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Annual Report 2008 09
Annual Report 2008 09
Dear Shareholders,
The Indian mobility sector witnessed robust growth during
the year. The total mobility subscribers, as on March 2009,
stood at 392 million, registering an annual growth of
around 50%. The low cost of entry and service, coupled
with the deeper penetration of the network, have been
the main drivers of the sector growth.
Your Company had an excellent year, with consolidated
revenue crossing the Rs. 100 billion mark. Its revenue at
Rs. 101.54 billion, is up by 51% over that of the previous
year. Even after the exclusion of revenue from the new
service areas of Mumbai and Bihar, and from the joint
ventures Spice and Indus, the annual revenue growth from
older service areas is around 46%. This growth,
coming on the back of the earlier year’s revenue growth of
54%, marks IDEA as India’s fastest growing major telco over
the last two years. The net profit, for the year, stood at
Rs. 8,816 million.
Your company, during the financial year 2009-10,
launched services in Orissa, Tamil Nadu (including
Chennai), Jammu & Kashmir, Kolkata and West Bengal.
With the imminent launch of services in Assam and North
East service areas, your Company, alongwith its subsidiary
and joint venture, will become a Pan India operator,
befitting its stature and potential.
Among other accolades, your company has been selected
by the Economic Times as the ‘Emerging Company of the
Year’ for 2009.
The calendar year 2009, has seen overcapacity hitting
the Indian telecom sector, largely due to the investment
decisions of 2007-08, both from cross-over licensees and
new licensees. This has inevitably lead to a phase of
hyper competition. Your company has anticipated and
prepared itself for this phase. Your company is strongly
placed in its established service areas, while the approach
for some of the new service areas is measured. I believe
based on this well-crafted strategy, advantage of
spectrum and scale, sophisticated management
processes, brand strength, human capital and strong
balance sheet, your Company will emerge even stronger
through this phase.
The Aditya Birla Group: In Perspective prides itself in having a course completion ratio of 90%,
Today, we manage multinational teams – 1,30,000 which is a world benchmark.
employees, comprising 30 nationalities, across 25 As perhaps many of you may be aware we track the
countries, anchor our US$ 29.2 billion meritocratic organisational climate every two years. We use the
conglomerate. Our values – Integrity, Commitment, Organisational Health Survey (OHS), as the barometer of
Passion, Seamlessness and Speed, is the thread that strings employee engagement at work. It is conducted by Gallup.
us together. Over 22,000 executives, across 17 businesses, spanning
Post our Group being declared the “Best Employer” in 2007 25 countries and 750 cities/interiors participated in the
by the Hewitt / Economic Times / Wall Street Study, our OHS6. The participation level at 94%, according to Gallup,
brand as an employer continues to grow strongly. More than is a benchmark. 83% of the employees surveyed in the OHS6
8,000 leading professionals from India and globally have said that they are proud to be an employee of the Aditya
teamed up with us. Birla Group and get professional satisfaction working here.
67% of our management employees have clearly
Our rigorous assessment process, inclusive of Development emphasized their confidence in the ability of the leaders at
Assessment Centres, assesses our people early in their various levels to successfully manage the emerging
career on their potential to hold leadership roles. This way, challenges that the Group is facing. Almost three-fourths
we have ensured that we have a robust bench strength of of our employees (73%) have stated that they would
talent. We also use short term secondments and long term definitely advocate our Group as a place to build a
assignments to develop the capability of our people to work meaningful career.
across borders. This year over 1,700 colleagues have been
job rotated. Going forward, I would like to emphasize that the brand of
leadership that we seek to build combines the virtues of
Over 80% of our businesses have participated in a professionalism with the commanding power of the mind,
compensation benchmarking exercise this year and we have heart and soul. The mind which has the intellect to perceive
taken significant corrective and proactive measures to stay the right from the wrong, the heart which has an emotional
competitive and attractive. This positioning will further help bond with the organisation that cannot be severed, and a
us to attract and retain the right talent. soul that is indomitable. Our biggest strength has been an
emotional bonding that our employees have with the Group
We lay great emphasis on continuous learning through our that makes the paradigm of duty truly boundaryless.
in-house learning university – Gyanodaya. This globally
benchmarked institution leverages resources from around
the world to meet the development needs of our people. Best Regards,
Over a 1,000 executives have taken courses this year.
Additionally, more than 14,000 employees spread across
the world, from Farmington Hills in USA to Giza in Egypt
to Perth in Australia and Renukoot in Uttar Pradesh have
used Gyanodaya’s E-learning platform called GVC. GVC Kumar Mangalam Birla
Table of Contents
1 Corporate Information
3 Performance Highlights
8 Directors’ Report
26 Auditors’ Report
30 Balance Sheet
57 Auditors’ Report
Company Secretary
Mr. Pankaj Kapdeo
Auditors
Deloitte Haskins & Sells
Chartered Accountants
706, B Wing,
ICC Trade Tower,
Senapati Bapat Road,
Pune – 411 016
Registered Office
Suman Tower,
Plot No. 18, Sector No. 11,
Gandhinagar – 382 011
Gujarat
Corporate Office
Windsor, 5th Floor,
Off CST Road,
Near Vidya Nagari, Kalina,
Santacruz (East),
Mumbai – 400 098
Website
http://www.ideacellular.com
1
Performance Highlights at a glance
INR bn INR bn
30 28.4
120
101.5
100 25 22.7
80 20
67.4
14.9
60 15
43.9 10.9
40 10 8.4
29.9
22.7
20 5
0 0
FY 05 FY 06 FY 07 FY 08 FY 09 FY 05 FY 06 FY 07 FY 08 FY 09
INR bn INR bn
12 28
10.4 23.3
24
10
8.8 19.8
20
8
16
6 5.0 11.7
12
4 7.6
8
2.1 5.2
2 0.8 4
0 0
FY05 FY06 FY07 FY08 FY09 FY05 FY06 FY07 FY08 FY09
3
Annual Report 2008-09
5
IDEA CELLULAR LIMITED
Roaming and Access Charges 18.2%, Subscriber Acquisition and commitment, integrity, passion, seamlessness and speed,
Servicing Expenses 8.1%, Advertisement & Business Promotion promotes strong bonding with its employees. During the year,
Expenditure 4.5%, and Administration and Other Expenditure 4.1%. it has again undertaken sharing of value creation by granting
another tranche of employee stock options to the eligible
Profit before Interest, Depreciation and Amortisation
employees. The findings of Organisation Health Study (OHS)
For the year ended March 31, 2009, the Company had a have been analysed, which are very encouraging, and concern
Profit before Interest, Depreciation and Amortisation of areas are being suitably addressed. The employee strength on
Rs. 28,364 mn, a growth of 25.0% compared to the previous rolls stood at 6,481 as on March 31, 2009.
year. The operating profit margins for the current financial year Risk Management
and for the previous financial year stood at 27.9% and 33.7%
respectively. The Risk Management framework of the Company ensures,
amongst others, compliance with the requirements of Clause
Depreciation, Amortisation and Finance Charges 49 of the Listing Agreement. The framework establishes risk
management across all service areas and functions of the
During the year ended March 31, 2009, Depreciation &
Company, and has in place procedures to inform the Board
Amortisation expenses increased by 60.0% to Rs. 14,028 mn as
Members about the risk assessment and minimization process.
against Rs. 8,768 mn for the previous year. Net finance charges
These processes are periodically reviewed to ensure that the
for the year increased by 78.1% from Rs. 2,776 mn to Rs. 4,945
management of the Company controls risks through a defined
mn, due to increased borrowings and foreign exchange
framework. The various risks, including the risks associated with
fluctuations.
the economy, regulations, competition, foreign exchange,
Profits and Taxes interest rate etc., are monitored and managed effectively.
Cash Profit from operations for the year ended March 31, 2009 Internal Control Systems
stood at Rs. 23,313 mn, showing an increase of 17.5% over the The Company has appropriate internal control systems for
previous year. The Profit before Tax for the year stood at business processes, covering operations, financial reporting and
Rs. 9,391 mn. The tax charge for the year, mainly due to deferred compliance with applicable laws and regulations. Clearly defined
tax charge, stood at Rs. 576 mn. The net profit for the year roles and responsibilities for all managerial positions drive
ended March 31, 2009 was Rs. 8,816 mn, resulting into a net adherence of defined processes. Operating parameters are
profit margin of 8.7%. monitored and controlled. Regular internal audits and checks
Capital Expenditure ensure that responsibilities are executed effectively. The audit
committee of the Board of Directors actively reviews the adequacy
During the year ended March 31, 2009, the Company incurred and effectiveness of internal control systems and suggests
capital expenditure of Rs. 66,857 mn. improvement for strengthening them, as appropriate.
Balance Sheet Opportunities, Risks, Concerns and Threats
During the current financial year, shareholder funds increased The strong growth in the sector continues, mainly due to
by Rs. 88,372 mn, largely due to a preferential issue of equity expansion of telecom networks to rural India, the reduced cost
by the Company, and the issue of Compulsorily Convertible of entry and the reduced cost of handsets. Low penetration,
Preference Shares (CCPS) by one of its subsidiary companies. more particularly in rural India, provides opportunity for further
This has led to strengthening of the balance sheet, which in growth, and your company, an incumbent GSM player with 900
turn provides potential for further debt leveraging for any future MHz spectrum in about half of India, is well positioned to tap
requirement. this opportunity.
The Gross Block stood at Rs. 205,234 mn, and Net Block The telecom sector has witnessed increasing competition
including Capital Work in Progress (CWIP) stood at Rs. 166,672 towards the end of financial year 2008-09 and the first half of
mn as at March 31, 2009. Treasury investments in mutual funds financial year 2009-10. New launches are coming both from
increased by Rs. 14,892 mn during the year and stood at 20,452 CDMA operators with crossover spectrum, and new licensees.
mn as at March 31, 2009. Net Current Assets stood at Rs. 13,324 These new launches, alongwith the expansion of some regional
mn as at March 31, 2009, mainly due to investment of surplus players, has created major overcapacity in the sector, which in
funds in fixed deposits with banks. The carried forward closing turn has lowered tariffs. However, your company, based on the
debit balance of the Profit and Loss Account is Rs. 5,263 mn as inherent advantage of spectrum and scale, brand strength and
at March 31, 2009. sophisticated management processes, is in a position to emerge
even stronger through this phase of hyper competition and
Human Resources sector overcapacity.
The Company through its participative work environment, skill The telecom sector is characterised by change in technology.
development activities, and by championing the values of Competition from new technologies is an inherent threat. While
6
Annual Report 2008-09
the planned 2100 MHz spectrum auction for 3G services spectrum allocation by the government. The Company believes
will lead to additional cash outflow, it will also open new in partnering with vendors who are of international repute, and
revenue streams. The Company’s strong balance sheet and with whom it builds long term relationships.
market standing, positions it to participate effectively in such
Outlook
auction.
The competitive intensity in the telecom sector has accelerated
The Company requires certain approvals, licenses, registrations
during the last three quarters, and is likely to increase with new
and permissions for operating its business. In addition, regulators
launches creating further overcapacity, placing pressure on
may amend license conditions, norms for spectrum allocation,
margins. However, it is anticipated that market forces will
spectrum charges, merger & acquisition rules etc. which may
eventually work the overcapacity out of the sector. The Company
have a significant impact on the Company’s business. The
focuses on strengthening its position in 900 MHz service areas,
Company, however, is hopeful that the policy changes will be
by exploiting its advantages of scale and spectrum, while in the
equitable.
newer service areas it follows a disciplined and measured
The Company’s business is dependent on key vendors to supply approach. The Company is fully equipped for this phase of
critical network equipment and services. Besides, its ability to intense competition, and expects to emerge competitively
provide quality mobile network and expanding its area of stronger. The telecom sector will continue to demonstrate
operations and the subscriber base is also dependent on the attractive long term opportunities for strong operators.
Cautionary Statement
Statements in the Management Discussion and Analysis describing the Company’s objectives, projections, estimates, expectations
may constitute a “forward-looking statement” within the meaning of applicable securities laws and regulations. Actual results
could differ materially from those expressed or implied. Important factors that could make a difference to the Company’s
operations, include economic conditions affecting demand/supply and price conditions in the domestic markets in which the
Company operates, changes in the Government Regulations, tax laws and other statutes and other incidental factors.
7
IDEA CELLULAR LIMITED
Directors’ Report
Dear Shareholders, Capital Expenditure
th Your Company continues its aggressive network expansion for
The Directors are pleased to present the 14 Annual Report,
together with the audited financial statements of your Company, enhanced coverage and improved quality experience to the
for the financial year ended March 31, 2009. customer. Your Company incurred a capex of Rs 66,857 mn
during the financial year 2008-09. As a result, cell sites of the
Financial Results
Company have increased from 24,793 as at end March, 2008
Financial highlights of the consolidated Statement of Operations to 49,860 as at end March, 2009.
of your Company for the financial year 2008-09 are: The Company also made significant progress in rolling out its
(Rupees in Million) National Long Distance (NLD) network and as at end September,
Particulars 2008-09 2007-08 2009, it carried about 51% of its captive NLD traffic.
Income from Services 101,313 67,200 Employee Stock Option Scheme
Other Income 231 174 Your Company has formulated and implemented the Employee
Stock Option Scheme 2006 (ESOS-2006). During the year under
Total Revenue 101,544 67,374
review, the ESOS Compensation Committee granted 6,131,250
Operating Expenses 73,180 44,682 options on July 24, 2008, as a second tranche to the eligible
EBITDA 28,364 22,692 employees of the Company. Each option is convertible into one
Depreciation and Amortization 14,028 8,768 Equity Share of the Company upon vesting. These options will
vest in 4 equal annual installments after one year of the grant
EBIT 14,336 13,924
and shall be exercisable within a period of 5 years from the
Interest and Financing charges 4,945 2,776 date of the vesting. Out of the total options granted, 2,655,000
EBT 9,391 11,148 options and 454,750 options lapsed out of the options granted
Taxes 575 725 in first and second tranches respectively. As on March 31, 2009
the outstanding options are 22,952,500.
Net Profit after Tax 8,816 10,423
Details of the options granted under ESOS – 2006 upto
Balance brought forward from March 31, 2009, and other disclosure in compliance with Clause
previous year (14,079) (24,502) 12 of Securities and Exchange Board of India (Employees Stock
Carried forward Loss (5,263) (14,079) Option Scheme and Employees Stock Purchase Scheme)
Guidelines 1999, are set out in Annexure ‘A’ to this Report.
During the year ended March 31, 2009, gross revenues grew by Human Resources
50.7% to Rs. 101,544 mn from Rs. 67,374 mn for the year
ended March 31, 2008. Your Company registered a net Your Company continuously invests in fostering people
profit of Rs. 8,816 mn against a net profit of Rs.10,423 mn development, identifying and grooming management talent,
in 2007-08. and has a culture of harnessing employees’ potential to the
maximum.
Dividend Awards and Recognitions
As your Company does not have distributable profits as on March Your Company has been selected as “Emerging Company of the
31, 2009, your Directors have not recommended any dividend Year” for 2009 by The Economic Times, arguably Corporate
for the year. India’s pre-eminent awards. This award is a recognition of the
Review of Consolidated Operations strides made by your company in recent years.
12
Annual Report 2008-09
13
IDEA CELLULAR LIMITED
b) The pricing formula The exercise price was determined by The exercise price was determined by
averaging the daily closing price of the averaging the daily closing price of the
Company’s equity shares during 7 days Company’s equity shares during 7 days
immediately preceding the date of grant immediately preceding the date of
and discounting it by 15%. grant.
Exercise price - Rs.112.57 per option Exercise price - Rs.84.03 per option
i) Senior managerial personnel: Mr. Sanjeev Aga: 17,12,000 Mr. Sanjeev Aga: 4,28,000
14
Annual Report 2008-09
The impact of this difference on profits and The effect of adopting the fair value on the net income and earnings per share for 2008-09
on EPS of the company is as presented below :
Particulars Rs. in million
Net profit after tax but before exceptional items 10,012.11
Add: Intrinsic Value compensation cost 144.74
Less: Fair Value compensation cost 568.46
Adjusted Net Income 9,588.39
Earnings Per Share (Rs.) Basic Diluted
As Reported 3.42 3.42
As Adjusted 3.27 3.27
(v) the price of the underlying share in Rs. 139.10 Rs. 87.75
market at the time of option grant
15
IDEA CELLULAR LIMITED
Name of Director Category No. of Outside Directorship(s) Held1 Outside Committee Positions Held2
1. The Directorships held by the Directors, as mentioned above excludes alternate directorships, directorships in foreign companies, companies
under Section 25 of the Companies Act, 1956 and Private Limited companies, which are not the subsidiaries of Public Limited companies.
2. Represents Membership/ Chairmanship of two Committees viz. Audit Committee and Shareholders’/ Investors’ Grievance Committee.
16
Annual Report 2008-09
Board Meetings and Procedure Managerial Personnel have affirmed compliance to the Code of
The Board of Directors plays the primary role in ensuring good Conduct. A declaration signed by the Managing Director
governance and functioning of the Company. The Meetings are affirming the compliance with the Code of Conduct by the Board
governed by a structured agenda. All the agenda items are Members and Senior Management Personnel of the Company
backed by comprehensive agenda notes, containing all the vital is appended at the end of this report.
information, so as to enable the Directors to have focused 2. COMMITTEES OF THE BOARD
discussion at the meeting and to take informed decisions. All A. Audit Committee
the relevant information as enumerated in Annexure IA to Clause
49 of the Listing Agreement is placed before the Board. The Composition, Meetings and Attendance
agenda and agenda notes are circulated to all the Directors in The Company has an Audit Committee at the Board level with
advance of each meeting of the Board of Directors. Where it is the powers and role that are in accordance with Clause 49 of
not practical to send the relevant information as a part of the the Listing Agreement and Section 292A of the Companies Act,
agenda papers, the same is tabled at the meeting. The 1956. The Committee acts as a link between the Management,
presentations covering the Company’s performance, operations the Statutory Auditors, Internal Auditors and the Board of
and business strategy are also made to the Board. Directors to oversee the financial reporting process. The Audit
The Board also reviews periodically the compliance status of all Committee consists of four members, of which three members
the applicable laws. All the decisions are taken after detailed including the Chairman are Independent Directors and one
discussions by the Board Members at the meetings. The Member is a Non-Executive Director. The majority of the Audit
Members of the Board have complete freedom to express their Committee members have accounting and financial
opinion and have unfettered and complete access to information management expertise. The Company Secretary acts as a
in the Company. Secretary to the Committee.
The Board meets at least once in a quarter to review the quarterly The Managing Director and the Chief Financial Officer of the
financial results and operations of the Company. Apart from Company are permanent invitees of the Audit Committee
the above, additional Board Meetings are convened to address Meetings and representatives of the Statutory Auditors and Internal
the specific needs of the Company. Auditors of the Company are also invited to the Audit Committee
Meetings. In addition, other Senior Management Members are
During the financial year 2008-09, six meetings of the Board also invited to the Committee meetings to present reports on the
were held on April 24, 2008, May 22, 2008, June 25, 2008, respective items being discussed at the meeting from time to time.
