Bharti Airtel Report

8/10/2019 Bharti Airtel Report

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FINANCIAL ANALYSIS

OF

BHARTI AIRTEL LTD.

COMPILED BY:

AMAN RAWAT (07304)BHAVIK VYAS (07311)

IPSHITA VERMA (07325)

HARDIK MARFATIA (07329)

RADHIKA GUPTA (07346)

VITRAG SHELADIA (07352)

YASHMITA GOEL (07358)


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CONTENTS

1. SECTION I Introduction........................................................................................................04

Products............................................................................................................04

Board of Directors.............................................................................................05

Worldwide Presence.........................................................................................06

Shareholding Pattern........................................................................................07

2. SECTION II Peer Comparison.............................................................................................09

3. SECTION III Ratio Analysis..................................................................................................13

Trend Analysis.................................................................................................25

Analysis of Cash Flow Statement....................................................................31

4. SECTION IV SWOT Analysis...............................................................................................33

5.ANNEXURES Consolidated Balance Sheet..........................................................................35

Consolidated Profit And Loss Account...........................................................36

Cash Flow Statement.....................................................................................37


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SECTION I


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INTRODUCTION:

Bharti Airtel Limited, commonly known as Airtel, is an Indian

multinational telecommunications Service Company headquartered in New Delhi, India. In

1983, Sunil Bharti Mittal founded the Bharti Group. It operates in 20 countries across South

Asia, Africa, and the Channel Islands. Airtel has GSM network in all countries in which itoperates, providing 2G, 3G and 4G services depending upon the country of operation. Airtel

is the world's fourth largest mobile telecommunications company by subscribers with over

275 million subscribers across 20 countries as of July 2013. It is the largest cellular service

provider in India, with 191.39 million subscribers as of July 2013.

Airtel is the largest provider of mobile telephony and second largest provider of fixed

telephony in India, and is also a provider of broadband and subscription television services.

It offers its telecom services under the Airtel brand, and is headed by Sunil Bharti Mittal.

Bharti Airtel is the first Indian telecom service provider to achieve Cisco Gold Certification. It

also acts as a carrier for national and international long distance communication services.

The company has a submarine cable landing station at Chennai, which connects thesubmarine cable connecting Chennai and Singapore.

Airtel launched "Hello Tunes", a Caller ring back tone service (CRBT), in July 2004

becoming to the first operator in India to do so. The Airtel theme song, composed by A.R.

Rahman, was the most popular tune on that year.

On 26 February 2013, Airtel announced that it had deployed Ericsson s Mobile Broadband

Charging (MBC) solution and completely modernized its prepaid services for its subscribers

in India. As a part of the deal, Ericssons multi service MBC suite allows prepaid customers

to have personalized profile based data charging plans. Prepaid customers will be able to

customize their data plans across mobility, fixed line and broadband by cross bundlingacross multiple domains (2G, 3G, 4G/LTE & Wi-Fi). It will also offer flexible multi service

charging in geographical redundant mode, making Airtel the first operator to implement

geographical redundancy at such a large scale.

PRODUCTS:

1. Fixed line and mobile telephony

2. Broadband and fixed-line internet services

3. Digital television

4. IPTV


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BOARD OF DIRECTORS:

Executive Chairman

Sunil Bharti Mittal

Director

Chua Sock Koong

Pulak Chandan Prasad

Rajan Bharti Mittal

Managing Director Manoj Kohli

Director Nikesh Arora

Craig Edward Ehrlich

Tan Yong Choo

Tsun Yan Hsieh

Company Secretary Mukesh Bhavnani

Additional Director Manish Kejriwal

Obiageli Oby Ezekwesili

Additional Director & JMD Gopal Vittal

Ajay Lal


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WORLDWIDE PRESENCE:

a. TheIndian Subcontinent:

Airtel Bangladesh,in Bangladesh

Airtel, in India

Airtel Sri Lanka,in Sri Lanka

b. Airtel Africa,which operates in 17 African countries:

