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2008 was Rs.279 mn. resulting in the net debt to EBITDA of 0. world’s leading security company. (~USD 1. 114 bn.848 104. HIGHLIGHTS OF THE YEAR Major agreements and alliances During the year.122 mn.979 46. respectively.954 184.488 mn.85 bn. Verisign will bring its technology and help Airtel with multiple initiatives . 34. 53% increase in EBITDA and 57% growth in net profit. 2008. In addition. 2008 31. FINANCIAL RESULTS AND RESULTS OF OPERATIONS Financial highlights of Consolidated Statement of Operations of the Company: Particulars Year ended March March 31. the Company signed the following major agreements relating to operations and the customer service delivery: • With Google to provide a world-class suite of services on broadband. OVERVIEW Bharti Airtel is India’s largest integrated telecom operator with a pan India footprint. wherein all dot com and dot net resolutions happen in India instead of overseas. 63.954 mn. 2.23.621 Y-o-Y Growth 47% 53% 53% 56% 57% last year.6 bn.407 73. 2008.535 73.115 63. connect with friends and publish content.332 Y-o-Y Growth 44% 47% 47% 52% 55% Gross revenue EBITDA Cash profit from operations Earnings before taxation Net profit/(loss) DIVIDEND The Board is of the view that the Company should take advantage of the tremendous growth potential of the telecommunication sector by expanding and strengthening its existing network and operations through capital expenditure funded by internal accruals to the maximum extent possible. (~USD 2. the Company achieved certain key milestones and maintained its position as a leading telecommunications services provider.36 times and interest (net) coverage ratio of 19. of total customers in a year. Earnings before tax for the year ended March 31.Directors’ Report Dear Shareholders. The net finance cost for the year was Rs. This is a first of its kind initiative in India. As a part of this alliance.944 72. • Highest ever net additions of 25. Airtel Broadband customers will be able to access all web portal services with a single sign-on completely free of cost. 114. Financial highlights of Standalone Statement of Operations of the Company Particulars Year ended March March 31. and Rs. share ideas. • Full year consolidated net profit of Rs. and the net profit was at Rs.the first initiative being the launch of a Regional Internet Resolution Site (RIRS). to bring a “Clean Pipes” philosophy and capability to the Indian market. Some of the key highlights include the following: • First operator to cross total customer base of 64 mn. The Company is also the country’s largest GSM mobile service provider with approximately 62 mn.. The consolidated revenues and EBITDA grew by 47% and 53% respectively for the year ended March 31. The consolidated revenues and EBITDA for the year ended March 31. • With Verisign.2 mn. During the financial year 2007-08.037 46.602 70. • Full year consolidated gross revenues of Rs. 2008 was Rs. 5. search the web. (~USD 6.115 mn. mobile customers as on March 31. The directors submit that this will increase shareholder value in the long term.784 40. the Company has 2. 2008. landline and broadband customers.369 69. 2007 270.. 64 bn.442 177.). an increase of 57% over the previous year and an earnings per share (basic) of Rs.886 mn. The portal makes it easy for customers to access their email.76 bn. 2008 31. 2008 was Rs.725 62. the directors do not recommend any dividend for the year ended March 31. Net debt for the year ended March 31.035 106. 40.) and consolidated EBITDA of Rs.018 mn. Accordingly.018 111. 73. 270 bn. for the corresponding period . as compared to Rs.014 40. Your directors have pleasure in presenting the thirteenth annual report on the business and operations of the Company together with audited financial statements and accounts for the year ended March 31.202 74. 2008. 270. 27 Gross revenue EBITDA Cash profit from operations Earnings before taxation Net profit/(loss) The strong operational performance of the Company contributed to equally robust financial numbers. • Year-on-year (Y-o-Y) growth of total customer base by 65% resulted in a 47% increase in revenues.122 114.05 times.). 2007 257.3 mn. More offerings like e-commerce applications will be added to the portal over a period of time.

The Unity consortium is a joint effort by Bharti Airtel (India). 2007. Etisalat (UAE). STAR India will receive a committed advertising outlay from Airtel for the next 24 months. The appointed date of the merger was October 1. This hand held device operates on the intuitive touch screen navigation technology and is now exclusively available to Airtel Mobile users in India. • With Western Union. including expansion of its GSM and EDGE network and providing capacity management. (“Huawei”).e. acquisitions & scheme of arrangement • The Hon’ble High Court of Delhi. (‘the Telecom Infrastructure’). It is the first Treo smartphone to be introduced on Airtel’s extensive network and also the first Windows Mobile® based Treo smartphone to be launched in India. seamless user experience and reliable technology to their customers. to build a high bandwidth undersea fibre-optic cable linking Asia and the United States. Therefore. the world’s leading provider of Microsoft® Windows Mobile®based smart devices. Huawei will deploy and manage Airtel’s core network. Google (US). • With five leading international companies. • With PCCW Global Limited (PCCW Global). The new agreement is estimated to be USD 150 mn. • With IBM. optimize and manage Bharti Airtel’s GSM network across 15 circles in India as well as for its pan India prepaid (IN) platform across 23 circles. while Airtel will have the privilege of paying a mutually-negotiated rate with inflation protection. plan. Ericsson will design. distribution. This will create new opportunities to extend the benefits of financial services to many Indian families. its National Long Distance and International Long Distance network with 1. to benefit from its global expertise in areas including the telemedia business. 28 includes SEA-ME-WE series. The three-year deal is valued at approximately USD 150 mn. to offer enhanced endto-end global solutions through the extended international connectivity wherein Bharti’s MPLS IPVPN in India and PCCW Global’s MPLS IPVPN will be connected. deploy. the effective date of the Scheme. • With Palm and Microsoft to Launch First Windows Mobile Treo Smartphone in India. known as I-ME-WE (India. Next Generation Network (NGN) ports – the largest ever NGN contract in the country – and its International Calling Card prepaid service capacity by 4. Airtel and Star will jointly develop key properties to promote music across various audience segments. • The scheme of arrangement (“the Scheme”) between Bharti Airtel Limited and Bharti Infratel Limited (‘Infratel’) for transfer of passive telecom infrastructure. Mergers. TE (Egypt). sanctioned the scheme of amalgamation of Satcom Broadband Equipment Limited (SBEL) and Bharti Broadband Limited (BBL) with the Company and the same was filed with the Registrar of Companies. • With STAR India. Under the contract. fixed and intelligent network platforms. enterprise segments and business resilience.India’s first mobile phone with TouchFLO™ technology. Western Europe) is the fifth in the series of similar cable systems which . • With Huawei Technologies Co. This pioneering agreement marks Indian telecom sector’s foray into international remittances over the mobile phone. STC (Saudi Arabia). Ericsson will also deliver pan India Integrated Device Management Solutions.• With High Tech Computer Corp. Airtel will be able to jointly develop and provide inputs to the creation of specific properties that will appeal to its customers and will involve Star in joint on-ground marketing exercises. This is an expansion contract across Airtel’s mobile. a two-year strategic agreement that is tailored to mutually benefit both organizations. a managed networks deal for its Sri Lanka operations. to jointly develop and pilot a Mobile Money Transfer service in India. Under the agreement. The agreement also states that Airtel will receive preferential access to content developed across all the Star Group channels. The agreement has created an extensive MPLS IPVPN coverage that will enable both the companies to deliver greater coverage. The cable system. Middle East. Under the agreement. France Telecom (France). Node-Bs and BTSs and comprehensive end-to-end 2G/3G network solutions. Ogero (Lebanon). The companies include Bharti Airtel (India).8 mn. a two-year supply and services contract for an estimated USD 2 bn. NCT of Delhi on January 31. KDDI Corporation (Japan). both SBEL and BBL have dissolved without the process of winding up. (HTC). In addition. from Bharti Airtel to Bharti Infratel was approved by the Hon’ble High Court of Delhi and filed with the Registrar of Companies. and introduced The HTC Touch™ . Star will be the preferred destination for Airtel’s media needs. Global Transit Limited (Malaysia). Nokia Siemens Networks will expand Airtel’s GSM network in eight circles. Both will also focus on developing customer interactivity programmes which will be driven through services such as SMSs over the mobile phone. Ltd. a memorandum of understanding for USD 900 mn. TIS Sparkle (Italy) and VSNL (India). NCT of Delhi on July 27. 2008 i. with the extensive reach and accessibility of the Airtel mobile network. • With eight major leaders of the global telecommunications industry. a formal Construction and Maintenance Agreement to build a high-capacity fibre-optic submarine cable that will stretch from India to France via the Middle East. and includes telecom applications and software.5 mn. pursuant to which. enabling usage of advanced data services by all mobile customers across retail and enterprise segments. • With Nokia Siemens Networks. 2005. a subsidiary of PCCW Limited. Pursuant to the aforesaid Scheme. new users. PTCL (Pakistan). Pacnet (Singapore) and Sing Tel (Singapore). • With Ericsson.

At present the Company has acquired 2% stake in a subsidiary of IFFCO Limited called IFFCO Kissan Sanchar Limited at a consideration of Rs. a feature-rich service that allowed all Airtel mobile customers the advantage of the same experience as a desktop chat service by which users can send and receive messages in real-time on their mobile without being attached to a computer. • Pioneered 8Mbps Broadband in India and joined a group of select operators globally for such high speeds.airtelcallhome. 10 each in Indus Towers Limited on December 17. the Company’s strategy of introducing new and innovative products and services were received well in the market and also enabled the Company to maintain its leadership position despite severe competition. 500 thousand. tourists and students in the USA. business travelers.200 thousand shares. Subsequently. Airtel network is IPTV ready.000 Indian H1B visa holders. Airtel broadband customers can browse multiple windows at the same time downloading heavy files. 2007 to 10% as on March 31.4 mn. email etc. The Company: • Launched Airtel Messenger. as well as websites on the Internet.5% as on March 31. • Pioneered the ease of booking rail tickets on the mobile and getting them delivered to customers doorstep.the Telecom Infrastructure has been transferred to and vested in Infratel on January 31. the effective date. • Introduced its popular Lifetime Prepaid at a lower price point of Rs. • Launched a whole range of M-Commerce solutions such as Mobile Money Transfer (MMT).the first mobile services provider in the country to offer at this price point.5 mn. This feature will be particularly useful for over 700. This initiative further reinforced Airtel’s commitment to make mobile more affordable and provide greater value to the prepaid customer. Corporation bank and VISA to enable these payments. The Company and Vodafone will hold approximately 42% each in Indus Tower and the balance 16% will be held by Idea.). Singapore (Bridge Mobile). Rural network coverage is a clear focus area for the Company and it is expected that a major part of the Company’s new customers will be located in rural and remote areas. The launch of the enhanced version of the CallHome service marks an important step by Airtel to further strengthen its focus on the 2. Postpaid Bill Payment and Prepaid Recharge on the mobile phone. 2008 due to introduction of new shareholders. at a consideration of USD 133.91 mn.com marks the first time a Telco in India has made Google 29 . • The Company has signed a joint venture with IFFCO for wider coverage and distribution of the Company’s services in the rural hinterland. • The Company has sold its entire shareholding in Forum I Aviation Limited at cost to its subsidiary. 50. Network i2i Limited is engaged in the business of operation and provision of telecommunication facilities and services utilising a network of submarine cable systems and associated terrestrial capacity. chat. India (Aquanet) at a consideration of Rs. (~Rs. • The Company acquired 100% of the equity in Network i2i Limited. 2008. Aquanet has filed a scheme of amalgamation (Scheme) with Bharti Airtel Limited with the Hon’ble High Court of Delhi. For this purpose. view streaming video. Bridge Mobile is a joint venture among 10 mobile operators to form a regional alliance.com is the enablement of payment through Indian credit cards for purchasing talk time for calling from USA to India. the Company further invested USD 1. • The Company has entered into a joint venture agreement with Vodafone Essar Limited (Vodafone) and Idea Cellular Limited (Idea) to form an independent tower company (“Indus Towers Limited” or “Indus Tower”) to provide passive infrastructure services in 16 circles of India.55 mn. The group’s share in the joint venture has reduced from 12. strong Indian diaspora living in the United States of America. thus making Aquanet a wholly owned subsidiary. • Launched airtellive. of Bridge Mobile Pte Limited. This is the first time in India that Mobile Money transfer will be available. This was yet another step forward towards making Airtel mobile a one stop solution for all travel plans. Bharti Infratel Limited has subscribed 50. New Products and Initiatives During the year. The telecom passive infrastructure will be transferred to Bharti Infratel Ventures for ultimate merger in Indus Towers Limited.313.com. 495/. The principal activity of the venture is creating and developing regional mobile services and managing the Bridge Mobile Alliance Programme. HDFC bank. SBI. 159. • Introduced Google search to the Airtel Live mobile WAP portal that enables customers to quickly search content available on Airtel Live!..13 mn. Bharti Airtel Services Limited.000 equity shares of Rs. enjoy online gaming. 5. 2007 for an aggregate value of Rs. It has partnered with ICICI bank. airtellive. With 8 Mbps speeds. a leading provider of mobile security and payment solutions. Bharti Infratel Ventures Limited has been incorporated as a wholly owned subsidiary of Bharti Infratel Ltd.200 thousand towards 1. its new all-in-one internet portal for its broadband customers. Pursuant to the aforesaid agreement. • Launched enhanced Airtel Call Home service for calls made from US to India. • During the year. Mauritius. The solution has been developed by mChek. Another unique feature of the upgraded experience on www. • The Company acquired the balance 49% of the equity in Bharti Aquanet Limited.

1 on its all prepaid products. is available for inspection at the Company’s registered office and copies will be made available to shareholders of Bharti Airtel and its subsidiary companies upon request. is • Introduced the exclusive handset bundles with Nokia across India. • During the year. the Company will now be able to operate international carrier facilities from Singapore. Airtel customers will now be able to receive a call while roaming at Re. enables discovery of relevant content services on the mobile handset and also delivers contextual advertising. 30 Operator (FBO) license in Singapore. 2008. secure and reliable broadband network. 1956 (i) Bharti Hexacom Limited (ii) Bharti Airtel Services Limited (iii) Bharti Aquanet Limited (iv) Bharti Telemedia Limited (v) Bharti Infratel Limited (vi) Bharti Infratel Ventures Limited (vii) Bharti Airtel (UK) Limited (viii) Bharti Airtel (USA) Limited (ix) Bharti Airtel (Canada) Limited (x) Bharti Airtel (Hongkong) Limited (xi) Bharti Airtel (Singapore) Private Limited (xii) Bharti Airtel Lanka (Private) Limited (xiii) Bharti Airtel Holdings (Singapore) Pte. 1. from small towns to rural clusters and provide greater value to its consumers. 47/154/2008-CL-III dated March 24. was awarded the Facility Based . 1956. This tariff reduction is in line with Airtel’s continuous effort to drive affordability in the market and bring value and convenience to the customers. to provide Direct To Home (DTH) services in India. Voice Chat on Fixed-Lines enables customers to talk and chat anonymously with other Airtel Mobile and Fixed-Line customers.75 per minute. For Airtel mobile customers. The Company is expected to launch commercial services during the current financial year. Airtel reduced its STD rates dramatically to Re. Other Company Developments • Bharti Airtel (Singapore) Private Ltd. Airtel customers can make an outgoing local call at Re. a unique upgrade to regular SMS. • Launched GPS based Navigation Application on Mobile handsets in collaboration with Wayfinder Systems AB of Sweden. As the consolidated accounts present a complete picture of the financial results of the Company and its subsidiaries. depending on the plan that they were using. • Launched ‘SMS2.35 bn.40 to Re. the documents in respect of the aforementioned subsidiary companies for the year ended March 31.0’.50 per minute from the earlier Rs. along with the related information. • Announced unprecedented tariff reductions on STD and Roaming services for its over 62 mn. • Introduced the Voice Chat service on Airtel Fixed-Lines as part of its endeavor to deliver innovative service offerings to its Fixed-Line customers. 1 per minute. the Ministry of Information and Broadcasting has granted a license to Bharti Telemedia Limited. The navigation system provides all users with continuously updated. as compared to Re. Limited (xiv) Network i2i Limited (xv) Bharti Infratel Lanka (Private) Limited. Bharti Infratel Limited.0 provides enhanced messaging features. 1. 2. while roaming.03. 1 per minute and an STD call at Re. in aggregate. Bharti Infratel Lanka (Private) Limited was incorporated in March 2008 as a wholly owned subsidiary of Bharti Airtel Lanka (Private) Limited and therefore no financial statements have been prepared till March 31. SUBSIDIARY COMPANIES The Company has following fifteen subsidiary companies in terms of Section 4 of the Companies Act. Airtel has also redefined the roaming regime in the country. real-time content and geographical data via the wireless network using EDGE/GPRS. SMS2. • Introduced ‘Super Lifetime Prepaid’ with Re. Existing customers too could avail of this offer free-of-charge or by paying a minimal amount.000 each in our Company’s subsidiary. • Leading international investors have invested an amount of USD 1. non-cumulative. Statement pursuant to the approval under Section 212(8) of the Companies Act. The Annual Accounts of these subsidiary companies. making communication with loved ones easier and more affordable.550 fully and compulsory convertible. Under the license. In terms of approval granted by the Central Government under Section 212(8) of the Companies Act. in which the Company holds an equity stake of 40%. 10 each and 32. It included a Nokia handset and a Life Time SIM from Airtel.1 outgoing local tariff for life. The collaboration gives customers easy access to Google’s simple and powerful web applications over Airtel’s fast. 1956 vide letter No. benefiting all Airtel customers who make long distance calls.65 per minute. towards 4050 equity shares of Rs.50 per minute. across the country. Further. The FBO license is yet another important step in our journey towards ensuring that Airtel is able to meet our customer’s complete global communication needs. unsecured and interest free debentures of Rs.products officially available on its portal. Profit and Loss Account and other documents of each of its subsidiary companies with the Balance Sheet of the Company. 2008. the Company had applied to the Central Government seeking exemption from attaching the documents referred to in the aforesaid section. customers in April 2008. a subsidiary of Bharti Airtel. This will help create an India without boundaries. 1. 2008 as set out in sub-section 1 of section 212 of the Companies Act have not been attached with the Balance Sheet of the Company. As per Section 212(1) of the Companies Act. The application turns the compatible mobile phone into a complete GPS-based navigation system with detailed maps and Points-ofInterest of a number of cities in India. 10. 2/2. 1956. the Company is required to attach the Balance Sheet. This revolutionary offer from Airtel opened up new segments of the market from the very young to the old. • Reduced the tariffs on local calls across the board from Rs.

