reached 39.4 mn as on October2007.

8/8/2019 AIRTEL1PPT


5% in March 2003.The Industry is5% in March 2003.The Industry iswitnessing rapid growth in subscriber basewitnessing rapid growth in subscriber base

but the Average Revenue Per User perbut the Average Revenue Per User permonth (ARPU) is declining, therefore themonth (ARPU) is declining, therefore theindustry is playing on volumesindustry is playing on volumes

The overall teleThe overall tele--density has increased todensity has increased to

more than 21% in October 2007 .more than 21% in October 2007 .

8/8/2019 AIRTEL1PPT


AIRTEL AIRTEL

Bharti GroupBharti Group

Bharti AirtelBharti Airtel

Telecom giant Bharti Airtel is the flagshipTelecom giant Bharti Airtel is the flagshipcompany of Bharti Enterprises Airtel comes tocompany of Bharti Enterprises Airtel comes toyou from Bharti Airtel Limited, Indias largest you from Bharti Airtel Limited, Indias largest integrated and the first private telecom servicesintegrated and the first private telecom servicesprovider in all the 23 telecom circlesprovider in all the 23 telecom circles

The Journey Towards LeadershipThe Journey Towards Leadership

8/8/2019 AIRTEL1PPT


The Journey Towards LeadershipThe Journey Towards Leadership

1994 1995 : The Birth

1995 1997 : Creating a newCategory

1997 2002 : Building thefoundation of a Power Brand

2002 2004 : Driving Growth &

Leadership 2005 today : Towards Global Admiration

8/8/2019 AIRTEL1PPT


2006. The Journey towards

Global Admiration 13 Years of PASSION & SUCCESS

New VISION for Airtel Vision 2010

8/8/2019 AIRTEL1PPT


Bharti Airtel - s tanding in the

world and I ndia 3 rd LARGEST wireless operator in the

world

LARGEST priv ate INTEGRATED telec omc ompany in I ndia

LARGEST WIRELESS operator in I ndia

LARGEST priv ate FIXED LINE operator in

I ndia LARGEST TELECOM c ompany listed on

I ndian S tock Exc hanges

8/8/2019 AIRTEL1PPT


Cash f low strength

Bharti has shown a strong growth in EBITDA and shouldbe able to finance most of its capex plan throughinternal accruals.

The company has no working capital requirement as it

is financed through prepaid customers balances andvendor financing. Bharti is a pan India operator and weexpect its capex intensity will decline.

Bharti has not tapped the capital markets since its IPO in2002 and they do not expect it to raise any debt orequity funding for its existingoperations.

It might need to raise some short-term debt forlaunching 3G services which it can repay, considering itsstrong cash flow and negligible debt level.

8/8/2019 AIRTEL1PPT


CAPITAL MARKET RATINGSCAPITAL MARKET RATINGS

As at March 31, 2010, Bharti Airtel Limited As at March 31, 2010, Bharti Airtel Limitedhas outstanding ratings with fourhas outstanding ratings with fourinstitutions, two of them domestic, viz.institutions, two of them domestic, viz.

CRISIL and ICRA, and two international,CRISIL and ICRA, and two international,viz. Fitch Ratings and S&P.viz. Fitch Ratings and S&P.

CRISIL and ICRA have rated Airtel at theCRISIL and ICRA have rated Airtel at the

top end of their rating scales, both fortop end of their rating scales, both forshort term (P1 + / A1 +) as well as longshort term (P1 + / A1 +) as well as longterm (AAA/ LAAA)term (AAA/ LAAA)

8/8/2019 AIRTEL1PPT


Both Fitch Ratings and S&P have ratedBoth Fitch Ratings and S&P have rated Airtel at the level of the sovereign rating Airtel at the level of the sovereign ratingof India (BBBof India (BBB--))

Subsequent to March 31, 2010, andSubsequent to March 31, 2010, andpursuant to the closure of the Zainpursuant to the closure of the Zaintransaction and related acquisition debt,transaction and related acquisition debt,

while CRISIL, ICRA and Fitch Ratings havewhile CRISIL, ICRA and Fitch Ratings havereaffirmed the above ratings, S&P hasreaffirmed the above ratings, S&P hasmoved the rating to BB+.moved the rating to BB+.