Burkina Faso, Chad, Democratic Republic of the Congo, Republic of the

Congo, Gabon, Ghana, Kenya, Madagascar, Malawi, Niger, Nigeria, Rwanda,

Seychelles, Sierra Leone, Tanzania, Uganda and Zambia.
http://en.wikipedia.org/wiki/Indian_Subcontinenthttp://en.wikipedia.org/wiki/Airtel_Bangladeshhttp://en.wikipedia.org/wiki/Bharti_Airtel_Lankahttp://en.wikipedia.org/wiki/Airtel_Africahttp://en.wikipedia.org/wiki/Airtel_Africahttp://en.wikipedia.org/wiki/Bharti_Airtel_Lankahttp://en.wikipedia.org/wiki/Airtel_Bangladeshhttp://en.wikipedia.org/wiki/Indian_Subcontinent


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SHAREHOLDING PATTERN:

Shareholding pattern of a company shows how its shares are split among the entities that

make up its owners.

Shareholding pattern of Bharti Airtel is as follows:

ParticularsNo. of

SharesPercent share(%)

Promoter Holding

Indian Promoters 1735453890 45.7

Foreign Promoters 865673286 22.8

Non-Promoter holdings (Other thanPublic)

Financial Institutions/Banks 166287643 4.38

FII/Foreign Fin Inst/Foreign Banks 665436317 17.52Corporate Bodies 154418700 4.07

Government Holdings 0 0

OCB 5082710 0.13

NRI 55 0

Mutual Funds 144077538 3.79

Other Foreign Holdings 3366737 0.09

General Public

Individual Holding Upto Rs. 1 lakh 41017834 1.08

Individual Holding Excess of Rs. 1 lakh 10783182 0.28

Others 5932204 0.16

Total 3797530096 100

Shareholding Pattern (%)

Promoter Holding

Indian Promoters

Foreign Promoters

Non-Promoter holdings

(Other than Public)

Financial

Institutions/Banks

FII/Foreign Fin

Inst/Foreign Banks


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SECTION II


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OPERATING PERFORMANCE

I. PEER COMPARISON:

Peer comparison is an investment rating used by analysts when given security is expected to

provide returns that are consistent with those of other companies within its sector.

We will be comparing Bharti Airtel with its Peers Idea Cellular, Reliance communication,

Tele Communication and MTNL.

COMPETITION

Name

NSE

Price Market Cap (Rs Crore)

Sales

Turnover Net Profit

Total

assetsBharti Airtel 313.75 125418.43 45350.90 5096.30 67126.00

Idea Cellular 158.10 52437.29 22036.87 818.26 23072.72

Reliance Communication 139.50 28793.17 11267.00 624.00 73068.00

Tata Communication 161.70 4608.45 4416.12 475.24 8087.80

MTNL 10.75 677.25 3428.66 -5321.12 12184.20

i. On The Basis Of NSE Price:Comparing on the basis of NSE Price, Bharti Airtel is highest priced, MTNL being the

cheapest.

0.0050.00

100.00150.00200.00

250.00300.00350.00

NSE Price

NSE Price


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ii. On The Basis Of Market Capture:

Comparing on the basis of Market Capture, we can see that Bharti Airtel has the largest

market share, whereas the peers are nowhere close to it.

iii. On The Basis Of Sales Turnover:

Comparing on the basis of Sales Turnover, Bharti Airtels turnover of the sales is the highest.

0.0020000.0040000.0060000.0080000.00

100000.00120000.00140000.00

Market Cap (Rs Crore)

Market Cap (Rs Crore)

0.005000.00

10000.0015000.00

20000.0025000.0030000.0035000.0040000.0045000.0050000.00

Sales Turnover

Sales Turnover


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iv. On The Basis Of Net Profit:

Comparing on the basis of Net Profit, we observe that Bharti Airtels Net Profit is the highest,

while its peers Net Profit is a few thousands, MTNLs being in negative.

v. On The Basis Of Total Assets:

Comparing on the basis of Total Assets, Bharti Airtel is ranked Two, Reliance

Communication being the First and Tata Communication being Fifth.