V. Rajan Bharti Mittal and Rakesh Bharti Mittal. SHARE CAPITAL During the year the Company has allotted 2. 1956. DIRECTORS Bashir Currimjee. Since the last Directors’ Report. Gavin John Darby. The Company has appointed Mr. AUDITORS The Statutory Auditors of the Company. 2008. read with the Companies (Disclosure of particulars in the report of the Board of Directors) Rules. 159. retire by rotation at the forthcoming annual general meeting and being eligible. the issued. 1988. Chartered Accountants. to conduct secretarial audit of the Company for the financial year ended March 31. AUDITORS’ REPORT The Board has duly examined the statutory auditors’ report to accounts and clarifications wherever necessary. confirming compliance of conditions of corporate governance as stipulated under the aforesaid Clause 49 is provided as annexure C. 2008. the Company has also allotted 17. However. Further. ENERGY CONSERVATION. FIXED DEPOSITS We have not accepted any fixed deposits and as such no amount of principal or interest was outstanding as of the balance sheet date. Paul Donovan. Syeda Imam and Donald Cameron during their tenure on the Board. containing details of the directors proposed to be appointed/re-appointed as stipulated under Clause 49 of the Listing Agreement with the stock exchanges is appended as an annexure to the notice of ensuing annual general meeting. S. 1956. 1956 proposing the appointment of Mauro Sentinelli as non-executive independent director of the Company. as amended is not applicable. Mauro Sentinelli has been appointed as additional director. if made.48. M/s. A certificate from the auditors of the Company. Corporate Social Responsibility (CSR) encompasses much more than social outreach programs and is an integral part of the way the Company conducts its business. most of the information as required under Section 217(1)(e) of the Companies Act. regulations and guidelines issued by the Securities and Exchange Board of India and the listing agreement. the Company is further strengthening its process to ensure that even such slight/ minor delays do not occur in future. R. offer themselves for re-appointment.975 equity shares on exercise of stock options under ESOP Scheme 2005 of the Company. Chartered Accountants. Narayanswamy. the Company has voluntarily started a practice of secretarial audit from a practicing company secretary. subscribed and paid-up equity share capital stand increased from 1895934157 as on March 31.annexed as parts of the Notes to Consolidated Accounts of the Company at Page No. The Secretarial Audit Report is provided separately in the Annual report. CORPORATE GOVERNANCE The Company is committed to uphold the highest standards of corporate governance and adhere to the requirements set out by the Securities and Exchange Board of India. R.314 equity shares upon conversion of Foreign Currency Convertible Bonds (FCCBs) by their holders. Chua Sock Koong. have been included in the Corporate Governance Report and Notes to Accounts section of the Annual Report. who has submitted his report confirming the compliance with all the applicable provisions of various corporate laws. MANAGEMENT DISCUSSION AND ANALYSIS REPORT In accordance with the Listing Agreement requirements. A brief profile of directors. SECRETARIAL AUDIT REPORT Keeping with the high standards of corporate governance adopted by the Company and also to ensure proper compliance with the provisions of various corporate laws. 2007 to 1897907446 equity shares as of March 31. retire at the conclusion of the ensuing annual general meeting of the Company and have confirmed their willingness and eligibility for re-appointment and have also confirmed that their re-appointment. The Board acknowledges its appreciation for the counsel and services of Gavin John Darby. As regards comments under para ix(a) of annexure to the auditors’ report regarding slight delay in few cases in deposition of statutory dues. the Management Discussion and Analysis report is presented in the separate section forming part of the Annual Report. CORPORATE SOCIAL RESPONSIBILITY At Bharti Airtel. will be within the limits under Section 224(1B) of the Companies Act. A detailed report on Corporate Governance pursuant to the requirements of Clause 49 of the Listing Agreement forms part of the Annual Report. TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO Since the Company is a provider of telecommunication services. T. Syeda Imam and Donald Cameron have resigned as directors. Paul Donovan. Batliboi & Associates. 31 . Detailed information on the initiatives of the Company towards CSR activities is provided in the Corporate Social Responsibility section of the Annual Report. the information as applicable has been given in annexure A to this report. The Company has received notice from a member under section 257 of the Companies Act. S. Practicing Company Secretary. Gurgaon. Accordingly.24. Batliboi & Associates.

are provided in annexure B to this report. 1956 and for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities. 2008. with respect to the implementation of the Company’s ESOP schemes. The policy also helps in retention of well-performing employees who are contributing to the growth of the Company. the Central Government. 1999. constituted in accordance with SEBI Guidelines. DIRECTORS’ RESPONSIBILITY STATEMENT Pursuant to Section 217(2AA) of the Companies Act. Last but not the least. 2008 Sunil Bharti Mittal Chairman and Managing Director 32 . (iii) they have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act. (iv) they have prepared the annual accounts on a going concern basis. the State Governments and Company’s bankers.R. However. in terms of the provisions of section 219(1)(b)(iv) of the Act the Annual Report has been sent to the members of the Company excluding these information. for the assistance. the directors to the best of their knowledge and belief confirm that: (i) in the preparation of the annual accounts for the year ended March 31. ACKNOWLEDGEMENTS Your Directors wish to place on record their appreciation to the Department of Telecommunications (DoT). Members who desire to obtain this information may write to the Company Secretary at the registered office address and will be provided with a copy of the same.EMPLOYEES STOCK OPTION PLAN The Company values its human resource and is committed to adopt the best HR practices. as amended. PARTICULARS OF EMPLOYEES The information as are required to be provided in terms of section 217(2A) of the Companies Act. We look forward for their continued support in the future. your Directors would also like to thank various partners viz. would be placed before the shareholders at the ensuing annual general meeting. The ESOP Compensation Committee. the business associates. For and on behalf of the Board Place : New Delhi Date : April 25. 1956. 1956 read with the Companies (Particulars of Employees) Rules. Bharti Telecom Ltd. S. the applicable accounting standards have been followed along with proper explanation relating to material departures. 1975 have been set out in the annexure to the report. statutory auditors. (ii) they have selected and applied consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at the end of the financial year and of the profit of the Company for that period. Chartered Accountants. Disclosure in compliance with clause 12 of the Securities and Exchange Board of India (Employee Stock Option Scheme and Employee Stock Purchase Scheme Guidelines. Employee Stock Option Policy. Batliboi & Associates. The employees of the Company are presently benefited from two ESOP Scheme under 2001 and 2005. and a copy of the same shall be available for inspection at the registered office / corporate office of the Company. administers and monitors the Schemes.. A certificate from M/s. Singapore Telecommunications Limited. co-operation and encouragement they extended to the Company and to the employees for their continuing support and unstinting efforts in ensuring an excellent all round operational performance. and other valuable shareholders for their support and contribution.

TECHNOLOGY ABSORPTION.Annexure A INFORMATION RELATING TO CONSERVATION OF ENERGY. enters into arrangements to avail of the latest technology trends and practices. has also been incorporated with an objective to provides passive infrastructure services on a nondiscriminatory basis to all telecom operators in Sri Lanka Total foreign exchange used and earned for the year: (a) Total Foreign Exchange Earning Rs. 1956 READ WITH THE COMPANIES (DISCLOSURE OF PARTICULARS IN THE REPORT OF THE BOARD OF DIRECTORS) RULES 1988. connects the widespread NRI population in USA to their families and friends in India at a cost effective and reliable manner.359 mn. our international calling service through wholly owned subsidiary companies. We have strong relationships for under-sea networks and we will continue to invest in major cable systems to increase our presence and share of the global traffic. The service was launched in December 2006. avoid wastage and conserve energy as far as possible. 33 . we anticipate significant further growth in this domain. being a telecommunications service provider. The launch marked Bharti Airtel’s foray into the US market. across the globe to address the needs of the Indian diaspora through our global network in near future. 15. the Company requires energy for its operations and every endeavour has been made to ensure the optimal use of energy. With India’s increasing integration into the global macro economy. (b) Total Foreign Exchange Outgo Rs. a wholly owned subsidiary of Bharti Airtel Lanka (Private) Limited. International Calling Card Services Airtel CallHome. and export plans. The Company plans to extend its services through its wholly owned subsidiary companies. development of new export markets for products and services. From time to time. Telecom Services in other countries The Company continuously explores and evaluates various opportunities for growth and expansion inside and outside the country organically and through alliances. However. RESEARCH AND DEVELOPMENT AND FOREIGN EXCHANGE EARNING AND OUTGO FORMING PART OF DIRECTORS’ REPORT IN TERMS OF SECTION 217(1)(e) OF THE COMPANIES ACT. FOREIGN EXCHANGE EARNING AND OUTGO Activities relating to exports initiatives taken to increase exports. 64.462 mn. the Company evaluates global innovation and technology as a benchmark and wherever required. In its efforts the Company achieved its first success upon receipt of letter of offer in January 2007 after a competitive bidding process. mergers/ acquisitions in identified markets. subject to availability of licenses. the information in Part A and B pertaining to conservation of energy and technology absorption are not applicable to the Company. In addition. CONSERVATION OF ENERGY & TECHNOLOGY ABSORPTION Bharti Airtel Limited. International Long Distance Business We have seen significant growth in our long distance business. Bharti Airtel would be providing these services through its wholly owned subsidiary company Bharti Airtel Lanka (Private) Limited. from the Telecom Regulatory Commission of Sri Lanka to offer 2G and 3G services in Sri Lanka. Bharti Infratel Lanka (Private) Limited. growth potential and cost as well as other relevant factors. Sri Lanka.

950 434. 1) 2) Particulars Number of stock options granted Pricing formula ESOP Scheme 2005 56. 70 71. (ii) The average of the weekly high and low of the closing prices of the related shares quoted on the stock exchange during the two weeks preceding the relevant date.000 @ Rs. 221 1.000 15.820.280 1.748.000 Nil Nil Nil Nil Nil Nil Nil 86.625 113. 22.000 20.500 @ Rs.000 @ Rs. No.843 @ Rs. Nil 20. Venkatesh Krish Shankar S.996 12.444. the Exercise Price in case of employees.914.Annexure B INFORMATION REGARDING THE EMPLOYEES STOCK OPTION SCHEME (as on March 31.500 Nil Nil Nil Nil Nil 8. who meet the eligibility criteria.000 8.326 34 .887.750 The Exercise Price of the options for the purpose of grant of options will be higher of the following: (i) The average of the weekly high and low of the closing prices of the related shares quoted on the stock exchange during the six months preceding the relevant date.000 10. 2005.258 8.686 340.170 31.5 2.375 1.760 @ Rs.000 20.265 @ Rs. 10 Plus applicable taxes as may be levied on the Company 3) 4) 5) 6) 7) 8) 9) Option vested Number of options exercised Number of shares arising as a result of exercise of option Number of options lapsed Money realized by exercise of options Total number of options in force Employee-wise details of options granted to i) Senior managerial personnel Inder Walia David Nishball Deepak Srivastava Devendra Khanna Jayant Khosla Anurag Prashar Shankar Halder Ajai Puri V.360. 221/ESOP Scheme 2001 18.000 8.000 959.000 12.000 8.642. 120 12.642.000 20.190. Asokan Gopal Vittal Syed Safawi Nilanjan Roy Sanjay Gupta Sanjeev Kumar Saxena Nil Nil 20.325** 414. was Rs.355 Nil 3.800 16.707*** 3.403 12. Notwithstanding anything contained above.000 20.845.000 20.537.367* 14.507. 2008) Sl.998 12.15. as on June 1.

000 Manu Talwar Rahul Gupta ii) Any other employee who receives a grant in any one year of option amounting to 5% or more of options granted during that year iii) Identified employees who were granted option. 168. Rs. 70. Rs.A. Rs. No. 14.521. Particulars ESOP Scheme 2005 Nil Nil ESOP Scheme 2001 8. during any one year. 139. 345. 22.60 Rs. equal to or exceeding 1% of the issued capital (excluding outstanding warrants and conversions) of the company at the time of grant 10) Diluted earning per share (EPS) pursuant to issue of shares on exercise of options calculated in accordance with Accounting Standard (AS) 20 ‘Earning Per Share’ In case.310 (0.0018 N.000 8. the difference between the employees compensation of the stock option cost based on intrinsic value of the stock and the employees compensation of the stock option cost based fair value for the year ended March 31. 0. 11) 35 N.A.5. 419. 120. 2008 and the impact of this difference on profits and on EPS of the Company For options whose exercise price either equals or exceeds or is less than market price of the stock. 474. Rs.08.79 Rs.Annexure B Sl.96 . Rs. 10. the following are disclosed separately: a) Weighted average exercise price b) Weighted average fair price Nil Nil Nil Nil 0.87. NA. Rs.0077) 12) Rs. 221 NA. Rs.40. the employees compensation cost is calculated on the basis of intrinsic value of stock option. Rs. Rs. 542.

13) Particulars ESOP Scheme 2005 Fair value Method : Black Scholes/ Lattice Valuation Model ESOP Scheme 2001 A description of the method and significant assumptions used during the year to estimate the fair values of options. The Company shall be entitle to recover taxes as may be incurred by it with respect to such employee. 854. 36 * Grants of 3. arising on account of the issue of options and / or allotment or transfer of the shares to the employee. the liability shall be that of the employee alone and shall be paid / reimbursed by the employee when due. (The Government Securities curve yields are considerable as on valuation date).A. the liability shall be that of the employee alone and shall be paid / reimbursed by the employee when due. All the liabilities arising on disposal of the equity shares after exercise shall be borne by the employee. The Company shall be entitle to recover taxes as may be incurred by it with respect to such employee. 2007.31 per equity share 14) Variation of terms of option# Following amendment was made in ESOP Scheme 2005 In the event of any tax liability or any other levies including Fringe Benefit Tax (FBT) levied by the Government. # The Company ammended its ESOP Scheme I and ESOP Scheme 2005 by passing a special resolution through postal ballot dated October 27. which is pending allotment and against which money has been realized.950 number of options under Scheme 2005. arising on account of the issue of options and / or allotment or transfer of the shares to the employee. (ii) expected life. .A to 8. including the following weighted average information (i) risk free interest rate. No.524 number of shares were made out of the options lapsed over a period of time. *** This include Rs.318 thousand on account of money received against 19.Annexure B Sl.33% (assuming 250 trading days to annualize) Nil Rs.25% P.936.45% P. 48 to 66 months 40.950 options pending allotment. (iii) expected volatility. 12.09% to 41. Following amendment was made in ESOP Scheme I In the event of any tax liability or any other levies including Fringe Benefit Tax (FBT) levied by the Government. 6. ** This includes 19. (iv) expected dividends (v) the price of the underlying shares in the market at the time of option grant.

