PROJECT OF AIRTEL - Copy

8/7/2019 PROJECT OF AIRTEL - Copy

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AN ASSIGNMENT

OF

E-BUSINESS

BHARTI AIRTEL

SESSION 2009-2010

SUBMITTED TO: - SUBMITTED BY:-

Mrs. Rajani Sadiora Surbhi JainDeptt. Of Commerce 10+2(Com.) - E

ROLL NO - 22254371

S.A.N.JAIN MODEL SENIOR

SECONDARY SCHOOL


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BHARTI AIRTEL

COMPANY PROFILE:

Bharti Airtel, formerly known as Bharti Tele-Ventures LTD (BTVL) is India's largest

cellular service provider with more than 100 million subscribers as of May 2009.

With this, Bharti is now the world's third-largest, single-country mobile operator and

sixth-largest integrated telecom operator. It also offers fixed line services and

broadband services. It offers its TELECOM services under the Airtel brand and is

headed by Sunil Bharti Mittal. The company also provides telephone services and

Internet access over DSL in 14 circles. 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 the submarine cable connecting

Chennai and Singapore.

The businesses at Bharti Airtel have been structured into three individual strategic

business units (SBUs) - Mobile Services, Airtel Telemedia Services & Enterprise

Services. The mobile business provides mobile & fixed wireless services using GSM

technology across 23 telecom circles while the Airtel Telemedia Services business

offers broadband & telephone services in 95 cities and has recently launched a Direct-

to-Home (DTH) service, Airtel digital TV. The company provides end-to-end data

and enterprise services to the corporate customers through its nationwide fiber optic

backbone, last mile connectivity in fixed-line and mobile circles, VSATs, ISP and

international bandwidth access through the gateways and landing station.

Globally, Bharti Airtel is the 3rd largest in-country mobile operator by subscriber

base, behind China Mobile and China Unicom. In India, the company has a 24.0%

share of the wireless services market, followed by 17.7% for Reliance

Communications and 17.4% for Vodafone Essar. Airtel was born free, a force

unleashed into the market with a relentless and unwavering determination to succeed.

A spirit charged with energy, creativity and a team driven to seize the day with an

ambition to become the most globally admired telecom service..
http://en.wikipedia.org/wiki/Indiahttp://en.wikipedia.org/wiki/Sunil_Bharti_Mittalhttp://en.wikipedia.org/wiki/Chennaihttp://en.wikipedia.org/wiki/Singaporehttp://en.wikipedia.org/wiki/Indiahttp://en.wikipedia.org/wiki/Sunil_Bharti_Mittalhttp://en.wikipedia.org/wiki/Chennaihttp://en.wikipedia.org/wiki/Singapore


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COMPANY HISTORY:

Airtel was started by Mr.Sunil Bharti Mittal, a graduate from Ludhiana

(PUNJAB).earlier he was owner of local telecom company Beetel. Afterwards he

planned to expand his company at national level and the consequence is Airtel, what

we see today. Bharti Airtel Limited, a part of Bharti Enterprises, is India's leading

provider of telecommunications services. The businesses at Bharti Airtel have been

structured into three individual strategic business units (SBUs) - mobile services,

telemedia services (ATS) & enterprise services. The mobile services group provides

GSM mobile services across India in 23 telecom circles, while the ATS business

group provides broadband & telephone services in 94 cities. The Enterprise services

group has two sub-units - carriers (long distance services) and services to corporates.

All these services are provided under the Airtel brand.

VISION AND PROMISE

By 2010 Airtel wil be the most admired brand in India:

Loved by more customers

Targeted by top talent

Benchmarked by more businesses.

Airtel always finds out fresh and innovative ways to serve the needs of customers and

delivers what it promises and can also go out of the way to delight its customers. It is

also working on mission R.A.C.E. i.e. revenue and customer excellence.

LOGO

The Airtel logo is a specially drawn wood mark. It incorporates two solid, red

rectangular forms whose counter-form creates an open doorway. The title case

lettering with its capital A reinforces our leadership position. The red dot cues in our


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focus on innovation. Our logo is a reflection of our identity a confident symbol of a

brand that is always ahead of the rest, always In-touch and on customers side.