July 24, 2008, October 20, 2008 and January 22, 2009. The
time gap between two meetings did not exceed four months. The Audit Committee observes and controls the financial
The Board Meetings are generally held in Mumbai. reporting process of the Company with a view to provide
accurate and proper disclosures. The Committee reviews the
The details of attendance of Directors at Board Meetings and at internal audit reports periodically as well as the action taken
the last Annual General Meeting are as under: report. The Committee also gives directions to the management
in areas that needs to be strengthened. The recommendations
Name of Director No. of Board Meetings Attended
of the Audit Committee are binding on the Board.
held during the tenure Last AGM
Held Attended During the financial year 2008-09, six meetings of the Audit
Committee were held on April 2, 2008, April 24, 2008, July 24,
Mr. Kumar Mangalam Birla 6 6 No 2008, October 20, 2008, December 22, 2008, and January 22,
Mrs. Rajashree Birla 6 5 No 2009.
Mr. M.R. Prasanna 4 4 Yes The composition of the Audit Committee as on March 31, 2009
and the attendance of the members at the meetings are as under:
Mr. Saurabh Misra 6 4 No
Mr. Biswajit A. Subramanian 6 6 No Name of Director Category No. of No. of meetings
Meetings held attended
Mr. Arun Thiagarajan 6 3 Yes during the tenure
Mr. G.P. Gupta 6 6 No Mr. G.P. Gupta
Mr. Mohan Gyani 6 1 No (Chairman) Independent 6 6
Ms. Tarjani Vakil 6 5 No Mr. Arun Thiagarajan Independent 6 5
Mr. R.C.Bhargava 2 2 No Ms. Tarjani Vakil Independent 6 6
Dr. Shridhir Sariputta
Mr. P. Murari 2 1 No
Hansa Wijayasuriya Non Executive 3 1
Dr. Shridhir Sariputta Hansa
Wijayasuriya 2 2 No Powers of Audit Committee
As enumerated in Clause 49 of the Listing Agreement, the Audit
Mr. Sanjeev Aga 6 6 Yes
Committee has the following powers:
Code of Conduct: 1. To investigate any activity within its terms of reference;
The Board of Directors play an important role in ensuring good 2. To seek information from any employee;
governance and have laid down the Code of Conduct for all the
3. To obtain outside legal or other professional advice, and
Board Members and Senior Managerial Personnel of the
Company, which is also uploaded on the website of the Company 4. To secure attendance of outsiders with relevant expertise,
(www.ideacellular.com). All Board Members and Senior if it considers necessary.
17
IDEA CELLULAR LIMITED
Terms of reference having post-audit discussions to ascertain any area of
The broad terms of reference of Audit Committee includes the concern;
following, as mandated in Clause 49 of the Listing Agreement i. Reviewing with the management, the quarterly financial
and Section 292A of the Companies Act, 1956: statements before submission to the Board for approval;
a. Oversight of the Company’s financial reporting process and j. Reviewing the reasons for substantial defaults in the
the disclosure of its financial information to ensure that payment to the depositors, debenture holders, shareholders
the financial statement is correct, sufficient and credible; (in case of non-payment of declared dividends) and
creditors;
b. Recommending to the Board, the appointment,
re-appointment and if required, the removal of external k. Review of Management Discussion and Analysis of financial
auditor, determination of audit fee and also approval of condition and results of operations;
payment for any other services; l. Review of Management Letters / Letters of Internal Control
c. Reviewing with the management, the annual financial Weaknesses issued by the Statutory / Internal Auditors;
statements before submission to the Board, with particular m. Reviewing of functioning of ‘Whistle Blower Mechanism’ in
reference to: case the same exists; and
• Changes in accounting policies and practices; n. Carrying out any other function as and when referred by
• Major accounting entries based on exercise of the Board.
judgment by the management; B. Remuneration Committee
• Qualifications in Draft Audit Report; The Company has constituted a Remuneration Committee
• Significant adjustments made in financial statements comprising of three Non-Executive Directors, all of whom are
arising out of audit findings; Independent Directors. The Company Secretary acts as Secretary
• The Going Concern assumption; to the Committee. As on March 31, 2009, the Committee
• Compliance with Accounting Standards; comprised of Mr. Arun Thiagarajan, Ms. Tarjani Vakil and
• Compliance with listing and other legal requirements Mr. G.P. Gupta.
concerning financial statements; During the financial year 2008-09, the Remuneration Committee
• Any related party transactions i.e. transactions of the met once on December 22, 2008 and all the three members
Company of material nature, with promoters or the attended the said meeting.
management, their subsidiaries or relatives etc., that
Terms of reference
may have potential conflict with the interests of
Company at large; The broad terms of reference of Remuneration Committee
• Matters required to be included in the Directors’ includes the following:
Responsibility Statement, in terms of Section 217 (2AA) a. Review of remuneration payable to the Directors and senior
of the Companies Act, 1956. officials of the Company;
d. Reviewing the adequacy of internal audit function, including b. Reviewing and advising the Board over the remuneration
the structure of the internal audit department, staffing and policies of the Company generally; and
seniority of the official heading the department, reporting c. Such other matters as may be decided by the Board from
structure, coverage and frequency of internal audit; time to time.
e. Discussion with internal auditors on any significant findings
Remuneration of Directors
and follow-up thereon;
f. Reviewing the findings of any internal investigations by (i) Remuneration to the Managing Director
the internal auditors into matters where there is suspected The remuneration package of Mr. Sanjeev Aga, Managing
fraud or irregularity or a failure of internal control systems Director was recommended by the Remuneration
of a material nature and reporting the matter to the Board; Committee, approved by the Board of Directors and the
g. Reviewing with the management, the performance of same was approved by the members of the Company and
external and internal auditors, and the adequacy of internal also by the Central Government.
control systems; The remuneration package of Managing Director comprises
h. Discussion with external auditors before the audit of a fixed salary component and a performance linked
commences on the nature and scope of audit as well as bonus.
20
Annual Report 2008-09
Extra Ordinary General Meeting GENERAL SHAREHOLDERS’ INFORMATION
During the financial year 2008-09, an Extra Ordinary 1. Annual General Meeting
General Meeting of the Company was held on July 30,
2008, for passing the following special resolutions: Day and Date : Monday, December 21, 2009
Time : 12:00 noon
• Further issue of Capital
Venue : Cambay Spa and Resort,
• Utilisation of IPO proceeds of Equity Shares Plot No. X-22/23, GIDC
Electronic Estate, Sector 25,
Postal Ballot Gandhinagar – 382 044,
There was no Special Resolution passed through Postal Gujarat
Ballot during the financial year 2008-09 2. Financial Calendar for 2009-10 (Tentative)
iv) Details of unclaimed shares in terms of Clause 5A of Financial reporting for the quarter : End July 2009
the Listing Agreement ending June 30, 2009
As per the terms of newly inserted clause 5A of the Listing Financial reporting for the quarter : End October 2009
Agreement, the Company would take necessary steps for ending September 30, 2009
crediting the shares allotted pursuant to the Initial Public Financial reporting for the quarter : End January 2009
Offering (IPO) of the Company in year 2007, which are ending December 31, 2009
unclaimed and are lying in escrow account to a demat
Financial reporting for the quarter : End April 2010
suspense account and the details thereof as required to be
ending March 31, 2010
disclosed in the Annual Report are given below:
Annual General Meeting for the : July / August 2010
Particulars No. of No. of year 2009-10
cases shares
Aggregate number of shareholders and 3. Book Closure Date : December 14, 2009 to
the outstanding shares lying in the December 21, 2009
suspense account at the beginning of (both days inclusive)
the year i.e. as on April 1, 2008 192 35598 4. Dividend Payment Date : Not Applicable
(Since no dividend
Number of shareholders who
is proposed for the Financial
approached to the Issuer / Registrar for
Year 2008-09)
transfer of shares from suspense account
during the Financial Year 2008-09 74 13058 5. Registered Office : Suman Tower,
Plot No. 18, Sector-11,
Number of shareholders to whom shares Gandhinagar – 382 011,
were transferred from suspense account Gujarat, India.
during the Financial Year 2008-09 47 7933 Tel: +91-79-66714000
Fax: +91-79-23232251
Aggregate number of shareholders and
the outstanding shares lying in the 6. Plant Locations : The Company being a
suspense account at the end of the service provider, has no
year i.e. as on March 31, 2009 145 27665 Plant Locations.
7. Listing Details
7. CEO/CFO CERTIFICATION
The Equity Shares of the Company are listed on the
As required by Clause 49 of the Listing Agreement, the following Stock Exchanges:
CEO/CFO certification is appended as an Annexure to this
report.
Name of Stock Exchanges
8. REPORT ON CORPORATE GOVERNANCE National Stock Exchange of Bombay Stock Exchange Limited
This Corporate Governance Report forms part of the Annual India Limited Phiroze Jeejeebhoy Towers,
Report. The Company is in full compliance with all the “Exchange Plaza”, Dalal Street,
provisions of Clause 49 of the Listing Agreement entered Bandra-Kurla Complex, Mumbai – 400 001
into with the Stock Exchange(s). Bandra (East),
Mumbai – 400 023
9. COMPLIANCE
The Company’s payment of Listing Fees is up-to-date.
A Certificate from the Statutory Auditors of the Company,
confirming compliance with the conditions of Corporate 8. Stock Codes
Governance, as stipulated in Clause 49 of the Listing
Stock Code Reuters Bloomberg
Agreement of the Stock Exchange(s) is annexed and forms
part of this Annual Report. As far as adoption of non- Bombay Stock Exchange 532822 IDEA.BO IDEA IN
mandatory requirements are concerned, the Board has National Stock Exchange IDEA IDEA.NS NIDEA IN
constituted a Remuneration Committee of Directors
ISIN INE669E01016
comprising of Non-Executive and Independent Directors.
21
IDEA CELLULAR LIMITED
Month Bombay Stock Exchange Limited National Stock Exchange of India Limited
High Low Close Avg. Vol. High Low Close Avg. Vol.
(in Rs.) (in Rs.) (in Rs.) (in Nos.) (in Rs.) (in Rs.) (in Rs.) (in Nos.)
April – 08 112.50 96.60 105.50 2123631 112.50 96.55 105.55 9375300
May – 08 113.90 100.00 108.90 5926764 114.00 100.00 108.90 14320177
June – 08 112.00 92.40 93.10 2290985 112.00 92.65 93.40 6619318
July – 08 95.00 74.20 88.30 2959158 97.60 74.00 88.05 7518864
Aug – 08 92.60 80.05 82.50 1628785 93.45 79.50 82.40 4877007
Sept – 08 87.50 67.90 75.35 1469282 87.70 66.50 75.15 5178128
Oct – 08 78.15 34.05 42.75 2417920 78.40 34.00 42.55 6790556
Nov – 08 52.60 40.00 47.00 1443274 53.40 39.90 46.85 4503507
Dec – 08 58.35 42.20 52.65 1022018 58.40 37.10 52.65 3729929
Jan – 09 54.80 41.30 47.00 969306 54.90 41.20 47.00 3872367
Feb – 09 52.20 43.20 46.90 1282551 52.50 43.10 47.00 4431396
Mar – 09 53.25 41.85 50.15 1437507 53.35 42.00 50.25 4940030
115 18000
100 16000
85
14000
70
12000
55
10000
40
25 8000
Jun 2008
Jul 2008
Mar 2009
Jan 2009
Nov 2008
May 2008
Aug 2008
Feb 2009
Dec 2008
Apr 2008
Oct 2008
Sep 2008
115 5500
100 5000
85 4500
70 4000
55 3500
40 3000
25 2500
Jun 2008
Jul 2008
Mar 2009
Jan 2009
Nov 2008
May 2008
Aug 2008
Feb 2009
Dec 2008
Apr 2008
Oct 2008
Sep 2008
22
Annual Report 2008-09
11. Registrar and Share Transfer Agents 15. Shareholding Pattern
M/s. Bigshare Services Private Limited The shareholding pattern of the Company as on
E/2 Ansa Industrial Estate, March 31, 2009 is as follows:
Sakivihar Road,
Saki Naka, Category No. of % Share-
Andheri (East), Shares holding
Mumbai – 400 072 Promoters 1,522,937,212 49.13
Tel: +91-22-28470652
Foreign Institutional
Fax: +91-22-28475207
Investors 215,410,202 6.95
12. Share Transfer System
Non-Resident Indians/
Transfer of shares in physical form are processed within a Overseas Corporate
period of 12 days from the date of the lodgement subject Bodies 989,521,356 31.92
to documents being valid and complete in all respects. There
Mutual Funds, Insurance
have been no instances of transfer of shares in the physical
Companies, Financial
form during the financial year 2008-09.
Institutions & Banks 242,685,212 7.82
13. Investor Services
Bodies Corporate 37,809,754 1.22
The status of investors’ complaints as on March 31, 2009 is
Resident Indians & Others 91,731,473 2.96
as follows:
No. of complaints received during the The Shares of the Company are compulsorily traded in
financial year 2008-09 228 dematerialised form. The shares of the Company are
admitted for trading under both the Depository Systems in
No. of complaints resolved upto March 31, 2009 234
India – NSDL and CDSL. A total number of 3,100,077,108
No. of complaints pending as on March 31, 2009 0 Equity Shares of the Company constituting over 99.99% of
the issued, subscribed and paid-up share capital were in
dematerialised form as on March 31, 2009.
14. Distribution of Shareholding
The distribution of shareholding of the Company as on 17. Outstanding GDRs / ADRs etc.
March 31, 2009 is as follows: No GDRs/ADRs/Warrants or Convertible Instruments are
outstanding as on March 31, 2009.
Number of Number % to total No. of % to
18. Investor Correspondence
Equity Shares of Share- Share- Shares total
held holders holders held Share- In order to facilitate quick redressal of the grievances /
holding queries, the Investors and Shareholders may contact the
Upto 5000 3,81,560 95.05 53,632,040 1.73 Company Secretary at the under mentioned address for
any assistance:
5000 – 10000 11,525 2.87 9,035,797 0.29
Mr. Pankaj Kapdeo
10001– 20000 4,309 1.07 6,420,138 0.21 Vice President (Legal) & Company Secretary
20001 – 30000 1,364 0.34 3,493,358 0.11 Idea Cellular Limited
30001 – 40000 498 0.13 1,768,244 0.06 “Windsor” 5th Floor,
Off CST Road, Near Vidya Nagari,
40001 – 50000 522 0.13 2,470,992 0.08 Kalina, Santacruz (East),
50001 – 100000 794 0.20 5,654,971 0.18 Mumbai – 400 098
100001 & above 858 0.21 3,017,619,669 97.34 Tel: +91-9594003434
Fax: +91-22-26527080
Total 4,01,430 100.00 3,100,095,209 100.00 E-Mail: shs@idea.adityabirla.com
23
IDEA CELLULAR LIMITED
Declaration
As provided under Clause 49 of the Listing Agreement entered into with the Stock Exchange(s), it is hereby confirmed that all the
Board Members and Senior Management Personnel of the Company have affirmed the compliance with the Code of Conduct for
the year ended March 31, 2009
CEO/CFO Certification
To the Board of Directors
Idea Cellular Limited
a) We have reviewed the financial statements and cash flow statement of Idea Cellular Limited for the year ended March 31,
2009 and to the best of our knowledge and belief:
i) these statements do not contain any materially untrue statement or omit any material fact or contain statements that
might be misleading;
ii) these statements together present a true and fair view of the Company’s affairs and are in compliance with existing
Accounting Standards, applicable laws and regulations, other than the accounting treatment in respect of court approved
Scheme(s) of Arrangement which have been explained in the relevant notes to the Accounts.
b) To the best of our knowledge and belief, no transactions are entered into by the Company during the year ended March 31,
2009, which are fraudulent, illegal or violative of the Company’s Code of Conduct.
c) We accept responsibility for establishing and maintaining internal controls for financial reporting and we have evaluated the
effectiveness of internal control system of the Company pertaining to financial reporting. We have disclosed to the Auditors
and the Audit Committee, deficiencies in the design and operations of such internal controls, if any, of which we are aware
and steps that have been taken to rectify these deficiencies.
d) We have indicated to the Auditors and the Audit Committee:
i) Significant changes in the internal control over financial reporting during the year;
ii) Significant changes in the accounting policies during the year and that the same has been disclosed in the notes to the
financial statements; and
iii) Instances of significant fraud of which we have become aware and the involvement therein, if any, of the management
or any employee having a significant role in the Company’s internal control system over financial reporting.
Auditors’ Certificate
To the Members of
Idea Cellular Limited
We have examined the compliance of conditions of Corporate Governance by Idea Cellular Limited, for the year ended
March 31, 2009, as stipulated in Clause 49 of the Listing Agreement of the said Company with the Stock Exchanges.
The compliance of conditions of Corporate Governance is the responsibility of the Management. Our examination has been
limited to review of the procedures and implementation thereof adopted by the Company for ensuring compliance with the
conditions of Corporate Governance as stipulated in the said Clause. It is neither an audit nor an expression of opinion on the
financial statements of the Company.
In our opinion and to the best of our information and according to the explanations given to us and the representations made by
the Directors and the management, we certify that the Company has complied with the conditions of Corporate Governance as
stipulated in Clause 49 of the above mentioned Listing Agreement.
We further state that such compliance is neither an assurance as to the future viability of the Company nor of the efficiency or
effectiveness with which the management has conducted the affairs of the Company.
For Deloitte Haskins & Sells
Chartered Accountants
Hemant M. Joshi
Partner
Membership No:38019
Place: Mumbai
Date: October 26, 2009
24
Annual Report 2008-09
Persons constituting group coming within the definition of “Group” for the purpose of regulation 3(1)(e)(i) of Securities
and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 1997, include the following:
25
IDEA CELLULAR LIMITED
Auditors’ Report
To the Members of
Idea Cellular Limited
1. We have audited the attached Balance Sheet of Idea Cellular (c) the Balance Sheet, the Profit and Loss Account and
Limited (‘the Company’) as at March 31, 2009, the Profit the Cash Flow Statement dealt with by this report are
and Loss Account and the Cash Flow Statement of the in agreement with the books of account;
Company for the year ended on that date, both annexed
thereto (together referred to as ‘financial statements’). These (d) in our opinion, the Balance Sheet, the Profit and Loss
financial statements are the responsibility of the Company’s Account and the Cash Flow Statement dealt with by
management. Our responsibility is to express an opinion this report comply with the Accounting Standards
on these financial statements based on our audit. referred to in Section 211(3C) of the Companies Act,
1956;
2. We conducted our audit in accordance with the auditing
standards generally accepted in India. These Standards (f) in our opinion and to the best of our information and
require that we plan and perform the audit to obtain according to the explanations given to us, the said
reasonable assurance about whether the financial financial statements read together with the notes
statements are free of material misstatements. An audit thereon give the information required by the
includes examining, on a test basis, evidence supporting Companies Act, 1956 in the manner so required and
the amounts and disclosures in the financial statements. give a true and fair view in conformity with the
An audit also includes assessing the accounting principles accounting principles generally accepted in India:
used and the significant estimates made by management,
(i) in the case of the Balance Sheet, of the state of
as well as evaluating the overall financial statement
affairs of the Company as at March 31, 2009;
presentation. We believe that our audit provides a
reasonable basis for our opinion. (ii) in the case of the Profit and Loss Account, of the
profit of the Company for the year ended on that
3. Without qualifying our opinion, we draw attention to Note
date; and
B4 of schedule 22 to the financial statements. As explained
in the said note, the difference between the carrying value (iii) in the case of the Cash Flow Statement, of the
of the licenses and consideration, or impairment loss, if cash flows of the Company for the year ended on
any would be adjusted with the securities premium account. that date.