-6000.00

-4000.00

-2000.00

0.00

2000.00

4000.00

6000.00

Net Profit

Net Profit

0.0010000.0020000.0030000.0040000.0050000.0060000.0070000.0080000.00

Total assets

Total assets


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SECTION III


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RATIO ANALYSIS

Ratio Analysis is a tool used by individuals to conduct a quantitative analysis of information in a

company's financial statements. Ratios are calculated from current year numbers and are thencompared to previous years, other companies, the industry, or even the economy to judge the

performance of the company. Ratio analysis is predominately used by proponents of fundamental

analysis.

I. LIQUIDITY RATIOS:Liquidity Ratios measure the ability of a company to repay its short-term debts and meet

unexpected cash needs.

Liquidity Ratios Mar '10 Mar '11 Mar '12 Mar '13

Current Ratio 1.06 0.5 0.81 0.54

Quick Ratio 1.06 0.5 0.81 0.54

Debtors' Turnover Ratio 15.3 16.97 18.45 20.7

Inventory Turnover Ratio 1307.05 1105.11 1296.07 21595.67

i. CURRENT RATIO:

The Current Ratio measures a company's ability to pay short-term obligations. It

gives an idea of the company's ability to pay back its short-term liabilities

(debt and payables) with its short-term assets (cash, inventory, receivables). The

higher the current ratio, the more capable the company is of paying its obligations.

Ideally it is 2:1.

Bharti Airtel had a healthy Current Ratio in March 2010, but it declined steeply to 0.5

in March 2011 and has been on a lower side since then due to inadequate Working

Capital. This indicates that the firm might not be able to meet its current liabilities.

0

0.2

0.4

0.6

0.8

1

1.2

Mar '10 Mar '11 Mar '12 Mar '13

Current Ratio

Current Ratio


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ii. QUICK RATIO:

Quick Ratio determines whether a firm has enough short-term assets to cover its

immediate liabilities without selling inventory.

Since Current Ratio and Quick Ratio of Bharti Airtel has been identical, it indicates

that the quantum of inventory is sufficient for the company.

iii. DEBTORS TURNOVER RATIO:

Debtors Turnover Ratio signifies how fast the debtors can be converted into

equivalent cash.

This ratio for Bharti Airtel has been increasing which means that the company has

been able to convert debtors into cash at a faster rate each year, which leads to an

increase in cash balance which the company can use for its day to day operations.

0

0.2

0.4

0.6

0.8

1

1.2

Mar '10 Mar '11 Mar '12 Mar '13

Quick Ratio

Quick Ratio


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iv. INVENTORY TURNOVER RATIO:

Inventory Turnover Ratio shows that how many times in a year, a companys inventory

changes.

This ratio has been moreover a constant one from March 2010 to March 2012 but

increased steeply in March 2013 indicating that the sales of Bharti Airtel have been

increasing.

0

5

10

15

20

25

Mar '10 Mar '11 Mar '12 Mar '13

Debtors' Turnover Ratio

Debtors' Turnover

Ratio

0

5000

10000

15000

20000

25000

Mar '10 Mar '11 Mar '12 Mar '13

Inventory Turnover Ratio

Inventory Turnover

Ratio


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II. PROFITABILITY RATIO:

Profitability ratios measure a company's operating efficiency, including its ability to generate

income and therefore, cash flow. Cash flow affects the company's ability to obtain debt and

equity financing.

Profitability Ratios Mar '10 Mar '11 Mar '12 Mar '13

Net Profit Margin 26.47 20.3 13.77 11.24

Operating Profit Margin 39.08 35.25 32.98 29.7

Return On Equity 29.42 19.2 12.33 9.9

Return On Capital Employed 26.27 18.51 13.97 12.41

i. NET PROFIT MARGIN:

Net Profit Ratio establishes the relationship between net profit and sales, that is, it

shows the percentage of net profit earned on sales. It is an indicator of overall

efficiency of the business.

