Download - Airtel Project Final
-
8/3/2019 Airtel Project Final
1/41
INDUSTRY PROFILE
Overview of the Indian Telecom Industry
The Indian telecommunications industry is one of the fastest growing in the world and India is
projected to become the second largest telecom market globally.
According to the Telecom Regulatory Authority of India (TRAI), the number of telecom
subscribers in the country increased to 562.21 million in December 2009, an increase of 3.5
per cent from 543.20 million in November 2009. With this the overall teledensity (telephones
per 100 people) has touched 47.89.
The telecom industry notched up US$ 8.56 billion in revenues during the quarter ended
December 31, 2009 helped by a recovery in earnings from both mobile and landline services.
According to Business Monitor International, India is currently adding 8-10 million mobile
subscribers every month. It is estimated that by mid 2012, around half the country'spopulation will own a mobile phone. This would translate into 612 million mobile subscribers,
accounting for a tele-density of around 51 per cent by 2012.
Moreover, according to a study conducted by Nokia, the communications sector is expected to
emerge as the single largest component of the country's GDP with 15.4 per cent by 2014.
The Indian equipment market was estimated at US$ 24 billion in FY09. Finnish giant Nokia is
the market leader, with over US$ 3.4 billion revenues in 2008-09, followed by Ericsson at
US$ 2.11 billion.
With the availability of the 3G spectrum, about 275 million Indian subscribers will use 3G-
enabled services, and the number of 3G-enabled handsets will reach close to 395 million by
2013-end, estimates the latest report by Evalueserve.
According to a Frost & Sullivan industry analyst, by 2012, fixed line revenues are expected to
touch US$ 12.2 billion while mobile revenues will reach US$ 39.8 billion in India.
Moreover, in an attempt to boost auction of 3G spectrum, the government has allowed
prospective bidders to raise short-term funds from domestic market, which could be
refinanced through external commercial borrowings (ECBs) within 12 months. The
government is expected to mop up US$ 7.53 billion through the auction of 3G spectrums,which is likely to be completed by March 2010. It has fixed the reserve price at US$ 753.74
million.
State-run telecom operator BSNL has rolled out 3G services in 318 cities with 856,000
subscribers. BSNL has plans to cross 400 cities by March 31, 2010 and this will be increased
to 760 cities by September 2010. And even as debate on 3G continues, TRAI has started
1
-
8/3/2019 Airtel Project Final
2/41
consultation on the next level of telecom services. Fourth generation or 4G offers download at
faster speeds.
Value-Added Services Market
Currently, mobile value-added services (MVAS) in India accounts for 10 per cent of theoperator's revenue, which is expected to reach 18 per cent by 2010. According to a study by
Stanford University and consulting firm BDA, the Indian MVAS is poised to touch US$ 2.74
billion by 2010.
In a bid to increase revenue from add-on services, India's top two mobile firms, Bharti Airtel
Limited and Reliance Communications both plan to launch online mobile applications stores.
Bharti Airtel will provide more than 1,250 applications across 25 categories including games,
books and social networking on its applications store.
Reliance Communications first version of its applications store would go live for GSMcustomers by the end of February 2010, and by the end of March 2010 an expanded version
would be available to its code division multiple access (CDMA) customers as well.
Major Investments
The booming domestic telecom market has been attracting huge amounts of investment which
is likely to accelerate with the entry of new players and launch of new services.
Norway-based telecom operator Telenor, has bought a further 7 per cent in Unitech Wireless
for a little over US$ 430.70 million. Telenor now holds 67.25 per cent. Last year, it had
bought a 60 per cent stake for US$ 1.23 billion.
The government has approved the foreign direct investment proposal of the Federal Agency
for State Property Management of the Russian Federation to buy 20 per cent stake in telecom
service provider Sistema-Shyam for US$ 660.1 million.
Tata Teleservices is planning to invest an additional US$ 1 billion in its recently-launched
GSM service Tata DoCoMo. It had already committed an investment of US$ 2 billion for the
GSM services when it was launched in June 2009.
Reliance Infratel, the tower subsidiary of Reliance Communications (RCom), will build
56,596 telecom towers by financial year 2010, increasing the total number of towers to
100,000.
BSNL, India's leading telecom company in revenue terms, will put in about US$ 1.16 billion
in its WiMax project.
2
-
8/3/2019 Airtel Project Final
3/41
Vodafone Essar will invest US$ 6 billion over the next three years in a bid to increase its
mobile subscriber base from 40 million at present to over 100 million.
Manufacturing
India's telecom equipment manufacturing sector is set to become one of the largest globally.
Mobile phone production is estimated to grow at a CAGR of 28.3 per cent from 2006 to 2011,
totalling 107 million handsets by 2010. Revenues are estimated to grow at a CAGR of 26.6
per cent from 2006 to 2011, touching US$ 13.6 billion.
Rural Telephony
Rural India had 76.65 million fixed and Wireless in Local Loop (WLL) connections and
551,064 Village Public Telephones (VPT) as on September 2008. Therefore, 92 per cent of
the villages in India have been covered by the VPTs. Universal Service Obligation (USO)
subsidy support scheme is also being used for sharing wireless infrastructure in rural areaswith around 18,000 towers by 2010.
Policy Initiatives
The government has taken many proactive initiatives to facilitate the rapid growth of the
Indian telecom industry.
100 per cent foreign direct investment (FDI) is permitted through the automatic route in
telecom equipment manufacturing.
FDI ceiling in telecom services has been raised to 74 per cent.
Introduction of a unified access licensing regime for telecom services on a pan-India basis.
Introduction of mobile number portability in a phased manner, starting in the fourth quarter of
2008.
