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  • Best service provider, good call center serice esp. in local languages, good service even in the remote areas, emphasis on “barriers break when people speak”, new initiatives like google search on airtellive, downloads etc2. Long term HR strategy, Gallup Great Workplace Award, Both internal development as well as external hiring, development programs with iims etc, Young leader development program for top 18 MBA prog3. retail, insurance, realty
  • MNP – Mobile Number Portability
  • The CDMA subscriber base has reached 74.36m in the quarter ending June 2008 as against 68.37m at the end of the previous quarter. The growth in this quarter is 8.76% as against 11.37% for the previous quarter. Reliance remains the largest CDMA mobile operator followed by Tata Teleservices and BSNL with subscriber base of 42.71m, 26.33m and 4.59m respectively. Wimax – This is a disruptive technology facing Indian telecosVoIP – This will put pressure on the Telecos since ISP can offer virtually free internet based mobile phones – Also License fees is 2 Cr against 1650 Cr for telecom operators4 G – people are already talking about it
  • Cellular Services address the communication needs and staying connected.Hence a necessityThere is no substitute that can replace it completely.
  • What they are doing in retail for last 4 years. What to put in Cash Cow.BhartiInfratelThe Company has entered into a joint ventureagreement with Vodafone Essar Limited (Vodafone)and Idea Cellular Limited (Idea) to form an independenttower company (“Indus Towers Limited” or “IndusTower”) to provide passive infrastructure services in16 circles of India. The Company and Vodafone willhold approximately 42% each in Indus Tower and thebalance 16% will be held by Idea. Pursuant to theaforesaid agreement, BhartiInfratel Limited hassubscribed 50,000 equity shares of Rs. 10 each in IndusTowers Limited on December 17, 2007 for an aggregatevalue of Rs. 500 thousand. For this purpose, BhartiInfratel Ventures Limited has been incorporated as awholly owned subsidiary of BhartiInfratel Ltd. Thetelecom passive infrastructure will be transferred toBharti Infratel Ventures for ultimate merger in IndusTowers Limited.TheCompany’s 61,984,721 mobile customers accounted fora 23.8% of wireless (GSM + CDMA) market share as onMarch 31, 2008.The revenues from the mobile services for the financialyear were Rs. 218,697 mn., a growth of 55% over therevenues in the previous financial year. The mobile servicesbusiness contributed 80% to the consolidated revenues.Telemedia ServicesDuring the year, the Broadband and Telephone Servicesbusiness was renamed as Telemedia Services in line withthe Company’s growing focus on new media solutionsand foray into IPTV and DTH businesses.The Company provides broadband (DSL) and telephoneservices (fixed line) in 15 circles spanning over 94 citiesacross India. As on March 31, 2008, the Company had2,283,328 customers (a growth of 22%), of which 34.8%(~795,000) were subscribing to broadband / internetservices.The Company’s strategy for Telemedia business is to focuson the cities with high revenue potential, excepting forDTH which will be an all India offering. The productoffering in this segment includes supply and installationof fixed-line telephones providing local, national andinternational long distance voice connectivity andbroadband Internet access through DSL. The business alsoprovides value added services such as intelligent networkPassive Infrastructure ServicesThe undertaking relating to the entire assets and liabilitiesof telecom passive infrastructure was transferred fromBhartiAirtel Limited to BhartiInfratel Limited pursuant toa scheme of arrangement sanctioned by the Honble HighCourt of Delhi. BhartiInfratel provides passiveinfrastructure services on a non-discriminatory basis to alltelecom operators in India. BhartiInfratel deploys, ownsand manages passive infrastructure on an all India basis.The Company has approximately 52,000 towers as onMarch 31, 2008, of which approx 30,000 towers will betransferred to Indus Towers Ltd (a Joint Venture betweenBhartiInfratel, Vodafone and Idea Cellular) for 16 circles.
