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A

PROJECT REPORT

ON

A RETAILERS BEHAVIOUR TOWARDS MTS

(SUBMITTED IN PARTIAL FULFILLMENT OF REQUIREMENTS FOR

MASTER OF BUSINESS ADMINISTRATION)

2013 - 2014

SISTEMA SHYAM TELELINK SERVICES LIMITED

AMRAPALI CIRCLE, VAISHALI NAGAR, JAIPUR

Submitted By

PRITAM SINGH

SHEKHAWAT

Submitted To

Head of DepartmentManagement StudiesMDS

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PREFACE

This project report has been prepared as per the requirement of the syllabus of BBA course

structure under which the students are the required to undertake research. We look our projectstudy ―RETAILERS BEHAVIOUR TOWARDS MTS‖ Jaipur city in Rajasthan.

It was a firsthand experience for us as that we were exposed to the professional set-up and were

facing the market, which was really a great experience.

During project period, I had very touching experiences. When business is involved, experiences

counts a lot, as we know, experience are an instrument, which leads towards success. As we all

know that working in market on the grass route level has always been a pleasure.

Now I take this opportunity to present the project report and sincerely hope that it will be as

much knowledge enhancing to the readers as it was to use during the fieldwork and the

completion of the report.

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TABLE OF CONTENT

PARTICULARS: PAGE NO

ACKNOWLEDGEMENT 04

INTRODUCTION 05

CONCEPT OF THE STUDY

OBJECTIVE 07

DATA COLLECTION 07

LIMITATIONS OF THE STUDY 08

MARKET – SIZE, PLAYERS AND TRENDS 09

OPPORTUNITY 15

MTS : AN INTRODUCTION 16

MISSION 17

CORPORATE GOVERNANCE 18

STRATEGY 19

SISTEMA HISTORY 21

CORPORATIVE CULTURE 28

SOCIAL RESPONSIBILITY 29

INTREPRETATION AND ANALYSIS OF DATA 32

CONCLUSION 41

RECOMMENDATION 42

BIBLIOGRAPHY 43

ANNEXURES 44

QUESTIONNAIRES

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ACKNOWLEDGEMENT

This project would never had been an achievable task, had I not been under the great shelter of

guidance of respected Mr. Anurag Jhanwer. His simplified teaching technique based on

examples had helped me gain more understanding of the subject.

The very essence of the project work is the linguistic precision which has an impact of conveying

more detail in least possible words. I am very much grateful to Mr. Navojit sir for their unfailing

co-operation.

I am very much under obligation to mention here, the contributions of my batch mates who have,

knowingly or unknowingly, provided me the competitive edge which is the driving force of the

whole labour and extra labour put into the project. I would also take an opportunity to thank all

the respondents, who have taken pains in answering the questions and filled the place of true

representatives for deciding the nature of the problem.

PRITAM SINGH SHEKHAWAT

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INTRODUCTION

Exactly ten years ago, Jyoti Basu in Calcutta called Sukh Ram in Delhi in what was the first

mobile phone call in India. Brick sized cell phones used to cost Rs. 45,000 and each call costedRs. 16.5/minute. Back then, cell phone was a status symbol. Today, there are over 60 million

mobile connections in India (expected to double in number in next 12 months). A local call costs

around less than Rs 1/min and a cell phone can be purchased for less than Rs. 2000

CONCEPT

TELECOM SECTOR : A GLOBAL SCENARIO

The Indian telecom market has been displaying sustained high growth rates. Riding on

expectations of overall high economic growth and consequent rising income levels, it offers an

unprecedented opportunity for foreign investment. A combination of factors is driving growth in

the telecom market, promising rich returns on investments.

India is the fourth largest telecom market in

Asia after China, Japan and South Korea.

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The Indian telecom network is the eighth largest in the world and the second largest

among emerging economies.

The Indian telecom market size of over US $ 8 billion is expected to increase three fold

by 2012. The expansion of the telecom industry in India has been fuelled by a massive

growth in mobile phone users, which has reached a level of 10 million users in December

2002, an increase of nearly 100 per cent in 2002.

This exponential growth of mobile telephony can be attributed to the introduction of

digital cellular technology and decrease in tariffs due to competitive pressures. For the

first time in India, the growth of cellular subscriber base has exceeded the fixed line

subscriber base. However, cellular penetration is still 1 per cent as compared to world

average of around 16 per cent.

INDIAN TELECOM SECTOR

Indian Telecom sector, like any other industrial sector in the country, has gone through many

phases of growth and diversification. Starting from telegraphic and telephonic systems in the

19th century, the field of telephonic communication has now expanded to make use of advanced

technologies like GSM, CDMA, and WLL to the great 3G Technology in mobile phones. Day by

day, both the Public Players and the Private Players are putting in their resources and efforts to

improve the telecommunication technology so as to give the maximum to their customers.

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The Indian telecom sector can be broadly classified into Fixed Line Telephony and

mobile telephony. The major players of the telecom sector are experiencing a fierce

competition in both the segments.

The major players like BSNL, MTNL, VSNL in the fixed line and Airtel, Vodafone

(Hutch), Idea, Tata, Reliance in the mobile segment are coming up with new tariffs and

discount schemes to gain the competitive advantage.

The Public Players and the Private Players share the fixed line and the mobile segments.

Currently the Public Players have more than 60% of the market share.

OBJECTIVE

The purpose of the project is to get better knowledge about the retailers behavior towards

MTS in the telecom sector in today‘s scenario because this sector is at the booming stage.

To identify and analyze whether the company is communicating in the market positively

or not. (MARCOM Analysis)

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DATA COLLECTION

Primary data sources like use of questionnaire are included for collecting primary data.