It has been on a decline since March 2010 indicating that the companys overall

efficiency has suffered a downfall.

0

5

10

15

20

25

30

Mar '10 Mar '11 Mar '12 Mar '13

Net Profit Margin

Net Profit Margin


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ii. OPERATING PROFIT MARGIN:

Operating Profit Margin measures the operational efficiency of a firm.

It has also been decreasing which again means that the companys earnings have

been declining.

iii. RETURN ON EQUITY:

The amount of net income returned as a percentage of shareholders equity. Return

on equity measures a corporation's profitability by revealing how much profit a

company generates with the money shareholders have invested.

It has been decreasing since March 2010 indicating that Bharti Airtel has not

generated much profit with the money invested by shareholders.

0

5

10

15

20

25

30

35

40

45

Mar '10 Mar '11 Mar '12 Mar '13

Operating Profit Margin

Operating Profit

Margin

0

5

10

15

20

25

30

35

Mar '10 Mar '11 Mar '12 Mar '13

Return On Equity

Return On Equity


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iv. RETURN ON CAPITAL EMPLOYED:

Return on Capital Employed judges the overall performance of the enterprise, that is,

the efficiency and the profitability.

It has been declining since March 2010.

0

5

10

15

20

25

30

Mar '10 Mar '11 Mar '12 Mar '13

Return On Capital Employed

Return On Capital

Employed


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III. SOLVENCY RATIO:The solvency ratio measures the size of a company's after-tax income; excluding non-cash

depreciation expenses, as compared to the firm's total debt obligations. It provides a

measurement of how likely a company will be to continue meeting its debt obligations.

Solvency Ratios Mar '10 Mar '11 Mar '12 Mar '13

Debt Equity Ratio 0.14 0.27 0.29 0.24

Debt To Total Asset Ratio 0.08 0.14 0.13 0.15

Interest Coverage -17.84 27.92 5.98 4.91

i. DEBT EQUITY RATIO:

A measure of a company's financial leverage calculated by dividing its totalliabilities by stockholders' equity. It indicates what proportion of equity and debt the

company is using to finance its assets.

Debt Equity Ratio of Bharti Airtel initially increased from March 2010 to March 2012,

but gradually decreased in March 2013. The gradual decline in debt/equity ratio

shows that the company is less dependent on debt for its financing activities.

0

0.05

0.1

0.15

0.2

0.25

0.3

0.35

Mar '10 Mar '11 Mar '12 Mar '13

Debt Equity Ratio

Debt Equity Ratio


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ii. DEBT TO TOTAL ASSET RATIO:

A Debt to Total Asset Ratio is a measurement representing the percentage of a

corporation's assets that are financed with loans and financial obligations lasting

more than one year.It has been increasing since March 2010 indicating that the percentage of Bharti

Airtels assets that are financed with loans and financial obligations lasting more than

one year has increased.

iii. INTEREST COVERAGE:

Interest Coverage Ratio shows how efficiently a company can pay off its interest

expenses over and above the principle amount.

In March 2011, it was the highest of these four years but again declined in the

consecutive years indicating the companys ability to pay off its interest expenses has

decreased.

0.00

0.02

0.04

0.06

0.08

0.10

0.12

0.14

0.16

Mar '10 Mar '11 Mar '12 Mar '13

Debt To Total Asset Ratio

Debt To Total Asset

Ratio


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-30

-20

-10

0

10

20

30

40

Mar '10 Mar '11 Mar '12 Mar '13

Interest Coverage

Interest Coverage


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IV. CAPITAL MARKET RATIOS:

Capital Market Ratios Mar '10 Mar '11 Mar '12 Mar '13

Earnings Per Share 24.82 20.32 15.09 13.42

Earnings Yield 0.08 0.06 0.04 0.05

Dividend Yield 0 0 0 0

Price Earning Ratio 12.57 17.59 22.32 21.74

i. EARNINGS PER SHARE:

Earnings Per Share is portion of a company's profit allocated to each outstanding

share of common stock. Earnings per share serve as an indicator of a company's

profitability.Bharti Airtels earnings per share have shown a decline since March 2010 indicating

that its profitability has decreased.