  • Telemedia – Airtel Industry % BroadBand - 0.2 4.5 4 Fixed Line 1.2 40 3 Broadband ..HP and Airtel had a deal …As on March 31, 2008, the Company had2,283,328 customers (a growth of 22%), of which 34.8%(~795,000) were subscribing to broadband / internetservices.Broadband subscribers - 4.38 million at the end of June 2008 as compared to 3.87 million at the end of March 2008 (growth rate @ 13.18%)Out of total 4.38 million broadband subscribers, 3.72 million are DSL based; 0.42 million Cable Modem; 0.11 million Ethernet LAN; 0.045 million Fiber; 0.057 million Radio, Leased Line 0.018 million and 0.005 million use other technologies.The key financial results of the Long Distance Servicesdivision for the year ended March 31,2008 are presentedbelow. About 25% growth ..Enterprise Services – Corporates--- 49% growth ….
  • Air1

    1. 1.
    2. 2. Bharti Airtel<br /><ul><li>Largest Private Integrated Telecom Company in India
    3. 3. 3rd Largest Wireless Operator in the World
    4. 4. Largest & Fastest Growing Wireless Operator in India
    5. 5. Largest Telecom Company listed on Indian Stock Exchange</li></ul>2<br />GROUP 7<br />
    6. 6. Integrated Telecom Company<br /><ul><li>Wireless Services
    7. 7. 2G/3G
    8. 8. Rural Market
    9. 9. TelemediaServices
    10. 10. Fixed Line
    11. 11. Broadband
    12. 12. DTH
    13. 13. Enterprise Services
    14. 14. Carrier
    15. 15. Corporate
    16. 16. Passive Infrastructure
    17. 17. BhartiInfratel
    18. 18. Indus Tower</li></ul>GROUP 7<br />3<br />
    19. 19. Financials Snapshot<br />4<br />GROUP 7<br />
    20. 20. Financial Snapshot - Ratios<br />GROUP 7<br />5<br />
    21. 21. Vision 2010<br />By 2010 Airtel will be the most admired brand in India:<br />Loved by more customers<br />Targeted by top talent<br />Benchmarked by more businesses<br />
    22. 22. Vision 2020 <br />To build India's finest business conglomerate by 2020<br />Supporting education of underprivileged children through Bharti Foundation <br />Strategic Intent:<br />To create a conglomerate of the future by bringing about “Big Transformations through Brave Actions.” <br />
    23. 23. Mission<br />“ We at Airtel always think in fresh and innovative ways about the needs of our customers and how we want them to feel. We deliver what we promise and go out of our way to delight the customer with a little bit more” <br />
    24. 24. Core Values<br /><ul><li>Empowering People - to do their best
    25. 25. Being Flexible - to adapt to the changing environment and evolving customer needs
    26. 26. Making it Happen - by striving to change the status quo, innovate and energize new ideas with a strong passion and entrepreneurial spirit
    27. 27. Openness and transparency - with an innate desire to do good
    28. 28. Creating Positive Impact – with a desire to create a meaningful difference in society.</li></li></ul><li>Objectives/Goals<br />To undertake transformational projects that have a positive impact on the society and contribute to the nation building process. <br />To Diversify into new businesses in agriculture, financial services and retail business with world-class partners<br />To lay the foundation for building a “conglomerate” of future<br />
    29. 29. Indian Telecom Sector<br /><ul><li>Fastest Growing Sector – CAGR 22% (2002-07)
    30. 30. Second Largest Telecom Market
    31. 31. Lowest tariff charges in the world
    32. 32. Wireless Subscribers – 315.3 Mn
    33. 33. Wireline Subscribers – 38.4 Mn
    34. 34. Teledensity – 30.6
    35. 35. 23 Circles - 4 Categories ( Metro, A, B & C)
    36. 36. BhartiAirtel – Largest player with presence in 23 Circles</li></ul>11<br />GROUP 7<br />
    37. 37. 12<br />Why Mad Rush for Telecom ??<br /> Low teledensity (depicting large untapped potential) <br />Large number of additions in telecom subscribers<br />Telecom<br />Advantage<br />GROUP 7<br />CAGR 40.4%<br />