OUR BRAND

Airtel was born free, a force unleashed into the market with a relentless and

unwavering determination to succeed. A spirit charged with energy, creativity and a

team driven to seize the day with an ambition to become the most globally admired

telecom service. Airtel, in just ten years of operations, rose to the pinnacle to

achievement and continues to lead.As India's leading telecommunications company

Airtel brand has played the role as a major catalyst in India's reforms, contributing toits economic resurgence.Today we touch peoples lives with our Mobile services, Tele

media services, to connecting India's leading 1000+ corporate. We also connect

Indians living in USA, UK and Canada with our call home service

BHARTI AIRTEL

ORGANISATIONAL STRUCTURE


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Chairman & Managing Director

Chairman & Managing Director since October 2001Board director since: July 1995

Age: 49 years

Sunil Bharti Mittal is the Founder, Chairman and Managing Director of Bharti Airtel.Sunil is a path-breaking pioneer in the mobile communications industry and is

credited with the phenomenal growth of the telecom sector in India over the last ten

years. A first generation Entrepreneur, he started his first business in 1976 with a


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capital investment of Rs 20,000. He initially founded a number of trading concerns,

and established the first company to manufacture push button telephones in India.

Bharti TeleTech is today one of the largest manufacturers of telephones in the

world. He started his career at a young age of 18 after graduating from Punjab

University in India and founded Bharti, with a modest capital, in the year

1976.

Today, at 51 he heads a successful Enterprise, amongst the top 5 in India, with

a market capitalization of over US$ 25 billion and employing over 30,000

people.

He is an alumnus of Harvard Business School, MA, USA. He has been honored with one of India's highest civilian award Padma

Bhushan.

He received the GSM Association Chairman's Award for the year 2008. He is

also on the board of the International Telecommunication Union (ITU), the

leading United Nations Agency for Information and Communication

Technology.

AWARD & RECOGNITION Bharti Airtel declared Service Provider of the Year

2009 at the 2009 Frost & Sullivan Asia Pacific ICT Awards.

Infrastructure Excellence Awards

Bharti infratel was voted as the Telecom Infrastruture Company of the

year at the CNBC-TV18 Infrastruture Excellence Awards.

World Communications AwardsBharti Airtel recevied the best content service award for the Airtel-IFFCO

Farmer Information Dissemintation Platform at the World Communication

Awards in London.

Bharti Airtel also receive the Best Project Management Awards for its

Gujrat E-GRAM project.

Best Practices in Corporate Social Responsibility

Bharti Airtel ranked 3rd

among indias 500 most valuaable companies for2008


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Buzziest Brands of the year

SWOT Analysis Bharti Airtel

Strengths

Bharti Airtel has more than 65 million customers (July 2008). It is the largest

cellular provider in India, and also supplies broadband and telephone services

- as well as many other telecommunications services to both domestic and

corporate customers.

Other stakeholders in Bharti Airtel include Sony-Ericsson, Nokia - and Sing

Tel, with whom they hold a strategic alliance. This means that the business has

access to knowledge and technology from other parts of the

telecommunications world.

The company has covered the entire Indian nation with its network. This has

underpinned its large and rising customer base.

experience of how a cellular telephone system actually worked. So the start-up

business had to outsource to industry experts in the field.

Opportunities

The company possesses a customized version of the Google search engine

which will enhance broadband services to customers. The tie-up with Google

can only enhance the Airtel brand, and also provides advertising opportunities

in Indian for Google.

Global telecommunications and new technology brands see Airtel as a key

strategic player in the Indian market. The new I-Phone will be launched in

India via an Airtel distributorship. Another strategic partnership is held with

Blackberry Wireless Solutions.

Despite being forced to outsource much of its technical operations in the early

days, this allowed Airtel to work from its own blank sheet of paper, and to

question industry approaches and practices - for example replacing the

Revenue-Per-Customer model with a Revenue-Per-Minute model which is


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better suited to India, as the company moved into small and remote villages

and towns.

The company is investing in its operation in 120,000 to 160,000 small villages

every year. It sees that less well-off consumers may only be able to afford afew tens of Rupees per call, and also so that the business benefits are scalable -

using its 'Matchbox' strategy.

Bharti Airtel is embarking on another joint venture with Vodafone Essar and

Idea Cellular to create a new independent tower company called Indus

Towers.