The government is implementing a program of connecting 66,822 uncovered villages under
the Bharat Nirman programme.
The Department of Telecommunications (DoT) has stated that foreign telecom companies can
bid for 3G spectrum without partnering with Indian companies. Only after winning a bid,would they need to apply for unified access service licence (UASL) and partner with an
Indian company in accordance with the FDI regulations.
The Road Ahead
3
-
8/3/2019 Airtel Project Final
4/41
The target for the 11th Plan period (2007-12) is 600 million phone connections with an
investment of US$ 73 billion. Apart from the basic telephone service, there is an enormous
potential for various value-added services.
According to the CII Ernst & Young report titled 'India 2012: Telecom growth continues',
revenue from India's telecom services industry is projected to reach US$ 54 billion in 2012, asagainst US$ 31 billion in 2008.
4
-
8/3/2019 Airtel Project Final
5/41
COMPANY PROFILE
Background and inception of the company
Incorporated on July 7, 1995, Bharti Airtel Ltd is a division of Bharti Enterprises. The
businesses of Bharti Airtel are structured into two main strategic groups - Mobility andInfotel. The Mobility business provides GSM mobile services in all 23 telecommunications
circles in India, while the Infotel business group provides telephone services and Internet
access over DSL in 15 circles. The company complements its mobile, broadband, and
telephone services with national and international long-distance services. The company also
has a submarine cable landing station at Chennai, which connects the submarine cable
connecting Chennai and Singapore. Bharti Tele-Ventures provides end-to-end data and
enterprise services to corporate customers by leveraging its nationwide fibre-optic backbone,
last mile connectivity in fixed-line and mobile circles, VSATs, ISP and international
bandwidth access through the gateways and landing station. All of Bharti Tele-Ventures'
services are provided under the Airtel brand.
As of September 2005, Bharti Tele-Ventures was the only company to provide mobile
services in all 23 telecom circles in India.
By the end of October 2005, Bharti Tele-Ventures was serving more than 14.74 million GSM
mobile subscribers and 1.10 million broadband and telephone (fixed line) customers.
The equity shares of Bharti Tele-Ventures are currently listed on the National Stock Exchange
of India Ltd (NSE) and the Stock Exchange, Mumbai (BSE). As of September 30, 2005, the
main shareholders of Bharti Tele-Ventures were: Bharti Telecom Ltd (45.65%), a subsidiary
of Bharti Enterprises; Singapore Telecom (15.69%), through its investment division Pastel
Ltd; and, Warburg Pincus (5.65%), through its investment company Brentwood Investment
Holdings Ltd). Other shareholders with more than a 1% stake were: Citi Group Global
Markets Mauritius Pvt Ltd (2.99%); Europacific Growth Fund (2.04%); Morgan Stanley & Co
International Ltd (1.93%); CLSA Merchant Bankers Ltd A/C Calyon (1.33%); Life Insurance
Corporation of India (1.34%); and, The Growth Fund of America Inc (1.11%).
Sunil Bharti Mittal, the founder-chairman of Bharti Enterprises (which owns Airtel), is today,
the most celebrated face of the telecom sector in India. He symbolises the adage that success
comes to those who dream big and then work assiduously to deliver it. Sunil Bharti Mittal
began his journey manufacturing spare parts for bicycles in the late 1970s. His strong
entrepreneurial instincts gave him a unique flair for sensing new business opportunities. In the
early years, Bharti established itself as a supplier of basic telecom equipment. His true calling
came in the mid 1990s when the government opened up the sector and allowed private players
to provide telecom services.
5
-
8/3/2019 Airtel Project Final
6/41
Bharti Enterprises accepted every opportunity provided by this new policy to evolve into
India's largest telecommunications company and one of India's most respected brands. Airtel
was launched in 1995 in Delhi. In the ensuing years, as the Airtel network expanded to several
parts of India, the brand came to symbolise the very essence of mobile services.
Product
Airtel provides a host of voice and data products and services, including high-speed GPRS
services. Airtel also offers a wide array of 'postpaid' and 'prepaid' mobile offers, with a range
of tariff plans that target different segments. A comprehensive range of value-added,
customised services are part of the unique package from Airtel. The company's products
reflect a desire to constantly innovate. Some of these are reflected in the fact that Airtel was
the first to develop a 'single integrated billing system'
Airtel comes to you from Bharti Airtel Limited - a part of the biggest private integrated
telecom conglomerate, Bharti Enterprises. Bharti is the leading cellular service provider, withan all India footprint covering all 23 telecom circles of the country. It has over 21 million
satisfied customers. Bharti Enterprises has been at the forefront of technology and has
revolutionized telecommunications with its world class products and services. Established in
1976, Bharti has been a pioneering force in the telecom sector with many firsts and
innovations to its credit. Bharti has many joint ventures with world leaders like Singtel
(Singapore Telecom); Warburg Pincus, USA; Telia, Sweden; Asian infrastructure find,
Mauritius; International Finance Corporation, USA and New York Life International, USA.
Bharti provides a range of telecom services, which include Cellular, Basic, Internet and
recently introduced National Long Distance. Bharti also manufactures and exports telephone
terminals and cordless phones. Apart from being the largest manufacturer of telephoneinstruments in India, it is also the first company to export its products to the USA.
Airtel's journey to leadership began in Delhi in 1995. Since then, Airtel has established itself
across India in sixteen states covering a
population of over 600 million people. Airtel will soon cover the entire country through a
process of acquisitions and green field projects. With a presence in over 1,400 towns, Airtel
today has the largest network capacity in the country.
In the last nine years Airtel has achieved many firsts and unique records: it was the first to
launch nationwide roaming operations, it was the first to cross the one million and the five
million customer marks. It was also the first to launch services overseas.