    38. 38. 13<br />Evolution of Telecom In India<br />Department of Telecommunication (DoT) is the main body formulating laws and various regulations for the Indian telecom industry.<br />ILDservices was opened to competition<br />BSNL was established by DoT<br />Number portability was proposed (pending) <br />Intra-circle merger guidelines were established<br />Independent regulator, TRAI, was established<br />Private players were allowed in Value Added Services<br />Calling Party Pays (CPP) was implemented<br />Attempted to boost Rural telephony<br />Go-ahead to the CDMA technology<br />1999<br />2007<br />1994<br />2002<br />2005<br />2003<br />2004<br />2006<br />2000<br />Internet telephony initiated<br />Unified Access Licensing (UASL) regime was introduced<br />INDIA <br />1992<br />1997<br />Broadband policy 2004 was formulated—targeting 20 million subscribers by 2010<br />Decision on 3G services (awaited)<br />National Telecom Policy (NTP) was formulated<br />NTP-99 led to migration from high-cost fixed license fee to low-cost revenue sharing regime<br />Reduction of licence fees<br />FDI limit was increased from 49 to 74 percent<br />Reference Interconnect order was issued<br />ILD – International Long Distance<br />GROUP 7<br />
    39. 39. Telecom Ecosystem<br />14<br />Indian Telecom Industry Framework<br />Indian Government Bodies<br />Independent Bodies<br />They formulate various policies and pass laws to regulate the telecom industry in India.<br />They undertake various research activities and monitor the quality of service provided in the Indian telecom industry. They also provide various recommendations to improve the status of telecom operations in India.<br />Wireless Planning and Coordination (WPC)<br />Handles spectrum allocation and management<br />Department of Telecommunications<br />Telecom Regulatory Authority of India (TRAI)<br />DoT – Licensee and frequency management for telecom<br />Independent regulatory body<br />Telecom Disputes Settlement and Appellate Tribunal (TDSAT)<br />Telecom Commission<br />Telecom disputes settlement body<br />Exclusive policy making body of DoT<br />Handles ad hoc issues of the telecom industry<br />Group on Telecom and IT (GoT-IT)<br />GROUP 7<br />
    40. 40. Regulatory Framework<br /><ul><li>74% FDI Investment
    41. 41. Lack of Transparency in Spectrum & License Allocation
    42. 42. 3G Policy & MNP still Pending</li></ul>GROUP 7<br />15<br />
    43. 43. Declinging Tariff – Rising Revenue<br />GROUP 7<br />16<br />Source: TRAI Report<br />
    44. 44. Economic Factors<br />GDP growth rate - Averaged around 7.9 % from 2002-2008<br />Rising Tele-density – Target of 45% by 2010<br />Growing per capita income/disposable Income <br /><ul><li>Rs 12000 in 2002 to Rs 33000 in 2008)</li></ul>Falling Handset Prices<br />Moderate inflation levels which were prevalent during the past 7 years – around 5-6%<br />
    45. 45. Changing Demographics<br /><ul><li>Demand for VAS & Broadband services Among Youth
    46. 46. 28 % Urban Population
    47. 47. Rapid Urbanization
    48. 48. Rising Income level</li></ul>Source: Mckinsey Report<br />
    49. 49. Technology<br />CDMA – Already there are big players in this segment Reliance , Tata <br />3G – Value added services potential still to be tapped fully<br />2G/3G – GSM Currently commands 70% of mobile subscribers in India<br />
    50. 50. Porter’s Generic Strategy <br />20<br />GROUP 7<br />
    51. 51. Porter’s 5 Forces<br />21<br />GROUP 7<br />
    52. 52. 1. Threat from Competition<br />Wireless Market – Top 4 garnering 75% market share<br />22<br />GROUP 7<br />HIGH<br />
    53. 53. Competitor Analysis<br />23<br />GROUP 7<br />Best OP Margins & Net Profit Margins among Peers<br />Source: CMIE November 2008<br />