It is neither an audit nor an expression of opinion on the financial statements of the Company. BATLIBOI & ASSOCIATES Chartered Accountants Date : April 24. adopted by the Company for ensuring the compliance of the conditions of the Corporate Governance. we certify that the Company has complied with the conditions of Corporate Governance as stipulated in the above mentioned Listing Agreement. Our examination was limited to procedures and implementation thereof. In our opinion and to the best of our information and according to the explanations given to us. 93283 37 . The compliance of conditions of corporate governance is the responsibility of the management. We further state that such compliance is neither an assurance as to the future viability of the Company nor the efficiency or effectiveness with which the management has conducted the affairs of the Company.Annexure C Auditors’ certificate regarding compliance of conditions of corporate governance To The Members of Bharti Airtel Limited We have examined the compliance of conditions of corporate governance by Bharti Airtel Limited (“the Company”). For S. R. for the year ended March 31. as stipulated in clause 49 of the Listing Agreement of the said Company with stock exchange(s) in India. 2008. 2008 Place : Gurgaon per Prashant Singhal Partner Membership No.

April 1. customers as on 31st March. in profits. 2008. 2007. which became effective from December 1. Radio Access Network and Transmission System.8%. • Guidelines on infrastructure sharing On April 1. various pro active and positive policy measures taken by the regulatory authorities have also provided an impetus for growth. besides being among the top five in market capitalization in India. m-commerce. it will be discontinued. On the other hand. ADC on incoming ILD calls has been reduced to Re. gaming.. new low cost technology and energy saving devices are critical to rural connectivity.50 per minute for a limited period between April 1. the direction and pace of regulatory changes is positive for the industry and augurs well for the Company. we are the largest integrated telecom operator in India with investments of more than USD 12 bn. 2007. sharing of allocated spectrum is not permitted. Recent developments in regulation While success is attributable to the entrepreneurial spirit of the telecom companies. 2008. navigation and location maps. With over 64 mn. • Interconnection Regulation for Direct-to-Home (DTH) service In September 2007. competition will intensify with entry of new players and renewed interest from global telecom operators. Under its open license policy. Infrastructure providers (Category-I) are now allowed to seek SACFA siting clearance for erecting towers with or without agreement with licensed service providers. Overall. On January 17. revenues of USD 7 bn. Innovations like shared infrastructure. 20 bn.e. More interesting is that the majority of new customers will be from the hinterland and remote areas with inadequate basic infrastructure and no previous connectivity.Management Discussion & Analysis INDUSTRY STRUCTURE AND DEVELOPMENTS Indian telecom industry The Indian telecom sector has witnessed growth on a scale that has seen few parallels in any industry in the world with close to 300 mn. and USD 1 bn. IPTV and mobileTV jostling for attention with demand for low tariffs for plain voice calls and better network coverage. weather. India has reached a wireless penetration of 22. 2007 On September 14. with high speed applications like audio-video streaming. The provision of DLC or local lead shall be at rates specified by TRAI. mandates broadcasters to publish a Reference Interconnect Offer (RIO) specifying technical and commercial terms on which it will 38 . Feeder Cable. TRAI amended the Interconnection Regulation of Broadcasting and Cable Services. 0. TRAI published a regulation enabling service providers to obtain DLCs and its local lead from each other in a transparent manner. service provider has to indicate the reasons in writing and maintain record of such cases for a period of 1 year. Node B. The following list captures the key regulatory changes that were implemented by the Department of Telecommunication (DoT) and Telecom Regulatory Authority of India (TRAI) in the year 2007-08. 2008 on quarterly basis. music downloads may also drive demand in these areas. The relative importance of the regulatory changes should be viewed in light of big challenges and opportunities that the industry is facing today (as detailed in later section of this report). With increased coverage and affordability. Sectoral growth is primarily driven by parallel economic growth. Thereafter. by 2010. agriculture and education. While rural content is expected to focus on market and commodity prices. rising income levels and favorable demographics (54% of the population is less than 25 years of age). • Domestic Leased Circuits (DLCs) Regulation. the DoT issued guidelines allowing sharing of active infrastructure viz. In case it is infeasible. as prescribed for obtaining a new UASL. this growth is expected to continue in the medium term. Tariffs for local and long distance calls are at the lowest levels in the world and still falling. This support shall be reviewed in the third year. making India one of the largest telecom markets in the world. health. Regulatory changes • Spectrum On October 19. • Access Deficit Charge regime The ADC regime is being gradually phased out with the curtain down on revenue-share ADC w. the DoT issued a press release wherein licensees were allowed to use alternate technology (CDMA/GSM) under the same licence after payment of the requisite entry fee. existing operators moved the Hon’ble TDSAT and High Court. 2008. Antenna. 2008 to September 30.f. the DoT released a revised and stringent eligibility criterion for allocation of additional spectrum. 2008. The regulation allows DTH operators to offer services in both C-Band and Ku-Band. the DoT has issued 120 new Unified Access Licenses making India one of the most fiercely competitive regions in the world. TRAI has recommended that a sum of Rs. 2008. where the matter is sub-judice. customers and a target of 500 mn.8% in financial year 2008 registering an annual growth of 43. 2007. per annum may be given to BSNL from the Universal Service Obligation (USO) Fund as subsidy for a period of 3 years from April 1. The requirements and expectations of the urban and rural consumer will be quite different. In order to protect its legal and contracted rights over spectrum. many of whom wish to re-enter India and participate in the success of Indian telecom. When a service provider receives a request for DLCs it is required to confirm feasibility within 30 days. music downloads. However.

including call centre. date of the TRAI’s Directive. Regulation mandates owners of CLS to publish a Reference Interconnect Offer (RIO) approved by TRAI. 2007. retail customer tariffs have been left to the market. telecom resources provided to the telemarketer to be disconnected. 2007. • Consumers Protection and Redressal of Grievances Regulation. 2007. A “National Do Not Call Registry” (“NDNC Registry”) was established to enlist telephone numbers of all subscribers who do not want to receive UCC. an execution petition was filed by private operators. A penalty of Rs. TRAI issued a regulation mandating creation of a hierarchical three tier institutional mechanism within each telecom service provider Company for resolution of consumer grievances. backhaul circuits. Revision should be prospective and apply to subscribers enrolled six months after the date of revision. mandates broadcasters to offer channels on a-la-carte basis in addition to bouquets to DTH operators and prescribes a wholesale pricing formula for channels given by broadcasters to DTH operators. Access to service provider’s call centre for lodging complaints has to be toll-free. 2007. • Access to Essential Facilities at Cable Landing Stations (CLS) Regulation. Since BSNL refused to refund the amounts collected by it. Hon’ble TDSAT has largely accepted TRAI’s recommendations. 2007 On June 7. 1. A clear time frame has been prescribed for various activities such as submission of draft RIO to TRAI. mandates itemized billing. Every telemarketer has to verify its calling lists with the NDNC Registry before making a call. 2007. Hon’ble TDSAT identified items of revenue that may be included in the definition of AGR for License Fee calculation.interconnect with DTH operators. • Hon’ble TDSAT order on Revenue Share on Roaming Call On September 11. However. fair and open access at CLS and co-location facilities for all eligible Internet Service Providers (ISPs) and International Long Distance Operators (ILDOs) within a well-defined time frame. 2007. establishment of consumer dispute redressal mechanism. publication of approved RIO by the owner of CLS. All telemarketers were required to register with the DoT as per guidelines dated June 06. etc. TRAI made the following recommendations to the Ministry of Information and Broadcasting (I&B): (a) Existing technical interoperability condition of DTH license should be retained (b) GOI should request Bureau of Indian Standards (BIS) to update standards for DTH STB for advanced technologies. • Hon’ble TDSAT Order on definition of AGR (Adjusted Gross Revenue) Vide Judgment dated August 30. For continuing default. sales outlets and website. benchmarks and procedures for seeking redressal of grievances. to avoid disconnection of its telecom resources by the telecom service providers. Hon’ble TDSAT upheld TRAI’s Directive dated September 11. co-location and landing facilities at its CLS. • Quality of Service (QoS) Regulation for DTH service On August 31. 500 per call/SMS has been prescribed for first instance of default by telemarketer calling a number listed in the NDNC Registry and Rs. The manual has to be available for reference at every office of the service provider. The service provider has to provide a copy of the manual or its abridged version to each consumer at the time of enrollment. It defines benchmarks for response time in resolving customer requests/complaints. 2007 In June 2007. etc. TRAI issued a regulation for ensuring non-discriminatory. All telecom service providers are mandated to provide toll free numbers to receive request from their subscribers who want to enroll in the NDNC Registry. • Unsolicited Commercial Communications (UCC) Regulation. negotiation of agreement between owner of CLS and eligible ISPs and ILDOs. TRAI issued a regulation establishing a mechanism for curbing unwanted telemarketing calls/ SMS. TRAI issued a QoS Regulation for DTH services to be effective from December 1. Hon’ble TDSAT upheld the decision in the industry’s favour. In some instances where TRAI had rejected the industry’s contentions. provision of co-location facility. Revision should not compulsorily require DTH operators to upgrade STBs of existing subscribers to conform to revised standards (c) DTH operators may offer services either in Ku-Band or C-Band. Regulatory work-in-progress • TRAI’s recommendations on DTH service In January 2008. • Final recommendations on Mobile Television service TRAI’s recommendation on MobileTV Service permits CMSPs/UASPs to offer MobileTV service using their 39 . containing terms and conditions at which it shall provide access. approval by TRAI.000 for every subsequent UCC. 2007.e. 2006 which stipulated that BSNL is not justified in claiming a share of the revenue earned by private operators from their roaming subscribers.f. rental and hire-purchase basis. Vide Order dated November 28. Every service provider to publish a manual for handling consumer complaints outlining time limits. Regulation inter alia mandates provision of Customer Premises Equipment to subscribers on sale. 2007. The procedures and time frame for redressal of grievances at each of these levels have been defined. Hon’ble TDSAT directed BSNL to refund the excess amounts so collected w. 2007 On May 4.

USO fund may be utilized to subsidize broadband services through satellite in remote and hilly areas and to subsidize backhaul charges initially for a period of 3 years. Bharti will partake in the discussions regarding the feasibility and the model for adopting 3G and other NGN related technologies in the Indian context. Annual license fee at 4% of gross revenue or 10% of OTEF. Bharti Airtel is in the process of acquiring the necessary clearances and expects to commence operations in the second half of the fiscal year 2008-09. it is one of the most attractive telecom markets in the world today.a. Foreign equity may be capped at 74%. with approximately 70. License shall specify roll-out obligations and bank guarantees to securitize performance. after a competitive bidding process. Higher per capita income and appetite for increased consumption is resulting in a greater-than-proportionate impetus for telecom growth. This license may be granted through a Closed Tender System on the basis of One Time Entry Fee (“OTEF”) quoted by bidders. a separate license with a 10 year term will be issued by the Ministry of Information and Broadcasting (I&B). Spectrum will be allocated automatically to the successful bidders. Our passive infrastructure partnership with Idea and Vodafone will provide access to a larger network infrastructure and pace our expansion plans in the coming year. Bharti Airtel received a letter of offer. 1 slot of 8MHz in UHF band V). with total flexibility in developing a commercial model. The low levels of reach. At the end of 2006.telecom network and the already allocated spectrum without needing any other license/permission. has been incorporated with 40 . it shall be considered as IPTV under the telecom license and will attract the relevant license fee. The pro-rural steps taken in the recent Union Budget also provides a greater incentive to achieve deeper penetration in the untapped rural markets. The OTEF will include the initial cost of spectrum (i. Cable TV Networks (Regulation) Act 1995 would not apply to IPTV service delivered through a telecom network. in the form of TRAI’s recommendations. from the Telecom Regulatory Commission of Sri Lanka to offer 2G and 3G services in Sri Lanka. quality and service standards of existing cables.e. Close monitoring be prescribed to ensure effective utilization of the local loop. Unified Access Service (UAS) Licensees. Indus Towers. an independent tower Company to provide passive infrastructure services in India. to offer MobileTV service using terrestrial broadcast mode. UAS and CMTS Licensees may offer IPTV under their existing licenses and shall pay an annual license fee at 6%. B and C circles respectively while ISPs will pay license fee at 6% p. The Indian telecom industry will adopt 3G with the proposed auctioning of the 3G spectrum. Cellular Mobile Telephone Service (CMTS) Licensees and certain Internet Service Providers (ISPs). As India still remains a largely under-penetrated market with over a billion people. • Recommendations on growth of broadband TRAI recommended that BSNL/MTNL should be encouraged to appoint franchisees for providing broadband services. The outcome. coupled with growing demand for digital content and introduction of CAS (Conditional Access System) by the Government of India will help DTH grow manifold in the next few years. The downlink policy should be amended to allow broadcasters to provide feed to IPTV and HITS service providers in addition to COs/MSOs/DTH operators. New technologies and paradigms The trend towards adoption of Next Generation Networks (NGN) is global and India is in advanced stages of adopting these as well. • Final recommendation on IPTV service TRAI’s recommendations on IPTV service are based on the premise that IPTV service is technically distinguishable from Cable TV service and therefore provisions of The Cable TV Networks (Regulation) Act of 1995 are not applicable to IPTV service provided by Telecom Licensees viz. may be imposed. However. is awaited for the following: – – – – Foreign Investment Limits in Broadcasting Issues relating to DTH service Issues relating to Mobile TV service Issues relating to Head End in the Sky (HITS) Service OPPORTUNITIES AND THREATS Opportunities A strong economy and a growing market The Indian telecommunication industry is poised to deliver solid growth as a result of several economic reforms that have lead to strong GDP growth pegged at around 8% for financial year 2007-08. Bharti Airtel is in advanced stages of launching its DTH services. Choice of technology may be left to operators so long as it is digital and based on ITU/ETSI/TEC standards. The annual spectrum charge payable by the licensees will be determined by WPC wing of DoT. whichever is higher.000 sites. In case any telecom service provider registers itself as a cable operator and provides IPTV service using its telecom resources. Row procedures should be streamlined. Bharti Infratel Limited. Strong strategic partnerships Singtel is our long time strategic investor and alliance partner and we expect to continue to leverage the strengths and experience of Singtel in the years to come. several consultation papers were floated. There exists a tremendous potential for Direct To Home broadcast in the Indian market. partnered with Vodafone Essar Limited and Idea Cellular Limited to form Indus Towers Limited. • Public consultation During financial year 2008. We believe that Sri Lanka is a very promising market for telecom services. a subsidiary of Bharti Airtel Ltd. 8% and 10% in category A. Bharti Airtel with its extensive experience and a unique business model is very well placed to address this opportunity and create value for the Sri Lankan customers.