There are other 'firsts' credited to Airtel - many of them in the area of innovative products and
services. Today, Airtel innovates in almost everything that it presents to the market. An
excellent example is Easy Charge - India's first paperless electronic recharging facility for
prepaid customers. As evidence of its fine record, Airtel has also been conferred with
6
-
8/3/2019 Airtel Project Final
7/41
numerous awards. It won the prestigious Techies Award for 'being the best cellular services
provider' for four consecutive years between 1997 and 2000 - a record that is still unmatched.
And in 2003, it received the Voice & Data Award for being 'India's largest cellular service
provider', amongst others.
As part of its continuing expansion, Airtel has invested over Rs. 1,065 billion in creating anew telecom infrastructure. In 2003/04, Bharti Tele-Ventures earned a gross profit of Rs. 16
billion on revenues of Rs. 50 billion.
7
-
8/3/2019 Airtel Project Final
8/41
Nature of the business carried
BHARTI ENTERPRISE
Bharti Enterprises is one of Indias leading business groups with interests in telecom, retail,
manufacturing, agri business and financial services.
BHARTI AIRTEL
Bharti Airtel, is Asias leading integrated telecom services provider with operations in India
and Sri Lanka. Bharti Airtel has been at the forefront
of the telecom revolution and has transformed the sector with its world-class services built on
leading edge technologies.
FINANCAL SERVICES
In financial services, Bharti is partnering with AXA of France to offer life insurance, generalinsurance and asset management.
BHARTI RETAIL
Bharti Retail, the 100% subsidiary of Bharti Enterprises operates multiple format consumer
friendly stores. Bharti Wal-Mart, is a B2B JV with Wal-Mart
for wholesale cash-and-carry and back-end supply chain management operation.
BHARTI TELE TECH LTD
Established in 1985, Bharti Teletech is, currently engaged into distribution & marketing of
wide range of products that include Smart Phones, high quality cordless phones, modems,
audio / video conferencing products, Free To Air Set Top Boxes, Fixed Cellular Phones &
Fixed Wireless Terminals. The alliances are with Blackberry, Apple, ASUS, Polycom,
Transcend, Logitech, Huawei, Samsung, Aastra, Panasonic and Sanyo. Apart from this, Bharti
Teletech is also engaged into manufacture of high quality landline telephones at its
manufacturing operations Ludhiana under Beetel brand for Airtel, BSNL / MTNL as well as
retail market & exports to over 30 countries across more than 5 continents.
TELECOM SEYCHELLES LTD
A subsidiary of Bharti, Telecom Seychelles Ltd provides comprehensive telecom servicesincluding 3G mobile services in Seychelles, under the Airtel brand.
FIELD FRESH FOOD PVT LTD
FieldFresh Foods Pvt. Ltd., is a venture between Bharti Enterprises and Del Monte Pacific
Limited, to offer fresh and processed fruits and vegetables in the domestic as well as
international markets, including Europe and the Middle East.
8
-
8/3/2019 Airtel Project Final
9/41
MOBILE SERVICE
Bharti Airtel offers GSM mobile services in all the 23-telecom circles of India and is the
largest mobile service provider in the country, based on the number of customers.
BHARTI REALITY LIMITED
Bharti Realty Limited is a young, vibrant and dynamic realty company with expanding
interests in commercial, retail and residential real estate.
BHARTI FOUNDATION
Bharti Foundation was set up in 2000, with the vision, To help underprivileged children and
young people of our country realize their potential. It aims to create and support programs
that bring about sustainable changes through education and the use of technology and
information.
BHARTI INFRATEL
Bharti Infratel, a wholly owned subsidiary of Bharti Airtel, provides passive infrastructure
services on a non-discriminatory basis to all telecom operators in India. Bharti Infratel also
holds approximately 42% stake in Indus Towers, a joint venture between Bharti, Vodafone
and Idea to offer passive infrastructure services.
9
-
8/3/2019 Airtel Project Final
10/41
Vision, Mission and Quality Policy
VISION
By 2010 Airtel will be the most admired brand in India:
Loved by more customers.
Targeted by top talent.
Benchmarked by more businesses.
MISSION
To be global admired for telecom services that delight customers.
Bharti Tele-Ventures Mobile Division (Airtel) is one of Indias leading private sectorproviders of telecommunications services with more than 85.7 million customers in December
2008. The only operator to provide mobile services in all 23 business regions, or circles, in
India, the company also provides telephone services and Internet access over DSL in 15
circles, complementing its national and international long distance telephone services with
mobile and broadband services. 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 24.6% share of the wireless services market, followed by 17.7% for Reliance
Communications and 17.4% for Vodafone Essar.
QUALITY POLICY
We will deliver error-free services to our customers by doing our jobs right the first time,
every time.
Our quality policy is a reflection of the teams commitment to excellence in every aspect. In
line with our quality policy and our determination to pursue the path of continuous quality
improvement, we do the following?
We have strong and robust Business Process Management System which helps in monitoring
of output performance of processes in the form of Non Financial Parameters which are
reviewed at different levels i.e local, regional, national and corporate office level.
Continuous process improvements happen within the organization based on Voice of
Customers using six sigma methodology and knowledge management.
10
-
8/3/2019 Airtel Project Final
11/41
The organization has been in Six Sigma for the last three years by creating Six Sigma
Champions - Black Belt, Green Belts and Yellow Belts.
All AES employees are trained in the strategy, statistical tools and techniques of Six Sigma
Quality. Training courses are offered at various levels.
11
-
8/3/2019 Airtel Project Final
12/41
Products/service profile
Services offered under the brand name Airtel.