LIMITATION OF THE STUDY

The study has following limitations:

Due to sample size: The sample size of our project is particularly small. A small sample

size has a greater probability that the observation just happened to be particularly good or

particularly bad. Therefore it is harder to find significant relationships from the data, as

statistical tests normally require a larger sample size to justify that the effect did not just

happened by chance alone.

Literacy level: In earlier days people don‘t prior their children‘s on studies but firstly let

their children‘s learn business techs but now things are changing people are know

understanding that due to lack in studies they are lacking behind .so know people are

making their new generation literate

Lack of contact with company personnel acted as hindrance in the study.

The study is based on the limited knowledge & information provided by the marketing

personnel‘s and individuals who were available for interview.

The basis of selection of sample for the study was vague. Randomly individuals were

picked up to provide their responses on the questionnaire.

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MARKET – SIZE, PLAYERS AND TRENDS

Both fixed line and mobile segments serve the basic needs of local calls, long distance calls and

the international calls, with the provision of broadband services in the fixed line segment and

GPRS in the mobile arena. Traditional telephones have been replaced by the codeless and the

wireless instruments.

Mobile phone providers have come up with GPRS – enabled multimedia messaging,

internet surfing, and mobile commerce.

The much-awaited 3G mobile technology has entered in the Indian telecom market.

The GSM, CDMA, WLL service providers are all upgrading them to provide 3G mobile

services.

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Radio services have also been incorporated in the mobile handsets, along with other

applications like high storage memory, multimedia applications, multimedia games, MP3

Players, video generators, Camera's, etc. The value added services provided by the

mobile service operators contribute more than 10% of the total revenue.

The 2009 budget has brought further relief to the customers with the reduction in the

tariffs, both local and long distance, and with slashing down the roaming rentals. This is

likely to lead to even more people going for cellular services and more and more use of

the value added services.

However, landline telephony is likely to remain popular, too, in the foreseeable future.

MTNL, the largest landline service provider, has recently taken some bold initiatives to

retain its market share and, if possible, expand it.

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MAJOR PLAYERS

There are three types of players in telecom services:

• -State owned companies (BSNL and MTNL)• -Private Indian owned companies (Reliance Infocomm, Tata Teleservices,)

• -Foreign invested companies (Hutchison-Essar, Bharti Tele-Ventures, Escotel, Idea Cellular,

BPL Mobile, Spice Communications)

BSNL

On October 1, 2000 the Department of Telecom Operations, Government of India became acorporation and was renamed Bharat Sanchar Nigam Limited (BSNL). BSNL is now India‘s

leading telecommunications company and the largest public sector undertaking. It has a network

of over 45 million lines covering 5000 towns with over 35 million telephone connections. The

state-controlled BSNL operates basic, cellular (GSM and CDMA) mobile, Internet and long

distance services throughout India (except Delhi and Mumbai). BSNL will be expanding the

network in line with the Tenth Five-Year Plan (1992-97). The aim is to provide a telephone

density of 9.9 per hundred by March 2007. BSNL, which became the third operator of GSM

mobile services in most circles, is now planning to overtake Bharti to become the largest GSM

operator in the country. BSNL is also thelargest operator in theInternet market, with a share of 21

per cent of the entiresubscriber base

BHARTI

Established in 1985, Bharti has been a pioneering force in the telecom sector withmany firsts and

innovations to its credit, ranging from being the first mobile servicein Delhi, first private basic

telephone service provider in the country, first Indiancompany to provide comprehensive

telecom services outside India in Seychelles andfirst private sector service provider to launch

National Long Distance Services in India. Bharti Tele-Ventures Limited was incorporated on

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July 7, 1995 for promoting investments in telecommunications services. Its subsidiaries operate

telecom services across India. Bharti‘s operations are broadly handled by two companies: the

Mobility group, which handles the mobile services in 16 circles out of a total 23 circles across

the country; and the Infotel group, which handles the NLD, ILD, fixed line, broadband, data, and

satellite-based services. Together they have so far deployed around 23,000 km of optical fiber

cables across the country, coupled with approximately 1,500 nodes, and presence in around 200

locations. The group has atotal customer base of 6.45 million, of which 5.86 million are mobile

and 588,000 fixed line customers, as of January 31, 2004. In mobile, Bharti‘s footprint extends

across 15 circles. Bharti Tele-Ventures' strategic ob jective is ―to capitalize on the growth

opportunities the company believes are available in the Indian telecommunications market and

consolidate its position to be the leading integrated telecommunications services provider in key

markets in India, with a focus on providing mobile services‖.

MTNL

MTNL was set up on 1st April 1986 by the Government of India to upgrade the quality of

telecom services, expand the telecom network, introduce new services and to raise revenue for

telecom development needs of India‘s key metros – Delhi, the political capital, and Mumbai, the

business capital. In the past 17 years, the company has taken rapid strides to emerge as India‘s

leading and one of Asia‘s largest telecom operating companies. The company has also been in

the forefront of 5 technology induction by converting 100% of its telephone exchange network

into the state-of-the-art digital mode. The Govt. of India currently holds 56.25% stake in the

company. In the year 2003-04, the company's focus would be not only consolidating the gains

but also to focus on new areas of enterprise such as joint ventures for projects outside India,

entering into national long distance operation, widening the cellular and CDMA-based WLLcustomer base, setting up internet and allied services on an all India basis.

MTNL has over 5 million subscribers and 329,374 mobile subscribers. While the market for

fixed wireline phones is stagnating, MTNL faces intense competition from the private players —

Bharti, Hutchison and Idea Cellular, Reliance Infocomm — in mobile services. MTNL recorded

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sales of Rs. 60.2 billion ($1.38 billion) in the year 2002-03, a decline of 5.8 per cent over the

previous year‘s annual turnover of Rs. 63.92 billion.