2008. we are well poised to take full advantage of the market opportunities. Bharti Infratel will transfer approximately 30. With mobile tariffs in India being among the lowest in the world. This segment constitutes the largest portion of the Company’s business.210 Rs.328 customers (a growth of 22%). Nokia and Huawei. North East and Orissa. SEGMENT WISE PERFORMANCE Bharti Airtel has had an overall robust performance in all segments in which it operates.8% of wireless (GSM + CDMA) market share as on March 31.141. The Company’s 61. of which 34. 218. the Company had 2.909 mn.623 noncensus towns and villages covering approximately 71% of the country’s total population. 2008 are presented below: Particulars Customers Gross Revenue EBIT FY 2006–07 37. Jammu and Kashmir. Bharti Infratel will be managed and run independently and shall offer passive infrastructure services to all telecom operators and wireless service providers on a non-discriminatory basis. the Company will not be able to provide 3G services. The Company’s strategy for Telemedia business is to focus on the cities with high revenue potential. garnering a 23.984. The mobile services business contributed 80% to the consolidated revenues. In all. To start with. our leadership position amongst the private operators. the 3G spectrum allocation would be done in phases. will further intensify the competition. 2008.721 mobile and 2. Madhya Pradesh. Equipment suppliers for our mobile networks include Ericsson. wide distribution coverage and innovative product offerings. The key financial results of the mobile segment for the year ended March 31. given the under penetration in the market. For our group-wide IT requirements. Rs.697 mn. However.843.049 customers. FY 2007–08 61. The Company offers post-paid.366 outlets. 141.283. In the event of non-allocation of 3G spectrum to Bharti Airtel. which owns 20.000 towers to Indus Towers. The growth in revenues happened despite reductions in tariffs and intense competition. CISCO and Wipro. mobile subscribers during the year. the Company’s prime focus is on ensuring customer satisfaction through network quality.the objective of merging the passive infrastructure assets of the three companies across 16 telecom circles in India.8% share of the all India wireless market. Nortel. the spectrum will be allocated to only three operators through a process of bidding.8% (~795. 2008.269 mn. based on the number of customers.189 mn. As on March 31. Corning. We believe in deploying the finest technology and operating state-of-the-art networks. For our fixed line and long distance networks.721 mobile customers accounted for a 23. we partner with reputed companies like Siemens. the Company expanded its operations to 5. The Company’s strong performance helped consolidate its leadership in the market and has given it the opportunity to take full advantage of the rapidly growing telecom market. the Broadband and Telephone Services business was renamed as Telemedia Services in line with the Company’s growing focus on new media solutions and foray into IPTV and DTH businesses.721 Rs. Himachal Pradesh.511 mobile customers in financial year 2007-08. During the financial year.328 Telemedia Services customers. Bharti Airtel Limited is confident of being among the three companies to receive 3G spectrum. The business also provides value added services such as intelligent network . 34.268. Bharti Infratel. consisting of 61.000 sites will operate the passive infrastructure in the remaining 7 circles of Assam. The Company provides broadband (DSL) and telephone services (fixed line) in 15 circles spanning over 94 cities across India. Y-o-Y Growth 67% 55% 70% 41 Telemedia Services During the year. Our total customer base increased by 65% compared to the customer base on March 31. 59. representing a customer addition of 67% over the previous year. this should help to further increase the overall market for telecommunication services..984. spread of our network and operations. 2007.283. we have an alliance with IBM and with Nortel for our call center requirements. entry of new players and expansion to newer circles to achieve pan India presence by some of the existing players.000) were subscribing to broadband / internet services. national and international long distance voice connectivity and broadband Internet access through DSL. Threats Increased competition may reduce market share and/ or revenue In a market which is already very competitive. The product offering in this segment includes supply and installation of fixed-line telephones providing local. As on March 31. both in terms of total revenues and total customers. Mobile Services The Company offers mobile and fixed wireless services (FWP) using GSM technology on 900MHz and 1800MHz bands. superior customer service and continuous innovation in value-added services that would help expand its mobile subscriber base and drive up volumes. 218. the Company added 24. and is the largest wireless service provider in the country. Bihar. However. The revenues from the mobile services for the financial year were Rs. 3G spectrum allocation As per current plans.8 mn. roaming and value added services through its extensive sales and distribution channel covering 859.697 mn. The Company added 24.023 census towns and over 342. Rs. excepting for DTH which will be an all India offering. pre-paid.984. the Company had an aggregate of 64. We believe that with the size and scale that we have built over the years. a growth of 55% over the revenues in the previous financial year.

scalable. virtual private automatic branch exchange networks. viz. it is.871. 5. The Company complements its mobile and telemedia services with national and international long distance services. 13. Rs. a member of the South East Asia-Middle EastWestern Europe – 4 (SEA-ME-WE-4) consortium that has commissioned the fourth generation cable system. OUTLOOK We believe that Bharti Airtel Ltd will benefit from the overall economic growth and the potential for further growth of telecom services in the Indian market. 6. 2008 are presented below. 11. Rs. FY 2007–08 Rs. 11. 28. Y-o-Y Growth 25% -3% Enterprise Services – Corporates This sub-group of Enterprise Services provides secure. viz. 2008. 22. The national long distance infrastructure comprises of 73. It also offers virtual calling card services in the overseas markets. • the growth potential of new services in the data market and our track record in innovation.109 mn. working with them to meet the challenges of growth. India Middle East and Western Europe (IMEWE) and Unity North. FY 2007–08 2. 2008 are: Particulars Gross revenue EBIT FY 2007–08 Rs. Rs. Bharti Infratel deploys. Rs.000 towers will be transferred to Indus Towers Ltd (a Joint Venture between Bharti Infratel. reliable and customized integrated solutions of voice and data communications to corporate. 43.28. The revenues from the Telemedia services were Rs. thus offering total telecom solutions through a single window. over 1000 MPLS and SDH POPs and over 800 POIs with the local exchanges. national and international long distance and data connectivity services to key account corporate customers through business relationship management. 1.328 Rs. toll free numbers. 6. The Enterprise Services group has two sub-groups.950 mn. a growth of 27% over the revenues in the previous financial year. providing a pan India reach.492 mn.637 mn.289 mn.243 mn. seamless. 9. Y-o-Y Growth 22% 27% 260% The key financial results of the Long Distance Services division for the year ended March 31. it has announced investments in new cable systems such as Asia America Gateway (AAG). For international connectivity to the west.2008 are presented below. The Company has approximately 52. Rs. For international connectivity to the east. Carriers (Long Distance Services) and Corporate.293 mn.798 mn. of which approx 30. jointly with 15 other global telecom operators.304 mn. Enterprise Services – Carriers Carrier business unit provides long distance wholesale voice and data services to carrier customers as well as to other business units of Airtel. 3. the tariffs were reduced drastically. Particulars Gross Revenue EBIT FY 2006–07 Rs.245 mn. 2008. the Company saw significant growth in the long distance traffic carried on its network. Vodafone and Idea Cellular) for 16 circles. ring back tones and call forwarding among others.787 Route Kilometers of optical fibre.387 Rs. small and medium scale enterprises.698 mn. Rs.615 mn.023 mn.000 towers as on March 31.based advanced management services. Enterprise Services is regarded as the trusted communications partner to India’s leading organizations.2008 are presented below. 1. Bharti Infratel provides passive infrastructure services on a non-discriminatory basis to all telecom operators in India. Rs. The business unit owns a state of the art national and international long distance network infrastructure enabling it to provide connectivity services both within and outside India. 34. The group focuses on delivering telecommunications services as an integrated offering including mobile services.615 mn. Particulars Gross revenue EBIT FY 2006–07 Rs. Passive Infrastructure Services The undertaking relating to the entire assets and liabilities of telecom passive infrastructure was transferred from Bharti Airtel Limited to Bharti Infratel Limited pursuant to a scheme of arrangement sanctioned by the Honble High Court of Delhi. During the financial year 2007-08. . telemedia services. We believe that we are in a strong position to enhance our leadership. We are the first and only private mobile GSM operator to have an all-India footprint.885 mn. Particulars Customers Gross Revenue EBIT FY 2006–07 1. The key financial results of Telemedia Services for the year ended March 31. With reductions in ADC and license fees.. FY 2007–08 Rs. 42 There are no comparable previous period figures since the undertaking has been transferred only on January 31. The key financial results of the Passive Infrastructure Services division for the year ended March 31. During the financial year. based on:• our rich human resource talent pool. it has a submarine cable landing station at Chennai between Chennai and Singapore. owns and manages passive infrastructure on an all India basis. The key financial results of the Enterprise ServicesCorporates division for the year ended March 31. Y-o-Y Growth 49% 59% Enterprise Services Enterprise Services provides a broad portfolio of services to large Enterprise and Carrier customers. which has helped augment usage by our customers.283.

923 mn.82% 47% 53% 57% Rs. Rs 74. • our ability to maximize returns on investment. 65.• the expansion of our networks to rural markets. Collection.202 mn. RISKS AND CONCERNS Our business is subject to extensive regulation by the Government. We have consistently been the first to market many successful and innovative products that add to superior customer experience and satisfaction. our ability to remain competitive could be affected. in order to mitigate the risk. equal to the replacement value of our existing telecommunications network. Rs 423. We maintain insurance for our assets. audit observations of both internal and external audits. whereby the management regularly reviews actual performance with reference to business plans . and terrorist attacks. The Corporate Assurance Group is responsible for performing regular internal assurance reviews to ensure adequacy of the internal control systems and adherence to management policies and statutory requirements. The regulatory environment may tend to benefit them over the private operators. 142. • the ability to leverage on the strengths of our business partners and our integrated player status. Technical failures and natural disasters could damage our telecommunication networks. However. We. Rs 40. • our focus on building a strong brand and enhancing customer experience. MIS.954 mn. we have implemented back-up solutions in the event such issues arise. and Information Technology and Network Security.018 mn. Procurement and Financial Reporting. facilitate accurate and timely compilation of financial statements and management reports and ensure compliance with statutory laws. We have prudently deployed new technologies after assessing the experience our international partners have had in the deployment processes before choosing to do so ourselves. we place considerable emphasis on development of leadership skills and on building employee motivation. For Bharti Airtel. 138% Y-o-Y Growth 43 MATERIAL DEVELOPMENTS IN HUMAN RESOURCES The Indian telecom sector has been one of the most vibrant and dynamic sectors in the country. Our business units compete with government-owned or government controlled companies. Rs 93. For instance. Rs 114. the Company has issued ESOPs.both financial and operational.049 Rs 270. DISCUSSION ON FINANCIAL PERFORMANCE Particulars Customers Gross revenue EBITDA PAT Gross assets Capital expenditure Capital productivity FY 2006–07 39. we consistently introduce sophisticated new technologies. it has been a year of building market supremacy as our three business units consolidated their market positions. do not perceive adverse changes in the regulatory environment. Credit and Risk. The Corporate Assurance Group functionally reports to the Board Audit Committee and administratively to the President & CEO. risk assessment and adequacy of internal controls.122 mn.224 mn.621 mn. special perils. there can also be no assurance that any claim under the insurance policies maintained by us will be honoured. Risk assessment helps in identifying and focusing on all high-risk areas. 63.268. or which we intend to adopt. which could have an adverse effect on our business. The Company has also put in place an extensive monitoring and review mechanism. We are confident that the Government will continue to ensure a level playing field for all operators keeping the customers’ best interest in mind. As a retention strategy. The internal assurance review covers all the business-critical functions.407 mn. Changes in available technology could increase competition and our capital costs. may cause disruption in our operations. which provides cover for damage caused by fire.012. we were the first to kick-start the trend in India towards a validity free world.597 Rs 184. If the new technologies we have adopted. however. Rs 63. such as Revenue Assurance. which we believe will enable us to continue with normal operations under most circumstances. Skilled manpower and talent The growth of the Indian economy has led to an increased requirement for talented managerial personnel. We believe that talented manpower is a key strength. technical failures and natural disasters even when covered by insurance. The Corporate Assurance Group deploys an annual internal assurance plan based on assessment of major risks in each of the businesses. Rs 223. INTERNAL CONTROL SYSTEMS The Company deploys a strong system of internal controls to allow optimal use and protection of assets. other companies often look to Bharti Airtel Ltd as a hunting ground for talent. We firmly believe that we will continue to provide unique and innovative products and services to our customers that will help us further consolidate our market leadership. Rs 281.51% FY 2007–08 64. In order to remain competitive.199 mn.025 mn.940 mn. The Board audit committee periodically reviews the audit plans. As a normal course of business. regulations and Company policies. Further. The . Given the track record and success of our employees. Further. fail to be cost-effective and accepted by customers.

Development of human resources will continue to be a key strategic challenge as Bharti Airtel continues to grow at a fast clip in an environment where the total service industry is growing at a rapid pace while the pool of employable resources is effectively growing at a slower pace. retain and get the best talent. customer centric products and services and a strong management team.423 were on the rolls of Bharti Airtel Limited. In addition to this. Tata Teleservices Limited. and remain on customer service. backed by its strong execution capabilities.120 were on the rolls of Bharti Airtel Services Limited.Company has also started seeing the benefits of the ‘One Airtel’ synergies which aimed at leveraging its diverse strength to address future competitive challenges. thereby resulting in significant cost savings. Significant expansion. 15. Bharti Airtel has pioneered the passive infrastructure sharing model in India. The Company has focused on developing an internal leadership pipeline to fill key leadership positions internally. CDMA operators such as Reliance Communications Limited. With the 2010 vision of ‘being the most admired brand in India targeted by top talent’. COMPETITION Competition is not new to the Indian telecom industry but the coming years will see heightened competitve activity as further 120 licenses have been issued to new operators. The Company continues to adopt global best practices in areas like employee training and development. is being planned. 2008. The customer has been at the centre of our strategy and going forward our full focus will be. In the coming year. This expansion will provide an opportunity to test our business model outside India. We recognize the potential offered by the rural Indian market. Swan Telecom (13 licenses). 44 . Bharti Airtel has consistently strengthened its leadership position among the private operators. At the end of March 31. Bharti Airtel had a total of 25. and to build the right capabilities in current and new businesses to strengthen its competitive advantage. availability and simplicity. the Company has a long term human resources strategy in place to attract. KEY STRATEGIES In the year gone by.543 employees. employee engagement. We will explore the extent of active infrastructure sharing based on guidelines issued by TRAI. The Company is in the process of seeking the required clearances after which the roll-out can commence. We are confident that with the solid foundations built over the past 13 years. Strategic alliances have been announced to target rural affluent customers. During the year the Company made gross additions of 11. leadership capability development. Bharti Airtel will also expand abroad through launch of our operations in Sri Lanka. we are well placed to take full advantage of the market opportunities that this very buoyant market presents and continue to hold our leadership position. Some of the beneficiaries of these licenses include Shyam Telelink (21 licenses). 10. The Company will continue to pursue this strategy of affordability. the Company expects more than half of its new business to come from rural customers. The coming year will see a stronger emphasis on nonmobile business with the planned introduction of Directto-home (DTH) services and IPTV. both of network and distribution. reward management and ensuring a healthy work life balance to achieve our 2010 vision of ‘being the most admired brand in India’. The Company will increase investments in the area of broadband to enhance penetration and usage of broadband services.526 employees. Loop Telecom Private Limited (21 licenses) and Unitech Group (22 licenses). In addition to rural expansion. Bharti Airtel has focused on making telecom services affordable through a dedicated effort of rationalising and simplifying tariffs. We will continue our focus on our customers with value added services and invest in further enhancing our brand strengths. Datacom Solutions (21 licenses). HFCL and Shyam Telelink Limited are foraying into the GSM space under their existing licenses. Bharti Airtel Limited attrition stood at 28% compared to 31% previous year. The Company believes that infrastructure sharing will provide a boost to managing efficient operations.