8/8/2019 AIRTEL1PPT


Market Penetration strategy Market Penetration strategy

Hello tunesHello tunes

Airtel live Airtel live

Voice sms Voice sms Missed call alertsMissed call alerts

MM-- billbill

24 hrs customer service24 hrs customer service GROUP 7 10GROUP 7 10

8/8/2019 AIRTEL1PPT


SHARE CAPITALSHARE CAPITAL

During the year, the Company issued 919,734During the year, the Company issued 919,734(sub(sub--divided) equity shares of Rs 5 each upondivided) equity shares of Rs 5 each uponexercise of stock options under ESOP Schemeexercise of stock options under ESOP Scheme

2005 of the Company.2005 of the Company. Further, the Company also allotted 65,385 (preFurther, the Company also allotted 65,385 (pre--

split) equity shares of Rs 10 each uponsplit) equity shares of Rs 10 each uponconversion of Foreign Currency Convertibleconversion of Foreign Currency ConvertibleBonds (FCCBs) by their holders in May 2009.Bonds (FCCBs) by their holders in May 2009.

8/8/2019 AIRTEL1PPT


Due to these corporate actions, theDue to these corporate actions, theissued, subscribed and paidissued, subscribed and paid--up equityup equityshare capital of the Company increasedshare capital of the Company increasedfrom 3,796,479,592 (subfrom 3,796,479,592 (sub--divided) (Marchdivided) (March31, 2009) to 3,797,530,096 equity shares31, 2009) to 3,797,530,096 equity sharesas of March 31,2010.as of March 31,2010.

8/8/2019 AIRTEL1PPT


ANALYSIS ANALYSIS

The Company meets its working capitalThe Company meets its working capitalrequirement by having suitable commercialrequirement by having suitable commercialagreement with its creditors and sufficient agreement with its creditors and sufficient standby credit lines with banks and financialstandby credit lines with banks and financial

institutions.institutions. It deploys a robust cash management system toIt deploys a robust cash management system to

ensure timely availability of funds and itsensure timely availability of funds and itsdeployment.deployment.

The Company has been able to optimise financeThe Company has been able to optimise financecost and generate funds for expansion bycost and generate funds for expansion byminimising the amount of funds tiedminimising the amount of funds tied--up in theup in thecurrent assets.current assets.

8/8/2019 AIRTEL1PPT


As on March 31, 2010, the Company has cash As on March 31, 2010, the Company has cashand bank balance of Rs 25,786 mn andand bank balance of Rs 25,786 mn andmarketable securities of Rs 51,512 mn.marketable securities of Rs 51,512 mn.

The Company actively manages the short The Company actively manages the short--termtermliquidity to generate optimum returns byliquidity to generate optimum returns byinvestments made in debt and money market investments made in debt and money market instruments including liquid and income debt instruments including liquid and income debt fund schemes, fixed maturity plans and otherfund schemes, fixed maturity plans and othersimilar instruments.similar instruments.

8/8/2019 AIRTEL1PPT


The Company foresees liquidityThe Company foresees liquidityrequirements for funding the 3G spectrumrequirements for funding the 3G spectrumand BWA spectrum auction fees.and BWA spectrum auction fees.

The strength of the Companys balanceThe strength of the Companys balancesheet has enabled the Company tosheet has enabled the Company toadequately tie up funding for expected 3Gadequately tie up funding for expected 3G

and BWA liquidity requirements onand BWA liquidity requirements onfavorable terms.favorable terms.

8/8/2019 AIRTEL1PPT


On March 30, 2010, the Company has alsoOn March 30, 2010, the Company has alsoannounced acquisition of Zain Africa in aannounced acquisition of Zain Africa in aUSD 10.7 bn deal.USD 10.7 bn deal.

The Company has tied up adequateThe Company has tied up adequatefunding to cover the deal.funding to cover the deal.

The Company expects to maintain aThe Company expects to maintain a

comfortable liquidity position post comfortable liquidity position post payment of spectrum fees and closure of payment of spectrum fees and closure of the acquisition.the acquisition.

8/8/2019 AIRTEL1PPT


Key Concerns

Stiffer-than-expected competition in the wirelessbusiness

Continual tariff cuts

Huge out-payments to obtain 3G spectrum

Lower-than-expected increase in long distance volumes

Increasing competitors like Idea cellular, RelianceComm.

Declining Average revenue per user (ARPU) driven bylower IUC, lower mix of urban consumers in subscriber

additions and intensifying competition Slow down in telemedia, wireless and enterprise

segments.

8/8/2019 AIRTEL1PPT


THANK YOU !!!!THANK YOU !!!!

AIRTEL1PPT

Documents

Transcript of AIRTEL1PPT