BROADBAND AND INTERNET SERVICES.
DIGITAL TV
BLACK BERRY
E-MAIL ON GO
CALLING CARDS
WIRELESS INTERNET
FIXED LINE SERVICES
AIRTEL ENTERPRISE SERVICES
The Company is a part of Bharti Enterprises, and 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, broadband & telephone services
(B&T) & enterprise services. The mobile services group provides GSM mobile services
across India in 23 telecom circles, while the B&T business group provides broadband &
telephone services in 90 cities. The Enterprise services group has two sub-units - carriers
(long distance services) and services to corporate. All these services are provided under the
Airtel brand. Its include
Voice Services
Mobile Services
Satellite Services
Managed Data & Internet Services
Managed e-Business Services
Voice Services
Bharti Airtel became the first private fixed-line service provider in India. It is now promoted
under the Airtel brand. Recently, the Government opened the fixed-line industry to unlimited
12
-
8/3/2019 Airtel Project Final
13/41
competition. Airtel has subsequently started providing fixed-line services in the four circles of
Delhi, Haryana, Madhya Pradesh, Karnataka, Tamil Nadu & UP (West).
Airtel Enterprise Services believes that these circles have high telecommunications potential,
especially for carrying Voice & Data traffic. These circles were strategically selected so as to
provide synergies with Airtels long distance network and Airtels extensive mobile network.
Airtel Enterprise Services, India's premium telecommunication service, brings to you a whole
new experience in telephony. From integrated telephone services for Enterprises and small
business enterprises to user-friendly plans for Broadband Internet Services (DSL), we bring
innovative, cost-effective, comprehensive and multi-product solutions to cater to all your
telecom and data needs.
Voice - Product Portfolio
Airtel Enterprise Services telephone services go beyond basic telephony to offer our users a
whole host of Value Added Services as well as premium add-ons. Each telephone connection
from Airtel Enterprise Services is backed by a superior fibre-optic backbone for enhanced
reliability and quality telephony. Few of the Value Added Services offered are Calling Line
Identification, Three Party Conferencing, Dynamic Lock, Hunting Numbers, and Parallel
Ringing etc.
Airtel Enterprise Services Voice Services provide Free Dial-up Internet access that is bundled
along with your Telephone connection from Airtel. Its fast, reliable and gives you unlimited
Internet access.
Mobile Services
Airtels mobile footprint extends across the country in 21 telecom circles. Its service
standards compare with the very best in the world. In fact, thats how Bharti has managed to
win the trust of millions of customers and makes it one of the top 5 operators in the world, in
terms of service and subscriber base.
The company has several Firsts to its credit:
The First to launch full roaming service on pre-paid in the country.
The First to launch 32K SIM cards.
The First in Asia to deploy the multi band feature in a wireless network for
efficient usage of spectrum.
The First to deploy Voice Quality Enhancers to improve voice quality and
acoustics.
13
-
8/3/2019 Airtel Project Final
14/41
The First telecom company in the world to receive the ISO 9001:2000 certification
from British Standards Institute
Satellite Services
Airtel Enterprise Services provides you connectivity where ever you take your business Our
Satellite Services bring you the benefits of access in remote locations. Airtel Enterprise
Services is a leading provider of broadband IP satellite services and DAMA/PAMA services
in India. Our solutions support audio, video and voice applications on demand.
Satellite Services include :
PAMA/DAMA
BIT - Internet
VPN
Satellite based IPLCs for redundancy reasons
Managed Data & Internet Services
Airtel Enterprise Services brings you a comprehensive suite of data technologies. So we are
able to support all types of networks and ensure our customers can migrate their network to
the future seamlessly. Our Managed Data & Internet services make our customers future
14
-
8/3/2019 Airtel Project Final
15/41
proof.
Managed Data & Internet Services include :
MPLS
ATM
FR
Internet
IPLC
Leased Lines
Customised Solutions
International Managed Services
Metro Ethernet
Managed e-Business Services
Airtel Enterpirse Services, offers an internationally benchmaked, carrier class hosting, storage
and business continuity services.
A range of services that help to keep your business running the way you want- 24x7. Thanks
to our world-class high tech Data Centres.
Managed e-Business Services include :
Co-lo: Dedicated and Shared
BCRS Services
Web hosting
Area of operation
15
http://www.airtelenterprise.com/colocation.htmlhttp://www.airtelenterprise.com/hosting.htmlhttp://www.airtelenterprise.com/hosting.htmlhttp://www.airtelenterprise.com/colocation.html -
8/3/2019 Airtel Project Final
16/41
Airtels nationwide operations are built on a high quality VSAT infrastructure with a
Central Hub at Bangalore which is a high speed internet backbone.
Last mile connectivity through Indias leading fixed line service, Airtel, in Delhi, Haryana,
Tamil Nadu, Karnataka, Madhya Pradesh and Chhattisgarh.
Pan-India Mobile Network
It has Indias finest long distance network covering over 180 cities on 25,000 km of optical
fibres. Worlds largest submarine cable system, Network i2i stretching from Chennai to
Singapore.
World Class Connectivity Portfolio
Global Data & Internet Service:
Riding on owned carrier class infrastructure, leveraging a total connectivity infrastructure, we
bring Indias 1st end to end IPLC and unleash the full power of Global Data & Internet
Services.
SE-ME-WE-4
The South East AsiaMiddleEastWestern Europe 4
submarine communications cable
system OR SEA-ME-WE 4 is a
consortiumof 16 companies
(including Airtel and Tata
Communications) which carries
telecommunications between
Singapore, Malaysia, Thailand,
Bangladesh, India, Sri Lanka,
Pakistan, UAE, Saudi Arabia,
Sudan, Egypt, Italy, Tunisia, Algeria and France.