RELI ANCE I NFOCOMM

Reliance is a $16 billion integrated oil exploration to refinery to power and textiles conglomerate

(Source: http://www.ril.com/newsitem2.html). It is also an integrated telecom service provider

with licenses for mobile, fixed, domestic long distance and international services. Reliance

Infocomm offers a complete range of telecom services, covering mobile and fixed line

telephony including broadband, national and international long distance services, data services

and a wide range of value added services and applications. Reliance IndiaMobile, the first of

Infocomm's initiatives was launched on December 28, 2002. This marked the beginning of

Reliance's vision of ushering in a digital revolution in India by becoming a major catalyst in

improving quality of life and changing the face of India. Reliance Infocomm plans to extend its

efforts beyond the traditional value chain to develop and deploy telecom solutions for India's

farmers, businesses, hospitals, government and public sector organizations.

Until recently, Reliance was permitted to provide only ―limited mobility‖ services through its

basic services license. However, it has now acquired a unified access license for 18 circles that

permits it to provide the full range of mobile services. It has rolled out its CDMA mobile

network and enrolled more than 6 million subscribers in one year to become the country‘s largest

mobile operator. It now wants to increase its market share and has recently launched pre-paid

services. Having captured the voice market, it intends to attack the broadband market.

TATA TELESERVICES

Tata Teleservices is a part of the $12 billion Tata Group, which has 93 companies, over 200,000

employees and more than 2.3 million shareholders. Tata Teleservices provides basic (fixed line

services), using CDMA technology in six circles:

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Maharashtra (including Mumbai), New Delhi, Andhra Pradesh, Tamil Nadu, Gujarat, and

Karnataka. It has over 800,000 subscribers. It has now migrated to unified access licenses, by

paying a Rs. 5.45 billion ($120 million) fee, which enables it to provide fully mobile services as

well. The company is also expanding its footprint, and has paid Rs. 4.17 billion ($90 million) to

DoT for 11 new licenses under the IUC (interconnect usage charges) regime. The new licenses,

coupled with the six circles in which it already operates, virtually gives the CDMA mobile

operator a national footprint that is almost on par with BSNL and Reliance Infocomm. The

company hopes to start off services in these 11 new circles by August 2004. These circles

include Bihar, Haryana, Himachal Pradesh, Kerala, Kolkata, Orissa, Punjab, Rajasthan, Uttar

Pradesh (East) & West and West Bengal.

VSNL

On April 1, 1986, the Videsh Sanchar Nigam Limited (VSNL) - a wholly Government owned

corporation - was born as successor to OCS. The company operates a network of earth stations,

switches, submarine cable systems, and value added service nodes to provide a range of basic

and value added services and has a dedicated work force of about 2000 employees. VSNL's main

gateway centers are located at Mumbai, New Delhi, Kolkata and Chennai. The international

telecommunication circuits are derived via Intelsat and Inmarsat satellites and wide band

submarine cable systems e.g. FLAG, SEA-ME-WE-2 and SEA-ME-WE-3.

The company's ADRs are listed on the New York Stock Exchange and its shares are listed on

major Stock Exchanges in India. The Indian Government owns approximately 26 per cent equity,

M/s Panatone Finvest Limited as investing vehicle of Tata Group owns 45 per cent equity and

the overseas holding (inclusive of FIIs, ADRs, Foreign Banks) is approximately 13 per cent and

the rest is owned by Indian institutions and the public. The company provides international and

Internet services as well as a host of value-added services. Its revenues have declined from Rs.

70.89 billion ($1.62 billion) in 2001-02 to Rs. 48.12 billion ($1.1 billion) in 2002-03, with voice

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revenues being the mainstay. To reverse the falling revenue trend, VSNL has also started

offering domestic long distance services and is launching broadband services. For this, the

company is investing in Tata Telservices and is likely to acquire Tata Broadband.

VODAFONE

Vodafone‘s presence in India dates back to late 1992, when they worked with local partners to

establish a company licensed to provide mobile telecommunications services in Mumbai.

Commercial operations began in November 1995. Between 2000 and March 2004, Vodafone

acquired further operator equity interests or operating licences. With the completion of the

acquisition of BPL Mobile Cellular Limited in January 2006, it now provides mobile services in

16 of the 23 defined licence areas across the country.

Vodafone India has benefited from rapid and profitable growth in recent years. it had over 17.5

million customers by the end of June 2006.

IDEA

Indian regional operator IDEA Cellular Ltd. has a new ownership structure and grand designs to

become a national player, but in doing so is likely to become a thorn I the side of Reliance

Communications Ltd. IDEA operates in eight telecom ―circles,‖ or regions, in Western India,

and has received additional GSM licenses to expand its network into three circles in Eastern

India -- the first phase of a major expansion plan that it intends to fund through an IPO,

according to parent company Aditya Birla Group.

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OPPURTUNITIES

India offers an unprecedented opportunity for telecom service operators, infrastructure vendors,

manufacturers and associated services companies. A host of factors are contributing to enlarged

opportunities for growth and investment in telecom:

an expanding Indian economy with increased focus on the services sector

population mix moving favorably towards a younger age profile

urbanization with increasing incomes

Investors can look to capture the gains of the Indian telecom boom and diversify their operations

outside developed economies that are marked by saturated telecom markets and lower GDP

growth rates.

MTS : AN INTRODUCTION

Sistema Shyam TeleServices Ltd. was founded in 1998 (original name – Shyam Telelink Ltd.)

and started full-scale business in Rajasthan in 2000. The company obtained its pan-India license

for provision of mobile services in March 2008 and at present has enough spectrum to provide

mobile telephony services in 22 telecom-circles, covering India‘s 28 states and 7 union

territories, with a population of 130 million.