The impact of the above on the Reserve and Surplus of the
6. on the basis of the written representations received from
Company is not ascertainable at this stage.
the directors, as on March 31, 2009 and taken on record
4. As required by the Companies (Auditor’s Report) Order, by the Board of Directors, we report that none of the
2003, (‘the said Order’) issued by the Central Government directors is disqualified as on March 31, 2009 from being
in terms of Section 227(4A) of the Companies Act, 1956, appointed as a director in terms of Section 274 (1)(g) of
we enclose in the annexure a statement on the matters the Companies Act, 1956;
specified in the paragraphs 4 and 5 of the said Order.
5. Further to our comments in the Annexure referred to in For Deloitte Haskins & Sells
paragraph 3 above, we report that: Chartered Accountants
(a) we have obtained all the information and explanations, Hemant M. Joshi
which to the best of our knowledge and belief were Partner
necessary for the purposes of our audit;
Membership No: 38019
(b) in our opinion, proper books of account as required by
law have been kept by the Company so far as it appears Place: Mumbai
from our examination of those books; Date: October 26, 2009
26
Annual Report 2008-09
Name of the Statute Nature of Period to which Amount Forum where the
Dues the amount pertains (Rs. Million) dispute is pending
Income Tax Act, 1961 Income tax 2002-03, 2004-05, 53.27 Commissioner of Income Tax
2006-07, 2007-08, (Appeals)
2008-09
Kerala Sales Tax Act, 1963 Sales tax 1998-99 0.06 Deputy Commissioner
Kerala Sales Tax Act, 1963 Sales tax 2005-06 to 2007-08 0.03 Deputy Commissioner, (Appeals)
Kerala Sales Tax Act, 1963 Sales tax 1997-98 0.39 Sales Tax Appellate Tribunal
Andhra Pradesh General Sales tax 1997-98, 2002-03 227.46 Andhra Pradesh High Court
Sales Tax Act, 1957 to 2004-05
Andhra Pradesh Value Sales tax 2005-06 to 2007-08 81.95 Andhra Pradesh High Court
Added Tax, 2005
Delhi Sales Tax Act, 1975 Sales tax 2003-04,2004-05 92.74 Additional Commissioner
(Appeals)
Gujarat Sales Tax Act, 1969 Sales tax 1998-99 to 2001-02 7.04 Sales Tax Tribunal
Gujarat Sales Tax Act, 1969 Sales tax 2006-07 0.83 Assessing officer
Madhya Pradesh Commercial Sales tax 2000-01 , 2002-03 1.05 Appellate Board
Tax Act, 1994
Madhya Pradesh Commercial Sales tax 2001-02 , 2003-04 7.29 Appellate Deputy Commissioner
Tax Act, 1994 to 2005-06
Madhya Pradesh Commercial Sales tax 2004-05 3.12 Assistant Commissioner
Tax Act, 1994
Madhya Pradesh Commercial Sales tax 2003-04 0.63 Madhya Pradesh Commercial Tax
Tax Act, 1994 Tribunal
Uttar Pradesh Trade Tax Act, 1948 Sales tax 2004-05 0.05 Joint Commissioner (Appeals)
Uttar Pradesh Trade Tax Act, 1948 Sales tax 2005-06 0.43 Joint Commissioner (Appeals)
Finance Act, 1994 Service tax 2004-05 31.32 Central Excise, Service Tax
(Service Tax provisions) Appellate Tribunal
Finance Act, 1994 Service tax 2007-08 10.53 Central Excise, Service Tax
(Service Tax provisions) Appellate Tribunal
Finance Act, 1994 Service tax 2004-05 to 2007-08 171.76 Central Excise, Service Tax
(Service Tax provisions) Appellate Tribunal
Finance Act, 1994 Service tax 2003-04, 2006-07, 6.50 Commissioner (Appeals)
(Service Tax provisions) 2007-08
Finance Act, 1994 Service tax 1999-2000 to 3.10 Supreme Court
(Service Tax provisions) 2003-04
Finance Act, 1994 Service tax 2005-06 to 2007-08 32.59 Commissioner (Appeals)
(Service Tax provisions)
Finance Act, 1994 Service tax 2005-06 2.68 Commissioner (Appeals)
(Service Tax provisions)
Customs Act, 1962 Custom duty 2003-04 1.15 Central Excise, Service Tax
Appellate Tribunal
Haryana Land Development Tax Entry tax 2002-03 9.52 Tribunal
Act, 2001
MP Entry Tax Act, 1976 Entry tax 2003-04 to 2005-06 8.59 Appellate Deputy Commissioner
MP Entry Tax Act, 1976 Entry tax 1998-99,1999-2000, 0.13 Assistant Commissioner
2000-01
MP Entry Tax Act, 1976 Entry tax 1998-99 to 2002-03 4.70 Madhya Pradesh Commercial Tax
Tribunal
The Uttar Pradesh Tax on Entry of Entry tax 2004-05 2.08 Joint Commissioner (Appeals)
Goods Act, 2000
The Uttar Pradesh Tax on Entry of Entry tax 1999-2000, 2001-02 8.89 Trade Tax Tribunal
Goods Act, 2000 to 2003-04
Uttar Pradesh Trade Tax Act, 1948 Entry tax 2001-02 to 2003-04 1.14 Joint Commissioner (Appeals)
Uttar Pradesh Trade Tax Act, 1948 Entry tax 1999-2000, 2000-01, 11.72 Trade Tax Tribunal
2002-03, 2007-08
28
Annual Report 2008-09
10. The accumulated losses of the Company are less than fifty information and explanations given to us, as at the balance
percent of its net worth and the Company has not incurred sheet date funds amounting to Rs.15,000 million raised on
cash losses during the current financial year covered by the short term basis have been used for long term purpose.
our audit and the immediately preceding financial year.
18. The Company has not made preferential allotment of shares
11. In our opinion and according to the information and to parties and companies covered in the register maintained
explanations given to us, the Company has not defaulted under section 301 of the Companies Act, 1956, during the
in repayment of dues to the financial institutions and banks. year.
12. According to the information and explanations given to us, 19. The Company has not issued any debentures during the
the Company has not granted loans and advances on the year.
basis of security by way of pledge of shares, debentures
20. The management has disclosed the end use of money raised
and other securities.
by public issue and the same has been verified by us.
13. The Company is not a chit fund or a nidhi / mutual benefit
21. During the course of our examination of the books of
fund / society. Therefore, the provisions of paragraph 4(xiii)
account, carried out in accordance with generally accepted
of the said Order are not applicable to the Company.
auditing practices in India, and according to the information
14. In our opinion and according to the information and and explanations given to us, we have neither come across
explanations given to us, the Company is not dealing in or any incidence of material fraud on or by the Company,
trading in shares, securities, debentures and other noticed or reported during the year, nor have we been
investments. informed of any such case by the management.
15. In our opinion and according to the information and
For Deloitte Haskins & Sells
explanations given to us, the terms and conditions of the
Chartered Accountants
guarantees given by the Company for loans taken by others
from banks and financial institutions are not prima facie
prejudicial to the interest of the Company. Hemant M. Joshi
Partner
16. In our opinion and according to the information and Membership No: 38019
explanations given to us, the term loans taken by the
Company have been applied for the purpose for which they Place: Mumbai
were raised to the extent utilised. Date: October 26, 2009
17. On the basis of an overall examination of the balance sheet
of the Company, in our opinion and according to the
29
IDEA CELLULAR LIMITED
Loan Funds
Secured 3 55,649.32 53,154.17
Unsecured 4 20,144.34 11,993.42
75,793.66 65,147.59
Deferred Tax Liability (Net) (Refer Note B 29 to Schedule 22) 1,425.38 661.85
TOTAL 194,216.03 115,334.64
APPLICATION OF FUNDS
Fixed Assets
Gross Block (At Cost) 5 155,627.51 132,043.01
Less: Depreciation & Amortisation 47,398.61 42,214.97
Net Block 108,228.90 89,828.04
Capital Work-in-Progress 17,218.18 16,257.17
125,447.08 106,085.21
Investments 6 49,288.08 5,699.31
Current Assets, Loans and Advances
Current Assets
Inventories 7 427.29 276.15
Sundry Debtors 8 3,295.87 1,985.93
Cash and Bank Balances 9 23,444.29 4,970.55
Other Current Assets 10 1,330.84 520.66
Loans and Advances 11 19,140.17 7,986.73
47,638.46 15,740.02
The Schedules referred to above form an integral part of the Balance Sheet
As per our report of even date attached
For Deloitte Haskins & Sells For and on behalf of the Board
Chartered Accountants
30
Annual Report 2008-09
Profit and Loss Account for the year ended March 31, 2009
(Rupees in Million)
Schedules For the year ended For the year ended
March 31, 2009 March 31, 2008
INCOME
Service Revenue 98,383.47 67,199.83
Sales of Trading Goods 187.33 0.07
Other Income 13 215.77 174.55
TOTAL 98,786.57 67,374.45
OPERATING EXPENDITURE
Cost of Trading Goods Sold 14 189.64 0.06
Personnel Expenditure 15 4,676.85 3,417.82
Network Operating Expenditure 16 20,761.57 10,469.53
Licence and WPC Charges 17 10,958.96 6,851.03
Roaming & Access Charges 18 18,158.81 11,334.41
Subscriber Acquisition & Servicing Expenditure 19 8,145.66 6,469.63
Advertisement and Business Promotion Expenditure 4,265.71 3,224.29
Administration & other Expenses 20 3,824.93 2,895.03
70,982.13 44,661.80
PROFIT BEFORE FINANCE CHARGES, DEPRECIATION, 27,804.44 22,712.65
AMORTISATION & TAXES
Finance and Treasury Charges (Net) 21 4,507.24 2,776.42
Depreciation 5A 10,967.22 7,568.52
Amortisation of Intangible Assets 5B 1,461.34 1,199.10
Non Compete Fee (Refer note B 5 to Schedule 22) 5,439.75
Less: Amount Withdrawn from Securities Premium
(Refer note B 5 to Schedule 22) (5,439.75) – –
Loss on De-merger of Passive Infrastructure to Idea Cellular Towers
Infrastructure Limited (Refer note B 6 to Schedule 22) 16,227.76
Less: Amount withdrawn from Reserve for Business Restructuring
(Refer note B 6 to Schedule 22) (16,227.76) – –
PROFIT BEFORE TAX 10,868.64 11,168.61
Provision for taxation - Current 1,268.99 425.33
- Deferred 763.53 651.30
- Fringe Benefit Tax 93.00 73.69
- MAT Credit (1,268.99) (425.33)
PROFIT AFTER TAX 10,012.11 10,443.62
Balance of Loss brought forward from previous year (14,064.94) (24,508.56)
BALANCE OF LOSS CARRIED FORWARD TO BALANCE SHEET (4,052.83) (14,064.94)
EARNINGS PER SHARE (Refer note B 28 to Schedule 22)
Basic 3.42 3.96
Diluted 3.42 3.96
Significant Accounting Policies and Notes to the
Financial Statements 22
The Schedules referred to above form an integral part of the Profit & Loss Account
As per our report of even date attached
For Deloitte Haskins & Sells For and on behalf of the Board
Chartered Accountants
31
IDEA CELLULAR LIMITED
As at As at
March 31, 2009 March 31, 2008
SCHEDULE 1
SHARE CAPITAL
Authorised (Refer note B 1(a) to Schedule 22)
6,775,000,000 (Previous year 4,275,000,000) Equity Shares of Rs.10 each 67,750.00 42,750.00
1500 (Previous year 1500) Redeemable Cumulative Non Convertible Preference Shares 15,000.00 15,000.00
of Rs.10 Mn. Each
82,750.00 57,750.00
Issued, Subscribed and Paid-Up
Equity Share Capital (Refer note B 1(b) to Schedule 22)
3,100,095,209 (Previous year 2,635,360,539) Equity Shares of Rs. 10 each fully paid up 31,000.95 26,353.61
31,000.95 26,353.61
SCHEDULE 2
RESERVES AND SURPLUS
Amalgamation Reserve 643.57 643.57
Capital Reserve 1,414.56 1,414.56
Security Premium Account
Opening Balance 21,075.87 18,313.36
Add: Premium on issue of Preferential allotment (Refer note B 1(b) to Schedule 22) 68,297.40 –
Add: Premium on issue of shares under Green Shoe Option – 2,762.51
Less: Share Issue Expenses (177.94) –
Less: Withdrawals (Refer note B 5 to Schedule 22) (5,439.75) –
83,755.58 21,075.87
Reserve for Business Restructuring (Refer Note B 6 to Schedule 22)
Opening Balance – –
Additions during the year 16,227.76 –
Less: Transferred to Profit and Loss Account during the year 16,227.76 –
– –
85,813.71 23,134.00
SCHEDULE 3
SECURED LOANS
Term Loan (Refer note B 8 to Schedule 22)
Foreign Currency Loan
- From Banks 4,268.34 4,268.04
- From Financial Institutions 4,279.80 –
Rupee Loan
- From Banks 40,071.95 41,480.20
- From Financial Institutions 6,682.76 7,099.70
(Repayable within one year Rs. 4,275.59 Mn, Previous Year Rs. 1,425.20 Mn)
Vehicle Loan 346.47 306.23
(Repayable within one year Rs. 142.04 Mn, Previous Year Rs. 103.08 Mn)
55,649.32 53,154.17
SCHEDULE 4
UNSECURED LOANS
Term Loan
Foreign Currency Loan
- From Banks 3,386.98 1,390.16
Rupee Loan
- From Others (Refer note B 12 to Schedule 22) 1,757.36 1,757.36
Short Term Loan
Rupee Loan from Banks – 8,845.90
Others 15,000.00 –
20,144.34 11,993.42
32
Schedules forming part of the Accounts
SCHEDULE 5 - FIXED ASSETS (Refer note B 6 & 22 to Schedule 22)
A. TANGIBLE ASSETS (Rupees in Million)
Gross Block Depreciation Net Block
Particulars As at Additions for Deletions on Sale/Adjustment As at As at Additions for Deletions on Sale/Adjustment As at As at As at
April 1, 2008 the Year ended account of for the Year ended March 31, 2009 April 1, 2008 the Year ended account of for the March 31, 2009 March 31, 2009 March 31, 2008
March 31, 2009 de-merger March 31, 2009 March 31, 2009 de-merger Year ended
March 31, 2009
Land 77.76 14.20 - - 91.96 - - - - - 91.96 77.76
Leasehold Land 209.99 19.96 - 3.82 226.13 67.94 11.95 - 3.57 76.32 149.81 142.05
Building 577.68 77.09 - 1.82 652.95 165.80 32.98 - 1.82 196.96 455.99 411.88
Plant & Machinery 107,341.44 45,065.89 21,187.53 2,177.88 129,041.92 29,925.73 10,596.47 5,189.06 2,010.97 33,322.17 95,719.75 77,415.71
Annual Report 2008-09
Furniture & Fixture 750.98 241.85 - 1.60 991.23 397.02 92.51 - 1.12 488.41 502.82 353.96
Office Equipment 644.83 130.94 - 4.63 771.14 491.99 79.85 - 4.04 567.80 203.34 152.84
Vehicles 520.21 244.73 - 80.24 684.70 189.97 155.98 - 33.45 312.50 372.20 330.24
Sub-Total 110,122.89 45,794.66 21,187.53 2,269.99 132,460.03 31,238.45 10,969.74 5,189.06 2,054.97 34,964.16 97,495.87 78,884.44
Less: Pre-operative
Charge Capitalized 2.52
TOTAL 110,122.89 45,794.66 21,187.53 2,269.99 132,460.03 31,238.45 10,967.22 5,189.06 2,054.97 34,964.16 97,495.87 78,884.44
Previous Year 70,469.28 42,441.36 - 2,787.75 110,122.89 26,305.67 7,568.52 - 2,635.74 31,238.45 78,884.44
Notes:
1. Plant & Machinery includes assets held for disposal- Gross Block Rs. 38.51 Mn. (Previous Year - Rs. 1,988.03 Mn) and Net Block Nil (Previous Year Rs. 45.00 Mn)
2. Plant & Machinery includes Gross Block of assets capitalised under finance lease Rs. 2,219.73 Mn (Previous Year Rs.975.01 Mn) and corresponding Accumulated Depreciation being Rs. 640.62 Mn (Previous Year Rs. 134.43 Mn)
33
IDEA CELLULAR LIMITED
As at As at
March 31, 2009 March 31, 2008
SCHEDULE 6
INVESTMENTS
Long-term Trade Investment (Unquoted)
Investments in Shares of Subsidiaries
Aditya Birla Telecom Limited (Refer note B 6 to Schedule 22) 16,327.76 100.00
10,000,000 fully paid equity shares of Rs 10 each
Idea Cellular Infrastructure Services Limited 0.50 0.50
50,000 fully paid equity shares of Rs 10 each
Idea Cellular Services Limited 0.50 0.50
50,000 fully paid equity shares of Rs 10 each
Swinder Singh Satara & Company Limited 38.31 38.31
50,000 fully paid equity shares of Rs 10 each
Long-term Trade Investment (Quoted)
Investment in Joint Venture
Spice Communications Limited (Refer note B 3 to Schedule 22) 22,041.87 –
283,489,350 fully paid equity shares of Rs. 10 each
(Market value - Rs. 16,343.16 Mn)
Current Investment
Investments in Units of Mutual Funds (Refer note B 19 to Schedule 22) 10,879.14 5,560.00
(Includes unutilised Initial Public Offer proceed of Rs.Nil, Previous Year Rs.4,885.90 Mn)
49,288.08 5,699.31
SCHEDULE 7
INVENTORIES
(At lower of cost or estimated realisable value)
Trading Goods (Refer note B 18 to Schedule 22) – 0.45
Sims and Other Cards 427.29 275.70
427.29 276.15
SCHEDULE 8
SUNDRY DEBTORS
Debts outstanding for over six months
Unsecured - Considered good 77.44 95.31
- Considered doubtful 2,640.99 2,356.33
2,718.43 2,451.64
Other Debts
Unsecured - Considered good 3,218.43 1,890.62
- Considered doubtful 153.73 106.80
3,372.16 1,997.42
Less: Provision for doubtful debts 2,794.72 2,463.13
Total 3,295.87 1,985.93
Sundry Debtors include certain parties from whom Security Deposits of Rs.246.51Mn.