Airtel and Vodafone seem to be having an on/off relationship. Vodafone

which owned a 5.6% stake in the Airtel business sold it back to Airtel, and

instead invested in its rival Hutchison Essar. Knowledge and technology

previously available to Airtel now moves into the hands of one of its

competitors.

The quickly changing pace of the global telecommunications industry could

tempt Airtel to go along the acquisition trail which may make it vulnerable if

the world goes into recession. Perhaps this was an impact upon the decision

not to proceed with talks about the potential purchase of South Africa's MTN

in May 2008.

Key milestones

Timeline Milestone / Event

2006-2008

- Profit crosses $1bn

- Receives license for providing 2G and 3Gmobile services in Sri Lanka

2005-2006

- All India footprint with launch of mobileservices in Assam

- Becomes Indias largest integrated privateoperator based on total customer base


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2003-2004

- Joins the $1bn revenue club

- Strategic partnership with IBM andEricsson for outsourcing IT and network activities

2001-2002

- Launches Indias first private sectornational and international long distance service

- Becomes a public limited company

1999-2000

- Acquisition of JT Mobile makes it thelargest private telecom operator in India

- Acquires Sky cell to expand its footprint in

South India

1997-1998

- First Private operator to offer fixed linetelephony in Madhya Pradesh

- VSAT launched across India

1995-1996

- Incorporated

- British Telecom acquires a stake in the

company

FINANCIAL PERFORMANCE

OF THE COMPANY OVER THELAST FEW YEARS.

Particulars 2003 2004 2005 2006 2007 2008

Revenues (Rs. Mn) 30,554 50,369 81,558 116,641 184,202 270,122

EBITDA (Rs. Mn) 7,634 17,055 30,658 41,636 74,407 114,018

PAT (Rs. Mn) (2,051) 5,837 12,116 20,279 40,621 63,954

EBITDA (%) 25.0% 33.9 37.6 35.7 40.4 42.2

PAT (%) -6.7% 11.6 14.9 17.4 22.1 23.7


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ROCE (%) 0.9% 9.9 15.7 21.5 31.6 33.3

ROE (%) -4.2% 12.0 23.7 32.0 43.1 38.5

Debt-Equity (x) 0.67 0.86 0.77 0.57 0.37 0.19

EPS (Basic) Rs. (1.11) 3.15 6.53 10.78 21.43 34.23

The consolidated revenue and EBITDA of the Company has grown at a CAGR of

54% and 72% respectively over the last five years. The Company's gross and net

margin has shown an impressive growth over the years. The company turned

profitable in 2004 and has seen a more than ten-fold growth in the profit since then.

As we seen in the above figure that the PAT (Profit After Tax) has been increasing

continuously from the last five years that is a good sign for the company and thismeans that the company is in a good position. The increase in companys revenues is

attributable to the growth in the total customer base more specifically the number of

mobile subscribers which has grown at a CAGR of 82% in the last five years All

business segments of Bharti have registered consistent growth in both top and bottom

lines over the past four years. The Company added 24.8 million mobile customers in

FY2007-08, representing a customer addition of 67% over the previous year. As on

March 31, 2008, the Company had an aggregate of 64.3 million customers, consisting

of 62.0 million mobile and 2.3 million Telemedia Services customers.

FINANCIAL PERFORMANCE OF

THE COMPANY QUARTER WISE

Particulars Q1FY09 Q2FY09 Q3FY09

Revenue (Rs million) 84,833 90,203 96,334

EBITDA (Rs million) 35,106 36,993 39,450

EBITDA Margin 41.40% 41.00% 41.00%

Mobile subscribers (million) 69.4 77.5 85.7

Telemedia subscribers (million) 2.4 6.5 2.6

ARPU (Mobile) 350 331 324

ARPU (Telemedia) 1138 1147 1,098

MoU (Mobile) 534 526 505

EPS (Rs) 10.7 10.8 11.39

Capex (Rs million) 40,671 31,870 38,775


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The Companys revenue increased by 38% to Rs 96,334 million in Q3FY09 as

compared to the same quarter last year. Net Income rose to Rs 21,593 million from

17,224 million in the same quarter last year. The company added 8.17 million

subscribers in Q3FY09 compared with the 5.31 added by its nearest rival Reliance

Communications. Average revenue per user fell from Rs 331 in Q2FY09 to Rs 324 in

Q3FY09. The Companys market share of net additions also fell from 28.5% in

Q2FY008 to 25.9% in this quarter.