As of May 2009, Sistema Shyam TeleServices has over 1 million users spread over more than

600 cities in Rajasthan, 373 cities in Tamil Nadu (including megapolis Chennai), 247 cities in

Kerala and 250 towns in West Bengal (including Kolkata). The subscribers‘ base growth in

Rajasthan has been 8.5 - 12% per month, starting from the network launch on 30th September

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2008. The company continues to implement its strategy of pan-India mobile network

construction, with the aim to cover over 35 million subscribers with its services (almost 7% of

Indian market.

The new head office of Sistema Shyam TeleServices was established in January 2009 in

Gurgaon – one of India‘s commercial capitals near Delhi. These new headquarters com bine the

functions of corporate office and technology centre, where top management and experts of

different divisions are equipped with the most modern infrastructure to support their work.

Since March 2009, Sistema Shyam TeleServices has been able to use the MTS brand for

advertising and other communication in India as per the agreement signed between the company

and MTS in December 2008. And since its launch, the MTS brand has been successful in every

market it has stepped into. The MTS brand is in the top 100 list of global brands according to

BRANDZä rating of Financial Times и Millward Brown.

Sistema Shyam TeleServices Limited (SSTL) was founded in 1998 and started its operations in

the state of Rajasthan in 2000. Presently SSTL has more than 500,000 fixed-line and mobile

subscribers in the state of Rajasthan and continues to further expand its network and develop its

service offering. SSTL obtained a unified pan-Indian license to provide cellular services in

March 2008 and now has spectrum in 22 Indian circles. SSTL is a joint venture between Sistema

and the Shyam Group of India. Sistema Shyam TeleServices is majority-owned by Sistema

(73.7%).

Some of the information in this press release may contain projections or other forward-looking

statements regarding future events or the future financial performance of Sistema. You can

identify forward looking statements by terms such as ―expect,‖ ―believe,‖ ―anticipate,‖

―estimate,‖ ―intend,‖ ―will,‖ ―could,‖ ―may‖ or ―might‖ the negative of such terms or other

similar expressions. We wish to caution you that these statements are only predictions and that

actual events or results may differ materially. In addition, there is no assurance that the new

contracts entered into by our subsidiaries referenced above will be completed on the terms

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contained therein or at all. We do not intend to update these statements to reflect events and

circumstances occurring after the date hereof or to reflect the occurrence of unanticipated events.

Many factors could cause the actual results to differ materially from those contained in our

projections or forward-looking statements, including, among others, general economic

conditions, our competitive environment, risks associated with operating in Russia, rapid

technological and market change in our industries, as well as many other risks specifically

related to Sistema and its operations.

MISSION

We create business leaders in service industries, mainly in high-tech sector. Our mission meets

the expectations of our shareholders as well as society's interests.

Sistema invests best finance, intellectual and management resources into business and economic

development of Russia to achieve a success in the accomplishment of its mission.

Corporate Governance

Sistema was among the first Russian companies to recognize the value of strong corporate

governance and remains a leader in informational openness and transparency.

Its system of corporate governance is based on several core principles: transparency in all

business processes for our investors and partners, maintaining an engaged and professional board

of directors and maintaining a consistent approach to all issues concerning the Corporation‘s

management. Sistema applies these principles to all company processes and procedures,

including strategic management, financial accounting and reporting, audit, risk management, HR

policy, corporate governance and corporate social policy.

Sistema‘s processes and procedures are codified in the Company‘s Charter, which determines the

structure and competencies of its governing bodies. The Company‘s Corporate Code and Code of

Ethics contain additional commitments that Sistema has made in terms of promoting openness,

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collective decision making, social responsibility, and ethical principles in its relationship with

partners, governments, employees, and shareholders.

Sistema‘s main governing bodies are the General Meeting of Shareholders, Board of Directors,

President and Management Board. Board committees are operational at the Board level, special

committees are operational at the President level to make policy recommendations. The

Company‘s organizational structure is built on the basis of operational management, identifying

key issues and establishing bodies with the necessary competencies to resolve them.

Throughout 2007 the Company made several strides to further the development of its corporate

governance structures. A new set of procedures was adopted by the Board of Directors in

October 2007 to increase the effectiveness of the Board‘s meetings. The changes call for a slight

reduction in the number of planned meetings per year and improving preparation and

organization processes. This will entail preparing more thorough materials in the run up to the

Board‘s meetings and limiting the number of invitees to the Board‘s meetings. Board materials

will be first reviewed by the Management Board and Board committees before being distributed.

The new rules also institutionalize constant flow of information between management and the

members of the Board of Directors between the Board‘s meetings.

Sistema launched an internal corporate governance rating system in June 2007 to measure theeffectiveness of corporate governance at its subsidiaries. The methodology relies on concepts

used by ratings agencies such as Standard & Poor‘s, Moody‘s and Expert RA. The results have

been used to create action plans to further the development of its subsidiaries‘ corporate

governance systems.

Strategy

Our strategy is to create companies-leaders on highly potential markets and permanent search for

the new opportunities for growth.

Investing in Growth

In 2007 the Board of Directors approved the principles of the portfolio strategy proposed

by the management. These principles call for an increase of the share of privately held businesses

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in the portfolio. Following this decision of the Board, Sistema initiated several investment

projects and M&A transactions in its fast growing businesses of Financial

Services,Retail,Media, Healthcare,and Travel.

Sistema was active in sourcing and taking advantage of new investment opportunities.

We acquired control in Indian mobile and fixed-line operator Shyam Telelink with the goal

of entering the rapidly growing Indian telecommunications market. Sistema will bring its

Russian and CIS telecommunications expertise to transform Shyam Telelink into a leading pan-

Indian communications provider.