(Previous Year Rs. 225.77 Mn) have been taken and are lying with the Company
SCHEDULE 9
CASH AND BANK BALANCES
Cash and Cheques on Hand 205.99 296.92
Balances with Scheduled Banks
- in Current Accounts 1,202.60 1,179.81
- in Deposit Accounts 22,035.70 3,493.82
[Includes unutilised Initial Public Offer proceeds of Rs.NIL, (Previous year 3,150.00 Mn)
and Rs. 35.55 Mn. (Previous year Rs. 71.90 Mn) as margin money]
23,444.29 4,970.55
34
Annual Report 2008-09
As at As at
March 31, 2009 March 31, 2008
SCHEDULE 10
OTHER CURRENT ASSETS
Unbilled Revenue 523.72 476.82
Interest Receivable on Deposits with Scheduled Banks 807.12 43.84
1,330.84 520.66
SCHEDULE 11
LOANS AND ADVANCES
(Unsecured, considered good unless otherwise stated)
Advances recoverable in cash or kind or for value to be received
- Considered good 6,173.57 6,286.75
- Considered doubtful 90.75 90.75
Less: Provision for doubtful advances 90.75 90.75
6,173.57 6,286.75
Deposits with Body Corporates 8,922.08 –
Deposits with Subsidiaries 748.03 272.16
Deposits and Balances with Govt. Authorities 204.74 241.10
Deposits with others 1,305.52 609.58
Advance Income Tax
(Net of provision of Rs. 1,268.99 Mn., Previous year Rs. 425.33 Mn) 91.91 151.81
MAT Credit Entitlement 1,694.32 425.33
19,140.17 7,986.73
SCHEDULE 12
CURRENT LIABILITIES AND PROVISIONS
Current Liabilities
Sundry Creditors (Refer note B 20 to Schedule 22) 19,938.74 16,854.57
Book Bank Overdraft 1,089.05 2,255.71
Advances from Customers 5,416.55 4,054.32
Deposits from Customers and Others 1,423.21 1,268.38
Other Liabilities 1,802.76 910.94
Interest accrued but not due 1,553.60 92.71
31,223.91 25,436.63
Provisions
Gratuity (Refer note B 24(a) to Schedule 22) 17.55 23.38
Leave Encashment 490.87 315.28
Asset Retirement Obligation (Refer note B 31 to Schedule 22) 470.89 473.58
Provision for Fringe Benefit Tax
(Net of Advance of Rs. 92.00 Mn., Previous Year Rs.174.66 Mn) 7.20 5.97
986.51 818.21
Total 32,210.42 26,254.84
35
IDEA CELLULAR LIMITED
36
Annual Report 2008-09
37
IDEA CELLULAR LIMITED
1. Basis of Preparation of Financial Statements: iii) Bandwidth / Fibre taken on Indefeasible Right of Use
(IRU) is amortised over the agreement period.
The Financial Statements have been prepared under the
historical cost convention on accrual basis. The mandatory Assets costing upto Rs. 5,000/- are depreciated fully in the
applicable accounting standards in India and the provisions month of purchase.
of the Companies Act, 1956 have been followed in 5. Inventories:
preparation of these financial statements.
Inventories are valued at cost or net realisable value, whichever
2. Fixed Assets: is lower. Cost is determined on weighted average basis.
Fixed assets are stated at cost of acquisition and installation
6. Foreign currency transactions:
less accumulated depreciation. Cost is inclusive of freight,
duties, levies and any directly attributable cost of bringing Transactions in foreign currency are recorded at the
the assets to their working condition for intended use. exchange rates prevailing at the dates of the transactions.
Asset retirement obligations are capitalized based on a As per the transitional provisions given in the notification
constructive obligation as a result of past events, when it issued by Ministry of Corporate Affairs dated 31st March
is probable that an outflow of resources will be required to 2009, the company has opted for the option of adjusting
settle the obligation and a reliable estimate of the amount the exchange difference on long term foreign currency
can be made. Such costs are depreciated over the monetary items to the cost of the assets acquired out of
remaining useful life of the asset. these foreign currency monetary items. The company has
aligned its accounting policy based on this notification.
3. Expenditure during pre-operative period of license:
Exchange difference arising out of fluctuation in exchange
Expenses incurred on Project and other charges during
rates on settlement / period end is accounted based on
construction period are included under pre-operative
the nature of transaction as under:
expenditure (grouped under Capital Work in Progress) and
are allocated to the cost of Fixed Assets on the 1) Short term foreign currency monetary assets and
commencement of commercial operations. liabilities: recognised in the Profit and Loss account.
4. Depreciation and amortization: 2) Long term foreign currency monetary liabilities used
Depreciation on fixed assets is provided on straight-line for acquisition of fixed assets: adjusted to the cost of
method (except stated otherwise) on the basis of estimated the fixed assets and amortised over the remaining
useful economic lives as given below: - useful life of the asset.
Tangible Assets Years 3) Other Long term foreign currency monetary liabilities:
Buildings 9 to 30 recognised in “Foreign Currency Monetary Item
Translation Difference Account” and amortised over
Network Equipments 10 to 13
the period of liability not exceeding 31st March 2011.
Optical Fibre 15
Other Plant and Machineries 5 7. Taxation:
Office Equipments 3 to 9 a) Current Tax: Provision for current income tax is made
Computers 3 on the taxable income using the applicable tax rates
and tax laws.
Furniture and Fixtures 3 to 10
Motor Vehicles upto 5 b) Deferred Tax: Deferred tax arising on account of
timing differences and which are capable of reversal
Leasehold improvements Period of lease
in one or more subsequent periods is recognised using
Intangible Assets are amortised on straight-line method as the tax rates and tax laws that have been enacted or
under:- substantively enacted. Deferred tax assets are not
recognised unless there is virtual certainty with respect
i) Cost of Rights and Licences including the fees paid on
to the reversal of the same in future years.
fixed basis prior to revenue share regime is amortised
on straight-line method on commencement of c) Minimum Alternative Tax (MAT) credit: is recognised
operations over the period of license. as an asset only when and to the extent there is
ii) Software, which is not an integral part of Hardware, is convincing evidence that the Company will pay normal
treated as Intangible asset and is amortized over their income tax during the specified period. In the year in
38
Annual Report 2008-09
may not be recoverable. An impairment loss is recognized 2 The status of utilisation of IPO proceeds and Green Shoe
in accordance for AS-28 “Impairment of Assets”, for the amount up to 31st March 2009 is as under:
amount by which the asset’s carrying amount exceeds its (Rs. Mn.)
recoverable amount as on the carrying date. The
Activity To be Utilisation Utilisation
recoverable amount is higher of the asset’s fair value less financed up to from
costs to sell vis-à-vis value in use. For the purpose of through March 31, April
impairment, assets are grouped at the lowest levels for the issue 2008 2008 to
which there are separately identifiable cash flows. proceeds March
2009
17. Contingent Liability:
Building strengthening and
Provisions are recognized when the Company has a present expanding network and
obligation as a result of past events; it is more likely than related services in the
not that an outflow of resources will be required to settle New Circles 9,708.00 8,121.98 979.57#
the obligation; and the amount has been reliably estimated. Capital expenditure
Disclosures for contingent liabilities are considered to the for NLD operations 808.00 – 7.62#
extent of notices / demands received by the Company. Roll out for services in
Mumbai Circle 6,470.00 828.12 1,415.12#
18. Issue Expenditure:
Redemption of Preference
Expenses incurred in connection with issue of equity shares Shares 7,563.26 7,563.26 –
are adjusted against share premium. Issue Expenses 620.04 620.04 –
19. Employee Stock Option: General Corporate
purpose ** 3,018.20 3,018.20 5,633.59#
In respect of stock option granted pursuant to the
Total 28,187.50 20,151.60 8,035.90
company’s Employee Stock Option Scheme, the intrinsic
value of the option is treated as discount and accounted # At the EGM held on 30th July 2008, members approved
as employee compensation cost over the vesting period. balance unutilized proceeds of IPO for mergers, acquisitions
and other general corporate purposes, in addition to the
B. NOTES TO AUDITED ACCOUNTS
objects of IPO, therefore the balance unutilised amounts
1 Equity Share Capital of the said objects has been utilised for general corporate
purposes.
a) Increase in Authorised Equity Share Capital : At the
** Including repayment of short term loans
Annual General Meeting held on 29th September, 2008,
members of the company passed a resolution to 3 Investment in Spice Communications Limited
increase Authorised Equity Share Capital by During the year, the company has acquired from MCorp
Rs. 25,000.00 Mn. to Rs. 67,750.00 Mn. Global Communications Private Limited (MCPL) their entire
b) Preferential Allotment 40.8% stake in Spice Communications Limited (Spice)
(having operations in Punjab and Karnataka Telecom
At the Extra-ordinary General Meeting (EGM) held on circles). The company along with TMI India Limited, TMI
30th July 2008, members passed a resolution to issue Mauritius Limited, Axiata Group Berhad (formerly known
on a preferential basis to TMI Mauritius Limited, as TM International Berhad) and Green Acre Agro Services
464,734,670 Equity Shares of face value of Rs. 10/- Private Limited, collectively referred to as “The acquirers”
each for cash at a premium of Rs. 146.96 per Equity had made a public offer to acquire upto 20% equity stake
Share, aggregating to Rs. 72,945 Mn. Accordingly, in Spice from other public shareholders. The said offer
413,094,098 and 51,640,572 shares were allotted on was opened on 17 th September 2008 and closed on
12th August 2008 and 13th August 2008 respectively. 6th October 2008. The acquirers have since made the
The objects of the issue was towards augmentation of payment on 15th October 2008 to all eligible shareholders
the long term resources of the Company in meeting of Spice who had validly tendered their shares under the
the fund requirements for growth plans, to supplement said offer. Consequently, the stake of the Company in Spice
working capital resources and for general corporate stands at 41.09% as of date. A scheme of amalgamation
purposes. of Spice with the Company has been filed with Hon’ble
During the year ended 31st March 2009, Rs. 62,230 High Court of Gujarat at Ahmedabad on 11th May, 2009.
Mn. has been utilised towards the specified objects of The scheme shall be effective on and from last of the
the issue. The unutilized balance of Rs. 10,715 Mn. as dates on which all required approvals are obtained and
on 31st March 2009 is lying in deposits with banks the sanctioned scheme is filed with the Registrar of
and mutual funds. Companies at Ahmedabad and Delhi respectively.
40
Annual Report 2008-09
4 Demerger of Licenses Rs. 4,071.05 Mn. and Rs. 5,439.75 Mn. respectively and
The Company, inter alia, has been granted UAS Licenses Profit after Tax for the year would have been lower by
by the Department of Telecommunications (DoT) for Punjab Rs. 1,368.70 Mn. on account of amortisation.
and Karnataka Service Areas which overlap with operational 6 De-merger of Passive Infrastructure
UAS Licenses of Spice in respect of same Service Areas. A Scheme of Arrangement was filed with the Hon’able
Since the Company has decided to merge Spice into itself, High Court of Gujarat at Ahmedabad to de-merge Passive
it has filed a scheme of arrangement on 11th May, 2009 Infrastructure (PI) assets in the telecom service areas of
with an appointed date of 1st December, 2008 in the Andhra Pradesh, Delhi, Gujarat, Uttar Pradesh (both East &
Hon’ble High Court of Gujarat at Ahmedabad to de-merge West including Uttaranchal), Haryana, Kerala, Rajasthan
its own UAS Licenses for Punjab and Karnataka service and Mumbai at nil consideration with an appointed date
areas to an eligible entity. Upon the scheme becoming of 1st January 2009 to Idea Cellular Towers Infrastructure
effective, the difference between the carrying values and Limited (ICTIL), a 100% subsidiary of Aditya Birla Telecom
the consideration for de-merger of these UAS Licenses is Limited (ABTL). ABTL is a 100% subsidiary of the company.
proposed to be adjusted against the balance in the The Hon’ble High Court of Delhi at New Delhi and the
Securities / Share Premium Account through the Profit & Hon’ble High Court of Gujarat at Ahmedabad approved
Loss account. The Company has, in the meanwhile sought the scheme on 3rd August 2009 and 31st August 2009
a deferment of the proceedings from Hon’ble High Court respectively. The scheme became effective on
of Gujarat at Ahmedabad due to regulatory clarity on the 29th September 2009. As per the scheme:-
subject. Upon clarity in the matter and Company deciding
to go ahead with the Scheme, the aforesaid appointed i) PI assets having book value of Rs. 16,227.76 Mn. as
on 31st December 2008 has been debited to the Profit
date may undergo a change.
& Loss account,
Further, the Scheme of Amalgamation of Spice with the
Company, as mentioned in Note 3 above, provides for the ii) Investment in ABTL has been increased by the book
adjustment of the amount of loss arising out of impairment value of PI assets vested with ICTIL as part of this
or sale, disposal or any other arrangement in connection scheme, by creating “Reserve for Business Restructuring”,
with these licenses against the balance in the Securities / iii) An amount equal to net book values of PI assets as
Share Premium Account in the event the Scheme of De- per point (i) above, has been withdrawn from “Reserve
merger for the above mentioned overlapping licenses not for Business Restructuring” recognized as per point
being pursued or not becoming effective for any reason (ii) above.
whatsoever. In such an event, the net-worth of the Had the scheme not mandated the above accounting
Company may diminish to that extent, which is currently treatment, the value of investment in ABTL would not
not ascertainable. These UAS Licenses have therefore been have included the book values of Rs. 16,227.76 Mn.
carried at cost (Rs. 3,585.80 Mn.) as on 31st March, 2009. of the PI assets de-merged to ICTIL but would have
5 The Company has paid Non-Compete Fee of Rs. 5,439.75 remained at Rs. 100.00 Mn. Consequently, there would
Mn. to MCPL in July 2008 pursuant to the Non-Compete have been no creation of “Reserve for Business
Agreement entered into as a part of the acquisition of Restructuring” of Rs. 16,227.76 Mn. and withdrawal
40.8% equity in Spice as mentioned in Note 3 above. A of the same to the credit of P&L.
Scheme of Arrangement was filed by the Company with 7 Rollout of services in Mumbai Circle
the Hon’ble High Court of Gujarat at Ahmedabad with an
On 20th August, 2008, the Company has commenced its
appointed date of 1st July, 2008, to adjust the Non-Compete
commercial operations in Mumbai service area.
fee paid to MCPL against the balance in Securities / Share
Premium Account through the Profit & Loss account. The 8 Secured Loans
said scheme was approved by the Hon’ble High Court on a) Foreign Currency and Rupee Loans
31st August 2009 and became effective on 21st September
Foreign Currency Loans amounting to Rs. 8,548.14
2009, pursuant to filing of the High Court order with
Mn. (Previous year Rs. 4,268.04 Mn.) and Rupee Loans
Registrar of Companies, Gujarat. The scheme has been
amounting to Rs. 46,754.71 Mn. (Previous year
given effect to in these financial statements by debiting
Rs. 48,579.90 Mn.) are secured by way of first charge
Non-Compete Fee to Profit & Loss Account and setting off
/ assignment ranking pari-passu interse the lenders,
from an equal amount withdrawn from the Securities
as under:
Premium account. Had the scheme not mandated the above
accounting treatment, the Non-Compete Fee would have i. First charge by mortgage on all the movable and
been capitalised as intangible asset and amortised over immovable properties of the Company,
the non-compete period. In such an event, Intangible Assets ii. A first priority charge over all intangible assets of
and Securities Premium would have been higher by the Company,
41
IDEA CELLULAR LIMITED
iii. Assignment of the rights, titles and interest, on 23rd August, 2002. The interest demand now raised
deposits, investments, bank accounts, book debts, by WPC wing of DoT for the period before 15th April,
insurance covers, other general assets, letters of 2002 is contrary to the DoT proposal in 2002. During
credit and guarantee or performance bond, the year, the Company along with other telecom
provided in favour of the Company. operators have approached TDSAT vide petition no.
b) Vehicle Loan 123 of 2008 challenging this demand. Following
submission of reply by DoT, the matter is expected to
Vehicle Loan amounting to Rs. 346.47 Mn. (Previous
be heard in November 2009.
year Rs. 306.23 Mn.) is secured by hypothecation of
Vehicles against which the loans have been taken. The Company has also taken up with the erstwhile
promoter of IMCL for Rs. 348.79 Mn. (refer note 12
9 Interest from Department of Telecommunications below)
The Company had recognised an income of Rs. 802.27 b) Under Export Promotion Credit Guarantee Scheme,
Mn. during the year ended 31st March, 2003 being refund Company had saved aggregated differential duty
of excess interest charged by DoT on the licence fee payable amounting to Rs. 37.72 Mn. against which company
by the Company pursuant to the judgement dated 9th April, had export obligation amounting to Rs. 301.06 Mn.
2002 of Telecom Disputes Settlement and Appellate The company has fulfilled its export obligation and is
Tribunal (TDSAT). During the previous years, DoT arbitrarily awaiting formal acknowledgement from Director
acknowledged an amount of Rs. 758.76 Mn. against General of Foreign Trade for the same.
Company’s claim of Rs. 802.27 Mn. The Company has c) Other Matters not provided for
represented this matter with DoT. The Company has not (Rs. Mn.)
provided for the difference of Rs. 43.51 Mn., as in the Particulars As on As on
opinion of the management, the amount is recoverable March 31, March 31,
from DoT. 2009 2008
The Company is also entitled to interest on the amount of Income Tax Matters not
the refund so accrued in terms of the Supreme Court acknowledged as debts 107.29 18.75
Judgment; the recognition of revenue on account of the Sales Tax, Entry Tax &
same has been postponed pending acceptance in this Service Tax Matters not
respect by DoT. As of 31st March, 2009, this case is pending acknowledged as debts 1,452.82 1,254.06
before the H’ble Supreme Court. Other claims not
10 Contingent Liabilities acknowledged as debts 1,345.07 1,117.18
a) During the financial year 2006-07, the WPC Wing of d) Estimated amount of contracts (net of advance)
the DoT had raised demands towards monthly remaining to be executed on capital account and not
compounded interest on WPC charges for the period provided for.
upto the financial year 2002-03 in respect of the (Rs. Mn.)
telecom service areas of the erstwhile Idea Mobile Particulars As on As on
Communication Limited (IMCL) and BTA Cellcom Ltd March 31, March 31,
amounting to Rs. 405.02 Mn., which were deposited 2009 2008
under protest in November 2006. The details of the Estimated amount of
same are given below. contracts (net of advance) 11,007.00 17,555.13
Telecom operators had paid WPC Royalty and license 11 Details of guarantees given
fees towards GSM frequency, access and back-bone (Rs. Mn.)
frequency charges on circle area basis as provided in Particulars As on As on
the license terms from inception till financial year March 31, March 31,
2002-03 while the DoT demands were on city basis. 2009 2008
The above matter was disputed by the operators and Bank guarantees given 9,233.51 9,868.26
contested in TDSAT. DoT proposed a change in the Corporate Guarantee
basis of levy of spectrum charges based on revenue given to others on behalf
share vide their letter dated 18th April, 2002 on the of Subsidiaries &
condition of its acceptance in entirety and withdrawal Joint Ventures 8,881.93 2,820.00
of all legal proceedings by the operators. Vide their
12 In accordance with an assignment agreement entered
letter dated 26th March, 2002, DoT had also given time between the original promoters of the amalgamated
to the operators to deposit the earlier principal subsidiary Idea Mobile Communications Limited (IMCL) i.e.
demands by 15th April, 2002.The operators accepted Escorts Ltd. and First Pacific Company Ltd., IMCL had issued
the offer of change to revenue share basis on interest free unsecured Bond of Rs. 1,757.36 Mn. to Escorts
42
Annual Report 2008-09
Limited vide a Loan agreement dated 15th January, 2004. 16 Earning in Foreign Currency (on receipt basis) :
This bond was in lieu of the loans from the original
promoters and included accrued interest of Rs. 857.36 Mn. (Rs. Mn.)
on 10th June, 2004. This Bond is repayable on 15th January, Particulars For the For the
2014 and carries a put option for Escorts Limited for a year ended year ended
period of thirty days commencing on 15th January, 2010
March 31, March 31,
to redeem the entire amount or part thereof at a price
2009 2008
which would have been payable by the Company had the
Company opted for an early redemption in accordance with International Roaming Services* 686.60 789.08
the terms of the said agreement. The Company is entitled Others – 1.18
to pre payment and set off against certain contingent
liabilities that may crystallise after 10th June, 2004. On the * On accrual basis Rs.669.60 Mn. for current year and
request of Escorts Ltd, the Company on 21st July, 2006 has Rs.863.27 Mn. for previous year.
consented to release the redemption proceeds of the above
loan to Axis Bank on the same terms and conditions, as
17 Managerial Remuneration under section 198 of the
mentioned in the above Loan agreement.