Chairman of the Board is an executive director. • Well defined corporate structure that establishes checks and balances and delegates decision making to appropriate levels in the organization. Corporate governance rating CRISIL has assigned Governance and Value Creation (GVC) rating viz. The present strength and composition of the Board reflects the diverse nature of the business environment in which we operate. This indicates our capability and clear objective to create value for all our stakeholders. All our directors have requisite professional skills and experience in various complementary fields. other statutory provisions and the terms of the shareholders' agreement. Clause 49 of the Listing Agreement with the stock exchanges has undoubtedly raised the minimum expectation on standards of corporate governance in India. while preserving the high standards of ethics and governance. We acknowledge that corporate governance is an upward moving target. • Independence of directors in reviewing and approving corporate strategy. management practices and outlook. loyalty and good faith. There is more widespread understanding and acceptance that good corporate governance ultimately leads to better performance. the role of the Board in upholding the highest standards of governance becomes increasingly important.bhartiairtel. The requisite information as per the requirements of Clause 49 of the Listing Agreement is provided in the following table: • Integrity and ethics in our dealings with all stakeholders. Since Sunil Bharti Mittal. increased investor confidence and higher value creation. the Board of directors of the Company currently comprises of fourteen members. half the Board comprises of independent directors. and we aim to establish and benchmark ourselves with the best of companies in India and overseas to ensure that we maintain the highest rating for our practices.Report on Corporate Governance COMPANY'S GOVERNANCE PHILOSOPHY As Indian corporations grow in size and complexity and become increasingly global in their structure. • Balancing the enforcement and protection of the rights of all stakeholders. Directors fulfill fiduciary duties of care. investors. business partners. "CRISIL GVC Level 1" on the corporate governance and value creation practices of the Company. They have proven judgment and competence in understanding and guiding companies' performance and strategy. major business plans and activities as well as senior management appointments. Corporate Governance Practices in Bharti Airtel Limited are based on the following broad principals: • Transparency in disclosure and communication of relevant and adequate financial and operational information in a timely manner. The Board reviews its strength and composition from time to time to ensure that it remains aligned with the requirements of the business. The Board's view is to ensure that the highest standards are set with an endeavor to raise the standards of governance as they evolve in line with global best practices. five are non-executive directors and seven are non-executive independent directors. But regulatory directives and guidelines are alone not enough to create a best in class transparent organization. A detailed profile of each of our directors is available on the website of the Company at www. retain responsibilities of oversight and focus principally on guidance and strategic issues.in in the Investor Relations section. shareholders and 45 . BOARD OF DIRECTORS Composition of the Board To comply with the provisions of the Listing Agreements. We believe that establishing trust with our customers. supported by robust internal processes of management oversight and control for monitoring of performance and evaluation of risk. two of whom (including the Chairman) are executive directors. employees. • Accountability. thus creating wealth and value in the long term. in compliance with the stipulations of the revised Clause 49 of the Listing Agreement. the public at large requires that we reach beyond regulatory compliance and adopt a culture and process for credible self-regulation that transcends mere form. FDI guidelines.

audit committee and shareholders/investors grievance committee of Indian public limited companies. Executive director . Marketing and Communication. 46 The directorships held by the directors.A. N. implementation of new projects and initiatives. N.A. Networks.e. 2008 Except Sunil Bharti Mittal. The functional directors seek functional guidance from the corporate directors and group directors in Bharti . N.A. of board chairmanships2 and committee memberships meetings Committee attended Director. The Company's business is structured into three Strategic Business Units (SBUs) i. April 25.A. No N.A No No No Yes No Yes No N. who report to the Chairman.S.A. Raju retired at the 12th Annual General Meeting held on July 19. Internal Assurance. 1 1 3 4 N.Chairman. ensuring success of outsourcing initiatives and improvements in the internal control metrics. and Enterprise Services.promoter Non-executive director Non-executive director Non-executive director Non-executive director Non-executive director Independent director Independent director Independent director Independent director Independent director Independent director Independent director Independent director Independent director Independent director Yes Yes Yes Yes No No No N. 7. Bharti Airtel's commitment to full compliance is backed by an independent and fully informed board and comprehensive processes and policies that strive to enable transparency in our functioning. 2007 V.A Whether attended last AGM Sunil Bharti Mittal Akhil Gupta Rajan Bharti Mittal Rakesh Bharti Mittal Chua Sock Koong Paul O’Sullivan Francis Heng Gavin John Darby3 Paul Donovan3 Bashir Currimjee Donald Cameron4 Kurt Hellstrom N Kumar Pulak Chandan Prasad Ajay Lal Arun Bharat Ram Syeda Imam5 V.f.A 1 1 1 7 3 5 12 N. 9.A.Name of director Category Number of directorships1. • The President & CEO heads the operational team and is responsible for overall profitability. who are brothers and promoter directors. 8. The committee membership details provided do not include chairmanship of committees as it has been provided separately Gavin John Darby and Paul Donovan. 4 3 4 3 4 4 4 Nil Nil 4 4 4 4 4 4 4 1 1 N. 2.A.A. N. Vodafone nominees resigned from the Board w. June 25. who himself holds 400 shares and through a relative holds 700 shares Governance Structure Building a culture of integrity in today's complex business environment demands high governance standards in every area of our operations.A.promoter Non-executive director . Raju6 Mauro Sentinelli7 1.f. N. 2007 Donald Cameron resigned from the Board w. • The Joint Managing Director is responsible for investor relations.e. Telemedia Services (formerly known as Broadband and Telephone Services).A. 3 1 N. N. April 25. 6. 4. save for Bashir Currimjee. employee engagement and leadership effectiveness.A.A. The organisation structure is headed by the Chairman and Managing Director. Legal and Regulatory. Each of the business units is headed by a business President who reports directly to the President & CEO of the Company. supported by the Joint Managing Director and the President & CEO. The President & CEO is also supported by the functional directors who are responsible for the critical functions of Human Resources. 2007 Mauro Sentinelli was appointed as an additional director of the Company w.promoter Executive director Non-executive director . No. N. process compliances. 2008 Syeda Imam resigned from the Board w.e. Rakesh Bharti Mittal and Rajan Bharti Mittal. Finance and Strategy.f. N. Mobile Services. 2 2 N.A. 3. 1956 The committees considered for the purpose are those prescribed under Clause 49(I)(C)(ii) of the Listing Agreement(s) viz. June 1. Supply Chain and Customer Service and IT. 4 1 2 2 N.f.S. do not include directorships held in foreign companies. N. 5.e. overall partner satisfaction.A.A.A. N.e. There is a clear demarcation of duties and responsibilities amongst the three positions: • The Chairman and Managing Director is responsible for providing strategic direction and mentoring of the core management team besides governance.Memberships ships ships 9 8 6 6 2 2 2 N. private limited companies and companies under Section 25 of the Companies Act. as mentioned above. customer satisfaction.A. none of the directors are relatives of any other director None of the non-executive directors hold any equity shares in the Company.

1956. counsel and support. (c) Operations management . 2008 47 b) The independent director must not be disqualified from being appointed as director in terms of Section 274 and other applicable provisions of the Companies Act. systems and policies. c) The minimum age for independent directors is 25 years and the maximum age is 70 years. 2007 January 29 and 30.by the Board of directors. each of which is interlinked in the following manner: (a) Strategic supervision and direction . Subject to re-appointment at annual general meetings. The corporate governance structure of the Company is multi-tiered. • Tenure for the chairmanship of HR committee is two terms of two years each. which exercises independent judgment in overseeing management performance on behalf of the shareowners and other stakeholders and hence plays a vital role in the oversight and management of the Company. (without the presence of any executive directors or representatives of management) to discuss and form an independent opinion on the agenda items and other board related matters. Number of Board meetings During the year 2007-08. Independent directors The Board has adopted a comprehensive policy on independent directors that sets out the criteria of independence. Meetings are generally held in New Delhi. It also allows us to maintain our focus on the organizational DNA and current and future business strategy. concentrating on assessing emerging technological trends and achieving consensus on future technology initiatives and action plans. The President & CEO. • Undertake such other assignments as may be requested by the Board from time to time. recommended tenure. • Tenure of lead independent director shall be two terms of two years each. whichever is later. The policy emphasises the importance of independence and states that an independent director shall not have any kind of relationship with the Company that could influence such directors' position as independent director. remuneration. As per the policy: a) The independent director must meet the baseline definition and criteria on "independence" as set out in Clause 49 of the Listing Agreement and other regulations. f) g) The tenure of independent directors on board committees will be as follows : • Tenure for the chairmanship of audit committee is two terms of three years each. from the independent directors to the effect that they qualify the test of independence as laid down under Clause 49 of the Listing Agreement. The team owns and drives company-wide processes. (b) Control and implementation . d) The independent directors will be appointed on at least one committee but not more than two committees of the Board. focused on enhancing the efficiency and effectiveness of the respective businesses. • Provide objective feedback of the independent directors as a group to the Board on various matters including agenda and other matters relating to the Company.Enterprises who serve as internal consultants in providing strategic direction. Our governance structure helps in clearly determining the responsibilities and entrusted powers of each of the business entities. In addition. and (d) Technology management . The calendar for the Board and committee meetings as well as major items of the agenda are fixed in advance for the whole year.by the Airtel Management Board (AMB).by the Airtel Technology Council. The AMB also functions as a role model for leadership development and as a catalyst for imbibing customer centricity and meritocracy in the culture of the Company. comprising governing boards at various levels. the Presidents of the three SBUs and the functional directors are members of the Airtel Management Board. the Company also ensures that the directors meet the above eligibility criteria. For incumbents who are in their third term. Bashir Currimjee has been designated as the lead independent director. e) It is recommended as a general principle that the independent director should not be a director on board of more than six public listed companies. All such declarations are placed before the Board for information. Meeting of independent directors and lead independent director All independent directors meet separately prior to the commencement of every board meeting. The role of the lead independent director is to: • Preside over all deliberation sessions of the independent directors. on following dates: • • • • April 26 and 27. 2007 July 25 and 26. as amended from time to time. thus enabling them to perform those responsibilities in the most effective manner. The AMB meets monthly and takes decisions relating to the OneAirtel business strategy and looks at achieving operational synergies across business units. 2008. the term will be until completion in the normal course or three years from January 1. and other related terms. The time gap between two meetings was not more than 4 months. We have adopted a practice of taking self-declaration annually and at the time of appointment. besides enabling effective delegation of authority and empowerment at all levels. the Board met four times. tenure for independent directors is three terms of three years each. Board meetings are held in the month . age limits.by the Management Boards of the three SBUs assisted by their respective Hub or Circle Executive Committees (ECs) for day-to-day management and decision making. 2007 October 30 and 31. membership of committees.

• Minutes of meetings of the Board and board committees. • Update on Corporate Social Responsibility activities. additional or supplementary item(s) on the agenda are permitted to be taken up as 'any other item' but only by exception. • Details of any joint venture or collaboration agreement. • Disclosures received from directors. All employees are expected to confirm compliance to the code annually. • Quarterly compliance certificates with the 'Exceptions Reports' which includes non-compliance of any regulatory. if any. • Quarterly treasury reports including details of foreign exchange exposures and the steps taken by management to limit the risks of adverse exchange rate movement. A declaration signed by the Chief Executive Officer (CEO) regarding affirmation of the compliance with the Code of Conduct by board and senior management is appended at the end of this report. Mr. The audit. subsidiaries. prepares the agenda of the Board and committee meetings. To ensure an immediate update to the Board. Constitution and charter of the Board committees is also available on the website of the Company at www. and to focus effectively on the issues and ensure expedient resolution of the diverse matters. prior to the Board meeting. if material. brand equity or intellectual property. The President & CEO. • Material important show cause. • Related party transactions. • Human resource updates and strategies. • Any issue which involves possible public or product liability claims of substantial nature. we invite proposals from independent directors for discussion/ deliberation at the meeting(s). in consultation with the Chairman. statutory nature or listing requirements and shareholders service. • Any material default in financial obligations to and by the Company or substantial non-payment for services provided by the Company.bhartiairtel. Before every board meeting. which is not in the normal course of business. N. The Chairman of the audit committee. the SEBI Regulations. • Proposals requiring strategic guidance and approval of the Board. The above information is generally provided as part of the agenda papers of the Board meeting and/or is placed at the table during the course of the meeting. dangerous occurrences.in The details of the committees constituted by the Board are given below: Audit Committee Our audit committee comprises of six members. HR and ESOP compensation committee meetings are held on the same dates as board meetings. resolutions passed by circulations and minutes of the meeting of the Board of subsidiary companies. if any. Kumar is an independent director and has sound financial knowledge as well as many years of experience in general management. • Transactions involving substantial payment towards goodwill. the Board has constituted a set of committees with specific terms of reference and scope. The Company Secretary. • Quarterly results for the Company and its operating divisions or business segments. The information regularly supplied to the Board specifically includes: • Annual operating plans. of investments. Sensitive subject matters may be discussed at the meeting without written material being circulated in advance. Joint Managing Director and President & CEO at senior management level. The committees operate as empowered agents of the Board as per their charter/terms of reference. The Code is applicable to all the Board members and direct reportees of the Chairman and Managing Director. which is also available on the website of the Company (www. In special and exceptional circumstances. capital budgets and updates therein. The detailed agenda is sent to the Board members at least a week before the Board meeting. • Information on recruitment/remuneration of senior officers just below board level. Our audit.following each quarter in the manner that it coincides with the announcement of quarterly results. The majority of the 48 .Finance and other senior management members are invited to the Board meetings to present reports on the items being discussed at the meeting. and to all our employees. any material effluent or pollution problems.bhartiairtel. Regular training programs are conducted by senior management across locations to explain and reiterate the importance of adherence to the code. if any. Information available to the Board The Board has complete access to all the relevant information within the Company. Two-thirds (4) of the members are independent directors. BOARD COMMITTEES In compliance with the Listing Agreements (both mandatory and non-mandatory). • Sale of material nature. demand. • Report on action taken on last board meeting decisions. The Code is circulated annually to all the Board members and senior management and the compliance of the same is affirmed by them annually. prosecution notices and penalty notices. Corporate Director . • Significant transactions and arrangements by the subsidiary companies. In addition to the Code of Conduct for the Board members and senior management. assets. the Company has also laid down a Code of Conduct for all the employees of the Company. • Regular business updates. Code of Conduct The Board has laid down a Code of Conduct for all directors and senior management personnel of the Company. all of whom are non-executive.in). The items suggested by the members are included in the agenda of the meeting. the Chairman of the respective committee briefs the Board about the proceedings of the respective committee meeting. HR and ESOP compensation committee meetings are held on the same day of the Board meeting. • Fatal or serious accidents. as a process.

Chief Financial Officer. attendence and compostion of Audit Committee During the financial year 2007-08. Internal auditors are also invited to present their views on risk management. performance of statutory and internal auditors. shareholders (in case of non payment of declared dividends) and creditors. as may be assigned by the Board of directors from time to time or as may be stipulated under any law. Approval of all related party transactions. if any. The Company Secretary is the secretary to the Committee. The appointment. 1956. Meetings. the quarterly financial statements before submission to the Board for approval. when considered necessary. 2007 and January 29. including any exceptions to these compliances. • Recommending to the Board. Time gap between any two meetings was less than four months. Compliance with listing and other legal requirements relating to financial statements. • Reviewing the findings of any internal investigations by the internal auditors into matters where there is suspected fraud or irregularity or a failure of internal control systems of a material nature and reporting the matter to the Board.e. if any. . debenture holders. rule or regulation including the Listing Agreement and the Companies Act. Such other function. In addition. statutory auditors and the internal auditors are permanent invitees. October 30. Director Internal Assurance. in accounting policies and practices and reasons for the same. Corporate Director . July 25. 49 – – – – – – – – – – – – Powers of the Audit Committee • Investigate any activity within its terms of reference and to seek any information it requires from any employee. reappointment and. with the management. availability and deployment of resources to complete their responsibilities and performance of the out-sourced audit activity. • Discussion with internal auditors with respect to the coverage and frequency of internal audits as per the annual audit plan. internal auditors and the determination of their audit fees. other senior management members are also invited to the committee meetings to present reports on the respective items being discussed at the meeting from time to time. removal and terms of remuneration of the chief internal auditor. • Reviewing the adequacy of internal audit function including the structure of the internal audit department. Quarterly compliance certificates confirming compliance with laws and regulations. The composition of the audit committee meets the requirements of Section 292A of the Companies Act. with the management. if required. with the management. • Obtaining an update on the Risk Management Framework and the manner in which risks are being addressed. which form part of the Board's report in terms of clause (2AA) of section 217 of the Companies Act. if any made by the unlisted subsidiary companies. • Discussion with statutory auditors before the audit commences. Key responsibilities of the audit committee • Oversight of the Company's financial reporting process and the disclosure of its financial information to ensure that the financial statements are true and accurate and provide sufficient information.audit committee members. which are not in the normal course of business or the transactions which are not at arms' length price. The President & CEO. • Reviewing the following: – – Management discussion and analysis of financial condition and results of operations. including the Chairman. • Reviewing. • Reviewing. staffing and seniority of the official heading the department. Management letters/letters of internal control weaknesses issued by the statutory auditors. the appointment. annual financial statements before submission to the Board for approval. Statement of related party transactions with specific details of the transactions.Finance. 1956. the audit committee met four times i. • Reviewing. Major accounting entries involving estimates based on the exercise of judgment by management. with particular reference to: – Matters required to be included in the directors' responsibility statement. Changes. 2007. 2008. the Committee invites head of one of the functions to make a brief presentation on action plans to improve the level of internal control. Internal audit reports relating to internal control weaknesses. • Review the reasons for substantial defaults in the payment to the depositors. 1956 and revised Clause 49 of the Listing Agreement. in particular the investments. nature of significant findings and follow up there on. Significant adjustments made in the financial statements arising out of audit findings. adequacy of the internal control systems. 2007. Qualifications in the draft audit report. • Reviewing the functioning of the whistle blower mechanism and the nature of complaints received by the Ombudsman. To ensure proper internal control at each audit committee meeting. • Approval of payment to statutory auditors for any other services rendered by the statutory auditors. The financial statements. have accounting and financial management expertise. about the nature and scope of audit as well as post-audit discussion to ascertain any area of concern. on April 26. the replacement or removal of the statutory auditor. • Obtain legal or other independent professional advice and to secure the attendance of outsiders with relevant experience and expertise.