The Corporation is developing its business relationships with the Russian state and is now seen

as a reliable private sector partner capable of providing competitive products and services. The

new National Center for Crisis Management that Sistema‘s subsidiaries had built for the Russian

Ministry of Emergency Situations in 2007 is one example of this partnership‘s potential.

Active Management

Sistema is a strategic investor and the controlling shareholder of its core businesses. The

Corporation sets targets for them, contributes to the development of their strategies, and monitors

the strategy‘s implementation.

In 2007 the boards of Sistema‘s subsidiaries fixed an updated set of KPIs, the so-called Criteria

Base. These KPIs steer the management towards shareholder value, creating growth, and at the

same time target mid-term operational indicators, aiming to outperform the competition.

To complement the ambitious goals set before the management, we initiated a review

of incentive and remuneration systems. In 2007 the boards of most companies introduced annual

bonus programs linked to KPIs, as well as long-term stock option plans.

Adding Value

Sistema‘s management believes that growing businesses within a diversified holding creates

numerous opportunities to add value to the portfolio of the Corporation. The holding structure

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in the relatively immature Russian economy helps raise financing at a corporate level on more

attractive terms, launch joint projects of businesses and make the best use of cross-selling

opportunities, and create and maintain a valuable corporate pool of top managers. Furthermore,

as one of the leading Russian companies, Sistema can more effectively represent the interests

of its businesses on national and international levels.

In 2007 Sistema raised $500 million in debt financing to develop its Indian project and

placed a 6-bn-ruble bond issue in March 2008 on very favorable terms, given the current market

environment. We launched the Tochka project, a chain of all-in-one retail stores that offer goods

and services from across the Corporation‘s areas of operations, including mobile and fixed-

line communications, banking, travel services, and multimedia.

At the same time, Sistema made a series of senior level appointments in its businesses that

included not only managers taken from the pool of internal candidates, but also those hired from

other companies.

Sistema's History

Sistema's ownership structure was formed in 1993. During this year the acquisition of the main

assets in telecommunications, high-tech, tourism, trade, oil and oil products, construction and

development was completed

Last Events

September 2008

Shyam Telelink launches cdma mobile network.

Sistema appoints Sergey Savchenko as chief financial officer of Shyam Telelink.

Sistema completes licensing process in India.

August 2008

Standard & Poor‘s upgrades Sistema corporate rating to ВВ.

Sistema consolidates its ownership of Dalcombank.

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Comstar-UTS has built wireless broadband access network in Tyumen.

July 2008

Sistema announces new organizational structure.EBRD provides a us$50 million syndicated loan facility to finance the expansion of Detsky

mir group retail network.

Sistema appoints vsevolod rozanov as chief executive officer of Shyam Telelink.

v. Mamay appointed as director of Comstar-UTS‘s south branch.

Sistema appoints maxim uvarov as general director of CJSC binnofarm.

CEO of MTS mikhail shamolin joins the board of the GSM association.

JSC Comstar-UTS appoints I.Gavriletsky as CEO of CJSC converiasvyaz.

Moody‘s confirms credit rating of Sistema-hals OJSC at B1.

Comstar acquires ural telephone company.

Shyam Telelink selects equipment vendors for its network rollout.

Sistema board of directors elects new management board.

Sochitelecomservice and porttelecom merged into JSC Comstar-UTS.

June 2008

New appointments at Sistema-hals.

Sistema obtains radio frequencies in four additional circles in India.

Sistema increases its stake in shyam Telelink to 73.71%.

Intracom telecom enters India.

Concern «RTI Systems» has acquired the majority shareholding of the watt drive

group (Austria).

Sistema signs US$ 613.3 million standby letter of credit and term loan facility.

Comstar to consolidate Comstar-direct.

Comstar acquires interlink group in Ryazan.

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May 2008

MTS announces the appointment of the new chief executive officer.

Sistema appoints leonid melamed as president and chief executive officer.

Sistema increases its stake in shyam Telelink.

Sistema and chinese corporation cpmiec sign agreement on cooperation.

Sistema-Hals concludes agreement with leading italian architectural firm.

Sergey tischenko has been appointed as president and CEO of «RTI Systems concern» JSC.

Sistema obtains radio frequencies in two additional circles in India.

Fitch ratings confirms B+ credit rating for Sistema-hals jsc.

Sistema signs memorandum of understanding with das holding LLC.

April 2008

MTS ranked in world‘s 100 most powerful brands.

Sistema repays US$ 350 million eurobond issue.

Sistema obtains radio frequencies in eight additional circles in India.

Detsky mir and Sistema-hals announce closure of flagship Detsky mir store on Lubyanka

square for reconstruction.

Sistema obtains radio frequences in India.

Fitch rates OJSC mobile telesystems (MTS) ‗BB+‘; outlook stable.

Sistema-hals sells 22 Rochdelskaya project.

March 2008

Comstar launches long term incentive programme for executives.

Comstar to build multimedia FTTB network in Sochi.

Nikolay Maximenka appointed mgts general director, a part of Comstar-OTS.

Jsc Comstar-UTS president Sergey pridantsev awarded the best top manager.

Sistema completes sale of sahles.

Sistema places 6 billion ruble bond issue.

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Sistema signs partnership agreement with the republic of belarus.

Newly appointed commercial director of Comstar-UTS.

«Detsky mir» has completed the reorganization of store management network.

Comstar-UTS appoints vladislav vasin to the position of government relations director.

February 2008

Comstar launches HDTV.

MTS increases ownership in its omsk subsidiary to 100%.

MTS announces subscriber growth numbers for January 2008.

MTS elects a new board of directors.

Sistema opens office in India.

Sistema appoints Sergey boyev as vice president for development of state programmes and

non-public assets.