Companies Act, 1956 paid or payable during the financial
Escorts Limited have approached the Company for a pre- year is as under:
payment settlement after adjusting agreed contingent
liabilities and demands in September 2009. (Rs. Mn.)
13 Auditors’ Remuneration (excluding of service tax): Particulars For the For the
(Rs. Mn.) year ended year ended
Particulars For the For the March 31, March 31,
year ended year ended 2009 2008
March 31, March 31,
2009 2008 Salary including perquisites 33.69 23.59
Contribution to provident and
Statutory audit fees 25.70 20.00
other fund 3.25 2.65
Certification and other matters
Performance incentive 12.46 14.40
(incl. in legal and professional
charges) 1.40 1.50 Total 49.40 40.64
Out of pocket expenses
The above remuneration excludes gratuity & leave
(incl. in misc expenses) 0.30 0.40
encashment amounts as the same is been based on
Total Remuneration 27.40 21.90 actuarial valuation.
14 CIF Value of imports:
(Rs. Mn.) 18 Quantitative details of goods traded:
Particulars For the For the Particulars For the year ended For the year ended
year ended year ended March 31, 2009 March 31, 2008
March 31, March 31, Nos. Value Nos. Value
2009 2008 (Rs. Mn.) (Rs. Mn.)
Capital Goods (including spares) 19,095.14 16,030.04 Handsets/Data cards
Trading Goods 189.19 – Opening Stock 108 0.45 108 0.45
Purchases (Net of returns) 92,595 189.19 13 0.06
15 Expenditure in Foreign Currency (on remittance basis):
Sale 92,703 187.33 13 0.06
(Rs. Mn.)
Closing stock – – 108 0.45
Particulars For the For the
year ended year ended
March 31, March 31,
2009 2008
Interest 5.79 25.06
Travel 7.40 8.48
Professional and Consultancy fees 24.49 53.58
International Roaming services 163.10 136.99
Others 214.88 88.35
43
IDEA CELLULAR LIMITED
19
a) During the year, the Company has purchased and sold following units:
During the year ended March 31, 2009 During the year ended March 31, 2008
Qty in Rs. in Qty in Rs. in Qty in Rs. in Qty in Rs. in
Particulars ‘000 Mn. ‘000 Mn. ‘000 Mn. ‘000 Mn.
Units Purchase Units Sale Units Purchase Units Sale
Purchased Value Sold Value Purchased Value Sold Value
ABN AMRO Cash Fund - IP - Growth 49,406 500 49,406 500 203,736 2,050 203,736 2,051
ABN Amro Interval Fund - Monthly Plan A 23,865 250 23,865 252 - - - -
ABN AMRO Money Plus IP Fund - Growth 20,556 250 20,556 252 129,650 1,500 129,650 1,510
Birla Cash Plus - I P - Growth 614,998 13,960 629,127 14,299 194,831 4,030 180,701 3,724
Birla Cash Plus - Institutional Premium Plan - Growth 12,173,456 163,858 12,118,699 163,196 2,416,417 30,384 2,338,918 29,441
Birla Floating Rate Fund - LTP - Growth 112,340 1,530 112,340 1,535 158,499 2,050 158,499 2,064
Birla Sun Life Liquid Plus - IP - Growth 5,717,108 92,529 5,782,799 93,740 - - - -
Birla SunLife Cash Manager - I P - Growth 1,234,364 17,936 722,848 10,443 433,326 5,613 433,326 5,623
Birla Sunlife Interval Income Fund - Monthly Plan - Series I - - 48,574 504 122,503 1,250 73,929 755
Birla SunLife Liquid Plus - IP - Growth - - - - 440,485 6,605 374,793 5,644
Birla Sunlife Monthly Interval Fund - Series 2 - - 122,373 1,261 122,373 1,250 - -
Birla Sunlife Quarterly Interval Fund - Series 6 19,548 200 19,548 204 - - - -
Birla Sunlife Quarterly Interval Fund - Series 8 - - 50,000 512 50,000 500 - -
BSL Credit Oppurtunities - Growth 10,573,312 106,026 10,573,312 107,209 - - - -
BSL Dynamic Bond Fund - Growth 379,666 5,020 379,666 5,059 - - - -
BSL Monthly Interval Series 1 Growth 186,764 2,000 186,764 2,016 - - - -
DBS Chola Liquid Fund - Institutional Plus - Growth 15,100 250 15,100 250 - - - -
DBS Chola Liquid Fund - Super IP - Growth 73,847 830 73,847 832 144,256 1,540 144,256 1,542
DSP Merrill Lynch Cash Plus Fund - IP - Growth 105,371 1,120 105,371 1,121 14,811 150 14,811 151
DSP Merrill Lynch Liquidity Fund - IP - Growth 95,882 1,140 95,882 1,145 13,103 150 13,103 150
DSP Merrill Lynch Liquidity Fund - Regular Plan - Growth 12,632 250 12,632 250 - - - -
DSP ML Liquid Plus Fund - IP - Growth - - - - 13,590 150 13,590 150
DWS Insta Cash Plus Fund - IP - Growth 76,289 1,000 76,289 1,002 310,745 3,783 310,745 3,787
DWS Insta Cash Plus Fund - Super IP - Growth 1,057,200 11,350 1,057,200 11,410 - - - -
DWS Money Plus Fund - IP - Growth - - - - 123,236 1,335 123,236 1,349
DWS Ultra Short Term Fund - Institutional - Growth 24,447 250 24,447 252 - - - -
Fidelity Cash Fund - IP - Growth 59,614 690 59,614 690 940 10 940 10
Fidelity Cash Fund - Super IP - Growth 318,595 3,720 318,595 3,725 18,167 200 18,167 200
Fidelity Liquid Plus Fund - Super IP - Growth 46,319 500 46,319 506 19,348 200 19,348 200
HDFC Cash Mgmt Fund - Call Plan - Growth - - - - 11,042 150 11,042 150
HDFC Cash Mgmt Fund - Savings Plan - Growth 646,221 11,640 646,221 11,660 9,110 150 9,110 150
HDFC Liquid Fund - Premium Plan - Growth 1,009,545 16,650 1,009,545 16,673 65,745 1,050 65,745 1,051
HSBC Cash Fund - I P - Growth 36,392 500 36,392 501 11,577 150 11,577 150
HSBC Cash Fund - Institutional Plus - Growth 719,743 9,350 719,743 9,362 414,559 5,064 414,559 5,069
HSBC Liquid Plus Fund - IP Plus - Growth - - - - 109,735 1,180 109,735 1,187
ICICI Prudential Flexible Income Plan - Growth 966,269 15,537 983,034 15,827 334,388 4,917 317,623 4,718
ICICI Prudential Liquid - I P - Growth 112,531 2,320 112,531 2,326 - - - -
ICICI Prudential Liquid - Inst Plus - Growth 91,971 1,900 91,971 1,907 - - - -
ICICI Prudential Liquid - Super IP - Growth 5,631,205 69,670 5,631,205 69,769 - - - -
IDFC Cash Fund - Plan C - Super I P - Growth 1,145,180 12,000 1,145,180 12,004 - - - -
IDFC Fixed Maturity Plan - Growth 45,011 450 45,011 454 - - - -
IDFC Money Manager - Treasury Plan - Plan C - Growth 188,194 1,950 188,194 1,952 - - - -
ING Liquid Fund - IP - Growth 53,621 690 53,621 692 135,933 1,660 135,933 1,662
ING Liquid Fund - Super IP - Growth 788,313 9,680 788,313 9,694 415,780 4,840 415,780 4,847
ING Vysya Liquid Plus Fund - IP - Growth - - - - 110,565 1,150 110,565 1,154
JM Fixed Maturity Fund – Series XII – Monthly Plan 3 45,011 450 45,011 454 - - - -
JM High Liquidity - I P - Growth 384,369 5,390 384,369 5,396 34,577 450 34,577 451
JM High Liquidity - Super I P - Growth 438,756 5,820 438,756 5,833 289,658 3,577 289,658 3,582
JM Money Manager Fund - Super Plus Plan - Growth 63,249 750 63,249 754 290,147 3,181 290,147 3,213
Kotak Flexi Debt Fund - Growth - - - - 65,862 809 65,862 818
Kotak Floater - LT - Growth 18,220 250 18,220 253 - - - -
Kotak Liquid - Inst Premium Plan - Growth 14,192 250 14,192 250 135,828 2,128 135,828 2,130
Kotak QIP Series 21,992 253 - - - - - -
Kotak Quarterly FMP - Series 5 48,861 500 48,861 511 - - - -
LIC MF FMP Series 30 - - - - 150,000 1,500 150,000 1,533
44
Annual Report 2008-09
During the year ended March 31, 2009 During the year ended March 31, 2008
Qty in Rs. in Qty in Rs. in Qty in Rs. in Qty in Rs. in
Particulars ‘000 Mn. ‘000 Mn. ‘000 Mn. ‘000 Mn.
Units Purchase Units Sale Units Purchase Units Sale
Purchased Value Sold Value Purchased Value Sold Value
LIC MF Liquid Fund - Growth 15,724 250 15,724 251 279,375 3,930 279,375 3,936
LIC MF Liquid Fund - IP - Growth 31,111 500 15,557 250 - - - -
Lotus India Liquid Fund - Institutional Plus - Growth - - - - 14,076 150 14,076 150
Lotus India Liquid Fund - IP - Growth 44,788 500 44,788 501 95,846 1,050 95,846 1,051
Lotus India Liquid Fund - IP Plus - Growth - - - - 39,963 430 39,963 430
Lotus India Liquid Fund - Super IP - Growth 120,047 1,360 120,047 1,363 131,110 1,440 131,110 1,441
PRINCIPAL Cash Mgmt Fund LO- I P - Growth 77,965 1,050 77,965 1,051 8,758 110 8,758 110
PRINCIPAL Cash Mgmt Fund LO- Inst Prem. Plan - Growth 285,240 3,730 285,240 3,739 314,170 3,800 314,170 3,803
PRINCIPAL Floating Rate Fund - FMP - IP - Growth 19,526 250 19,526 254 62,486 770 62,486 773
Prudential ICICI Interval Fund II Quarterly Interval Plan - B - - - - 100,000 1,000 100,000 1,021
Prudential ICICI Liquid - I P - Growth - - - - 21,110 400 21,110 401
Prudential ICICI Liquid - Inst Plus - Growth - - - - 43,606 850 43,606 852
Prudential ICICI Liquid – Super IP - Growth - - - - 815,170 9,416 815,170 9,441
Prudential ICICI Monthly Interval Fund - Series 1 - - 47,126 505 47,126 500 - -
Reliance Liquid Fund - TP – IP - Growth 95,991 1,950 95,991 1,956 53,070 1,030 53,070 1,031
Reliance Liquid Plus Fund – IP - Growth - - 22,905 251 146,585 1,562 123,681 1,326
Reliance Liquidity Fund - Growth 1,992,435 24,730 1,992,435 24,761 198,705 2,361 198,705 2,363
Reliance Medium Term Fund - Growth 13,291 240 13,291 241 - - - -
SBI Magnum Insta Cash - Cash Plan - - - - 39,967 700 39,967 701
SBI Magnum Insta Cash Fund - Liquid Floater Plan - Growth - - - - 49,511 660 49,511 660
SBI Premier Liquid Fund - Super IP - Growth 18,411 250 18,411 250 43,591 550 43,591 551
Standard Chartered Liquidity Manager Fund -Growth - - - - 13,889 150 13,889 150
Standard Chartered Liquidity Manager Fund Plus - Growth 429,659 5,050 429,659 5,054 472,939 5,280 472,939 5,283
Tata Fixed Income Portfolio Fund - A3 - - - - 49,607 500 49,607 504
Tata Liquid Fund - HIP - Growth - - - - 207,452 2,670 207,452 2,672
Tata Liquid Fund - RIP - Growth - - - - 5,462 100 5,462 100
Tata Liquid Fund - SHIP - Growth - - - - 225,051 3,210 225,051 3,216
TATA Liquidity Management Fund - Growth - - - - 59,224 650 59,224 651
Templeton India TMA - IP - Growth 84,681 1,080 84,681 1,082 157,603 1,940 157,603 1,942
Templeton India TMA - Super IP - Growth 492,515 6,000 492,515 6,010 276,475 3,180 276,475 3,186
UTI Liquid Fund - Cash Plan - IP - Growth 1,267,544 17,210 1,267,544 17,232 122,293 1,580 122,293 1,585
UTI Liquid Plus Fund - IP - Growth 222,920 2,600 222,920 2,613 - - - -
UTI Money Market – Growth 479,171 11,610 479,171 11,624 52,293 1,130 52,293 1,132
UTI Fixed Income Interval Fund-MIP Series-IP Growth 88,048 1,000 - - - - - -
Grand Total 51,238,591 670,521 50,934,288 667,430 11,661,031 145,806 11,195,969 140,678
b) As at 31st March, 2009 the closing balance in mutual fund units are as follows:
Particulars As at March 31, 2009 As at March 31, 2008
Qty in ‘000 Rs in Mn. Qty in ‘000 Rs in Mn.
Closing Units Closing Value Closing Units Closing Value
Birla Sunlife Cash Plus - I P - Growth - - 14,129 310
Birla Sunlife Cash Plus - Institutional Premium Plan - Growth 132,255 1,860 77,499 1,000
Birla Sunlife Cash Manager - IP - Growth 511,516 7,516 - -
Birla Sunlife Interval Income Fund - Monthly Plan - Series I - - 48,574 500
Birla Sunlife Liquid Plus - IP - Growth - - 65,692 1,000
Birla Sunlife Monthly Interval Fund - Series 2 - - 122,373 1,250
Birla Sunlife Quarterly Interval Fund - Series 8 - - 50,000 500
ICICI Prudential Flexible Income Plan - Growth - - 16,765 250
Kotak QIP Series 21,993 253 - -
LIC MF Liquid Fund - IP - Growth 15,554 250 - -
Prudential ICICI Monthly Interval Fund - Series 1 - - 47,126 500
Reliance Liquid Plus Fund – IP - Growth - - 22,905 250
UTI Fixed Income Interval Fund-MIP Series-IP Growth 88,048 1,000 - -
Total 769,366 10,879 465,063 5,560
45
IDEA CELLULAR LIMITED
20 As per the requirement of Section 22 of The Micro, Small and Medium Enterprises Development Act, 2006, following
information are disclosed:
(Rs. Mn.)
Particulars 2008-09 2007-08
a) (i) The principal amount remaining unpaid to any supplier at the end of
accounting year included in sundry creditors. 22.71 3.08
(ii) The interest due on above. Nil Nil
The total of (i) & (ii) 22.71 3.08
b) The amount of interest paid by the buyer in terms of section 16 of the Act. Nil Nil
c) The amount of the payment made to the supplier beyond the appointed day during
the accounting year Nil Nil
d) The amounts of interest accrued and remaining unpaid at the end of financial year Nil Nil
e) The amount of interest due and payable for the period of delay in making payment
(which have been paid but beyond the due date during the year) but without
adding the interest specified under this Act. Nil Nil
21 During the year, under ESOS 2006, 6,131,250 options have been granted as ‘Tranche II’ to the eligible employees as on
24th July 2008. Each option when exercised would be converted into one equity share of Rs. 10/- each, fully paid up, of the
Company. The options will vest in 4 equal annual installments after one year of the grant. The maximum period of exercise is
5 years from the date of vesting.
The compensation costs of stock options granted to employees have been accounted by the Company using the intrinsic
value method.
Summary of Stock Option
No. of Stock Options
Particulars March 31, 2009 March 31, 2008
Tranche I Tranche II Tranche I
Options Outstanding as on April 1, 2008 19,667,000 – –
Options Granted during the year – 6,131,250 19,931,000
Option forfeited/lapsed during the year 2,391,000 454,750 264,000
Options exercised during the year – – –
Options Outstanding as on March 31, 2009 17,276,000 5,676,500 19,667,000
Personnel Expenditure includes Rs. 144.74 Mn. (Previous Year Rs. 37.59 Mn.) being the amortisation of intrinsic value for the
period ending 31st March, 2009.
Had the compensation cost for the Company’s stock based compensation plan been determined as per fair value approach
(calculated using Black & Scholes Option Prising Model), the Company’s net income would be lower by Rs. 423.72 Mn.
(Previous Year: Rs. 100.93 Mn) and earnings per share as reported would be lower as indicated below:
(Rs. Mn.)
Particulars For the year ended For the year ended
March 31, 2009 March 31, 2008
Net profit after tax but before exceptional items 10,012.11 10,443.62
Add: Total stock-based employee compensation expense determined
under intrinsic value base method 144.74 37.59
Less: Total stock-based employee compensation expense determined
under fair value base method 568.46 138.52
Adjusted net profit 9,588.39 10,342.69
Basic Earnings Per Share (in Rs.)
- As reported 3.42 3.96
- Adjusted 3.27 3.93
Diluted Earnings Per Share (in Rs.)
- As reported 3.42 3.96
- Adjusted 3.27 3.92
46
Annual Report 2008-09
The fair value of each option is estimated on the date of grant based on the following assumptions:
22 As per the transitional provisions given in the notification issued by Ministry of Corporate Affairs dated 31st March 2009, the
company has opted for the option of adjusting the exchange difference on long term foreign currency monetary items to the
cost of the assets acquired out of these foreign currency monetary items. During the year, company has capitalised exchange
difference amounting to Rs. 189.10 Mn. on restatement of long term loans used for acquiring fixed assets. Due to this, profit for
the year is higher by Rs. 186.10 Mn.
47
IDEA CELLULAR LIMITED
24 Employee Benefits:
a) Defined Benefit Plan: The Company provides for its liability towards gratuity as per the actuarial valuation carried by the Life
Insurance Corporation of India (LIC). The present value of the accrued gratuity minus fund value is provided in the books of accounts.
(Rs. Mn.)