The statutory auditors are responsible for performing an independent audit of the Company's financial statements in accordance with the Indian GAAP (generally accepted accounting principles) and for issuing a report thereon. are given below: Member director N Kumar.f. April 26. Category Independent director Executive director Non-executive director Non-executive director Non-executive director Non-executive director Independent director Independent director Independent director Independent director Independent director Number of meetings attended 4 1 1 3 Nil 3 4 4 1 4 1 statements are fairly presented in conformity with Indian GAAP in all material aspects. Ceased to be a member of the Committee w.f. 2007. 2.f June 25. July 25. June 1. April 24. 50 • • Meetings. (Chairman) Akhil Gupta1 Chua Sock Koong2 Francis Heng3 Gavin John Darby4 Rakesh Bharti Mittal5 Ajay Lal Arun Bharat Ram Bashir Currimjee1 Pulak Chandan Prasad Syeda Imam6 1.e. In conclusion.f. 2008.e. In this regard the Committee discussed with the Company's internal auditors and statutory auditors the overall scope and plan for their respective audits.e. on April 26. of which three members. 6. attendance and composition of HR Committee During the year 2007-08. 2007 and January 29. April 26.e. incentives/benefits bonuses.e. 5.e. 2008 To the shareholders of Bharti Airtel Limited: Two-third of the Audit Committee members are independent directors. Ceased to be a member of the Committee w. July 25. Batliboi and Associates. The management presented to the Committee the Company's financial statements and also affirmed that the financial statements had been drawn up in accordance with the Indian GAAP. the Committee met four times i. we have a remuneration committee known as the HR committee. The Committee also discussed the results of their examinations. In conducting such reviews. Other senior management members are also invited to the committee meetings to present reports on the items being discussed at the meeting. The Company Secretary acts as the secretary of the Committee. the HR Committee also oversees the functions related to human resource matter of the Company. according to the definition laid down in Clause 49 of the Listing Agreement with the stock exchanges. internal controls and governance processes. The Company also has in place an Internal Assurance Group responsible for reviewing all the operations of the Company to evaluate the risks. 2007. 2008 New Delhi HR Committee N Kumar Chairman. 2007. 2007. Key responsibilities of the HR Committee Besides remuneration packages and other benefits of the executive directors. Key responsibilities of HR committee include the following: • • • Recruitment and retention strategies for employees. All human resource related issues. The composition of the committee and attendance of members at the meetings held during . Ceased to be a member of the Committee w. Appointed as member of the Committee w. 2007. stock options) and performance targets for the Chairman and Managing Director and Joint Managing Director. The Committee has recommended to the Board the reappointment and fees of M/s S. Chartered Accountants. 2007. Appointed as member of the Committee w. 2007. The Group Director HR is a permanent invitee. October 30. the Audit committee believes that the Company's financial In compliance with the non-mandatory requirements of Clause 49 of the Listing Agreement. 3. the Chairman of the Committee are independent directors. The Audit committee is responsible for ensuring the proper discharge of the above noted responsibilities of management and auditors. the Committee is sufficiently satisfied that it has complied with the responsibilities as outlined in the Audit committee's charter. Other key issues/matters as may be referred by the Board or as may be necessary in view of Clause 49 of the Listing Agreement or any statutory provisions.f. including Kurt Hellstrom. 2007.R. The Committee comprises of five non-executive directors. Gurgaon as statutory auditors of the Company. the Committee found no material discrepancy or weakness in the internal control systems of the Company. Employee development strategies. It is also responsible for overseeing the processes related to the financial reporting and information dissemination. 4.e. The Committee has also reviewed the internal controls put in place to ensure that the accounts of the Company are properly maintained and that the accounting transactions are in accordance with prevailing laws and regulations. Ceased to be a member of the Committee w.f July 25. Audit Committee Audit Committee report for the year ended March 31. Management is responsible for the Company's internal controls and financial reporting processes.The composition of the Committee and attendance of members at the meetings held during the financial year 2007-08. Based on its review and discussions conducted with the management and the statutory auditors. Compensation (including salaries and salary adjustments. their evaluation of the Company's internal controls and the overall quality of financial reporting.

000 21.537.665 100.584 150. are finalised at the beginning of the year for the Chairman and Managing Director and Joint Managing Director.175 194.446. the performance-linked incentives paid to the executive directors is based on the performance of the individual directors.750. based on the balance score card.973 99.147 759.127 49.f April 24.e. a commission.704.750 19.450 3.800* 174. 4.063 770. Rajan Bharti Mittal as Joint Managing Director relates to the financial year 2006-07 prior to relinquishment of his position as JMD on 1 April 2007. therefore. 2006 approved a policy on all payments including sitting fees. Name of director Sitting fees Salary and allowances Performance linked incentive 108. Ceased to be the Chairman of the Committee w. Appointed as member of the Committee w.000 99. The non-executive directors representing the key shareholders namely Bharti Telecom Limited and Singtel are not entitled to any remuneration or reimbursement of any expenses in line with the shareholders' agreements executed amongst themselves.A. Raju Total • 100. These are based on the approval of the shareholders obtained though postal ballot. Appointed as member of the Committee w.S.f April 25. • • • • The salary and allowance includes Company's contribution to the Provident Fund. together with performance indicators for each of these.Joint Managing Director is recommended by the HR Committee and approved by the Board of Directors within the limits approved by the shareholders.e.800 1. not exceeding 1% of the net profit of the Company for the year calculated as per the Companies Act.980 27. Further. the amount pertaining to directors is not ascertainable and.563 - 195.514.923. Performance Linked Incentive paid to Mr. 2008 and member of Committee w. the key result areas.f July 25.Chairman and Managing Director and Akhil Gupta .049.175 10.665 99. 1956 is also payable to the nonexecutive independent directors.293.943. 2007.829 859.140. 6.425 759. are given below: Member director Kurt Hellstrom1(Chairman) Paul Donovan2 Paul O'Sullivan Rajan Bharti Mittal3 Bashir Currimjee3 Donald Cameron4 Mauro Sentinelli5 V.000 99. No notice period or severance fee is payable to any director. 2008. commission. 2. 1 Independent director Non-executive director Non-executive director Non-executive director Independent director Independent director Independent director Independent director The performance targets i. i.the financial year 2007-08. duly approved by the shareholders.728 870. not included.902.665 20.e.147 470. Compensation of nonexecutive independent directors is linked with the number of meetings attended by the respective director during the year. April 25. 5.175 276. At the end of the year. 2008.e. 2007 Remuneration policy for directors The remuneration paid to the executive directors.079 113.000 738.223 2. While the fixed pay is paid to the directors on a monthly basis.000 20.968 86.250 1.446.175 174. 2008 Ceased to be the member of the Committee w. Ceased to be a member of the Committee w. . 2007. The Board of directors in their meeting held on January 23-24.120.f April 24. There are no other contracts with any other director.071 51 * Includes commission for the financial year 2006-2007.e . 3.800 1. Category Number of meetings attended 4 Nil 4 3 3 4 N.000 100.614.f.e. e.465 19.425 859.e.425 866.604. Remuneration to Directors Details of the remuneration paid by the Company to all directors during the last financial year is as under: Perquisites Commission Stock options Total Appointed as Chairman of the Committee w.043. Raju6 1. June 1. 1961.584 194. the HR Committee evaluates the performance of each of these senior executives against the targets set and recommends the performance linked incentive for each of them to the Board for payment.Kumar Paul O'Sullivan Pulak Chandan Prasad Rajan Bharti Mittal Rakesh Bharti Mittal Syeda Imam V.S.950. f. Liability for grauity and leave encashment is provided on acturial basis for the Company as a whole.e. reimbursement of expenses etc. The above payments were subject to applicable laws and deduction of tax at source The Company has entered into contracts with the executive directors each dated October 3. The value of the perquisites is calculated as per the provisions of the Income Tax Act.425 766. when the results are announced.f July 19. Sunil Bharti Mittal . The remuneration of executive directors has two components: fixed pay and variable pay (performance linked incentive). The independent non-executive directors are paid sitting fees within the prescribed limits for attending the Board/ Committee meetings.059 470.908. to independent directors.115 4.334 Executive director Sunil Bharti Mittal Akhil Gupta Non-executive director Ajay Lal Arun Bharat Ram Bashir Currimjee Chua Sock Koong Donald Cameron Francis Heng Kurt Hellstrom N. 2006.

e. Mr. 2007.e. – the procedure for making a fair and reasonable adjustment to the number of options and to the exercise price in case of rights issues. October 3. – the right of an employee to exercise all the options vested in him at one time or at various points of time within the exercise period. 2007 Investors' Grievance Committee In compliance with the Listing Agreement requirements and provisions of the Companies Act. Key responsibilities of the ESOP Compensation Committee: Key responsibilities of ESOP compensation Committee include the following: • To formulate ESOP plans and decide on future grants.S. 6. • To approve and effect transmission of shares arising as a result of death of the sole/any one joint shareholder.A.f.e. Rajan Bharti Mittal is a nonexecutive director. 2007. July 25. Raju6 1. on April 12. non-executive director is the Chairman of the Committee. April 25. Meetings. Rakesh Bharti Mittal. • Other key issues as may be referred by the Board. constituted in accordance with SEBI (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines. 2008. which are constrained by legal impediments/procedural issues. 2007. Key responsibilities of the Investor Grievance Committee The key responsibilities of the Investor Grievence Committee include the following: • Redressal of shareholders and investor complaints e.f July 25. 2007. 2007. Ceased to be member of ESOP compensation committee w. and – the procedure for cashless exercise of options. • To formulate terms and conditions on followings under the present two Employee Stock Option Schemes of the Company: – the quantum of option to be granted under ESOP Scheme(s) per employee and in aggregate. May 15. 2007. non receipt of balance sheet etc.f July 19. do not include complaints/requests. – the grant. 1999. f. 2008. three of whom are independent. Appointed as member of ESOP compensation committee w. are given below: Member director Category Number of meetings attended 3 3 Nil 3 4 4 N. 1 Rajan Bharti Mittal1 (Chairman) Paul O'Sullivan2 Rakesh Bharti Mittal3 Bashir Currimjee2 Donald Cameron4 Kurt Hellstrom Mauro Sentinelli5 V. These. The meetings of the Committee are generally held on monthly basis. The Company Secretary acts as the secretary of the Committee. Meetings. April 25. 2007 October 30. which may be relevant for administration of ESOP schemes from time to time.e. 2007. 2007 and January 29. the Committee met seven times i.e.e . – the conditions under which options vested in employees may lapse in case of termination of employment for misconduct. The Chairman of the Committee. Ceased to be member of ESOP compensation committee w. 1956. 2007. the Committee met four times i. bonus issues and other corporate actions. Appointed as member of the ESOP compensation committee w. The Company Secretary acts as the secretary of the Committee. July 25. Ceased to be member of the ESOP compensation committee w. 2. • Issue of duplicate share certificates in place of original certificate. which may be lost/ torn/mutilated. • Formulation of procedures in line with the statutory guidelines to ensure speedy disposal of various requests received from shareholders from time to time.ESOP compensation committee The ESOP compensation committee of the Board. July 05. 1995.e. Group Director HR is a permanent invitee. 1992 and Securities and Exchange Board of India (Prohibition of Fraudulent and Unfair Trade Practices relating to the Securities Market) Regulations. attendence and composition of Investor Grievance Committee During the year 2007-2008. 4.f July 25. – any other matter. 3. 2008 and 52 .e . to review and ensure that all investor grievances are redressed within a period of 7-10 days from the date of receipt of complaint. transfer of shares. The Committee comprises of three members. • To frame suitable policies and systems to ensure that there is no violation of Securities and Exchange Board of India (Insider Trading) Regulations. – the specified time period within which the employee shall exercise the vested options in the event of termination or resignation of an employee. the Company has constituted an Investor Grievance Committee. January 7. 2007.g. 5. 2008. however. – the exercise period within which the employee should exercise the option and that option would lapse on failure to exercise the option within the exercise period. August 9. attendence and composition of ESOP compensation committee During the year 2007-2008. The composition of the committee and attendance of members at the meetings held during the financial year 2007-08. Non-executive director Non-executive director Non-executive director Independent director Independent director Independent director Independent director Independent director Appointed as member and Chairman of the ESOP compensation committee w. on April 26. demat/ remat of shares. vest and exercise of option in case of employees who are on long leave. comprises of five non executive members.f.

. Ms. are given below: Member director Category Number of meetings attended 7 7 7 exchanges from time to time on various markets related matters. Details of the investors' complaints as on March 31. the following special resolutions were passed in the AGM held on September 6.officer@bharti. paid-up capital and free reserves) exceeds 20% of the consolidated turnover or net worth respectively. all these complaints/queries were resolved to the satisfaction of investors. 2006. c) Amendments in the Articles of the Company consequent upon reduction in shareholding of one of the strategic shareholders. These committees have been constituted to cater to the various day-to-day requirements and to facilitate the seamless operation of the Company. To redress investor grievances. Kiran Sharma. the complaints received by the Company were general in nature. borrowing committee. Group General Counsel and Company Secretary were appointed as persons responsible for the postal ballot voting process. 2005 Time 1530 Hrs. Nature of complaints and redressal status During the past financial year.e. the allotment committee. (IST) 1530 Hrs. Joint Managing Director and Vijaya Sampath. we have passed two special resolutions through postal ballot. annual reports. However. incorporated in India. viz. the Company has various other functional committees viz. As on date. 2007 and August 21. Independent non-executive director of the Company has been nominated by the Company as an independent director on the Board of Bharti Infratel Limited in compliance with the Clause 49(III)(i) of the Listing Agreement with the stock exchanges and will be appointed at the next board meeting of Bharti Infratel Limited. (IST) 53 Special resolutions passed at the last three AGMs No special resolutions were passed in the AGMs held on July 19. compliance. etc. New Delhi Air Force Auditorium. Subroto Park. of the listed holding company and its subsidiaries in the immediately preceding accounting year. 2007 August 21. Bharti Infratel Limited is a material non-listed Indian subsidiary as defined under Clause 49 of the Listing Agreement. b) Applicability of ESOP scheme 2005 to the employees of holding and subsidiary Companies. Subsidiary Companies Clause 49 defines a 'material non-listed Indian subsidiary' as an unlisted subsidiary. Sharma conducted the process and submitted her report to the Chairman and Managing Director. Group General Counsel and Company Secretary acts as Compliance Officer of the Company for complying with the requirements of the Listing Agreement with the Stock Exchanges and requirements of SEBI (Prohibition of Insider Trading) Regulations. N Kumar. 2005: a) Approval of the ESOP scheme 2005. Minutes of meetings of these committees are placed before the Board on quarterly basis. whose turnover or net worth (i. The constitution of these committees has been duly approved by the Board. Practicing Company Secretary was appointed as scrutinizer for the postal ballot voting process. 2008 The composition of the Committee and attendance of members at the meetings held during the financial year 2007-08. investment committee. 2006 September 6. Brentwood Investment Holdings Limited. 1992. of Complaint Received Redressed Pending 13 7 16 1 37 13 7 16 1 37 Nil Nil Nil Nil Nil Non-receipt of shares Non-receipt of annual report Non-receipt of dividend warrants Miscellaneous TOTAL The above table does not include the responses furnished by the Company on clarifications sought by stock Financial Year 2006-2007 2005-2006 2004-2005 Location Air Force Auditorium. New Delhi Air Force Auditorium. 2008 are as follows: Type of complaint No. which include issues relating to non-receipt of shares. Other committees In addition to the above committees. Subroto Park. (IST) 1530 Hrs. Subroto Park. the Company has a dedicated e-mail ID. New Delhi Date July 19. Postal ballot and postal ballot process During the previous year.in to which investors may send complaints. GENERAL BODY MEETINGS The last three Annual General Meetings were held as under: Rakesh Bharti Mittal (Chairman) Non-executive director Rajan Bharti Mittal Non-executive director Akhil Gupta Executive director Compliance Officer Vijaya Sampath.March 4. A detailed procedure followed by the Company is provided hereunder: Person conducting the postal ballot exercise Akhil Gupta. committee of directors.