    54. 54. AMOU & ARPU Stats<br />Minutes of Usage per Month – Mobile Services<br />Despite a low teledensity of approximately 19 percent, India has the second highest minutes of usage per month. This offers huge growth opportunity to telecom companies.<br />ARPU* in India – Mobile Services<br />The declining ARPU implies that India Inc. is tapping a large market at the bottom of the pyramid by reducing tariffs; thereby, enhancing affordability.<br />24<br />GROUP 7<br />
    55. 55. 2. Customer Bargaining Power<br /><ul><li>Lack of differentiation among Service Providers
    56. 56. Cut throat Competition
    57. 57. Low Switching Costs
    58. 58. Number Portability will have –Ve Impact
    59. 59. Businesses & Consumers</li></ul>25<br />GROUP 7<br />HIGH<br />
    60. 60. Market Scenario<br />GROUP 7<br />26<br />Postpaid Vs Prepaid<br />Customers & Market Share<br />
    61. 61. 3. Suppliers Bargaining Power<br />27<br />GROUP 7<br />LOW<br />
    62. 62. 4. Threat of Substitutes<br /><ul><li>Landline
    63. 63. CDMA
    64. 64. Video Conferencing
    65. 65. VOIP - Skype, Gtalk, Yahoo Messenger
    66. 66. e-Mail & Social Networking Websites</li></ul>28<br />GROUP 7<br />HIGH<br />DIMINISHING MARKET<br />BROADBAND SERVICES<br />
    67. 67. 5. Threat of New Entrants<br /><ul><li>Huge License Fees to be paid upfront & High gestation period
    68. 68. Entry of MVNOs & WiMAX operators
    69. 69. Spectrum Availability & Regulatory Issues
    70. 70. Infrastructure Setup Cost - High
    71. 71. Rapidly changing technology</li></ul>29<br />GROUP 7<br />LOW<br />
    72. 72. SWOT<br />Strengths<br />Largest Telecom Player in India - ~80Mn, 22.6%<br />Strategic Alliance with other stakeholders in Bharti Airtel include Sony-Ericsson, Nokia - and Sing Tel<br />Pan India Presence<br />Strong Financials<br />Weakness<br />Outsourcing of Core Systems<br />Lack of emerging market investment opportunity<br />Source: CMIE Report NOV 08<br />30<br />GROUP 7<br />
    73. 73. SWOT<br />Opportunities<br /><ul><li>BhartiInfratel – Cutting Down cost in Rural area
    74. 74. Match Box Strategy – Scale of Penetration
    75. 75. Current Tele-Density – 30.6 is still low among developing countries
    76. 76. Low Broadband Penetration, Rural Telephoney</li></ul>Threats<br />India centric – Major revenues from India<br />Falling ARPU & AMOU<br />Intense Competition & Shortage of Bandwidth <br />31<br />GROUP 7<br />
    77. 77. BCG Matrix for Bharti Airtel<br />HIGH<br />Mobile Services<br />DTH & IPTV<br />Broad Band<br />Market Growth Rate<br />LOW<br />LOW<br />HIGH<br />Market Share<br />32<br />GROUP 7<br />
    78. 78. GE Matrix Classification <br />Business Strength<br /> Strong<br />Medium<br />Weak<br />5.00<br />High<br />3.67<br />Medium<br />Market Attractiveness<br />2.33<br />Low<br />33<br />GROUP 7<br />5.00<br />1.00<br />2.33<br />3.67<br />
    79. 79. Business Strength<br /><ul><li>Current market share
    80. 80. Brand image
    81. 81. Brand equity
    82. 82. Production capacity
    83. 83. Corporate image
    84. 84. Profit margins relative to competitors
    85. 85. R & D performance
    86. 86. Managerial personal
    87. 87. Promotional effectiveness</li></ul>34<br />GROUP 7<br />
    88. 88. Factors Underlying Market Attractiveness<br />35<br />GROUP 7<br />
    89. 89. Factors Underlying Market/Biz Strength<br />36<br />GROUP 7<br />
    90. 90. Airtel’s GE Matrix<br />Business Strengths<br />Low<br />High<br />5.00<br />High<br />Attractive<br />Airtel<br />Enterprise<br />Mobile <br />3.67<br />Moderate Attractive<br />Market Attractiveness<br />TeleMedia<br />2.33<br />Unattractive<br />Low<br />5.00<br />1.00<br />2.33<br />3.67<br />37<br />GROUP 7<br />
    91. 91. Airtel – Strategy<br />MANTRA : Focus on Core Competencies and Outsource the rest!<br />
    92. 92. Strategy<br /><ul><li>Airtelpartnered with leading players in telecommunication players across the globe.