Sr. Particulars For the year ended For the year ended
No. March 31, 2009 March 31, 2008
1 Assumptions
Discount Rate 8.00% 8.00%
Salary Escalation 6%-7% 5%-7%
2 Table showing changes in present value of obligations
Present value of obligations as at beginning of year 84.92 81.97
Interest cost 6.79 6.18
Current Service Cost 25.25 16.93
Benefits Paid 11.85 8.65
Actuarial (Gain)/ Loss on obligations 27.58 (11.48)
Present value of obligations as at end of year 132.69 84.92
3 Table showing changes in the fair value of plan assets
Fair value of plan assets at beginning of year 80.33 61.80
Expected return on plan assets 8.04 6.07
Contributions 48.03 21.12
Benefits paid 11.85 8.65
Actuarial Gain/ (Loss) on Plan assets NIL NIL
Fair value of plan assets at the end of year 124.55 80.33
4 Table showing fair value of plan assets
Fair value of plan assets at beginning of year 80.33 61.80
Actual return on plan assets 8.04 6.07
Contributions 48.03 21.12
Benefits Paid (11.85) 8.65
Fair value of plan assets at the end of year 124.55 80.33
Funded status 8.14 (4.60)
Excess of Actual over estimated return on plan assets NIL NIL
(Actual rate of return = Estimated rate of return as ARD falls on March 31)
5 Actuarial Gain/ Loss recognized
Actuarial Gain/ (Loss) for the year -Obligation (27.58) 11.48
Actuarial (Gain)/ Loss for the year - plan assets NIL NIL
Total (Gain)/ Loss for the year 27.58 (11.48)
Actuarial (Gain)/ Loss recognized in the year 27.58 (11.48)
6 The amounts to be recognized in the Balance Sheet and
statements of profit and loss
Present value of obligations as at the end of year 132.69 84.92
Fair value of plan assets as at the end of the year 124.55 80.33
Funded status 8.14 (4.60)
Net Asset/ (Liability) recognized in Balance Sheet (17.55) (23.38)
7 Expenses Recognised in statement of Profit & Loss
Current Service cost 25.25 16.93
Interest Cost 6.79 6.18
Expected return on plan assets (8.04) 6.07
Net Actuarial (Gain)/ Loss recognised in the year 27.58 (11.48)
Expenses recognised in statement of Profit & Loss 51.58 5.55
b) Defined Contribution Plan : During the year, the Company has recognised the following amounts in the Profit and Loss account:
(Rs. Mn)
Particulars For the year ended For the year ended
March 31, 2009 March 31, 2008
Employers’ Contribution to Provident Fund 129.47 97.20
Employers’ Contribution to Superannuation Fund 31.41 25.00
48
Annual Report 2008-09
25 Segment Reporting
1. Primary Segments:
The Company operates in two business segments:
a) Mobility Services
b) Long Distance (LD)
2. Secondary Segment:
The Company caters only to the needs of Indian market representing a singular economic environment with similar risks
and rewards and hence there are no reportable geographical segments
Primary Business Information (Business Segments) for the year ended March 31, 2009.
(Rs. Mn.)
Particulars Business Segments Elimination Total
Mobility LD
Revenue
External Revenue 98,540.27 30.53 - 98,570.80
Inter-segment Revenue 260.04 7,080.18 (7,340.22) -
Total Revenue 98,800.31 7,110.71 (7,340.22) 98,570.80
Segment result 14,209.32 1,166.56 - 15,375.88
Interest & financing charges (Net) - - - 4,507.24
Profit before Tax - - - 10,868.64
Provision for tax (Net) - - - 856.53
Profit after tax - - - 10,012.11
Other information
Segment assets 142,458.35 6,556.42 (10,190.08) 138,824.69
Unallocated corporate assets - - - 83,548.93
Total assets 142,458.35 6,556.42 (10,190.08) 222,373.62
Segment liabilities 97,797.07 5,389.89 (10,190.08) 92,996.88
Unallocated corporate liabilities - - - 16,432.58
Total liabilities 97,797.07 5,389.89 (10,190.08) 109,429.46
Capital expenditure 47,128.02 878.26 - 48,006.28
Depreciation & amortisation 12,410.98 17.58 - 12,428.56
Primary Business Information (Business Segments) for the year ended March 31, 2008.
(Rs. Mn.)
Particulars Business Segments Elimination Total
Mobility LD
Revenue
External Revenue 67,199.90 - - 67,199.90
Inter-segment Revenue - 3,536.67 (3,536.67) -
Total Revenue 67,199.90 3,536.67 (3,536.67) 67,199.90
Segment result 13,220.23 724.80 - 13,945.03
Interest & financing charges (Net) - - - 2,776.42
Profit before Tax - - - 11,168.61
Provision for tax (Net) - - - 724.99
Profit after tax - - - 10,443.62
Other information
Segment assets 117,539.17 1,402.16 (1,120.93) 117,820.40
Unallocated corporate assets - - - 9,704.14
Total assets 117,539.17 1,402.16 (1,120.93) 127,524.54
Segment liabilities 91,996.79 520.60 (1,120.93) 91,396.46
Unallocated corporate liabilities - - - 667.82
Total liabilities 91,996.79 520.60 (1,120.93) 92,064.28
Capital expenditure 54,023.05 0.02 - 54,023.07
Depreciation & amortisation 8,766.37 1.25 - 8,767.62
49
IDEA CELLULAR LIMITED
26 Related Party Transactions
As per Accounting Standard-18 on “Related Party Disclosure”, related parties of the Company are disclosed below:
A. List of related Parties:
Promoters
Hindalco Industries Limited
Grasim Industries Limited
Aditya Birla Nuvo Limited
Birla TMT Holdings Pvt. Limited
Subsidiaries
Swinder Singh Satara & Co. Limited (SSS & Co)
Aditya Birla Telecom Limited (ABTL)
Idea Cellular Services Limited (ICSL)
Idea Cellular Infrastructure Services Limited (ICISL)
Idea Cellular Towers Infrastructure Limited (ICTIL)
Joint Venture
Spice Communications Limited (SCL) (from 16th October 2008)
Indus Towers Limited (ITL)
Key Management Personnel
Mr. Sanjeev Aga, MD
Mr. AJS Jhala, CFO (upto 30th June 2008)
Mr. Akshaya Moondra, CFO (from 1st July 2008)
50
Annual Report 2008-09
B. Transactions with Related Parties
(Rs. Mn.)
Nature of Relationship
Promoters Joint Venture Subsidiaries Key
Particulars Hindalco Grasim Aditya ITL SCL ABTL ICSL ICISL ICTIL SSS & Manage-
Industries Industries Birla Nuvo Co. ment
Limited Limited Limited Personnel
Deposit Taken - - - - - 774.38 - - - - -
(-) (-) (-) (-) (-) (-) (-) (-) (-) (-) (-)
Remuneration - - - - - - - - - - 63.09
(-) (-) (-) (-) (-) (-) (-) (-) (-) (-) (61.48)
Security Deposit Given - - - 684.69 - - - - - - -
(-) (-) (-) (-) (-) (-) (-) (-) (-) (-) (-)
Purchase of Fixed Assets - - - 1.01 - 42.08 - 0.05 - - -
(-) (0.13) (-) (-) (-) (-) (-) (-) (-) (-) (-)
Sale of Fixed Assets - - - 131.37 4.75 30.30 - 28.92 - - -
(-) (-) (-) (-) (-) (-) (-) (-) (-) (-) (-)
Investments - - - - - - - - - - -
(-) (-) (-) (-) (-) (-) (0.50) (0.50) (-) (-) (-)
Purchase of Service/ goods 0.12 - 0.33 2,291.15 167.34 29.78 228.02 - - 2.73 -
(-) (-) (-) (-) (-) (-) (51.02) (-) (-) (-) (-)
Sale of Service/ goods 5.36 7.67 0.52 - 95.90 23.60 - - - 116.07 -
(-) (-) (-) (-) (-) (-) (-) (-) (-) (-) (-)
Unsecured Loan/ ICD Taken - - - - - 1,000.00 - - - - -
(-) (-) (-) (-) (-) (-) (-) (-) (-) (-) (-)
Unsecured Loan/ ICD Repaid - - - - - 1,000.00 - - - - -
(-) (-) (-) (-) (-) (40.00) (-) (-) (-) (-) (-)
Unsecured Loans/ ICD given - - 750.00 4,188.80 - 3,285.88 - 208.90 7.54 52.37 -
(-) (-) (-) (-) (-) (253.03) (37.34) (0.79) (-) (-) (-)
Unsecured Loans/ ICD repaid by - - 750.00 - - 2,500.00 - 19.21 355.38 52.37 -
(-) (-) (-) (-) (-) (-) (-) (-) (-) (-) (-)
Interest on Unsecured loans Given - - 7.97 160.30 - - - - - - -
(-) (-) (-) (-) (-) (-) (-) (-) (-) (-) (-)
Pass through and reimbursement of - - - 339.15 - - - - - - -
expenses incurred on behalf of (-) (-) (-) (-) (-) (-) (-) (-) (-) (-) (-)
Pass through and reimbursement of - - - 2,027.90 - - - - - - -
expenses incurred on company’s behalf by (-) (-) (-) (-) (-) (-) (-) (-) (-) (-) (-)
Advance given - - - - - - - - 355.38 - -
(-) (-) (-) (-) (-) (-) (-) (-) (-) (-) (-)
Expense incurred by Company - - - - 24.71 174.23 - 1.34 - 1.01 -
on behalf of (-) (-) (-) (-) (-) (-) (-) (-) (-) (-) (-)
Expenses incurred on Company’s 0.13 1.49 - - - - - - - - -
behalf by (3.93) (2.00) (0.18) (-) (-) (-) (-) (-) (-) (-) (-)
Rent Paid - - - - - - - - - 2.70 -
(-) (-) (-) (-) (-) (-) (-) (-) (-) (2.70) (-)
(Figures in bracket are for the year ended March 31, 2008)
C. Outstanding as on March 31, 2009
(Rs. Mn.)
Nature of Relationship
Promoters Joint Venture Subsidiaries Key
Particulars Hindalco Grasim Aditya ITL SCL ABTL ICSL ICISL ICTIL SSS & Manage-
Industries Industries Birla Nuvo Co. ment
Limited Limited Limited Personnel
Deposit Taken - - - - - 774.38 - - - - -
(-) (-) (-) (-) (-) (-) (-) (-) (-) (-) (-)
Unsecured Loan taken - - - - - - - - - - -
(-) (-) (-) (-) (-) (-) (-) (-) (-) (2.47) (-)
Unsecured Loan/ Advances given - - - 5,275.13 - 1,201.65 - 220.70 7.54 - -
(-) (-) (-) (-) (-) (260.60) (10.77) (0.79) (-) (-) (8.00)
Remuneration Payable - - - - - - - - - - 17.44
(-) (-) (-) (-) (-) (-) (-) (-) (-) (-) (24.20)
Accounts Receivable - - - - 33.38 0.95 - - - 94.17 -
(-) (-) (-) (-) (-) (-) (-) (-) (-) (-) (-)
Accounts Payable - - - 1,853.55 - - 13.30 - - - -
(0.08) (-) (-) (-) (-) (-) (22.91) (-) (-) (-) (-)
Corporate Guarantee - - - - 5,246.73 3,635.20 - - - - -
(-) (-) (-) (-) (-) (2,820.00) (-) (-) (-) (-) (-)
(Figures in bracket are as of March 31, 2008)
51
IDEA CELLULAR LIMITED
D. Disclosures of amounts at the year end and the maximum amount of loans & advances outstanding during the year
(Rs. Mn.)
Name of the Party Outstanding Maximum Outstanding Maximum
as at Outstanding as at Outstanding
March 31, 2009 during the year March 31, 2008 during the year
2008-09 2007-08
Subsidiary :
Aditya Birla Telecom Limited (ABTL) 1,201.65 3,292.42 260.60 260.60
Idea Cellular Services Limited (ICSL) – 59.02 10.77 26.87
Idea Cellular Infrastructure Services Limited (ICISL) 220.70 2,243.10 0.79 0.79
Idea Cellular Towers Infrastructure Limited (ICTIL) 7.54 362.92 – –
Joint Venture:
Indus Towers Limited 4,595.85 4,595.85 – –
27 The Company has entered into non-cancellable operating leases for periods ranging from 36 months to 240 months. For the
current Year, total minimum lease payments amounting to Rs.1,927.44 Mn. (Previous Year Rs. 263.63 Mn.) are included in the
rental expenditure head.
The future lease payments in respect of the above are as follows.
(Rs. Mn.)
Particulars Not later than Later than one year but Later than five years
one year not later than five years
Minimum Lease payments 2,040.21 5,281.44 1,127.33
(313.24) (1,120.97) (902.12)
(Figures in bracket are as of March 31, 2008)
28 Basic & Diluted Earnings Per Share
Particulars For the year ended For the year ended
March 31, 2009 March 31, 2008
Nominal value of Equity Shares (Rs.) 10/- 10/-
Profit after Tax (Rs. Mn.) 10,012.11 10,443.62
Profit attributable to equity shareholders (Rs. Mn.) 10,012.11 10,443.62
Weighted average number of equity shares outstanding during the period 2,930,612,054 2,634,896,058
Basic Earnings Per Share (Rs.) 3.42 3.96
Dilutive effect on weighted average number of equityshares
outstanding during the year – 483,044
Weighted average number of diluted equity shares 2,930,612,054 2,635,379,102
Diluted Earnings Per Share (Rs.) 3.42 3.96
29 Deferred Tax
As of March 31, 2009, the Company has deferred tax liability of Rs. 3,736.48 Mn. and deferred tax asset of Rs. 2,311.10 Mn. as under:
(Rs. Mn.)
Particulars As at March 31, 2009 As at March 31, 2008
Deferred Tax Liability:
Depreciation of Fixed Assets 3,525.12 1,588.36
Amortisation of Entry & Licence Fee (Net) 211.36 74.84
Total Deferred Tax Liability 3,736.48 1,663.20
Deferred Tax Asset:
Provision for Doubtful Debts 949.93 837.22
Expenses allowable on payment basis 166.85 64.30
Brought Forward losses 1,124.00 –
Others 70.32 99.83
Total Deferred Tax Asset 2,311.10 1,001.35
Net Deferred Tax Liability 1,425.38 661.85
52
Annual Report 2008-09
30 During the financial year 2007-08, company had entered into a composite IT outsourcing agreement wherein fixed assets and
services related to IT has been supplied by the vendor. Such fixed assets received have been accounted for as a finance lease.
Correspondingly, such assets are recorded at fair value of these assets at the time of receipt and depreciated on the stated
useful life applicable to similar assets of the company.
As at 31st March, 2009, an amount of Rs. 939.12 Mn. towards the supply of fixed assets during the year stands outstanding
and will be paid during financial year 2009-10.
32 Previous year’s figures have been regrouped / rearranged wherever necessary to conform to the current period grouping.
Place: Mumbai
Date: October 26, 2009
53
IDEA CELLULAR LIMITED
Cash Flow Statement for the year ended March 31, 2009
(Rupees in Million)
For the year ended For the year ended
March 31, 2009 March 31, 2008
A) Cash Flow from Operating Activities
Net Profit after tax 10,012.11 10,443.62
Adjustments For
Depreciation 10,967.22 7,568.52
Amortisation of Intangible assets 1,461.34 1,199.10
Interest charge and Forex 8,483.78 4,592.27
Profit on sale of current investment (2,227.48) (431.79)
Provision for Bad & Doubtful Debts/Advances 331.59 244.94
Employee Stock Option Cost 144.74 37.59
Provision for Gratuity, Leave Encashment 169.76 53.53
Provision for Fringe Benefit Tax 93.00 73.69
Provision for Deferred Tax 763.53 651.30
Liability no longer required written back (156.78) (139.73)
Interest received (2,330.36) (849.52)
(Profit) / Loss on sale of fixed assets/ assets disposed off 17.57 8.89
17,717.91 13,008.79
Operating profit before working capital changes 27,730.02 23,452.41
Changes in Current Assets and Current Liabilities
(Increase)/Decrease in Sundry Debtors (1,641.53) (706.10)
(Increase)/Decrease in Inventories (151.14) (97.05)
(Increase)/Decrease in Other Current Assets (46.90) 163.33
(Increase)/Decrease in Loans and Advances (10,173.64) (3,585.68)
Increase /(Decrease) in Current Liabilities 4,221.45 6,223.50
(7,791.76) 1,998.00
Cash generated from operations 19,938.26 25,450.41
Tax paid ( including FBT & TDS ) (1,300.86) (428.20)
Net cash from operating activities 18,637.40 25,022.21
B) Cash Flow from Investing Activities
Purchase of Fixed assets & Intangible assets (including CWIP) (47,744.67) (55,506.36)
Proceeds from sale of Fixed assets 197.23 150.80
Payment for Non Compete Fee (5,439.75) –
Payment for purchase of Shares (22,041.87) (1.00)
Sale/ (Purchase) of Other Investments (3,091.66) (5,128.21)
Interest and Dividend Received 1,567.08 922.93
Net cash from / (used in) investing activities (76,553.64) (59,561.84)
54
Annual Report 2008-09
Cash Flow Statement for the year ended March 31, 2009
(Rupees in Million)
For the year ended For the year ended
March 31, 2009 March 31, 2008
C) Cash Flow from Financing Activities
Proceeds from issue of Share Capital 72,944.74 3,187.52
Share Issue Expenses (177.94) –
Proceeds from Long Term Borrowings 7,504.42 20,627.09
Repayment of Long Term Borrowings (3,012.45) (1,480.44)
Proceeds from Short Term Loan 40,952.10 22,120.90
Repayment of Short Term Loan (34,798.00) (18,625.00)
Interest Paid (7,022.89) (4,517.17)
Net cash from / (used in) financing activities 76,389.98 21,312.90
Net increase / (decrease) in cash and cash equivalent 18,473.74 (13,226.73)
Cash and cash equivalent at the beginning 4,970.55 18,197.28
Cash and cash equivalent at the end 23,444.29 4,970.55
Notes to Cash flow Statement for the Year ended 31st March, 2009
1. Cash and cash equivalent includes
Cash and Cheques on Hand 205.99 296.92
Balances with Scheduled Banks
- in Current Accounts 1,202.60 1,179.81
- in Deposit Accounts 22,035.70 3,493.82
23,444.29 4,970.55
2. The above cash flow statement has been prepared under the indirect method as set out in Accounting Standard 3 on Cash
Flow Statement.