Ownership pattern
The board of directors of the Company has an optimum mix of executive and non-executive
16
http://en.wikipedia.org/wiki/SEA-ME-WE_4http://en.wikipedia.org/wiki/SEA-ME-WE_4http://en.wikipedia.org/wiki/SEA-ME-WE_4 -
8/3/2019 Airtel Project Final
17/41
directors, which consists of two executive and fourteen non-executive directors.The
Chairman and Managing Director, Mr. Sunil Bharti Mittal, is an Executive Director and
the number of Independent Directors on the Board is 50% of the total board strength.
The independence of a director is determined on the basis that such director does not have
any material pecuniary relationship with the Company, its promoters or its management,
which may affect the independence of the judgment of a Director. The board members
possess requisite skills, experience and expertise required to take decisions, which are in the
best interest of the Company.
Sunil Bharti Mittal
Rajan Bharti Mittal
Akhil Gupta
Rakesh Bharti Mittal
Chua Sock Koong
N. Kumar
Kurt Hellstorm
Donald Cameron
Paul OSullivan
Professor V.S. Raju
Pulak Chandan Prasad
Bashir Abdullah Currimjee
Gavin Darby
Syeda Imam
Ajay Lal
York Chye Chang
Paul Donovan
Arun Bharat Ram
17
-
8/3/2019 Airtel Project Final
18/41
18
-
8/3/2019 Airtel Project Final
19/41
Competitors information
Other players in the industry
Reliance Comm
Idea Cellular
Tata Comm
Vodafone
Spice Comm
TataTeleservice
MTNL
19
-
8/3/2019 Airtel Project Final
20/41
Achievement and Awards
For the Year 2008 - 2009
Voted Indias most innovative company in a survey conducted by The Wall Street
Journal in 2008
Winner of the Gallup Great Workplace Award- Gallup Consulting, 2008
2nd Most Trusted Service Brand - Annual Economic Times-Brand Equity, Most
Trusted Brands survey 2008
Best Content Service Award for its Farmer Information Dissemination Platform for
Bharti Airtels joint venture with IFFCO, IKSL (IFFCO Kisan Samachar) - World
Communications Awards 2008
Best Project Management Award for its Gujarat e-GRAM project - World
Communications Awards 2008
Best Telecom Company at the NDTV Profit Business Leadership Awards
Best Carrier India for innovative products & services and efficient cost models and the
Ovum Telco-Transformation award recognizing philosophy and execution of a
successful outsourcing strategy at the Telecom Asia Awards 2008
Sunil Bharti Mittal was awarded the GSM Association Chairmans Award 2008. The
highest honour in global telecom sector, recognized his tremendous contribution to the
development of Indias telecom sector
Sunil Bharti Mittal adjudged the Business Leader Transforming India, 2008 at the
NDTV Profit Business Leadership Awards
For the Year 2007 - 2008
Sunil Bharti Mittal conferred Degree of Doctor of Science (Honoris Causa) by G. B.
Pant University
Bharti draws top honours at the NDTV Profit Business Leadership Awards 2007
Bharti Airtel Ranked 3rd on Shareholder Returns in BusinessWeek IT 100 List
Bharti Airtel has won the CNBC-TV18 India Business Leader Award for the
Outstanding Company of the year, 2007
Future growth and prospects
20
-
8/3/2019 Airtel Project Final
21/41
Bharti Airtel is one of the topmost companies in the telecom sector in India and is under the
Bharti Enterprises Group. Airtel Bharti has been ranked as the best performance company in
the whole world by the Business Week magazine in 2007.
The Company Bharti Airtel is in India the biggest integrated and also the 1st telephone service
provider in the private sector, which has footprint in around 23 telecom circles. Bharti Airtel
Limited has been since its very beginning using the latest technology and thus the company
has paved the way for the telecom sector in India with its world-class services and products.
This has helped Bharti Airtel Company to grow for the number of its customers has increased
very rapidly over the years. The company has around 50 million customers in 2007 and its
market share of mobile subscribers in India is at 23.4%.
The company Bharti Airtel Limited's total revenue amounted to Rs.12,242 crore in 2006-
2007 and the net profit stood at Rs.3,126 crore. The Company Bharti Airtel is divided into 3business units that are:
Broadband & Telephone (B&T) services
Enterprise services
Mobile services
Among the various services that the Bharti Airtel Limited Company provides to its customers,
the services of broadband and telephone (B&T) are 1 of them. The company provides
broadband Internet services of high speed for it has the best network in India. The companyBharti Airtel also provides telephone services in around 94 cities of the country and this helps
the people to stay connected with one another. The company plans to expand its broadband
and telephone services by providing IPTV services and DTH operations.
Further Bharti Airtel provides enterprise services to its customers. The services of enterprise
provide telecom end-to-end solutions to customers who belong to the corporate sector and
also long distance services to international and national carriers. The company Bharti Airtel
has more than 35,016 kilometers of optic fiber, a submarine landing station, and is also a
member of South East Asia- Middle East- Western Europe- 4. All this has helped the
company to provide the best enterprise services to its customers. The company Bharti Airtel
Limited plans to expand its enterprise services so that it can achieve the status of a global
carrier within a period of 2- 3 years.
The company Bharti Airtel Limited provides mobile services to its customers. The company
provides fixed and mobile wireless services in around 23 telecom circles by using the GSM
21
-
8/3/2019 Airtel Project Final
22/41
technology. Bharti Airtel Company has become the biggest mobile service provider in India
on the basis of the number of customers. The company in the future plans to expand its
network in order to establish its presence in more than 500,000 villages all across the country
by 2010.