    93. 93. It has managed to work with the best of domain specialists globally and emerge as a world class entity.
    94. 94. Partnerships include operational contracts with marquee vendors and strategic investors ranging from private equity investors to global telecom giants.</li></li></ul><li>Strategic partnerships/ Shareholders – Technology and Capital<br />Warburg Pincus – a celebrated PE investor held a stake for a substantial period of time and was instrumental in providing Airtel support in its early stages.<br />Vodafone was a strategic investor in Airtel.<br />Temasek – the Singapore based investor holds a considerable stake in it.<br />Was also affiliated with Singapore Telecom.<br />
    95. 95. Outsourcing deals in 2004<br />Ericsson was given the mandate to provide, manage and maintain the equipment as well as provide quality assurance in Airtel‘s then 13 mobile circles.<br />IBM was given the mandate to handle the back office requirements of Airtel’s presence in India<br />
    96. 96. Operational Strategies.<br /><ul><li>Higher emphasis on ARPU/min – stark contrast with other operators who concentrate on ARPU only.
    97. 97. Aim to be become a one stop shop for all telecommunication services under the Bharti umbrella.
    98. 98. Exploring opportunities in international markets.
    99. 99. Hived off tower infrastructure into a separate entity.</li></li></ul><li>Performance till date<br />Bharti Airtel has enjoyed an excellent run ever since the telecom sector opened.<br />It has managed to hold on to its leadership position inspite of the presence of other players with deep pockets – Ambani’s, Tata’s, Birla’s and Vodafone.<br />Has coped well with regulatory changes.<br />Continues to attract and delight customers.<br />
    100. 100. Future Strategies<br /><ul><li>Translate its expertise in Indian markets to other emerging economies.
    101. 101. This could call for acquisitions globally.
    102. 102. Technology leadership is a must – Airtel must ensure that its reliance on GSM technology does not render it obsolete.
    103. 103. Indian market inspite of being the worlds largest is still not matured. Opportunities abound in the hinterland which must be exploited.</li></li></ul><li>Growth Factors<br />GROUP 7<br />45<br />
    104. 104. Road Map – Growth Path<br />GROUP 7<br />46<br />VPN & VoIP<br />WiMAX<br />3G<br />2G/2.5G<br />
    105. 105. Airtel - Strategy<br />MANTRA : Focus on Core Competencies and Outsource the rest!<br />
    106. 106. References<br /><ul><li>BhartiAirtel, Annual Report -2008
    107. 107. Investors presentation, BhartiAirtel Limited, November 2008
    108. 108. Telecommunication Services, Indian Industry: A Monthly Review, CMIE – November 2008
    109. 109. Analyst Report – BhartiAirtel, Asit C. Mehta Invesment Intermediates Ltd.
    110. 110. Telecommunication Sector Report – March 2008, CRISIL
    111. 111. Capitaline Database http://capitaline.com
    112. 112. Indian Telecommunication Sector - August 2007, IBEF Report
    113. 113. “Next Big Spenders – Indian Middle Class”, Businessweek</li></ul>GROUP 7<br />48<br />
    114. 114. THANK You !!<br />GROUP 7<br />49<br />

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