3. Previous year’s figures have been rearranged/regrouped wherever necessary.
For Deloitte Haskins & Sells For and on behalf of the Board
Chartered Accountants
55
IDEA CELLULAR LIMITED
Product T E L E C O M S E R V I C E S
Description
Place: Mumbai
Date: October 26, 2009
56
Annual Report 2008-09
1. We have audited the attached Consolidated Balance Sheet 4. Without qualifying our opinion, we draw attention to Note
of Idea Cellular Limited (‘the Company’), its subsidiaries and B4 of schedule 22 to the financial statements. As explained
joint ventures (collectively referred as “the Group”) as at in the said note, the difference between the carrying value
March 31, 2009 and also the Consolidated Profit and Loss of the licenses and consideration, or impairment loss, if
account and the Consolidated Cash Flow Statement for the any would be adjusted with the securities premium account.
year ended on that date annexed thereto (all together The impact of the above on the Reserve and Surplus of the
referred to as “the consolidated financial statements”). These Group is not ascertainable at this stage.
financial statements are the responsibility of the Company’s
management and have been prepared by the Management 5. We report that the consolidated financial statements have
on the basis of separate financial statements and other been prepared by the Company’s Management in
financial information regarding components. Our accordance with the requirements of Accounting Standard
responsibility is to express an opinion on these consolidated 21 ‘Consolidated Financial Statements’ and Accounting
financial statements based on our audit. Standard (AS) 27, Financial Reporting of interest in Joint
Venture issued by the Institute of Chartered Accountants of
2. We conducted our audit in accordance with the auditing India.
standards generally accepted in India. Those Standards
6. Based on our audit and on consideration of reports of other
require that we plan and perform the audit to obtain
auditor on separate financial statements and on the other
reasonable assurance about whether the financial
financial information of the components, and to the best
statements are prepared, in all material respects, in
of our information and explanations given to us, we are of
accordance with an identified financial reporting framework
the opinion that the attached consolidated financial
and are free of material misstatement. An audit includes,
statements give a true and fair view in conformity with the
examining on a test basis, evidence supporting the amounts
accounting principles generally accepted in India:
and disclosures in the financial statements. An audit also
includes assessing the accounting principles used and a) in the case of the Consolidated Balance Sheet, of the
significant estimates made by the Management, as well as state of affairs of the Group as at March 31, 2009;
evaluating the overall financial statement presentation. We
believe that our audit provides a reasonable basis for our b) in case of the Consolidated Profit and Loss Account, of
opinion. the profits of the Group for the year ended on that
date; and
3. We did not audit the financial statements of Spice
c) in the case of the Consolidated Cash Flow Statement,
Communications Limited, joint venture of the Company and
of the cash flows of the Group for the year ended on
Indus Towers Limited, joint venture of Aditya Birla Telecom
that date.
Limited whose financial statements reflect total assets (net)
of Rs.16,509.54 million as at March 31, 2009, total revenue
For Deloitte Haskins & Sells
of Rs.4,619.84 million and net cash inflow amounting to
Chartered Accountants
Rs.246.43 million for the year ended on that date as
considered in the consolidated financial statements.
Hemant M. Joshi
These financial statements and other financial information
Partner
have been audited by other auditor whose reports have
Membership No: 38019
been furnished to us by the Management of the Group,
and our opinion, is based solely on the reports of the Place: Mumbai
other auditor. Date: October 26, 2009
57
IDEA CELLULAR LIMITED
Consolidated Balance Sheet as at March 31, 2009
(Rupees in Million)
As at As at
Schedules March 31, 2009 March 31, 2008
SOURCES OF FUNDS
Shareholders’ Funds
Share Capital 1 31,000.95 26,353.61
Outstanding Employee Stock Options 182.33 37.59
Reserves and Surplus 2 106,713.99 23,134.00
137,897.27 49,525.20
Compulsorily Convertible Preference Shares issued by Subsidiary Company 19.25 –
(Refer note B 7 to schedule 22)
Loan Funds
Secured 3 65,452.04 53,158.59
Unsecured 4 23,670.32 11,995.44
89,122.36 65,154.03
Net Deferred Tax Liabilities 1,425.38 661.85
Less: Net Deferred Tax Assets (295.47) (0.83)
Deferred Tax Liability (Net) (Refer note B 25 to schedule 22) 1,129.91 661.02
INCOME
Service Revenue 101,169.13 67,199.83
Sale of Trading Goods 143.72 0.07
Other Income 13 230.94 174.56
TOTAL 101,543.79 67,374.46
OPERATING EXPENDITURE
Cost of Trading Goods Sold 14 147.90 0.06
Personnel Expenditure 15 5,245.00 3,463.57
Network Operating Expenditure 16 21,078.31 10,470.11
Licence and WPC Charges 17 11,239.32 6,851.03
Roaming & Access Charges 18 18,442.09 11,334.41
Subscriber Acquisition & Servicing Expenditure 19 8,270.69 6,424.23
Advertisement and Business Promotion Expenditure 4,572.77 3,224.86
Administration & other Expenses 20 4,183.26 2,913.58
73,179.34 44,681.85
PROFIT BEFORE FINANCE CHARGES, DEPRECIATION, AMORTISATION & TAX 28,364.45 22,692.61
Finance and Treasury Charges (Net) 21 4,945.22 2,776.20
Depreciation 5A 12,472.70 7,569.01
Amortisation of Intangible Assets 5B 1,555.23 1,199.10
Non Compete Fee (Refer note B 5 to Schedule 22) 5,439.75
Less: Amount Withdrawn from Securities Premium
(Refer note B 5 to Schedule 22) (5,439.75) – –
PROFIT BEFORE TAX 9,391.30 11,148.30
Provision for taxation - Current 1,273.29 425.93
- Deferred 468.97 650.47
- Fringe Benefit tax 102.24 74.13
- MAT Credit (1,268.99) (425.33)
PROFIT AFTER TAX 8,815.79 10,423.10
Balance of Loss brought forward from previous year (14,079.19) (24,502.29)
BALANCE OF LOSS CARRIED FORWARD TO BALANCE SHEET (5,263.40) (14,079.19)
For Deloitte Haskins & Sells For and on behalf of the Board
Chartered Accountants
59
IDEA CELLULAR LIMITED
60
Schedules forming part of the Consolidated Accounts
SCHEDULE 5 - FIXED ASSETS
A. TANGIBLE ASSETS (Rupees in Million)
Gross Block Depreciation Net Block
Particulars As at Additions Additions Sale/ As at As at Additions Additions Sale/ As at As at As at
Apr 1, 2008 on account during the Year Adjustment Mar 31, 2009 Apr 1, 2008 on account during the Year Adjustment Mar 31, 2009 Mar 31, 2009 Mar 31, 2008
of JV during the Year of JV during the Year
Land 77.76 0.31 14.20 - 92.27 - - - - - 92.27 77.76
Leasehold Land 210.27 0.09 48.95 3.82 255.49 67.94 0.01 14.76 3.57 79.14 176.35 142.33
Building 584.49 179.13 81.65 2.52 842.75 166.46 30.71 37.27 2.48 231.96 610.79 418.03
Plant & Machinery 107,341.53 8,329.51 60,512.59 2,093.09 174,090.54 29,925.72 3,118.06 12,075.60 2,025.65 43,093.73 130,996.81 77,415.81
Furniture & Fixture 751.29 51.57 282.51 1.65 1,083.72 397.29 44.18 95.93 1.14 536.26 547.46 354.00
Annual Report 2008-09
Office Equipment 652.49 430.82 161.68 15.24 1,229.75 493.65 400.63 91.79 11.60 974.47 255.28 158.84
Vehicles 526.30 3.01 270.26 81.44 718.13 191.30 1.70 161.80 34.17 320.63 397.50 335.00
Sub-Total 110,144.13 8,994.44 61,371.84 2,197.76 178,312.65 31,242.36 3,595.29 12,477.15 2,078.61 45,236.19 133,076.46 78,901.77
Less : Pre-operative
Charge Capitalised 4.45
Total Tangible Assets 110,144.13 8,994.44 61,371.84 2,197.76 178,312.65 31,242.36 3,595.29 12,472.70 2,078.61 45,236.19 133,076.46 78,901.77
Previous Year 70,476.41 - 42,455.47 2,787.75 110,144.13 26,306.24 - 7,571.88 2,635.76 31,242.36 78,901.77
Notes:
1. Plant & Machinery includes assets held for disposal- Gross Block Rs. 783.23 Mn. (Previous year Rs. 1,988.03 Mn.) and Net Block Nil (Previous year Rs. 45.00 Mn.)
2. Plant & Machinery includes Gross Block of assets capitalised under finance lease Rs. 4338.62 Mn. (Previous Year Rs.975.01 Mn) and corresponding Accumulated Depreciation being
Rs. 950.55 Mn. (Previous Year Rs. 134.43 Mn )
61
IDEA CELLULAR LIMITED
SCHEDULE 7
INVENTORIES
(At lower of cost or estimated realisable value)
Trading Goods 46.65 0.45
Sim Cards and Others 474.61 275.70
521.26 276.15
SCHEDULE 8
SUNDRY DEBTORS
Debts outstanding for over six months
Unsecured - Considered good 87.66 95.31
- Considered doubtful 2,744.18 2,356.33
2,831.84 2,451.64
Other Debts
Unsecured - Considered good 3,530.23 1,890.62
- Considered doubtful 169.20 106.80
3,699.43 1,997.42
Less: Provision for doubtful debts 2,913.36 2,463.13
Total 3,617.91 1,985.93
Sundry Debtors include certain parties from whom Security Deposits of Rs. 246.51 Mn
(Previous Year Rs. 225.77 Mn) have been taken and are lying with the Company
SCHEDULE 9
CASH AND BANK BALANCES
Cash and Cheques on Hand 214.47 297.01
Balances with Scheduled Banks
- in Current Accounts 1,671.97 1,181.98
- in Deposit Accounts 28,977.11 3,495.52
Balances with Other Banks
- in Deposit Accounts 0.41 –
[Includes unutilised Initial Public Offer proceeds of Rs. 127.54 Mn.,
(Previous year 3,150.00 Mn) and Rs.111.93 Mn.
(Previous year Rs. 71.90 Mn) as margin money]
30,863.96 4,974.51
62
Annual Report 2008-09
SCHEDULE 11
LOANS AND ADVANCES
(Unsecured, considered good unless otherwise stated)
Advances recoverable in cash or kind or for value to be received
- Considered good 7,349.90 6,295.25
- Considered doubtful 96.29 90.75
Less: Provision for doubtful advances 96.29 90.75
7,349.90 6,295.25
Deposits with Body Corporates 5,474.28 -
Deposits and Balances with Govt. Authorities 892.97 242.50
Deposit with others 1,001.58 620.56
Advance Income Tax (Net of provision of Rs. 1,274.77 Mn., Previous year Rs. 425.33 Mn) 407.59 158.52
MAT Credit Entitlement 1,694.32 425.33
16,820.64 7,742.16
SCHEDULE 12
CURRENT LIABILITIES AND PROVISIONS
CURRENT LIABILITIES
Sundry Creditors 25,965.24 17,598.80
Book Bank Overdraft 1,264.72 2,272.97
Advances from Customers 5,763.79 4,054.32
Deposits from Customers and Others 1,496.59 1,268.38
Other Liabilities 2,115.82 915.93
Interest accrued but not due 2,030.60 92.71
38,636.76 26,203.11
Provisions
Gratuity (Refer note B 18 to schedule 22) 34.38 23.38
Leave Encashment 510.39 316.09
Asset Retirement Obligation (Refer note B 27 to schedule 22) 1,173.05 473.58
Provision for Fringe Benefit Tax
(Net of Advance Tax of Rs. 104.15 Mn, Previous year Rs. 174.72 Mn.) 6.55 6.26
1,724.37 819.31
40,361.13 27,022.42
63
IDEA CELLULAR LIMITED
SCHEDULE 18
ROAMING & ACCESS CHARGES
Roaming Charges 813.53 1,017.89
Access Charges 17,628.56 10,316.52
18,442.09 11,334.41
64
Annual Report 2008-09
65
IDEA CELLULAR LIMITED
The preparation of financial statements in conformity with Assets are reviewed for impairment whenever events or
generally accepted accounting principles requires estimates changes in circumstances indicate that the carrying amount
and assumptions to be made that affect the reported may not be recoverable. An impairment loss is recognized
amounts of assets and liabilities and disclosure of in accordance for AS-28 “Impairment of Assets”, for the
contingent liabilities on the date of the financial statements amount by which the asset’s carrying amount exceeds its
and the reported amounts of revenues and expenses during recoverable amount as on the carrying date. The
the reporting year. Differences between actual results and recoverable amount is higher of the asset’s fair value less
estimates are recognised in the periods in which the results costs to sell vis-à-vis value in use. For the purpose of
are known / materialise. impairment, assets are grouped at the lowest levels for
which there are separately identifiable cash flows.
15. Leases:
18. Contingent Liability:
a) Operating: Lease of assets under which significant
Provisions are recognized when the Company has a present
risks and rewards of ownership are effectively retained
obligation as a result of past events; it is more likely than
by the lessor are classified as operating leases. Lease
not that an outflow of resources will be required to settle
payments under an operating lease are recognised as
the obligation; and the amount has been reliably estimated.
expense in the profit and loss account, on a straight-
Disclosures for contingent liabilities are considered to the
line or other systematic basis over the lease term.
extent of notices / demands received by the Company.
b) Finance: Leased assets acquired on which significant
19. Issue Expenditure:
risk and reward of ownership effectively transferred
to the Company are capitalised at lower of fair value Expenses incurred in connection with issue of equity shares
or the amounts paid under such lease arrangements. are adjusted against share premium.
Such assets are amortised over the period of lease or
estimated life of such assets whichever is less. 20. Employee Stock Option:
16. Earnings Per Share: In respect of stock option granted pursuant to the
company’s Employee Stock Option Scheme, the intrinsic
The earnings considered in ascertaining the Group’s EPS value of the option is treated as discount and accounted
comprises the net profit after tax, after reducing dividend as employee compensation cost over the vesting period.
68
Annual Report 2008-09
B. NOTES TO ACCOUNTS
a) Increase in Authorised Equity Share Capital: At the Annual General Meeting held on 29th September, 2008, members of
the company passed a resolution to increase Authorised Equity Share Capital by Rs. 25,000.00 Mn. to Rs. 67,750.00 Mn.
b) Preferential Allotment
At the Extra-ordinary General Meeting (EGM) held on 30th July 2008, members passed a resolution to issue on a preferential
basis to TMI Mauritius Limited, 464,734,670 Equity Shares of face value of Rs. 10/- each for cash at a premium of Rs.
146.96 per Equity Share, aggregating to Rs. 72,945 Mn. Accordingly, 413,094,098 and 51,640,572 shares were allotted
on 12th August 2008 and 13th August 2008 respectively. The objects of the issue was towards augmentation of the long
term resources of the Company in meeting the fund requirements for growth plans, to supplement working capital
resources and for general corporate purposes.
During the year ended 31st March 2009, Rs. 62,230 Mn. has been utilised towards the specified objects of the issue.
The unutilized balance of Rs. 10,715 Mn. as on 31st March 2009 is lying in deposits with banks and mutual funds.
2 The status of utilisation of IPO proceeds and Green Shoe amount up to 31st March 2009 is as under:
(Rs. Mn.)
# At the EGM held on 30th July 2008, members approved balance unutilized proceeds of IPO for mergers, acquisitions and
other general corporate purposes, in addition to the objects of IPO, therefore the balance unutilised amounts of the said
objects has been utilised for general corporate purposes.
** Including repayment of short term loans
3 Investment in Spice Communications Limited
During the year, the company has acquired from MCorp Global Communications Private Limited (MCPL) their entire 40.8%
stake in Spice Communications Limited (Spice) (having operations in Punjab and Karnataka Telecom circles). The company
along with TMI India Limited, TMI Mauritius Limited, Axiata Group Berhad (formerly known as TM International Berhad) and
Green Acre Agro Services Private Limited, collectively referred to as “The acquirers” had made a public offer to acquire upto
20% equity stake in Spice from other public shareholders. The said offer was opened on 17th September 2008 and closed on
6th October 2008. The acquirers have since made the payment on 15th October 2008 to all eligible shareholders of Spice who
had validly tendered their shares under the said offer. Consequently, the stake of the Company in Spice stands at 41.09% as
of date. A scheme of amalgamation of Spice with the Company has been filed with Hon’ble High Court of Gujarat at
Ahmedabad on 11th May, 2009. The scheme shall be effective on and from last of the dates on which all required approvals
are obtained and the sanctioned scheme is filed with the Registrar of Companies at Ahmedabad and Delhi respectively.
69
IDEA CELLULAR LIMITED
Accordingly, Spice has been consolidated with effect from 16th October 2008. The goodwill on acquisition is calculated as under:-
(Rs. Mn.)
Investment value for 41.09% stake in Spice 22,041.87
Less: Proportionate share in Networth of Spice
- Equity Capital 2,834.90
- Share Premium 2,030.91
- P&L account * (5,220.11) (354.30)
Goodwill on acquisition of Spice 22,396.17
* after adjusting an amount of Rs. 64.61 Mn. (net of depreciation) pertaining to foreign currency exchange difference
capitalised by Spice as per the Notification dated 31st March 2009 issued by Ministry of Company affairs on transitional
provisions of AS-11
4 Demerger of Licenses
The Company, inter alia, has been granted UAS Licenses by the Department of Telecommunications (DoT) for Punjab and
Karnataka Service Areas which overlap with operational UAS Licenses of Spice in respect of same Service Areas. Since the
Company has decided to merge Spice into itself, it has filed a scheme of arrangement on 11th May, 2009 with an appointed
date of 1st December, 2008 in the Hon’ble High Court of Gujarat at Ahmedabad to de-merge its own UAS Licenses for Punjab
and Karnataka service areas to an eligible entity. Upon the scheme becoming effective, the difference between the carrying
values and the consideration for de-merger of these UAS Licenses is proposed to be adjusted against the balance in the
Securities / Share Premium Account through the Profit & Loss account. The Company has, in the meanwhile sought a
deferment of the proceedings from Hon’ble High Court of Gujarat at Ahmedabad due to regulatory clarity on the subject.
Upon clarity in the matter and Company deciding to go ahead with the Scheme, the aforesaid appointed date may undergo a
change.
Further, the Scheme of Amalgamation of Spice with the Company, as mentioned in Note 3 above, provides for the adjustment
of the amount of loss arising out of impairment or sale, disposal or any other arrangement in connection with these licenses
against the balance in the Securities / Share Premium Account in the event the Scheme of De-merger for the above mentioned
overlapping licenses not being pursued or not becoming effective for any reason whatsoever. In such an event, the net-worth
of the Company may diminish to that extent, which is currently not ascertainable. These UAS Licenses have therefore been
carried at cost (Rs. 3,585.80 Mn.) as on 31st March, 2009.
5 The Company has paid Non-Compete Fee of Rs. 5,439.75 Mn. to MCPL in July 2008 pursuant to the Non-Compete Agreement
entered into as a part of the acquisition of 40.8% equity in Spice as mentioned in Note 3 above. A Scheme of Arrangement
was filed by the Company with the Hon’ble High Court of Gujarat at Ahmedabad with an appointed date of 1st July, 2008, to
adjust the Non-Compete fee paid to MCPL against the balance in Securities/ Share Premium Account through the Profit & Loss
account. The said scheme was approved by the Hon’ble High Court on 31st August 2009 and became effective on 21st
September 2009, pursuant to filing of the High Court order with Registrar of Companies, Gujarat. The scheme has been given
effect to in these financial statements by debiting Non-Compete Fee to Profit & Loss Account and setting off from an equal
amount withdrawn from the Securities Premium account. Had the scheme not mandated the above accounting treatment,
the Non-Compete Fee would have been capitalised as intangible asset and amortised over the non-compete period. In such
an event, Intangible Assets and Securities Premium would have been higher by Rs. 4,071.05 Mn. and Rs. 5,439.75 Mn.
respectively and Profit after Tax for the year would have been lower by Rs. 1,368.70 Mn. on account of amortisation.