As per the legal advice received by us.195. on a quarterly basis in terms of Clause 49(IV)(A) and other applicable laws for approval.396.195. for the financial year ended March 31. we believe that in case of difference between the provisions of an Act and Rules made there under.0018%) Publication of Result of Postal Ballot The results of the postal ballot were published in Business Standard.143 (100%) 1. The draft resolution.105 (99.289 (99. . and profit after taxes for the year lower by Rs. Financial Express (English Daily) and Jansatta (Hindi newspaper) and were also placed at the website of the Company at www. The date of declaration of the results of the postal ballot was taken as the date of passing of the special resolutions. liquidity and capital resource of subsidiary and associates. 894. so as to reach the Scrutinizer on or before close of business hours on Wednesday.195. 57. respectively. As per legal advice received. business restructuring reserve would have been lower by Rs. The results of the postal ballot were published in the newspapers within 48 hours of the declaration of the results and also placed at the website of the Company at www.9982%) 1. together with the explanatory statement and the postal ballot forms and self-addressed envelopes were sent to the members and others concerned under certificate of posting. the value of investments. this Reserve was utilised to write off losses on transfer of Telecom Infrastructure Undertaking. b) AS 13 on Accounting of Investment and AS 10 on Accounting for Fixed Assets. which is at variance to the treatment prescribed in Accounting Standard (AS-11) “Effect of Changes in Foreign Exchange Rates” notified in the Companies (Accounting Standard) Rules 2006 dated December 7.in DISCLOSURES Disclosure on materially significant related party transactions The required statements/disclosures with respect to the related party transactions.Procedure followed (i) The Company issued the postal ballot notice dated July 25. 2008 there were no material individual transactions with related parties or others. we have revalued Bharti Airtel Ltd. Had the treatment as prescribed by the AS11 been followed.005 thousand which under the scheme were offset by transfer of an equivalent amount from Business Restructuring Reserve.181. This treatment was mandated and formed an integral part of the scheme of arrangement. 2007 October 27. The related party transactions have been disclosed under Note 24 of Schedule 21 forming part of the annual accounts.412.203 thousand and Rs.198 thousand. which were not on an arms' length basis. 2007.412. (the Scrutinizer) submitted her report on Friday October 26. bhartiairtel.390. 2007. for amendment in ESOP Scheme I and ESOP Scheme 2005 of the Company. 1956.854 (0.in (ii) (v) Details of voting pattern After scrutinizing all the ballot forms received. bhartiairtel. Kiran Sharma. The related party transactions are entered into based on consideration of various business exigencies such as synergy in operations. the net profit after tax would have been higher by Rs.038 (0. the Company should comply with the provisions of the Companies Act. 2007 Particulars of the resolutions passed Amendment in ESOP Scheme I Amendment in ESOP Scheme 2005 Total valid votes 1. 2006. 24. Members were advised to read carefully the instructions printed on the postal ballot form and return the duly completed form in the attached selfaddressed envelope. investment in Bharti Infratel Ltd. Disclosure of Accounting Treatment We have complied with all the applicable accounting standards except : a) AS11 on Effects of Changes in the Foreign Exchange Rates. 1956. we have continued 54 with our accounting policy to adjust foreign exchange fluctuation on loans/liability for fixed assets as per the requirement of Schedule VI of the Companies Act.946 thousand. 2007. October 24. October 27. the scrutinizer reported as under: (iii) Date of declaration of results October 27. Had we followed the treatment prescribed under AS 13 & AS 10 instead of accourting as per the above Scheme. 2007. (iv) The results of the postal ballot were declared on Saturday. After due scrutiny of all the postal ballot forms received up to the close of working hours on October 24. The Company's major related party transactions are generally with its subsidiaries and associates. Practicing Company Secretary.143 (100%) In favour(%) 1.390.9982%) Against(%) 21. at fair value and transferred the difference between book value and fair value of investment to “Reserve for Business Restructuring”. 2007. 82. 785.195. are placed before the audit committee as well as to the Board of directors. sectoral specialization. Further. Ms.0018%) 22. In compliance with the Scheme of Arrangement approved by the Hon’ble High Court of Delhi under section 391 to 394 between Bharti Airtel Limited and Bharti Infratel Limited.

non-GAAP information. which may involve both internal and external investigative bodies. CEO and CFO certification The certificate required under Clause 49(V) of the Listing Agreement duly signed by the CEO and CFO was placed before the Board and the same is provided as annexure A to this report.sebiedifar. the statutory auditors of the Company and the same is attached to the Directors' report. Up-to-date financial results. 55 . the Ombudsman constitutes a meeting of the code compliance committee to undertake a full investigation. viz. Compliance with the mandatory requirements of Clause 49 of the Listing Agreement We have complied with all the mandatory requirements of corporate governance as stipulated under the Listing Agreement. Financial Express and Jansatta (vernacular newspaper) and are also posted on our website. financial analysis reports. In addition. • Compliance with the ICSI Secretarial Standards The Company has substantially complied with the applicable Secretarial Standards as laid down by the Institute of Company Secretaries of India. Chartered Accountants. Depending on the gravity of the concern.in.R. • Shareholders' Rights and Auditors' Qualification The Company has a policy of announcement of the audited quarterly results. ratio analysis. Any specific presentation made to the analysts/others is also posted on the website.Details of non-compliance with regard to the capital market There have been no instances of non-compliances by us and no penalties and/or strictures have been imposed on us by stock exchanges or SEBI or any statutory authority on any matter related to the capital markets during the last three years. key industry and company developments. The Earnings Calls are webcast live and transcripts are posted on the website. we disseminate the results to the media by way of press release. none of the auditors' reports were qualified. are posted on SEBI's EDIFAR System and can be viewed on www. Adoption of non-mandatory requirements of Clause 49 of the Listing Agreement The Company had adopted the following non-mandatory requirements of Clause 49 of the Listing Agreement: • Remuneration Committee We have an HR Committee of the Board of directors.bhartiairtel. Once taken on record by the Board of directors. The Corporate Ombudsman administers a formal process to review and investigate any concerns raised. MEANS OF COMMUNICATION The quarterly audited results are published in prominent daily newspapers. Batliboi and Associates. which is also broadcast live on the Company's website. and undertakes all appropriate actions required to resolve the reported matter. The results approved by the Board of Directors (or Committee thereof) are first submitted to the stock exchanges within 15 minutes of the approval of the results. The quarterly reports are posted on our website and are also submitted to the stock exchanges where the shares of the Company are listed. We have obtained a certificate affirming the compliances from S. we have adopted a practice of releasing a quarterly report. Business Standard. shareholding patterns etc. an Earnings Call is organised where the investors/analysts interact with the management and the management respond to the queries of the investors/analysts. Members of this committee comprise the Ombudsman as convener.Internal Assurance and Group Director HR and the Group General Counsel and Company Secretary. official news releases. discussion with the management team is webcast and also aired in the electronic media. • Ombudsman Policy We have adopted an Ombudsman Policy (including Whistle Blower Policy). During the previous financial year. which outlines the method and process for stakeholders to voice genuine concerns about unethical conduct that may be in breach of the • Code of Conduct for employees. At the end of each quarter we organize an Earnings Call with analysts and investors. summarized US GAAP financial statements etc.nic. annual reports. the Director . On the day of announcement of our quarterly results. latest presentation made to the institutional investors and other general information about the Company are available on the Company's website www. without any fear of retaliation or victimization. Quarterly and annual financial statements of the Company. Since the time of listing of shares. shareholding patterns. No employee of the Company has been denied access to Ombudsman. A detailed note on the HR (remuneration) Committee has been provided in the 'Board Committees' section of this report. Instances of serious misconduct dealt with by the Ombudsman and the code compliance committee are reported to the audit committee.in. Memorandum and Articles of Associations The updated Memorandum and Articles of Association of the Company is uploaded on the website of the Company in the Investor Relations section. results of operations. and the transcript is posted on the website soon after. The policy aims to ensure that genuine complainants can raise their concerns in full confidence. which contains financial and operating highlights. stock market highlights.

00 834.400001 Paid as applicable In addition.com Bharti Share Price VS NSE Nifty Bharti Share Price Vs BSE Sensex .00 1063.30 p.00 1010. stock code and listing fee payment Name and address of the stock exchange National Stock Exchange of India Limited Phiroze Jeejeebhoy Towers Dalal Street.00 1069.400001 Scrip code Status of fee paid BHARTIARTL Paid as applicable Financial Calendar (Tentative Schedule. 2008 September 30.m. Dividend : Stock market data for the period April 1. 532454 Exchange Plaza C-1 Block G Bandra Kurla Complex.com Source : www.00 901. Air Force Auditorium.90 946.00 801.00 903. Friday January 22. 2009.80 845.80 Volume (Nos.00 945.bseindia.20 1074. 2007 to March 31. Thursday July 26. Singapore.00 899. Bandra (E). 2008 December 31.110 010 Equity shares listing. 2008 Friday 3.00 858.00 868. Friday April 30. 2008.00 1184.50 894.) 24556891 22502477 16640413 23325243 23646936 19996175 93762472 92488875 64339414 88986624 47563417 62556728 High 899. 2009.00 908. 2008.90 959.45 985. 2008. Mumbai . Subroto Park. New Delhi .55 BSE Low 726. Saturday August 1.00 772. subject to change) Financial year Results for the quarter ending June 30.GENERAL SHAREHOLDERS' INFORMATION 13th Annual General Meeting Date Day Time Venue : : : : August 1.80 801. Thursday October 31.nseindia.05 701.00 790.00 700. 2008 March 31. 2008.90 960.00 1025.00 807.) 4713956 4770323 2747485 6257862 5391542 4333526 15130286 15946824 8038103 14582829 5511899 8735855 56 Source : www.70 1010.15 828.00 835. Friday (Both days inclusive) Nil The Bombay Stock Exchange Limited.05 867.00 806.00 790. 2008 Book Closure : April 1 to March 31 : : : : : July 24.00 894.20 Volume (Nos.25 706.00 1149.50 847. The Company de-listed its shares from the Delhi Stock Exchange Association Limited (Regional) during the financial year 2003-04. the Company's Foreign Currency Convertible Bonds (FCCBs) are listed on Singapore Exchange Securities Trading Limited.00 858. Mumbai .30 750.00 985. 2008 Share price performance in comparison with NSE Nifty NSE Month Apr-07 May-07 Jun-07 Jul-07 Aug-07 Sep-07 Oct-07 Nov-07 Dec-07 Jan-08 Feb-08 Mar-08 High 882.00 Low 723.80 706.00 750.50 827.20 808.

aggregating to USD 9. The shareholders can hold our shares with any of the depository participants registered with these depositories. On March 31. convertible into 1.07 0.23 mn.05 0. National Securities Depository Limited Distribution of shareholding By number of shares held as on March 31.14 0. 1 2 3 4 5 6 7 8 Category 1 5001 10001 20001 30001 40001 100001 TOTAL By category of holders as on March 31. we issued USD 115. A copy of the certificate so received is submitted to both stock exchanges where the shares of the Company are listed. at an initial conversion price of Rs.06 2. we received six notices from different bondholders. The Bonds are convertible at any time after June 12. outstanding FCCB.314 equity shares of the Company. Dematerlisation of shares and liquidity The Company's shares are compulsorily traded in dematerialised form and are available for trading with both the depositories i.e.17 0. we obtain certificates from a practicing Company Secretary on half-yearly basis to the effect that all the transfers are completed in the statutorily stipulated period.02 0.28% shares of the Company were held in dematerialized form.13 0.37 24. which are convertible into 168. over 84. of shares %age of holding 859986028 390363150 1250349178 45. The equity shares of the Company are frequently traded at The Bombay Stock Exchange Limited and the National Stock Exchange of India Limited.100000 No.14 0. 2008.16 0.88 40612849 1222512 44892253 474252686 38391925 16251502 2325736 6177342 23431463 647558268 1897907446 2. of shareholders 165408 331 224 119 86 57 181 585 166991 (NSDL) and Central Depository Services (India) Limited (CDSL).162 equity shares.13 0.00 Total public shareholding Total shareholding . The authorised officials of the Company approve the transfer and the shares are returned to the shareholders.23 34. 2008 the Company had USD 0. Transfer of these shares is done through the depositories without any involvement of the Company.35 100. % to holders 99.99 2. due in 2009.00 No.11 0.86 0.no.28% of the equity shares of the Company are in electronic format.17 per share. of shares 14317089 2439777 3296319 2965091 3047891 2599554 13435641 1855806084 1897907446 % of shares 0. As on March 31. 2008 Sl. provided the documents are complete in all respects.33 1.per share.71 97.90 mn. 2008 Sl.20 0.000.03 0. I Category Promoter and promoter group (a) (b) II Indian promoters Foreign promoters Total promoters shareholding Public shareholding (a) Institutional investors (i) (ii) (iii) (iv) (b) Others (i) (ii) (iii) (iv) (v) Bodies corporate (Indian) Bodies corporate (foreign) Trusts NRIs/ OCBs / Foreign Nationals Indian Public and Others Mutual funds and Unit Trust of India Financial institutions and Banks Insurance companies Foreign Institutional Investors 5000 10000 20000 30000 40000 50000 above No. All transfers are first processed by the Transfer Agent and are submitted to the Company for approval thereafter. ISIN for the Company's shares is INE 397D01016. no. 2004 up to 12 April 2009 by the holders into fully paid equity shares of Rs.000 zero coupon foreign currency convertible bonds ("Bonds"). 10/. Pursuant to Clause 47(c) of the Listing Agreements.57 65.724.16 0.Share Transfer System 84. Outstanding GDRs/ADRs/warrants/options During the year 2004-05. 233.78 100. Transfers of shares in physical form are normally processed within 15 days from the date of receipt.12 0.12 100.05 0. During the year.31 20.00 57 50001 .75 0.