Bharti Airtel has become a leading company in the telecom sector in India due to the fact that
it has provided the best quality of services to its customers. And this has been possible for the
company has a wide telecom network that is of the latest technology. The Company Bharti
Airtel Limited in the future also should continue to upgrade its facilities for this will ensure
that high grade of services are provided to its customers.
22
-
8/3/2019 Airtel Project Final
23/41
FUNCTIONAL ANALYSIS
Marketing Department
Marketing Strategy
Process innovations and continues improvement through people involvement,problem
investigation by "fact based- root cause analysis"
Customer defined business processes based on customer specifications, airtel have webbed
many business process on the following concepts:
Delivery time
Turnaround time
Lead time
Time to market
Other performance indicators.
Promotional Strategy
After the liberalization of the Indian Telecom Sector in 1994, the Indian cellular market
witnessed a surge in cellular services. By 2005, there were a total of 12 players in the market
with the five major players being Bharti Tele-Ventures Limited (Bharti), Bharat Sanchar
Nigam Limited (BSNL), Vodafone-Essar limited (previously Hutch), Idea Cellular limited
(Idea), Reliance India Mobile (RIM),TATA Indicom, and Aircell in south india.
All the players except RIM and TATA offered services based on the Global System for
Mobile (GSM) technology. RIM and TATA provided services based on Code Division
Multiple Access (CDMA) technology, and now they have entered GSM market, with the
introduction of reliance GSM and TATA Docomo. However Virgin india mobile providing
service based on CDMA technology is targeting a niche segment, featuring them as a youth
brand.
As competition in the telecom arena intensified, service providers took new Initiatives to woo
customers. Prominent among these were celebrity Endorsements, loyalty rewards, discount
coupons, business solutions and Talk time schemes. The most important consumer segment in
the cellular Industry is the youth segment and the business class segment. The youth Segment
was the largest and fastest growing segment and was therefore targeted most heavily by
cellular service providers.
23
-
8/3/2019 Airtel Project Final
24/41
Bharti Tele-Ventures adopted celebrity endorsement as its chief promotional Strategy. By
2004 it emerged the unprecedented leader commanding the largest market share in the cellular
service market. Vodafone implemented the celebrity endorsement strategy partially, relying
primarily on its creative advertising for the promotion of its brand. BSNL, on the other hand,
attracted the consumer through its low cost schemes. Being a state owned player, BSNL could
cover rural areas, and this helped it increase its subscriber base. Reliance was another player
that cashed on its innovative promotional strategies, which included celebrity endorsements
and attractive talk time schemes. Idea, relied heavily on its creative media advertising sans
celebrities.
24
-
8/3/2019 Airtel Project Final
25/41
Human Resource Department
Composition
In compliance with the non- mandatory requirements of Clause 49 of the Listing Agreement,
Bharti Airtel has constituted a Remuneration Committee (which is known as HR Committee).The HR Committee comprises of following six non-executive directors, out of which four
members including the chairman of the committee are independent directors.
S. No. Member Director Category
1. Mr. Craig Ehrlich (Chairman) Independent Non-Executive Director
2. Mr. Rajan Bharti Mittal Non-Executive Director
3. Mr. Nikesh Arora Independent Non-Executive Director
4. Mr. Lim Chuan Poh Non-Executive Director
Secretary
The Company Secretary or his/her nominee act as the Secretary of the Committee.
Key Functions
The key functions of the HR Committee include the following:
Attraction and Retention strategies for employees.
Employees Development Strategies.
Compensation (including salaries and salary adjustments, incentives/benefits bonuses,
stock options) and performance targets for the Chairman and Managing Director
(CMD) and Joint Managing Directors (JMDs) Executive Directors.
All Human Resources related issue.
Other key issues / matters as may be referred by the Board or as may be necessary in
view of Clause 49 of the Listing Agreement or any statutory provisions.
Miscellaneous
25
http://www.airtel.in/wps/wcm/connect/About%20Bharti%20Airtel/bharti+airtel/investor+relations/corporate+governance/board+of+directors/craig_ehrlichhttp://www.airtel.in/wps/wcm/connect/About%20Bharti%20Airtel/bharti+airtel/investor+relations/corporate+governance/board+of+directors/rajan+bharti+mittalhttp://www.airtel.in/wps/wcm/connect/About%20Bharti%20Airtel/bharti+airtel/investor+relations/corporate+governance/board+of+directors/nikesh+arorahttp://www.airtel.in/wps/wcm/connect/About%20Bharti%20Airtel/bharti+airtel/investor+relations/corporate+governance/board+of+directors/lim+chuan+pohhttp://www.airtel.in/wps/wcm/connect/About%20Bharti%20Airtel/bharti+airtel/investor+relations/corporate+governance/board+of+directors/craig_ehrlichhttp://www.airtel.in/wps/wcm/connect/About%20Bharti%20Airtel/bharti+airtel/investor+relations/corporate+governance/board+of+directors/rajan+bharti+mittalhttp://www.airtel.in/wps/wcm/connect/About%20Bharti%20Airtel/bharti+airtel/investor+relations/corporate+governance/board+of+directors/nikesh+arorahttp://www.airtel.in/wps/wcm/connect/About%20Bharti%20Airtel/bharti+airtel/investor+relations/corporate+governance/board+of+directors/lim+chuan+poh -
8/3/2019 Airtel Project Final
26/41
The Committee may invite other Directors/ Officers of the Company to attend the meetings of
the HR Committee as Invitees from time to time, as and when required.
Minutes of the HR Committee are placed before the Board in its subsequent meeting.