FUTURE PROSPECTS AND PLAN

Bharti Airtel Unveils New Global Wholesale Service Portfolio for Telcos

Across the World

Airtel launches Hosted Mail for SMBs

Royal Government of Bhutan to partner with Airtel for fulfilling its 2013 ICT

vision Airtel digital TV expands bouquet to 164 channels

Airtel presents industry first new true and rich broadband experience

BHARTI AIRTEL COMPETITOR

Company Location
http://airtel.in/wps/wcm/connect/About%20Bharti%20Airtel/bharti+airtel/media+centre/fy2009-2010/pg-bharti-airtel-unveils-new-global-wholesale-service-portfolio-for-telcos-across-the-worldhttp://airtel.in/wps/wcm/connect/About%20Bharti%20Airtel/bharti+airtel/media+centre/fy2009-2010/pg-bharti-airtel-unveils-new-global-wholesale-service-portfolio-for-telcos-across-the-worldhttp://airtel.in/wps/wcm/connect/About%20Bharti%20Airtel/bharti+airtel/media+centre/fy2009-2010/pg-royal_government_of_bhutan_to_partner_with_airtel_for_fulfilling_its_2013_ict_visionhttp://airtel.in/wps/wcm/connect/About%20Bharti%20Airtel/bharti+airtel/media+centre/fy2009-2010/pg-royal_government_of_bhutan_to_partner_with_airtel_for_fulfilling_its_2013_ict_visionhttp://airtel.in/wps/wcm/connect/About%20Bharti%20Airtel/bharti+airtel/media+centre/fy2009-2010/pg-airtel_digital_tv_expands_bouquet_to_164_channelshttp://airtel.in/wps/wcm/connect/About%20Bharti%20Airtel/bharti+airtel/media+centre/fy2009-2010/pg-airtel_presents_industry_first_new_true_and_rich_broadband_experiencehttp://airtel.in/wps/wcm/connect/About%20Bharti%20Airtel/bharti+airtel/media+centre/fy2009-2010/pg-bharti-airtel-unveils-new-global-wholesale-service-portfolio-for-telcos-across-the-worldhttp://airtel.in/wps/wcm/connect/About%20Bharti%20Airtel/bharti+airtel/media+centre/fy2009-2010/pg-bharti-airtel-unveils-new-global-wholesale-service-portfolio-for-telcos-across-the-worldhttp://airtel.in/wps/wcm/connect/About%20Bharti%20Airtel/bharti+airtel/media+centre/fy2009-2010/pg-royal_government_of_bhutan_to_partner_with_airtel_for_fulfilling_its_2013_ict_visionhttp://airtel.in/wps/wcm/connect/About%20Bharti%20Airtel/bharti+airtel/media+centre/fy2009-2010/pg-royal_government_of_bhutan_to_partner_with_airtel_for_fulfilling_its_2013_ict_visionhttp://airtel.in/wps/wcm/connect/About%20Bharti%20Airtel/bharti+airtel/media+centre/fy2009-2010/pg-airtel_digital_tv_expands_bouquet_to_164_channelshttp://airtel.in/wps/wcm/connect/About%20Bharti%20Airtel/bharti+airtel/media+centre/fy2009-2010/pg-airtel_presents_industry_first_new_true_and_rich_broadband_experience


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Aditya Birla Management Mumbai, India

Bharat Sanchar Nigam New Delhi, India

Tata Communications

Mumbai, India

PRODUCT LIFE CYCLE

A product's life cycle (PLC) can be divided into several stages characterized by

the revenue generated by the product. If a curve is drawn showing productrevenue over time, it may take one of many different shapes, an example of which

is shown below:

BALANCE SHEET OF AIRTEL

Mar ' 09 Mar ' 08 Mar ' 07 Mar ' 06 Mar ' 05

Sources of funds

Owner's fund

Equity share capital 1,898.24 1,897.91 1,895.93 1,893.88 1,853.37
http://www.hoovers.com/company-information/--ID__138355--/free-co-factsheet.xhtmlhttp://www.hoovers.com/company-information/--ID__132464--/free-co-factsheet.xhtmlhttp://www.hoovers.com/company-information/--ID__53211--/free-co-factsheet.xhtmlhttp://www.hoovers.com/company-information/--ID__138355--/free-co-factsheet.xhtmlhttp://www.hoovers.com/company-information/--ID__132464--/free-co-factsheet.xhtmlhttp://www.hoovers.com/company-information/--ID__53211--/free-co-factsheet.xhtml