0

5

10

15

20

25

30

Mar '10 Mar '11 Mar '12 Mar '13

Earning Per Share

Earning Per Share


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ii. EARNINGS YIELD RATIO:

The Earnings Yield shows the percentage of each unit of money invested in the stock

that was earned by the company.

It has been on a decline since March 2010, but shown a slight increase in March2013.

iii. DIVIDEND YIELD RATIO:

Dividend Yield Ratio is a financial ratio that shows how much a company pays out in

dividends each year relative to its share price.

It has been constant at 0 since March 2010 as dividend per share was 0.

0.00

0.01

0.02

0.03

0.04

0.050.06

0.07

0.08

0.09

Mar '10 Mar '11 Mar '12 Mar '13

Earnings Yield

Earnings Yield


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iv. PRICE EARNING RATIO:

Price Earning Ratio conveys the number of times market is willing to pay to buy a

firm compared to its current net profits. If a firm has a bright future compared to its

present performance then it would have a high P/E ratio.

In case of Bharti Airtel, this ratio has been increasing from March 2010 to March

2012 but showed a slight decline in March 2013. Nonetheless, according to the price

earning ratio we can say Bharti Airtel has a strong position in the market.

0

0.1

0.2

0.3

0.4

0.5

0.6

0.7

0.8

0.9

1

Mar '10 Mar '11 Mar '12 Mar '13

Dividend Yield

Dividend Yield

0

5

10

15

20

25

Mar '10 Mar '11 Mar '12 Mar '13

Price Earning Ratio

Price Earning Ratio


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TREND ANALYSIS

Trend analysis is important in the business and financial sectors. Trend analysis is often used to

make projections and assessments of financial health. Financial analysts examine the pastperformance of their company, along with current financial conditions, to determine how their

company will perform in the future.

Trend analysis is one of the tools for the analysis of the companys monetary statements for the

investment purposes. In a trend analysis, the financial statements of the company are compared

with each other for the several years after converting them in the percentage.


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BALANCE SHEET

LIABILITIES Mar-10 Mar-11 Mar-12 Mar-13

Shareholder's Funds

Share Capital 100 100.00 100.00 100.00

Share Warrants & Outstandings 100 149.70 157.50 152.66Total Reserves 100 121.01 136.32 149.96