26
-
8/3/2019 Airtel Project Final
27/41
MCKENSYS 7S FRAME WORK
Structure:
The board of directors of the Company has an optimum mix of executive and non-executive
directors, which consists of two executive and fourteen non-executive directors.The
Chairman and Managing Director, Mr. Sunil Bharti Mittal, is an Executive Director and
the number of Independent Directors on the Board is 50% of the total board strength.
The independence of a director is determined on the basis that such director does not haveany material pecuniary relationship with the Company, its promoters or its management,
which may affect the independence of the judgment of a Director. The board members
possess requisite skills, experience and expertise required to take decisions, which are in the
best interest of the Company.
The composition of the Board is as under:
Sunil Bharti Mittal
Rajan Bharti Mittal
Akhil Gupta
Rakesh Bharti Mittal
Chua Sock Koong
N. Kumar
27
-
8/3/2019 Airtel Project Final
28/41
Kurt Hellstorm
Donald Cameron
Paul OSullivan
Professor V.S. Raju
Pulak Chandan Prasad
Bashir Abdullah Currimjee
Gavin Darby
Syeda Imam
Ajay Lal
York Chye Chang
Paul Donovan
Arun Bharat Ram
28
-
8/3/2019 Airtel Project Final
29/41
Skill
A skill is the ability, knowledge, understanding and the judgment to accomplish a task. Skills
maybe defines as what the company does best, the distinctive capabilities and competencies
that reside in the organization.
At Airtel Enterprise Service Unit, the value of a motivated, knowledgeable and skilled
workforce is recognized. It aims to be the No. 1 organisation in every aspect of corporate
29
-
8/3/2019 Airtel Project Final
30/41
governance People, Products, Philosophy and Quality, Ethics, Work Culture and
Partnership. It aims to create and maintain a work environment that is fun0filled, promotes
excellence through responsible leadership, innovation and excellence and adheres to a code of
conduct that lays emphasis on the highest ethical standards, which Airtel Brand epitomizes.
Style
Style of leadership or relationship refers to the manner in which the individual uses his or her
talents, values, knowledge, judgment and attitudes to lead and relate to others. Style expresses
the persons character. Style is the leadership approach to top management and the
organisations overall operating approach; also the way in which the organizations employees
present themselves to the outside world
Any one decision making parameter should be studied pertaining to day-to-day operation, to
conclude the style of functioning.
Bharti Airtel understands the importance of partners to remain competitive in a dynamic
business environment. As a step in that direction, the Supply Chain (SCM) function has
been created with a mandate to develop partner relationships to maximize mutual
opportunities for growth and profitability. The SCM organization has a central core team
of supply chain subject mater experts and execution teams operating under different
business divisions across the country.
Supply Chain Philosophy
At the center of Bharti Airtel's Supply Chain Philosophy is partnership and
collaboration. The Supply Chain characteristics have therefore been defined usingthe same approach, shown in the table below.
30
-
8/3/2019 Airtel Project Final
31/41
-
8/3/2019 Airtel Project Final
32/41
Communication Extensive; multi-level
Communication Collaborative; two-way
Role in development Substantial
Production flexibility High
Technology sharing Extensive
Dedicated investments Substantial
Mutual commitment High
Governance Self-governing
Future Expectations Considerable
32
-
8/3/2019 Airtel Project Final
33/41
Strategy
Growth strategies
33
MARKET
PENETRATION:BROADBAND, FIXED
LINE, DIGITAL TV, 3G
MOBILE, WIMAX.
PRODUCT
DEVELOPMENT:
IPLC PRODUCTS
MARKET
DEVELOPMENT:LOOKING FOROVERSEAS MARKET ,1)BHARTI-MTN DEAL.2)
OPERATING IN JERSEY(Channel Islands)UNDERAIRTEL-VODAFONEBRAND.
DIVERSIFICATION:OUTSOURCING BACKEND
JOBS TO COMPANIES LIKEIBM,MPHASIS AND HTMT
-
8/3/2019 Airtel Project Final
34/41
System:
System followed in any one department in the organization should be detailed. E.g
Inventory control system / order execution system / Merit rating system etc.
Staff:
Classification / Duties and responsibility of various groups of staff. E.g Technical /
Supervisory / Clerical.
Shared value:
Study of implementing shared value in the company by an illustration, where the company has
implemented its stated objective.
34
-
8/3/2019 Airtel Project Final
35/41
SWOT ANALYSIS
Following is the SWOT Analysis for AIRTEL
STRENGTH WEAKNESS
OPPORTUNITIES THREATS
STRENGTH
VERY FOCUSED ON TELECOM Bharti Airtel is largely focused on the telecom,
around 93% of the total revenue comes from telecom(Total telecom revenue Rs
3,326).
35
Very focused on telecom.Leadership in fast growingcellular segment.Pan-India footprint.
The only Indian operator,other than VSNL, thathas an internationalsubmarine cable.
Price Competition fromBSNL and MTNLUntapped Rural market
The fast-expanding IPLCmarket.Latest technology and lowcost advantage.Huge market.
Competition from othercellular and mobileoperaters.Saturation point in Basictelephony service
-
8/3/2019 Airtel Project Final
36/41
LEADERSHIP IN FAST GROWING CELLULAR SEGMENT Airtel is holding
leadership position in cellular market.. Bharti Airtel is one of India's leading privatesector providers of telecommunications services based on an aggregate of 27,239,757
customers as on August 31, 2006, consisting of 25,648,686 GSM mobile
and 1,591,071 broadband & telephone customers.
PAN INDIA FOOTPRINT Airtel offers the most expansive roaming network. Letting
you roam anywhere in India with its Pan-India presence, and trot across the globe with
International Roaming spread in over 240 networks. The mobile services group
provides GSM mobile services across India in 23 telecom circles, while the B&T
business group provides broadband & telephone services in 92 cities.