Particulars As on As on
March 31, 2009 March 31, 2008
d) Estimated amount of contracts (net of advance) remaining to be executed on capital account and not provided for.
(Rs. Mn.)
Particulars As on As on
March 31, 2009 March 31, 2008
Particulars As on As on
March 31, 2009 March 31, 2008
71
IDEA CELLULAR LIMITED
12 In accordance with an assignment agreement entered between the original promoters of the amalgamated subsidiary Idea
Mobile Communications Limited (IMCL) i.e. Escorts Ltd. and First Pacific Company Ltd., IMCL had issued interest free unsecured
Bond of Rs. 1,757.36 Mn. to Escorts Limited vide a Loan agreement dated 15th January, 2004. This bond was in lieu of the
loans from the original promoters and included accrued interest of Rs. 857.36 Mn. on 10th June, 2004. This Bond is repayable
on 15th January, 2014 and carries a put option for Escorts Limited for a period of thirty days commencing on 15th January,
2010 to redeem the entire amount or part thereof at a price which would have been payable by the Company had the
Company opted for an early redemption in accordance with the terms of the said agreement. The Company is entitled to pre
payment and set off against certain contingent liabilities that may crystallise after 10th June, 2004. On the request of Escorts
Ltd, the Company on 21st July, 2006 has consented to release the redemption proceeds of the above loan to Axis Bank on the
same terms and conditions, as mentioned in the above Loan agreement.
Escorts Limited have approached the Company for a pre-payment settlement after adjusting agreed contingent liabilities and
demands in September 2009.
13 As on 31st March, 2009 the closing balance in units are as follows:
As on March 31, 2009 As on March 31, 2008
Particulars Qty in ‘000 Rs in Mn. Qty in ‘000 Rs in Mn.
Closing Units Closing Value Closing Units Closing Value
Birla Sunlife Cash Plus - I P – Growth – – 14,129 310
Birla Sunlife Interval Income Fund - Monthly Plan - Series I – – 48,574 500
Birla Sunlife Liquid Plus - IP – Growth – – 65,692 1,000
Birla Sunlife Monthly Interval Fund - Series 2 – – 122,373 1,250
Birla Sunlife Quarterly Interval Fund - Series 8 – – 50,000 500
Birla Sun Life Cash Plus – Institutional Premium Plan – Growth 314,995 4,430 77,499 1,000
Birla Sun Life Cash Manager - IP – Growth 954,040 14,019 – –
ICICI Prudential Flexible Income Plan - Growth – – 16,765 250
ICICI Prudential Liquid - Super IP - Growth 38,500 500 – –
Kotak QIP Series 21,993 253 – –
LIC MF Liquid Fund - IP - Growth 15,554 250 – –
Prudential ICICI Monthly Interval Fund - Series 1 – – 47,126 500
Reliance Liquid Plus Fund – IP – Growth – – 22,905 250
UTI Fixed Income Interval Fund-MIP Series-IP Growth 88,048 1,000 – –
Total 1,433,130 20,452 465,063 5,560
14 During the previous year, Spice invested in a new 100% subsidiary, Carlos Towers Limited. However the said subsidiary has
been excluded in consolidation by Spice as its control is intended to be temporary. Company’s share in Spice’s investment in
Carlos Towers Limited, amounting to Rs. 0.21 Mn. has been disclosed under investment schedule.
15 Under ESOS 2006, 6,131,250 options have been granted as ‘Tranche II’ to the eligible employees as on 24th July 2008. Each
option when exercised would be converted into one equity share of Rs. 10/- each, fully paid up, of the Company. The options will
vest in 4 equal annual installments after one year of the grant. The maximum period of exercise is 5 years from the date of vesting.
The compensation costs of stock options granted to employees have been accounted by the Company using the intrinsic
value method.
Summary of Stock Option
No. of Stock Options
Particulars March 31, 2009 March 31, 2008
Tranche I Tranche II Tranche I
Options Outstanding as on April 1, 2008 19,667,000 – –
Options Granted during the year – 6,131,250 19,931,000
Option forfeited/lapsed during the year 2,391,000 454,750 264,000
Options exercised during the year – – –
Options Outstanding as on March 31, 2009 17,276,000 5,676,500 19,667,000
Personnel cost includes Rs. 144.74 Mn. (Previous Year Rs. 37.59 Mn.) being the amortisation of intrinsic value for the period
ending 31st March, 2009.
72
Annual Report 2008-09
Had the compensation cost for the Company’s stock based compensation plan been determined as per fair value approach
(calculated using Black & Scholes Option Pricing Model), the Company’s net income would be lower by Rs. 423.72 Mn.
(Previous Year: Rs. 100.93 Mn) and earnings per share as reported would be lower as indicated below:
(Rs. Mn.)
Net profit after tax but before exceptional items 8,815.79 10,423.10
The fair value of each option is estimated on the date of grant based on the following assumptions:
16 As per the transitional provisions given in the notification issued by Ministry of Corporate Affairs dated 31st March 2009, the
company has opted for the option of adjusting the exchange difference on long term foreign currency monetary items to the
cost of the assets acquired out of these foreign currency monetary items. During the year, the Group has capitalised exchange
difference amounting to Rs. 374.37 Mn. (including Rs. 185.27 Mn. pertaining to subsidiaries and company’s share in joint
ventures) on restatement of long term loans used for acquiring fixed assets. Due to this, profit for the year is higher by Rs.
316.49 Mn.
17 Details of foreign currency exposures:
a) Hedged by a derivative instrument:
(Amount in Mn.)
Particulars As on As on
March 31, 2009 March 31, 2008
Particulars As on As on
March 31, 2009 March 31, 2008
Foreign Currency Loan
in USD 167.88 –
Interest accrued on above in USD 0.66 –
Equivalent INR 8,587.05 –
Sundry Creditors:
in USD 80.99 48.78
in EURO 0.31 0.42
Equivalent INR 4,139.56 1976.23
Sundry Debtors:
in USD 5.09 4.56
in EURO 0.02 0.03
Equivalent INR 258.43 184.16
Bank Deposits:
in USD – 6.79
Equivalent INR – 271.48
Advance Paid to Supplier:
in USD 1.13 –
Equivalent INR 56.87 –
18 Employee Benefits:
a) Defined Benefit Plan: The Group provides for its liability towards gratuity as per the actuarial valuation carried by the
Life Insurance Corporation of India (LIC). The present value of the accrued gratuity minus fund value is provided in the
books of accounts.
i) Changes in benefit obligation for the Company and its Subsidiaries
(Rs. Mn.)
Sr. For the year ended For the year ended
No Particulars March 31, 2009 March 31, 2008
Funded Unfunded
1 Assumptions
Discount Rate 8.00% 7.00% 8.00%
Salary Escalation 6%-7% 6.00% 5%-7%
2 Table showing changes in present value of obligations
Present value of obligations as at beginning of year 84.92 – 81.97
Interest cost 6.79 0.07 6.18
Current Service Cost 25.25 0.91 16.93
Benefits Paid 11.85 – 8.65
Actuarial (Gain)/ Loss on obligations 27.58 0.46 (11.48)
Present value of obligations as at end of year 132.69 1.44 84.92
3 Table showing changes in the fair value of plan assets
Fair value of plan assets at beginning of year 80.33 – 61.80
Expected return on plan assets 8.04 – 6.07
Contributions 48.03 – 21.12
Benefits paid 11.85 – 8.65
Actuarial Gain/ (Loss) on Plan assets NIL NIL NIL
Fair value of plan assets at the end of year 124.55 – 80.33
74
Annual Report 2008-09
(Rs. Mn.)
Sr. For the year ended For the year ended
No Particulars March 31, 2009 March 31, 2008
Funded Unfunded
ii) Changes in benefit obligation for the Company’s share in Joint Ventures (Rs. Mn.)
Change in defined benefit obligation
Opening defined benefit obligation 11.08
Liability taken over from joint venturers 2.21
Current Service Cost 3.57
Interest Cost 0.50
Benefits paid (3.80)
Actuarial (gain)/ losses 1.03
Closing Defined benefit obligation 14.59
Fair value of Plan assets (2.75)
Unfunded liability recognized in the Balance Sheet 15.39
Expenses Recognised in statement of Profit & Loss
Current Service cost 3.57
Interest Cost 0.50
Expected return on plan assets (0.04)
Net Actuarial (Gain)/ Loss recognised in the year 1.06
Expenses recognised in statement of Profit & Loss 5.08
75
IDEA CELLULAR LIMITED
iii) Assumptions
Discount rate 7% - 7.6%
Salary Escalation rate 7% - 10%
b) Defined Contribution Plan: During the year, the Company has recognised the following amounts in the Profit and Loss
account:
(Rs. Mn)
Particulars For the year ended For the year ended
March 31, 2009 March 31, 2008
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Annual Report 2008-09
Primary Business Information (Business Segments) for the year ended March 31, 2008.
(Rs. Mn.)
Particulars Business Segments Elimination Total
Mobility LD
Revenue
External Revenue 67,199.90 – – 67,199.90
Inter-segment Revenue – 3,536.67 (3,536.67) –
Total Revenue 67,199.90 3,536.67 (3,536.67) 67,199.90
Segment result 13,199.70 724.80 – 13,924.50
Interest & financing charges (Net) – – – 2,776.20
Profit before Tax – – – 11,148.30
Provision for tax (Net) – – – 725.20
Profit after tax – – – 10,423.10
Other information
Segment assets 118,644.46 1,402.16 (1,120.93) 118,945.69
Unallocated corporate assets – – – 9,337.79
Total assets 118,644.46 1,402.16 (1,120.93) 128,283.48
Segment liabilities 92,770.52 520.60 (1,120.93) 92,170.19
Unallocated corporate liabilities – – – 667.28
Total liabilities 92,770.52 520.60 (1,120.93) 92,837.47
Capital expenditure 54,993.54 0.02 – 54,993.56
Depreciation & amortisation 8,766.86 1.25 – 8,768.11
20 Related Party Transactions
As per Accounting Standard-18 on “Related Party Disclosure”, related parties of the Company are disclosed below:
A. List of related Parties :
Promoters
Hindalco Industries Limited
Grasim Industries Limited
Aditya Birla Nuvo Limited
Birla TMT Holdings Pvt. Limited
Key Management Personnel
Mr. Sanjeev Aga, MD
Mr. AJS Jhala, CFO (upto 30th June 2008)
Mr. Akshaya Moondra, CFO (from 1st July 2008)
B. Transactions with Related Parties
(Rs. Mn.)
Particulars Promoters Key
Hindalco Grasim Aditya Birla Management
Industries Industries Nuvo Limited Personnel
Limited Limited
Remuneration – – – 63.09
(–) (–) (–) (61.48)
Purchase of Fixed Assets – – – –
(–) (0.13) (–) (–)
Purchase of Service/ Goods 0.12 – 0.33 –
(–) (–) (–) (–)
Sale of Service/ Goods 5.39 7.67 0.52 –
(–) (–) (–) (–)
Employee Expenses – – – –
(0.08) (–) (–) (–)
Unsecured Loans/ ICD repaid – – 750.00 –
(–) (–) (–) (–)
Unsecured Loans given/ ICD – – 750.00 –
(–) (–) (–) (–)
Interest on Unsecured Loans given – – 7.97 –
(–) (–) (–) (–)
Expenses incurred on Company’s behalf by 0.13 1.49 – –
(3.93) (2.00) (0.18) (-)
(Figures in bracket are for the year ended March 31, 2008)
77
IDEA CELLULAR LIMITED
C. Outstanding as on March 31, 2009
(Rs Mn.)
Particulars Promoters Key Management
Hindalco Personnel
Industries Limited
Unsecured Loan given - -
(-) (8.00)
Accounts Receivable 0.03 -
(-) (-)
Remuneration Payable - 17.44
(-) (24.20)
Accounts Payable - -
(0.08) (-)
(Figures in bracket are as of March 31, 2008)
21 The Company has entered into non-cancellable operating leases for office and main switching centre locations for periods
ranging from 36 months to 480 months. For the current year, total minimum lease payments amounting to Rs. 3,067.12 Mn.
(Previous year Rs. 264.63 Mn.) is charged to Profit & Loss account.
The future lease payments in respect of the above are as follows.
(Rs. Mn.)
Particulars Not later than Later than one year Later than five
one year but not later years
than five years
Minimum Lease payments 2,652.18 8,169.93 4,627.78
(313.24) (1,120.97) (902.12)
(Figures in bracket are as of March 31, 2008)
22 During the financial year 2007-08, company had entered into a composite IT outsourcing agreement wherein fixed assets and
services related to IT has been supplied by the vendor. Such fixed assets received have been accounted for as a finance lease.
Correspondingly, such assets are recorded at fair value of these assets at the time of receipt and depreciated on the stated
useful life applicable to similar assets of the company.
As at 31st March, 2009, an amount of Rs. 939.12 Mn. towards the supply of fixed assets during the year stands outstanding
and will be paid during financial year 2009-10.
23 During the financial year, Spice has taken certain fixed assets on finance lease, the company’s share of minimum lease rentals
outstanding as at 31st March 2009 are as follows :-
(Rs. Mn.)
Particulars Not later than Later than one year Later than five
one year but not later years
than five years
Minimum Lease payments outstanding 443.36 2,004.25 1,815.78
Future Interest outstanding 380.76 1,284.55 563.41
Present value of lease payments 62.59 719.70 1,252.36
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Annual Report 2008-09
25 Deferred Tax
As of March 31, 2009, the Company has deferred tax liability of Rs. 4,993.27 Mn. and deferred tax asset of Rs. 3,863.36 Mn. as under:
(Rs. Mn.)
Particulars As on As on
March 31, 2009 March 31, 2008
Deferred Tax Liability:
Depreciation and Amortisation 4,967.95 1,663.38
Others 25.32 –
Total Deferred Tax Liability 4,993.27 1,663.38
Deferred Tax Asset:
Brought forward loss 2,390.81 –
Provision for Doubtful Debts 949.93 837.22
Expenses allowable on payment basis 204.81 64.60
Others 317.81 100.54
Total Deferred Tax Asset 3,863.36 1,002.36
Net Deferred Tax Liability 1,129.91 661.02
26 The Company has the following joint ventures as on 31st March, 2009 and its percentage holding is given below :
79
IDEA CELLULAR LIMITED
27 The movement in the Asset Retirement Obligation is set out as follows:
(Rs. Mn.)
Particulars For the year ended For the year ended
March 31, 2009 March 31, 2008
Opening Balance 473.58 253.26
Additional Provision 702.16 220.32
Utilisation (2.69) –
Closing Balance 1,173.05 473.58
28 Previous year’s figures have been regrouped / rearranged wherever necessary to conform to the current year grouping and are
not comparable with the current period due to the consolidation of financials pertaining to additional subsidiaries and joint
ventures.
80
Annual Report 2008-09
Consolidated Cash Flow Statement for the year ended March 31, 2009
(Rupees in Million)
For the year ended For the year ended
March 31, 2009 March 31, 2008
81
IDEA CELLULAR LIMITED
Consolidated Cash Flow Statement for the year ended March 31, 2009
(Rupees in Million)
For the Year ended For the year ended
March 31, 2009 March 31, 2008
2. The above cash flow statement has been prepared under the indirect method as set out in Accounting Standard 3 on Cash
Flow Statement.
3. Previous year’s figures have been rearranged/regrouped wherever necessary.
For Deloitte Haskins & Sells For and on behalf of the Board
Chartered Accountants
82
Annual Report 2008-09
Statement pursuant to Section 212 of the Companies Act, 1956, related to Subsidiary Companies
Particulars Aditya Birla Idea Cellular Idea Cellular Idea Cellular Swinder Singh
Telecom Services Infrastructure Towers Satara &
Limited Limited Services Infrastructure Company
Limited Limited Limited
1. Financial year of the Subsidiary ended on March 31, 2009 March 31, 2009 March 31, 2009 March 31, 2009 March 31, 2009
2. Shares of the Subsidiary held by the Company
on the above date :-
(a) Number & face value 10,000,000 50,000 50,000 50,000 50,000
Equity Shares Equity Shares Equity Shares Equity Shares Equity Shares
of Rs.10 each of Rs.10 each of Rs.10 each of Rs.10 each of Rs.10 each
(b) Extent of holding 100% 100% 100% *100% 100%
3. Net aggregate amount of profits / (losses )
of the subsidiary for the above financial year
on the subsidiary so far as they concern
members of the company :-
(a) Dealt within the accounts of the NIL NIL NIL NIL NIL
company for the year ended
March 31, 2009 (Rs. Mn)
(b) Not dealt with the accounts of the (285.65) 0.11 (37.86) (129.57) 1.74
company for the year ended
March 31, 2009 (Rs. Mn)
4. Net aggregate amount of profits / (losses)
for previous year of the subsidiary so far as
they concern members of the company :-
(a) Dealt within the accounts of the NIL NIL NIL NIL NIL
company for the year ended
March 31, 2008 (Rs. Mn)
(b) Not dealt with the accounts of the (13.02) (1.97) (0.10) (0.64) 1.67
company for the year ended
March 31, 2008 (Rs. Mn)
* Shares held through Aditya Birla Telecom Limited
For and on behalf of the Board
Tarjani Vakil Biswajit Subramanian Sanjeev Aga
Director Director Managing Director
Akshaya Moondra Pankaj Kapdeo
Chief Financial Officer Company Secretary
Place: Mumbai
Date: October 26, 2009
Statement pursuant to exemption received under section 212(8) of the Companies Act, 1956
relating to subsidiary companies for the year ended March 31, 2009
(Rupees in Million)
Sr. Name of the Company Country of Capital Reserves Total Total Investments Turnover Profit/ Provision for Profit/ Proposed
No. Registration Assets Liabilities other than (Loss) Taxation (Loss) Dividend
Investments in before after
subsidiary Taxation Taxation
1 Aditya Birla
Telecom Limited India 119.25 20,575.97 15,319.59 4,197.60 9,572.73 434.60 (431.52) (145.87) (285.65) NIL
2 Idea Cellular
Services Limited India 0.50 (1.86) 25.22 26.58 – 239.17 3.05 2.94 0.11 NIL
3 Idea Cellular Infrastructure
Services Limited India 0.50 (37.96) 3,422.20 3,459.66 – 337.33 (37.29) 0.57 (37.86) NIL
4 Idea Cellular Towers
Infrastructure Limited India 0.50 16,098.13 16,107.44 8.81 – 410.56 (129.57) – (129.57) NIL
5 Swinder Singh Satara
& Co Limited India 0.50 11.84 119.28 106.94 – 79.72 2.31 0.57 1.74 NIL
83
IDEA CELLULAR LIMITED
NOTES
84
Printed at Infomedia 18 Limited
Corporate Office:
“Windsor”, 5th Floor
Off CST Road, Kalina
Santacruz (East)
Mumbai - 400 098
Registered Office:
Suman Tower
Plot No.18, Sector-11
Gandhinagar - 382 011
Gujarat