T-Mobile is the 4th largest telecom operator globally with a market cap of Euro 40 billion. It has a strong presence in Europe, North America, and emerging economies. The document analyzes T-Mobile's financial performance from 2000-2009 including dividend payments, earnings, capital structure, cash flows, and intrinsic value. It finds the company's market price is below its calculated intrinsic price of 15.78, suggesting it may be undervalued.

1. T-Mobile
By
Chetan Goenka
Ravi Jha
Srivathsan
Soumya Agarwal
Vivek Modgil

2.  4th Largest Telecom Operator in World
 Market Cap -Euro 40 Billion
 Strong presence in Europe ,N America & Emerging
economies.
 Investment in Subsidiaries in 2002
Facts

3. Dividend and Market Price
Year Dividend
2000 0.62
2001 0.37
2002 0
2003 0
2004 0.62
2005 0.72
2006 0.72
2007 0.78
2008 0.78
2009 0.78
DAX Index
T Mobile Stock Prices
Dividend Declarartions

4.  Mix of Sticky and
Constant growth.
 Single instance of
decreased dividend
 2 instances of no
dividend
Dividend Policy
0.62
0.37
0 0
0.62
0.72 0.72
0.78 0.78 0.78
0
0.1
0.2
0.3
0.4
0.5
0.6
0.7
0.8
0.9
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009

5. Earnings and P/E ratios
196
-586
110
131
13
34
816.37 31.61
115.53
10.74 15.13
-20.75
16.37
-700
-600
-500
-400
-300
-200
-100
0
100
200
300
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
Earnings per share *100 P/E

6. Capital Structuring
1.34
0.95
1.73
1.38
0.93
0.79 0.80 0.82
0.89
0.98
0
0.2
0.4
0.6
0.8
1
1.2
1.4
1.6
1.8
2
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
Debt/Equity

7. Shareholding Pattern
By May 2001, approximately 57% of DT’s shares were privately owned. Of these 57%,
38.3% were owned by households/individual investors and 61.7% by institutional
investors. Approximately one-third of private investors come from Germany
and the US, the remainder from the rest of Europe (23.8%) and Asia (9.9%).

8. EBITDA v/s Net Profit
-1.5
-4.7 -4.8
0.2
2.2
4.7
3.9
3 3.4 3.4
12.9
15.1
16.3
18.3
19.4
20.7
19.4 19.3 19.5
20.7
-10
-5
0
5
10
15
20
25
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
Net profit (adjusted) EBITDA

9. Cash Flows
10
11.9 12.5
14.3
16.3
15.1
14.2 13.7
15.4 15.8
-27.7
-10.1
-14.3
-11.4
-8.6
17.9
-4.8 -5.2
-12.7
-8
-2.1
-6.1
-3.1
-5.1
-30
-20
-10
0
10
20
30
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
CFO CFI CFF

10. Intrinsic Value
http://www.docstoc.com/docs/41342632/The-Cost-of-Capital-for-Mobile-Operators-Investigation-into
Average Return on Equity 5%
Last Dividend 0.79
Intrinsic Share Price 15.78
Market Price 9.12

11. Future Plans