MTS and Microsoft to work together to deliver mobile services across Russia and CIS.

Sistema completed the creation of healthcare services holding.

Comstar announces business development strategy for the southern federal district of Russia.

SITRONICS announces appointment of new head of telecom solutions division.

Sistema-Hals has appointed andrey solovyev as company‘s financial director.

Sistema acquires further 50.5% stake in Dalcombank.

Sergey Shmakov appointed first vice president of JSC Sistema-Hals.

January 2008

Comstar to build first wimax network in armenia.

SITRONICS signs contracts with MTS-Ukraine.

Federal service for financial markets has registered report on the issue of additional common

stocks of Detsky mir — center OJSC.

SITRONICS extraordinary shareholder meeting elects new board of directors.

Comstar builds multi-service ngn network in Ukraine.

Moody‘s investors service conf irmed mbrd ratings.

MTS announces subscriber growth numbers for Desember 2007.

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Sistema acquires control of shyam Telelink.

Sistema obtains telecommunication licenses in India.

Sistema-Hals signs strategic partnership agreement with apsys.

Sistema-Hals chooses a strategic partner to develop the kamelia resort complex in sochi.

December 2007

TS Retail sets up a new retail brand TOCHKA.

Comstar-UTS signs an agreement with Intel for strategic partnership on development of

WiMAX first mobile network in Russia.

SITRONICS launches production of 0.18 micron chip technology in Zelenograd.

Sistema-Hals gains a partnership agreement with Hebei Construction Group, a Chinese state-

owned company, to carry out development projects in Russia.

Bashcell is purchased by MTS for $38 million.

Sistema announces its decision to offer up to RUB 6 billion of unconvertible interest-bearing

bonds.

Intourist Group of Companies accomplishes the first phase construction of tourist complex

Altai.

The company Access executes option and becomes a shareholder in Comstar-UTS with a

stake of 11,06%.

MBRD obtains a syndicated loan of $50 million.

Sistema-Hals sales stake in 13 CJSC Kostyansky to the partner company MIRAX Group.

MBRD consolidates 66% of EWUB.

The section of Zvenigorodskoe highway between Moscow Ring Road and Marshall Zhukov

Avenue is constructed by Sistema-Hals.

Medsi acquires Family Medicine Corporation Sistema launches long-term incentive program

for its employees.

November 2007

Sitronics sings a strategic partnership agreement with Nokia Siemens Networks.

Sistema registers share split by 1,000 times.

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Sistema-Hals announces the obtaining of the credit line of $200 million from VTB Bank.

Comstar UTS acquires «Regional Technical Centre» (Khanty-Mansi Autonomous Area) and

Digital Telephone Networks South for $188 million.

MTS and Olympic Committee of Russia announce the establishment of strategic partnership.

October 2007

Sistema signes share purchase agreement for the acquisition of additional 41% stake in Shyam

Telelink Ltd. As a result Sistema stake in the operator will be 51%.

Sistema acquires further 28,16% stake in Dalcombank. As a result Sistema increases its

ownership in the bank up to 48,16%.

Sistema approves the development strategy for its healthcare services division. Sistema

intends to create a chain of 100 clinics by 2011.

September 2007

Sistema shares lists on MICEX. Sistema JSFC shares are included in the ―B‖ list under the

symbol AFKS.

Sistema registers share split by 1,000 times.

MTS acquires 80% authorized capital of International Cell Holding Ltd.

MTS purchases 74,9% of Gorky-8 Ltd.

Sitronics sets up WiMAX network for telecommunication operator in the Kingdom of

Bahrain. Project value is $10.2 million.

Sitronics prices announced first ruble-denominated bond issue. Issuing size is RUB 3 billion

for the term of 3 years.

Sistema enters Indian market after acquiring 10% stake of Indian telecommunication operator

Shyam Telelink.

August 2007

Comstar UTS subsidiary is opened in St. Petersburg.

Sochitelecomservice operator is purchased by Comstar UTS.

Sistema acquires 20% of Dalcombank.

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July 2007

Sistema Telecom is incorporated into Sistema as a new division.

June 2007

Sistema consolidates 100% of Medexpress network of medical centers.

Sistema-Hals` Board of Directors is joined by 3 independent directors.

Sistema-Hals approves an option program.

MTS increases its share in Uzdunrobita, Uzbek mobile operator, up to 100%.

May 2007

MTS acquires federal license allowing it to provide 3G services in Russia.

American Hospital Group is purchased by Sistema.

Sistema acquires 20% of Medexpress network of medical centers.

Comstar founds a business-block Comstar International.

April 2007

Sistema gains 2 positions in Svyazinvest Board of Directors.

Golden Line of Comstar Direct is purchased by Comstar.

Sistema increases its share in Sitronics up to 60%.

Comstar acquires licenses to provide data transmission in 10 regions of Russia.

March 2007

According to the valuation carried out by Cushman and Wakefield Stules & Riabokobylko the

value of the Sistema-Hals stake in the property and projects increased by 35%.

Sistema-Hals is included in the RUXX (Russian Industrial Leaders Index) database.

Comstar acquires licenses to provide data transmission in 8 regions of Russia.

Comstar sells its stake in alternative fixed-line telecommunications operator ZAO Metrocom.

Sitronics and Chinese ZTE Corporation signs a Memorandum of Understanding for

developing communication facilities and consumer electronics.

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MTS announces its decision to write off costs associated with the acquisition of a 51% stake

in Bitel LLP, a Kyrgyzstan-based GSM mobile telephone operator.

February 2007

Sistema completes the purchase of 0.48% of its own stock.

Sitronics makes an IPO on LSE raising $400 million. The whole company is valued at $2.35

billion.

S&P confirms BB- long-term corporate credit rating on Sistema and makes a forecast as

«positive».