Shareholder's Funds 100 120.07 134.55 147.39

Long-Term Borrowings

Secured Loans 100 43.40 7.36 5.08

Unsecured Loans 100 149.05 164.63 196.80

Deferred Tax Assets / Liabilities 100 15987.88 25354.55 34857.58

Other Long Term Liabilities 0 100.00 100.21 126.17

Long Term Provisions 0 100.00 140.22 149.10

Total Non-Current Liabilities 100 210.42 232.62 283.83

Current Liabilities

Trade Payables 100 63.71 57.96 65.99

Other Current Liabilities 100 191.31 182.21 136.21

Short Term Borrowings 0 100.00 213.27 113.55

Short Term Provisions 100 128.17 154.81 180.60

Total Current Liabilities 100 131.51 152.48 161.85

Total Liabilities 100 131.13 148.20 163.26

ASSETS Mar-10 Mar-11 Mar-12 Mar-13

Non-Current AssetsGross Block 100 138.96 151.33 172.36

Less: Accumulated Depreciation 100 128.10 163.50 204.01

Net Block 100 145.23 144.30 154.09

Capital Work in Progress 100 89.80 57.88 64.64

Intangible assets under development 0 100.00 70.21 0.00

Non Current Investments 100 104.94 105.83 243.14

Long Term Loans & Advances 0 100.00 119.78 126.19

Other Non Current Assets 0 100.00 357.11 461.29

Total Non-Current Assets 100 162.54 162.57 200.33

Current Assets Loans & Advances

Currents Investments 100 2.34 11.55 23.38

Inventories 100 126.47 118.01 7.72

Sundry Debtors 100 69.45 101.40 106.74

Cash and Bank 100 16.31 58.92 44.41

Other Current Assets 100 1546.23 1584.34 1654.97

Short Term Loans and Advances 100 80.66 159.28 95.69

Total Current Assets 100 62.46 116.76 82.20

Net Current Assets (Including Current Investments) 100 -1148.19 -509.59 -1314.30

Total Current Assets Excluding Current Investments 100 82.26 151.42 101.58

Total Assets 100 131.13 148.20 163.26


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PROFIT & LOSS ACCOUNT

Particulars Mar-10 Mar-11 Mar-12 Mar-13

INCOME:Gross Sales 100 106.76 116.83 127.36

Less :Inter divisional transfers 0 0 0 0

Less: Sales Returns 0 0 0 0

Less: Excise 0 0 0 0

Net Sales 100 106.76 116.83 127.36

Other Income 100 129.87 165.57 387.78

Total Income 100 107.01 117.34 130.09

EXPENDITURE :

Increase/Decrease in Stock 100 48.98 -15.65 -204.08

Raw Materials Consumed 100 66.57 45.71 -80.29

Power & Fuel Cost 100 111.40 131.25 157.61

Employee Cost 100 96.71 92.73 100.72

Other Manufacturing Expenses 100 111.21 128.87 149.68

General and Administration Expenses 100 117.34 131.76 146.64

Selling and Distribution Expenses 100 136.84 139.68 155.00

Miscellaneous Expenses 100 100.92 117.14 107.14

Expenses Capitalised 0 0.00 0.00 0.00

Total Expenditure 100 113.71 127.96 145.90

Operating Profit (PBDIT) 100 96.64 100.94 105.65

Interest 100 -57.06 -245.81 -290.90

PBDT 100 90.71 87.54 90.33

Depreciation 100 115.16 147.73 170.48

Profit Before Taxation & Exceptional Items 100 81.55 65.02 60.33

Exceptional Income / Expenses 0 0.00 0.00 0.00

PBT 100 81.55 65.02 60.33

Provision for Tax 100 79.25 96.32 106.71

PAT 100 81.87 60.79 54.07

Adjustment to Profit After Tax 0 0.00 0.00 0.00

Profit Balance B/F 100 144.73 180.96 207.23


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I. INCOME-EXPENDITURE ANALYSIS:

As we can see in the above figure, there has been a continuous increase in Total Income of Bharti

Airtel. It has increased from 36,693.09 Crore in March 2010 to 46,784.00 Crore in March 2013.

Total Expenses have also increased from 21,608.29 Crore in March 2010 to 31,850.20 Crore in

March 2013. The difference between the two, that is, the Operating Profit has been near about

consistent over the years.

The Rate of increase in revenue and expenditure has been shown below:

Both Total Income and Total Expenses have been increasing over the years, but the rate of

increase in Total Expense is higher than that of rate of increase in Total Income. Sales Turnover

and Net Sales have driven the increase in Total Income and continuously high increase in

Miscellaneous Expenses along with introduction of Power and Fuel Cost has contributed to increase

in Total Expenses.

0

50000

100000

150000

200000

250000

300000

350000

400000

450000

500000

Total Income

Total Expenditure

Operating Profit (PBDIT)

0

50

100

150

200

250

300

350

400

450

-10 -11 -12 -13

Other Income

Total Expenditure

Operating Profit

(PBDIT)


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II. PROFIT ANALYSIS:

Both Profit Before Tax (PBT) and Profit After Tax (PAT) have been declining at a same rate over the

years. PBT has declined from 10,703.53 Crores to 6,454.80 Crores whereas PAT has declined

from 9,426.15 Crores to 5,096.30 Crores.