THE ONLY OPERATOR IN INDIA OTHER THAN VSNL HAVING
INTERNATIONAL SUBMARINE CABLES. Airtel, the monopoly breaker shattered
the Telecom monopoly in the International Long Distance space with the launch of
International Submarine cable Network i2i jointly with Singapore
Telecommunications Ltd. in the year 2002. This has brought a huge value to the IPLC
customers, delivering them an option besides the incumbent carrier, to connect to the
outside world.
WEAKNESS
Price Competition from BSNL and MTNL. Airtel is tough competition from the
operators like BSNL nd MTNL as these two operators are offering services at a low
rate.
Untapped Rural market. Although Airtel have strong Presence throughout the country
but still they are far away from the Indian rural part and generally this part is covered
by BSNL so indirectly Airtel is loosing revenue from the rural sector.
36
-
8/3/2019 Airtel Project Final
37/41
OPPORTUNITIES
THE FAST EXTENDING IPLC MARKET An IPLC (international private leased
circuit) is a point-to-point private line used by an organization to communicate
between offices that are geographically dispersedthroughout the world. An IPLC can
be used for Internet access, business data exchange, video conferencing, and any otherform of telecommunication. Airtel Enterprise Services and SingTel jointly provide
IPLCs on the Network i2i. The Landing Station in Singapore is managed by SingTel
and by Airtel in Chennai (India). Each Landing Station has Power Feeding Equipment,
Submarine Line Terminating Equipment and SDH system to power the cable, add
wavelengths and convert the STM-64 output to STM-1 data streams respectively.
LATEST TECHNOLOGY AND LOW COST ADVANTAGEThe costs of introducing
cellular services for Airtel are marginal in nature, as it needs only to augment its
cellular switch/equipment capacity and increase the number of base stations. The
number of cities, towns and villages it has covered already works to its advantage asputting more base stations for cellular coverage in these areas comes with negligible
marginal cost. Besides such cost advantages, it has also other cost advantages for the
latest cellular technology. As a late entrant into the cellular market, it has dual
advantage of latest technology with modern features, unlike other private cellular
operators who started their service more than 4-5 years back and low capital cost due
to advantages of large scale buying of cellular switch/equipment.
HUGE MARKETThe cellular telephony market is presently expanding at a
phenomenal / whopping __ rate every year and there is still vast scope for Airtel to
enter /expand in this market. Besides there is a vast rural segment where the cellularservices have not made much headway and many customers are looking towards Airtel
for providing the service to them. With its wide and extensive presence even in the
remotest areas, Airtel poised to gain a big market share in this segment when it
expands cellular services into the rural areas.
THREATS
COMPETITION FROM OTHER CELLULAR It is time for BSNL to improve/expand
its cellular services. Fierce and cut-throat competition is already in place with the
markets ever abuzz with several tariff reductions and announcement of attractive
packages, trying to grab most of the mind share of the king - the consumer, whose
benefits are increasing with passing of everyday. If BSNL is not innovative and agile,
its cellular service will be a flop. It needs to be proactive with attractive packaging,
pricing and marketing policies lest its presence in the market be treated with disdain
37
-
8/3/2019 Airtel Project Final
38/41
by the private cellular companies. The launch of WLL services by Reliance Infocomm
has aggravated the situation.
MARKET MATURITY IN BASIC TELEPHONY SEGMENT Although Airtel
entered in the basic telephony market its a biggest there for the company as the basic
telephony market has reached
38
-
8/3/2019 Airtel Project Final
39/41
ANALYSIS OF FINANCIAL STATEMENT
Balance sheet
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
Share application money 116.22 57.63 30.00 12.13 2.72
Preference share capital - - - - -
Reserves & surplus 25,627.38 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 4,708.12
Total net current assets -4,000.26 -5,922.95 -5,635.86 -3,933.92 -2,221.80
39
-
8/3/2019 Airtel Project Final
40/41
Mar ' 09 Mar ' 08 Mar ' 07 Mar ' 06 Mar ' 05
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
40
-
8/3/2019 Airtel Project Final
41/41
BIBLIOGRAPHY
www.airtel.com
www.airtelworld.com
airtel-broadband.com
www.trai.gov.in
www.hindustantimes.com
http://www.bhartiairtel.com/
BHARTIAIRTEL ANNUAL REPORT 2006-07,2005-06, 2004-05
http://www.blonnet.com/2007/08/10/stories/2007081051230200.htm
http://www.bhartiairtel.com/1024/aboutairtel/infrastructure.asp
http://www.bhartiairtel.com/1024/globalairtel/products.asp
http://www.bhartiairtel.com/1024/press/press.a
http://marketingpractice.blogspot.com/2006/01/bhartiairtel-1999-2005-rip.html
http://en.wikipedia.org/wiki/Bharti_Airtel
http://www.coolavenues.com/know/gm/bhartiairtel_1.php
http://www.airtel.com/http://www.bhartiairtel.com/http://www.bhartiairtel.com/1024/aboutairtel/infrastructure.asphttp://www.bhartiairtel.com/1024/globalairtel/products.asphttp://en.wikipedia.org/wiki/Bharti_Airtelhttp://www.coolavenues.com/know/gm/bhartiairtel_1.phphttp://www.airtel.com/http://www.bhartiairtel.com/http://www.bhartiairtel.com/1024/aboutairtel/infrastructure.asphttp://www.bhartiairtel.com/1024/globalairtel/products.asphttp://en.wikipedia.org/wiki/Bharti_Airtelhttp://www.coolavenues.com/know/gm/bhartiairtel_1.php