S&P assigns BB- long-term corporate credit rating to Comstar, with a «positive» forecast.

Sistema sells 46.19% of ROSNO to Allianz.

January 2007

Comstar obtaines licenses for IP Voice and Data transmission, including WiMAX services, in

twenty largest regions in Russia

Sistema-Hals signs a $187 million credit agreement with Eurohypo AG.

Corporative Culture

Sistema takes care of employees' education, their professional growth and always pay attention

to their opinion.

We share common corporate culture

The corporate culture of Sistema includes the philosophy and traditions of the organization,

accepted rules and norms of behavior and the style of mutual relations between employees of the

corporation. It is not so difficult to form principles of corporate philosophy in a few words:

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concern for each other and the whole company for its employees. If our employees see that the

corporation cares for their future, then they feel confidence in tomorrow. It ensures a comfortable

climate in the staff, stability, and it means that the efficiency of the daily work of each of us

increases. We believe that the human capital investments, including raising of skills, social

security or improvement of labor conditions, should always be made, guaranteeing a maximum

return from each of the employees of the corporation.

An important milestone in the formation of the corporate culture of Sistema was the adoption of

the Code of Corporate Behavior and the Code of Ethics.

We work in high tech markets; therefore intellectual leadership is one of the key factors of

success for us. For this reason we attract and mean to attract only the best personnel. We take

care of their training, career development and listen attentively to their opinion.

We are investing in human capital

The aim of personnel policy of Sistema is the creation of an effective, successful team of

managers, able to realize the company's business strategy in the conditions of the present day

market. Creating such a team, we are sure that investments in human potential will bringmaximal returns to the company, and ensure long term competitive advantages and leadership in

high tech spheres of economy.

At present, Sistema unites more than 90,000 employees; each of them is a perfect professional in

his business.

We are building contemporary motivation schemes

One of the key tasks of the human resources service of Sistema is to give the company's

employees an opportunity to reveal their capabilities, providing at the same time adequate

remuneration for successes. For this purpose, there is a system of staff motivation in the

corporation and subsidiary companies, which directly connects the achievements of an employee

with his career development and bonus payments.

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We are educating our personnel

We are striving sincerely so that every employee of Sistema had a personal opportunity to go

through the extended education, to increase his/her professional skill, getting a possibility of the

career growth inside the company. Training centers for increasing the professional skills are

successfully working in large companies of the corporation, like MGTS, MTS, Comstar UTS,

RTI Systems, etc. Around 30000 of the employees undergo training in the special company‘s

centers, on the courses outside Sistema as well as training in boarders of President‘s program

every year.

The Corporate University High School on Management and Innovations provides additionalopportunities of training to the employees. Sistema jointly with Lomonosov Moscow State

University organize the courses. The Corporate University gives the employees an opportunity to

receive high quality professional education without leaving their employment, ensuring further

career growth.

Social Responsibility

The social responsibility of a large corporation today is a reflection of the complex network of

relationships within a modern market economy. A critical component of responsibility is the

nature of the business the corporation conducts and the contribution of its products and services

to the economy as a whole.

At the core of Sistema‘s corporate outlook is the belief that the Company‘s businesses make vital

contributions to improving the quality of life in the markets they serve.

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Sistema focuses on growing service oriented high technology businesses that foster the creation

of an innovation economy in Russia and help diversify the economy to compete on the global

marketplace. Sistema‘s business strategy dovetails with the Russian government‘s belief that

promoting high technology is a national priority and crucial for the country‘s development.

Sistema‘s products and services provide customers with access to world class communications,

credit, and modern homes, offices, and infrastructure. As a responsible employer and corporate

citizen, Sistema has always been on the forefront of adapting international best practice to the

Russian landscape. Sistema has also played an important role in the growth of Russian capital

markets and creating a positive investment environment in the country.

At the same time, Sistema recognizes that it has a moral obligation as a leading Russian

company to contribute to the development of a better society in ways not limited to its

businesses. Sistema is an important patron of the arts, promotes sports, helps preserve cultural

treasures, contributes to the development of science and education, and reaches out to vulnerable

layers of society. In 2007 it published its first ever Social Report, which highlighted the range of

programs and charities it sponsors in the communities where it operates.

Sistema has adopted internationally recognized principles of sustainable development and

corporate social responsibility and integrates them into its business practices.

Corporation became one of the first companies in Russia to sign the Global Compact of the

United Nations (UNGC) in 2002. In 2003, Sistema joined the World Business Council for

Sustainable Development (WBCSD). As with other WBCSD members, the corporation has

committed itself to maintain a high level of transparency and responsibility in all aspects of its

business.

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INTERPRETATION AND ANALYSIS OF DATA :

Here, I am going to tabulate and analyze the data which I have gathered through my

questionnaire. These tabulation and analysis are deduced with common question which will givefocus on marcom analysis.

This Field Study was conducted on MTS, Jaipur to know the views of the retailers about

the organization.

A survey of 100 retailers was conducted.

The questionnaires were given to the following retailers which resides in the area of:-

MANSAROVER, SANGANER, RAJA PARK, RAISER PLAZA, PRATAP NAGAR.

Problem of distributor changing

YES 67%

N0 33%

67%

33%

DISTRIBUTOR PROBLEM

YES NO

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.