III. EARNINGS PER SHARE AND DIVIDEND PER SHARE:

Earnings Per Share (EPS) has been falling continuously, though Dividend Per Share (DPS) has

been constant over the years, the company has made efforts to maintain the Dividend paid despite

the fall in EPS. The fall in EPS cannot be accounted to increase in number of shares as the shares

in issue have not changed, but can be a result of the falling profit balance.

0

10

20

30

40

50

60

70

8090

100

-10 -11 -12 -13

PBT

PAT

0

20

40

60

80

100

120

Mar '10 Mar '11 Mar '12 Mar '13

EPS

DPS


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IV. EQUITY-DEBT ANALYSIS:

Bharti Airtel has raised the major portion of funds through Shareholders Fund. The value of

Shareholders Fund has been increasing over the years at a tremendous rate ranging from 100 to

150%. The above graph indicates Bharti Airtels heavy dependence on Shareholders Fund.

V. LONG TERM LOAN AND INVESTMENT ANALYSIS:

Loans and Investments have been increasing over the years, but the increase in Investments was

at more than 350%+ rate.

0

100000

200000

300000

400000

500000

600000

Mar-10 Mar-11 Mar-12 Mar-13

Shareholder's Funds

Long Term Debt

0

50

100

150

200

250

300

Mar' 10Mar' 11

Mar' 12Mar' 13

Long Term Debt

Investments


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ANALYSIS OF CASH FLOW STATEMENT

Cash Flow from Operating ActivitiesNet cash flow from operating activities is positive which is good for the company. Company

has generated income of 138847 Millions from operating activities which it can use in

other activities. This means it has good financial flexibility and has a backup if it needs cash.

It has the capacity to meet its daily operating expenses with ease. Increase in Inventories

and increase in Trade and other payables accounts for cash generated from operating

activities.

Cash Flow from Investing ActivitiesBharti Airtel is purchasing fixed tangible and intangible assets which may be due to the fact

that the company is expanding. This analysis can be supported by the fact that the company

has received interest as well as provided loan to its subsidiaries. Also, it has received

dividend from the subsidiary companies and has net movement of advances into the

subsidiaries. A large amount is spent on acquisition/subscription/investment in

subsidiaries/associate/joint venture.

Cash Flow from Financing ActivitiesThe major components of financing activities are receipts from borrowings and repayment of

borrowings. Since the company is highly dependent on equity, so it is important that it

maintains good dividend payment policies and it can be seen that it is doing so. Moreover ithas also been consistent in interest and other finance charges payment.


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SECTION IV


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SWOT ANALYSIS

SWOT Analysis is a structured planning method used to evaluate the Strengths, Weaknesses,

Opportunities, and Threats involved in a project or in a business venture. A SWOT analysis can becarried out for a product, place, industry or person. It involves specifying the objective of the

business venture or project and identifying the internal and external factors that are favourable and

unfavourable to achieving that objective.

STRENGTHS1. Present in more than 20 countries.

2. An integrated telecom company with complete tele-media solutions.

3. Present in the country with second largest population globally.

4. Largest operator in India and fourth largest in the world.5. Technology, infrastructure and skilled manpower.

WEAKNESSES

1. High degree of financial leverage.

2. Inadequate infrastructure in rural regions pushing cost of operations.

3. Integration in operations across continents.

4. Understanding evolving customer perceptions in a multi-cultural and multi-lingual

environment.