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Share application money 116.22 57.63 30.00 12.13 2.72

Preference share capital - - - - -

Reserves & surplus25,627.38 18,283.82 9,515.21 5,437.42 2,675.38

Loan funds

Secured loans 51.73 52.42 266.45 2,863.37 3,959.88

Unsecured loans 7,661.92 6,517.92 5,044.36 1,932.92 1,034.41

Total 35,355.48 26,809.71 16,751.95 12,139.72 9,525.76

Uses of funds

Fixed assets

Gross block 37,266.70 28,115.65 26,509.93 17,951.74 13,240.63

Less : revaluation reserve 2.13 2.13 2.13 2.13 2.13

Less : accumulated depreciation 12,253.34 9,085.00 7,204.30 4,944.86 3,475.64

Net block 25,011.23 19,028.52 19,303.51 13,004.75 9,762.86

Capital work-in-progress 2,566.67 2,751.08 2,375.82 2,341.25 994.46

Investments 11,777.76 10,952.85 705.82 719.70 931.90

Net current assets

Current assets, loans & advances 10,466.63 8,439.38 5,406.81 3,338.88 2,486.31

Less : current liabilities & provisions 14,466.89 14,362.33 11,042.67 7,272.80 4,708.12Total net current assets -4,000.26 -5,922.95 -5,635.86 -3,933.92 -2,221.80

Miscellaneous expenses not written 0.09 0.20 2.66 7.94 58.35

Total 35,355.48 26,809.71 16,751.95 12,139.72 9,525.76

Notes:

Book value of unquoted investments 9,898.56 9,379.62 580.43 476.52 460.83

Market value of quoted investments 1,887.76 1,574.29 125.85 243.99 472.71

Contingent liabilities 4,104.25 7,140.59 7,615.04 4,740.34 3,017.26

Number of equity sharesoutstanding(Lacs)

18982.40 18979.07 18959.34 18938.79 18533.67

PROFIT LOSS ACCOUNT OF AIRTEL


Income

Operating income 34,048.32 25,761.11 17,851.61 11,259.12 8,142.44

Expenses


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Material consumed 12.41 33.85 22.08 67.40 72.10

Manufacturing expenses 8,627.13 7,339.01 5,017.27 3,299.73 2,365.51

Personnel expenses 1,397.54 1,297.88 1,076.95 734.20 475.86Selling expenses 2,210.43 1,842.51 1,126.34 804.15 828.20

Adminstrative expenses 8,608.03 4,588.53 3,351.31 2,315.91 1,403.09

Expenses capitalised - - - - -

Cost of sales 20,855.54 15,101.78 10,593.96 7,221.40 5,144.77

Operating profit 13,192.78 10,659.34 7,257.65 4,037.72 2,997.67

Other recurring income 235.99 266.91 101.70 40.75 18.93

Adjusted PBDIT 13,428.77 10,926.24 7,359.35 4,078.47 3,016.61

Financial expenses 434.16 393.43 282.07 236.81 317.00Depreciation 3,206.28 3,166.58 2,353.30 1,432.34 1,019.36

Other write offs 178.82 266.07 137.80 127.39 161.34

Adjusted PBT 9,609.50 7,100.16 4,586.17 2,281.93 1,518.90

Tax charges 321.78 632.43 566.79 273.68 353.60

Adjusted PAT 9,287.72 6,467.73 4,019.39 2,008.25 1,165.30

Non recurring items -1,497.74 -162.87 3.92 -13.81 -1,726.88

Other non cashadjustments -46.15 -60.67 9.92 17.64 22.23

Reported net profit 7,743.84 6,244.19 4,033.23 2,012.08 -539.35

Earnigs beforeappropriation

19,541.05 11,778.12 5,489.61 1,225.65 -538.55

Equity dividend 379.65 - - - -

Preference dividend - - - - -

Dividend tax 64.52 - - - -

Retained earnings 19,096.89 11,778.12 5,489.61 1,225.65 -538.55

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