Response of the customer about MTS

FAVOURABLE 88%

UNFAVOURABLE 10%

CAN’T SAY 2%

0

10

20

30

40

50

60

70

80

90

100

FAVOURABLE UNFAVOURABLE CAN'T SAY

CUSTOMER RESPONSE

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3.Top three operators

GSM AIRTEL, IDEA, RELIANCE

CDMA RELIANCE, TATA, MTS

4.Monthly MTS connections sold

Less than 10 34

10 – 20 21

20 – 30 13

30 – 40 08

40 – 50 07

50 – 60 06

60 – 70 02

More than 70 09

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5.Factors responsible for no.1 player in CDMA

Low entry price 06%

Lowest tariff 07%

Support from company/distributor personal 53%

High visibility 15%

Any other 19%

34

21

13

8 7 62

9

Less than 10 10 – 20 20 – 30 30 – 40 40 – 50 50 – 60 60 – 70 More than

70

MONTHLY CONNECTIONS SOLD

6%7%

53%

15%

19%

FACTORS FOR NO.1 PLAYER IN CDMA

Low entry price

Lowest tariff

Support from company/distributor personal

High visibility

Any other

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6.Media vechile appropriate to support sales

YES 84%

NO 16%

7.Push and Pull ratio of MTS

PULL 91%

PUSH 09%

84%

16%

MEDIA VECHILE APPROPRIATE

YES NO

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8.Do you know about new SMS schemes

YES 96%

NO 04%

PULL PUSH

91%

9%

Push and Pull ratio of MTS

96%

4%

Knowing about SMS schemesYES NO

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9.Factors responsible for selling MTS more from Push

No print ad 00

No radio ad 00

Less outdoor 01

Less pos materials 03

Any other reason 05

10.Merchandiser come for Merchandising frequently

YES 97%

NO 03%

0%

20%

40%

60%

80%

100%

YES

NO

YES, 97%

NO, 3%

Merchandiser come for Merchandising

frequently

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11.Facing the problem of message delay

YES 56%

No 44%

12.Satisfication with Merchandising job and the communication material that get displayed

in your outlet

YES 87%

NO 13%

YES No

56%

44%

Facing the problem of message delay

YES

87%

NO

13%

Satisfication with Merchandising job

and the communication material

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13. Problem of network while E-Rechrge

YES 25%

NO 75%

14. Any special comment or suggestion for MTS

Refund of Claim 07

Improvement in Service 06

Do not change Distributor 04

Schemes 08

Supply Delay 05

Replacement problem 07

Network Improvement 09

Reduce Cutting 03

God one to sell 10

Multimedia sets 08

Low Commission 10

Display Problem 03

No Problem 20

YES NO

25%

75%

Problem of network while E-Rechrge

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CONCLUSIONS

In the next two years, MTS is expected to become the 2nd largest CDMA in India, after theReliance and soon be in a position to overtake the Reliance as well.

1. The important facts which could be concluded from our data regarding the retailers

survey is that they face the problem of distributor changing due to which they have to

suffer the losses.

2. It was seen that retailers do not receive their claims on time.

3. There is a certain decline in sales due to end of schemes (MTS to MTS free).

4. POS material was not properly distributed among the retailers.

5. Pull ratio is more as compared to Push.

6. Most of the customers response favorably when the retailers told them about MTS.

7. Almost all the retailers are satisfied with the merchandisers job.

8. Network and message delay problem are the main drawbacks.

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RECOMMENDATIONS

1. New distributor should activate the old connections.

2. Service should be more improved along with networking.

3. Distributor should be fixed for at least a year.

4. Advance schemes should be updated to the retailers time to time.

5. Supply should be on time so that retailers should not face shortage.

6. Replacement of the defected sets on time.

7. Reduce cutting of commission of the retailers.

8. Solve advance activation problem.

9. Multimedia sets should be introduced along with the present range.

10. POS material should be first given to those who kept the MTS connections and then the

others.

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BIBLIOGRAPHY

WEB SITES:

1. www.ficci.com/telecom.htm

2. www.mtsindia.in

3. www.sistemashyamteleserviceslimited.com

Magazines :

India Today

Business word

Business India

Economic Times

Material provided by the company

Survey

Search Engines :

www.google.com

www.wikipedia.com

http://www.sistemashyamteleserviceslimited.com/

http://www.sistemashyamteleserviceslimited.com/

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QUESTIONNAIRE FOR THE CUSTOMERS

Personal information:-

Name of the Outlet :--__________________________________Name of the Person contacted :--__________________________________

Contact no. :--__________________________________

Address :--__________________________________

1. Which mobile connections are available in your Shop?

Airtel

Idea

BSNL

Vodafone

Reliance

Tata Indicom

MTS

2. Do you face the problem of changing distributor?

Yes

No

3. Response of the customer when you told them about MTS

Favorable

Unfavorable

Can‘t Say

4. Which are the top three operator in term of sales?

GSM _________________________________________________________

CDMA _________________________________________________________

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5. How many monthly MTS connections do you sell?

Less than 10

10 – 20

20 – 30

30 – 40

40 – 50

50 – 60

60 – 70

More than 70

6. If MTS is not No.1 in CDMA, then why do you think No.1 player is holding this position?

Low entry price

Lowest tariff

Support from company/ Distributor personal

High visibility

Any other (please specify)

7. Is Media Vehicle appropriate to support sales of MTS?

Yes

No

8. What is the Push and Pull ratio of MTS?

_____________________________________________________________________________

9. Do you know about new SMS schemes?

Yes

No

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10 If sell of MTS connections are happening more from push, what do you think are the possible

reasons of the same?

No Print Ad

No Radio Ad

Less Outdoor

Less POS Material

Any other reason (please specify)

11. Does Merchandiser come for merchandising frequently?

Yes

No

12. Do you face the problem of message delay?

Yes

No

13. Are you satisfied with merchandising job and the communication materials that get displayed

in your outlet?

Yes

No

14. If no, what is the reason?

Creative is not appealing

Communication is not clear

Size of the poster is small

Any other (please specify)

15.Do you have the problem of network busy while E-Recharge from your mobile?

Yes

No

16. Any special comment or suggestion for MTS?

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