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OPPORTUNITIES

1. Untapped telecom market in Africa and rural India.

2. Underpenetrated broadband connectivity.

3. Mandatory digitisation of cable television across the country.4. Increasing data consumption over voice consumption.

THREATS

1. Falling Average Revenue per User.

2. Political and economic uncertainties in Africa and India.

3. Cost inflation across countries.

4. Continued regulatory stringency.

5. Increasing competition and competitive pricing.


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ANNEXURES

I. CONSOLIDATED BALANCE SHEET(Rs. In Millions)

LIABILITIES Mar-10 Mar-11 Mar-12 Mar-13

Shareholder's Funds

Share Capital 18988 18988 18988 18988

Share Warrants & Outstanding 1861 2786 2931 2841

Total Reserves 346523 419342 472377 519633

Shareholder's Funds 367372 441116 494296 541462

Long-Term Borrowings

Secured Loans 394 171 29 20

Unsecured Loans 49995 74516 82309 98388

Deferred Tax Assets / Liabilities 33 5276 8367 11503Other Long Term Liabilities 0 25132 25184 31708

Long Term Provisions 0 1002 1405 1494

Total Non-Current Liabilities 50422 106097 117294 143113

Current Liabilities

Trade Payables 77844 49598 45121 51372

Other Current Liabilities 45004 86097 82000 106034

Short Term Borrowings 0 27644 58956 31390

Short Term Provisions 53531 68611 82874 96677

Total Current Liabilities 176379 231950 268951 285473

Total Liabilities 594173 779163 880541 970048

ASSETS Mar-10 Mar-11 Mar-12 Mar-13

Non-Current Assets

Gross Block 442125 614374 669068 762061

Less: Accumulated Depreciation 161875 207367 264660 330235

Net Block 280250 407007 404408 431826

Capital Work in Progress 15947 14320 9230 10308

Intangible assets under development 0 50472 35435 0

Non Current Investments 111537 117051 118041 271191

Long Term Loans & Advances 0 70812 84817 89358

Other Non Current Assets 0 3059 10924 14111

Total Non-Current Assets 407734 662721 662855 816794

Current Assets Loans & Advances

Currents Investments 46196 1079 5337 10800

Inventories 272 344 321 21

Sundry Debtors 21050 14619 21345 22468

Cash and Bank 8167 1332 4812 3627

Other Current Assets 664 10267 10520 10989

Short Term Loans and Advances 110090 88801 175351 105349

Total Current Assets 186439 116442 217686 153254

Net Current Assets (Including Current Investments) 10060 -115508 -51265 -132219

Total Current Assets Excluding Current Investments 140243 115363 212349 142454Total Assets 594173 779163 880541 970048


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II. CONSOLIDATED PROFIT & LOSS ACCOUNT(Rs. In Millions)

Particulars Mar-10 Mar-11 Mar-12 Mar-13

INCOME:

Gross Sales 356095 380177 416038 453509

Less :Inter divisional transfers 0 0 0 0

Less: Sales Returns 0 0 0 0

Less: Excise 0 0 0 0

Net Sales 356095 380177 416038 453509

Other Income 3773 4900 6247 14631

Total Income 359868 385077 422285 468140

EXPENDITURE :

Increase/Decrease in Stock -147 -72 23 300

Raw Materials Consumed 350 233 160 -281

Power & Fuel Cost 22650 25233 29727 35699

Employee Cost 15005.5 14512 13915 15113

Other Manufacturing Expenses 110418 122800 142300 165271

General and Administration Expenses 43310.5 50821 57067 63511

Selling and Distribution Expenses 21613 29576 30189 33500

Miscellaneous Expenses 5310 5359 6220 5689

Expenses Capitalised 0 0 0 0

Total Expenditure 218510 248462 279601 318802

Operating Profit (PBDIT) 141358 136615 142684 149338

Interest -5680 3241 13962 16523

PBDT 147038 133374 128722 132815

Depreciation 40045 46116 59160 68267

Profit Before Taxation & Exceptional Items 106993 87258 69562 64548

Exceptional Income / Expenses 0 0 0 0

PBT 106993 87258 69562 64548

Provision for Tax 12731 10089 12262 13585

PAT 94262 77169 57300 50963

Adj to Profit After Tax 0 0 0 0

Profit Balance B/F 185028 267785 334820 383438


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III. CASH FLOW STATEMENT


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Date post:	02-Jun-2018
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