+91 11 46666111 Fax No. +91 11 46666111 Fax No. Vittalrao Nagar Madhapur. Senjam Raj Sekhar Vice President .senjam@bharti.ris@karvy. New Delhi 110 070 Telephone No.in Registrar and Transfer Agent Karvy Computershare Pvt.Investor Relations Bharti Airtel Limited Hotel The Grand. Vasant Kunj Nelson Mandela Road.in For Corporate Communication related matters Mr. 1-800-3454001 58 . +91 11 46666111 Fax No.in For queries relating to Financial Statements Ms.com Toll Free No. +91 40 23420814 E-mail id: einward.karvy. +91 11 46666137 Email: ir@bharti. New Delhi 110 070 Telephone No.bhartiairtel. Sonal Kapasi General Manager . Vijaya Sampath Group General Counsel and Company Secretary Bharti Airtel Limited Hotel The Grand. +91 11 46666137 Email: raj. +91 11 46666137 Email: compliance.officer@bharti. Vasant Kunj Nelson Mandela Road.in Website: www. Vasant Kunj Nelson Mandela Road.Communication addresses For Corporate Governance and other Secretarial related matters Ms.com Website: www. Plot No. Ltd.Corporate Communications Bharti Airtel Limited Hotel The Grand. 17-24. Hyderabad 500 081 Telephone No. +91 40 23420815-821 Fax No. New Delhi 110 070 Telephone No.

and (ii) (b) There are no transactions entered into by the company during the year that are fraudulent. Manoj Kohli. these statements together present a true and fair view of the company’s affairs and are in compliance with existing accounting standards.Annexure A Chief Executive Officer (CEO) and Chief Financial Officer (CFO) certificate We. to the best of our knowledge and belief hereby certify that: (a) We have reviewed financial statements and the cash flow statements for the year ended 31st March 2008 and: (i) these statements do not contain any materially untrue statement or omit any material fact or contain statements that might be misleading. President & Chief Executive Officer (CEO) and Sarvjit Singh Dhillon. if any. (c) We accept responsibility for establishing and maintaining internal controls for financial reporting and that we have evaluated the effectiveness of internal control systems of the Company pertaining to financial reporting and we have disclosed to the auditors and the Audit Committee. illegal or violative of the company’s code of conduct. (iii) Instances of significant fraud of which we have become aware and the involvement therein. 2008 Place: New Delhi Annexure B Declaration I hereby confirm that the Company has obtained from all the members of the Board and Senior Management team. 2008 Place: New Delhi Manoj Kohli President & CEO . Significant changes in the accounting policies during the year and that the same has been disclosed in the notes to the financial statements. of which we are aware and the steps we have taken or propose to take to rectify these deficiencies. Chief Financial Officer & Director Strategy of Bharti Airtel Limited. if any. 2008 For Bharti Airtel Limited 59 Date: April 24. Manoj Kohli President & CEO Sarvjit Singh Dhillon CFO & Director Strategy Date: April 24. deficiencies in the design and operations of such internal controls. of the management or an employee having a significant role in the company’s internal control system over financial reporting. affirmation of compliance with the Code of Conduct for Directors and Senior Management in respect of financial year ended March 31. applicable laws and regulations. (d) We have indicated to the auditors and the Audit Committee: (i) (ii) Significant changes in the internal control over financial reporting during the year.

records and documents of Bharti Airtel Limted (the Company) for the financial year ended March 31. registered office and the name of the Company. Requirements set out in the listing agreement with the aforementioned stock exchanges . 3. H-5/12. 1999. • The Securities and Exchange Board of India Act. Appointment. Remuneration of executive and independent directors.Secretarial Audit Report 2007. 1956 and the Rules made thereunder. Composition of the Board. 1999. 17. Mehrauli Road. retirement and resignation of directors. 18. 10. 5. in my opinion. I report that the Company has. Service of notice and agenda of board meetings and meetings of the committee of directors. Execution of contracts. Registration of transfer of shares held in physical mode. complied with the provisions of the Companies Act. New Delhi 110 030.08 The Board of directors. A. committee meetings and the annual general meeting. Bharti Airtel Limited. Passing of resolution by Postal Ballot. 1956 and the Rules made thereunder. 1997. Investment of the Company’s surplus funds. 19. returns and resolutions. 1956 and the Rules made thereunder and of the various Acts detailed above and the Rules. Obtaining the approvals for various acts of the Company. 4. affixation of common seal. Filing with the Registrar of Companies the forms. 16. Guidelines and Regulations made thereunder including: – The Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations. 14. 1992. Holding of annual general meeting and production of the various registers thereat. . Registrar and Stock Exchanges. Regulations and Guidelines made thereunder and of the Memorandum and Articles of Association of the Company. Dematerialisation and rematerialisation of shares. 6. Requirements of the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations 1997. Conferment of options and allotment of shares under the Employees Stock Option Scheme of the Company. 7. 1992 and the Rules. 8. Recording the minutes of proceedings of board meetings. 9. Meetings of the Board and its committees. – – 60 • The Listing Agreement with the National Stock Exchange and with the Bombay Stock Exchange. • The Depositories Act. appointment. 1996 and the Rules made thereunder and the bye-laws of the Depositories who have been given the requisite Certificate of Registration under the Securities and Exchange Board of India Act. 15. Qutab Ambience. Maintenance of various statutory and nonstatutory registers and documents and making necessary changes therein as and when the occasion demands. Service of the requisite documents by the Company on its members. The Securities and Exchange Board of India (Prohibition of Insider Trading Regulations). 11. with regard to: 1. Based on my examination and verification of the aforementioned records made available to me and according to the clarifications and explanations given to me by the Company. 12. 2008 in the light of the provisions contained in: • The Companies Act. 2. • The Securities Contracts (Regulation) Act. I have examined the registers. 13. The Securities and Exchange Board of India (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines. change in the appointment and remuneration of Auditors.

2008 T. Generally with regard to other requirements spelt out in the aforementioned Acts and Rules.20. membership of committees of the board of companies of which they are directors. 203 61 . declarations in regard to their other directorships. and. Regulations and Guidelines made thereunder or on its directors and officers. (ii) there was no prosecution initiated against or show cause notice received by the Company and no fine or penalties were imposed on the Company under the aforementioned Acts. Rules. Place : New Delhi Date : April 17. their shareholding and interest or concern in the contracts entered into by the Company in pursuing its normal business.V. B I further report that – (i) the directors of the Company have complied with the various requirements relating to making of disclosures. Narayanaswamy Practicing Company Secretary Certificate of Practice No. Regulations and Guidelines made thereunder.

and c) in the case of cash flow statement. 57. respectively. we enclose in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the said Order. 5.198 thousand. The relevant Indian Generally Accepted Accounting Principles in the absence of such Scheme would not permit this fair valuation or utilization of Reserves for Business Restructuring. where based on a legal opinion. Rs. on a test basis. In our opinion. 4. vi. 1956. In our opinion and to the best of our information and according to the explanations given to us. 2008 from being appointed as a director in terms of clause (g) of sub-section (1) of section 274 of the Companies Act. 57. in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India. we report that none of the directors is disqualified as on March 31. which is at variance to the requirements of Companies (Accounting Standard) Rules 2006 dated December 7. evidence supporting the amounts and disclosures in the financial statements. 24. the Company has continued with its accounting policy to adjust foreign exchange fluctuations related to purchase of fixed assets to the cost of fixed assets as per the requirement of Schedule VI of the Companies Act. These financial statements are the responsibility of the Company’s management. 2006.785. 2008 . BATLIBOI & ASSOCIATES Chartered Accountants per Prashant Singhal Partner Membership No. 82. 2008. we report that: i. Further to our comments in the Annexure referred to above. In our opinion. profit and loss account and cash flow statement dealt with by this report comply with the accounting standards referred to in sub-section (3C) of section 211 of the Companies Act. On the basis of the written representations received from the directors. 24. 2.005 thousand where the Company has followed such treatment prescribed in the Scheme of Arrangement as sactioned by Hon’ble High Court of Delhi vide order dated November 26.198 thousand as Reserve for Business Restructuring in the books of the Company and utilization of this Reserve for write off of losses on transfer of Telecom Infrastructue Undertaking Rs. Note 30 on Schedule 21. 1956. An audit also includes assessing the accounting principles used and significant estimates made by management. recognition of the difference between its book value and fair value Rs. 2007. profit and loss account and cash flow statement dealt with by this report are in agreement with the books of account. Note 2(b) on Schedule 21 to these financial statements regarding the revaluation of investments in Bharti Infratel Limited (‘BIL’) at fair value. Had the Company accounted for this as per generally accepted accounting principles instead of as per the above Scheme. the said accounts give the information required by the Companies Act. 2008. effective from January 31.396. and profit after taxes for the year lower by Rs.Standalone Financial Statements with Auditors’ Report Auditors’ Report to The Members of Bharti Airtel Limited 1. As required by the Companies (Auditor’s Report) Order. of the state of affairs of the Company as at March 31. The balance sheet. we draw attention to: a.005 thousand which under the scheme were offset by transfer of an equivalent amount from Business Restructuring Reserve.R. 1956. 2008. the balance sheet. iii.181. the value of investments. We conducted our audit in accordance with auditing standards generally accepted in India.203 thousand. 3. b. Without qualifying our opinion. We have obtained all the information and explanations. of the profit for the year ended on that date. v.:93283 Place : New Delhi Date : April 25. a) in the case of the balance sheet. as well as evaluating the overall financial statement presentation. 2008 and also the Profit and Loss account and the Cash Flow statement for the year ended on that date annexed thereto.785. 1956.396. We believe that our audit provides a reasonable basis for our opinion. An audit includes examining. of the cash flows for the year ended on that date. Those Standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. proper books of account as required by law have been kept by the Company so far as appears from our examination of those books. iv. This treatment was mandated and formed as integral part of the scheme of arrangment. ii. 2003 (as amended) issued by the Central Government of India in terms of sub-section (4A) of Section 227 of the Companies Act. and taken on record by the Board of Directors. which to the best of our knowledge and belief were necessary for the purposes of our audit. We have audited the attached Balance Sheet of Bharti Airtel Limited (‘Bharti Airtel’ or ‘the Company’) as at March 31. b) in the case of the profit and loss account. 1956. 62 For S. as on March 31. business restructuring reserve would have been lower by Rs. Our responsibility is to express an opinion on these financial statements based on our audit.

Annexure referred to in paragraph 4 of our report of even date Re: BHARTI AIRTEL LIMITED (i) (a) The Company has maintained proper records showing full particulars, including quantitative details and situation of fixed assets. (v)

come across nor have been informed of any continuing failure to correct major weaknesses in the aforesaid internal control system. (a) According to the information and explanations provided by the management, we are of the opinion that the particulars of contracts or arrangements referred to in section 301 of the Act that need to be entered into the register maintained under section 301 have been so entered (b) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of such contracts or arrangements exceeding value of Rupees five lakhs have been entered into during the financial year at prices which are reasonable having regard to the prevailing market prices at the relevant time. (vi) The Company has not accepted any deposits from the public within the meaning of Sections 58A and 58AA of the Act and the rules framed there under. (vii) In our opinion, the Company has an internal audit system commensurate with the size and nature of its business. (viii) We have broadly reviewed the books of accounts maintained by Company in respect of products where pursuant to the rules made by the Central Government for the maintenance of cost records under section 209(1) (d) of the Companies Act, 1956 and are of the opinion that prima facie, the prescribed accounts and records have been made and maintained. We have not , however, made a detailed examination of records with a view to determine whether they are accurate or complete. (ix) (a) The Company is generally regular in depositing with appropriate authorities undisputed statutory dues including provident fund, employees’ state insurance, income-tax, salestax, wealth-tax, service tax, customs duty, excise duty, cess and other material statutory dues applicable to it though there has been delays in few cases. (b) According to the information and explanations given to us, no undisputed amounts payable in respect of provident fund, employees’ state insurance, income-tax, wealth-tax, service tax, sales-tax, customs duty, excise duty, cess and other undisputed statutory dues were outstanding, at the year end, for a period of more than six months from the date they became payable. (c) According to the records of the Company, the dues outstanding of income-tax, sales-tax, wealth-tax, service tax, customs duty, excise duty and cess on account of any dispute, are as follows:

(b) The capitalised fixed assets are physically verified by the management according to a regular programme designed to cover all the items over a period of three years, Pursuant to the programme, a portion of fixed assets has been physically verified by the management during the year which in our opinion, is reasonable having regard to the size of the Company and nature of its assets. As informed, no material discrepancies were noticed on such verification. In respect of capital inventory, the management has a plan to cover all the items in the next year. (c) There was no substantial disposal of fixed assets during the year, except as mentioned in Note 2 (b) to Schedule 21 relating to Scheme of Arrangement of transfer of Telecom Infrastructure. The inventory (excluding stocks with third parties) has been physically verified by the management during the year. In our opinion, the frequency of verification is reasonable.

(ii) (a)

(b) The procedures of physical verification of inventory followed by the management are reasonable and adequate in relation to the size of the Company and the nature of its business. (c) The Company is maintaining proper records of inventory and no material discrepancies were noticed on physical verification. The Company has neither granted nor taken any loans, secured or unsecured, to companies, firms or other parties covered in the register maintained under section 301 of the Act. Accordingly, clauses (iii) of the Companies (Auditor’s Report) Order, 2003, as amended by the Companies (Auditor’s Report) (Amendment) Order, 2004 are not applicable to the Company for the current year. In our opinion and according to the information and explanations given to us, having regard to the explanation that certain items purchased are of special nature for which suitable alternative sources do not exist for obtaining comparative quotations, there is an adequate internal control system commensurate with the size of the Company and the nature of its business for the purchase of inventory, fixed assets and for the sale of goods and services. Further, on the basis of our examination of the books and records of the Company, and according to the information and explanations given to us, we have neither

(iii)

63

(iv)

Name of the statute

Nature of dues

Amount (Rs. in thousand) 411 1,130 3,213 1,388 2,797 402 14 4,999 1,035 501 320 7,733 252 500 35,000 928 150 500,275 611 750 1,927 1,069 206 75 400 650 256,302 1,992 144 825,174

Period to which the amount relates 2001-02 2002-03 2003-04 2004-05 2002-03 1996-97 1997-98 2004-05 2004-05 2003-04 2003-04 2006-07 2006-07 2003-04 2004-05 2006-07 2004-05 2006-07 2002-03 2003-04 2005-06 2006-07 2007-08 2002-03 2003-04 2004-05 2005-06 1997-98 1998-99

Forum where dispute is pending

Karnataka Sales Tax Karnataka Sales Tax Karnataka Sales Tax Karnataka Sales Tax Haryana Sales tax West Bengal Sales Tax Act West Bengal Sales Tax Act UP Trade Tax Act,1948 UP Trade Tax Act,1948 UP Trade Tax Act,1948 UP Trade Tax Act,1948 UP Trade Tax Act,1948 UP Trade Tax Act,1948 Central Sales Tax Act Central Sales Tax Act Gujarat Sales Tax Act Kerela Sales Tax Act Andhra VAT Act Punjab Sales Tax Act Punjab Sales Tax Act UP Trade Tax Act,1948 UP Trade Tax Act, 1948 UP Trade Tax Act, 1948 UP Trade Tax Act, 1948 UP Trade Tax Act, 1948 UP Trade Tax Act, 1948 Karnataka Sales Tax Act MadhyaPradesh Commercial Tax Act,1991 MadhyaPradesh Commercial Tax Act,1991 Sub-Total (A) Finance Act, 1994 (Service Tax Provisions) Finance Act, 1994 (Service Tax Provisions)
64

Sales Sales Sales Sales Sales Sales Sales Sales Sales Sales Sales Sales Sales Sales Sales Sales Sales Sales Sales Sales Sales Sales Sales Sales Sales Sales Sales

Tax Tax Tax Tax Tax Tax Tax Tax Tax Tax Tax Tax Tax Tax Tax Tax Tax Tax Tax Tax Tax Tax Tax Tax Tax Tax Tax

Assessing Officer Assessing Officer Assessing Officer Assessing Officer The Appelate Tribunal DCCT – Appelate Stage The Appelate Authority Assessing Officer Joint Commissioner Appeals Assessing Officer Joint Commissioner Appeals Joint Commissioner Appeals Assessing Officer Joint Commissioner Appeals Joint Commissioner Appeals Assisstant Commissioner of Sales tax Assessing Officer Assisstant Commissioner (CT) Jt. Director( Enforcement) Jt. Director( Enforcement) Assessing Officer Assessing Officer Asst Commissioner Trade Tax-Noida Joint Commisoner Appeals Joint Commisoner Appeals Joint Commisoner Appeals High Court of Karnataka Tribunal Deputy Commisoner Appeal

Sales Tax Sales Tax

Service Tax

547

2003-04

Commissioner of Central Excise (Appeals) Commissioner of Central Excise (Appeals) Asstt. Comissioner of Service Tax Supritendent of Mohali Appeal filed with Customs, Excise and Service Tax Appelate Tribunal, Mumbai Commissioner (Appeals) Joint Commissioner Commissioner (Appeals) Commissioner (Appeals) Commissioner (Appeals) Commissioner of Service tax

Service Tax

157

2003-04

Finance (Service Finance (Service Finance (Service Finance (Service Finance (Service Finance (Service Finance (Service Finance (Service Finance (Service

Act, 1994 Tax Provisions) Act, 1994 Tax Provisions) Act, 1994 Tax Provisions) Act, 1994 Tax Provisions) Act, 1994 Tax Provisions) Act, 1994 Tax Provisions) Act, 1994 Tax Provisions) Act, 1994 Tax Provisions) Act, 1994 Tax Provisions)

Service Tax Service Tax Service Tax

1,613 591 51,233

2005-06 2001-02 2002-03

Service Tax Service Tax Service Tax Service Tax Service Tax Service Tax

62,419 1,626 15,000 2,729 200 32,670 168,785

2004-05 2004-05 2002-03 2006-07 2004-05 2004-05

Sub-Total (B)

Income Income Income Income Income Income Income Income Income Income Income Income Income Income Income

Tax Tax Tax Tax Tax Tax Tax Tax Tax Tax Tax Tax Tax Tax Tax

Act, Act, Act, Act, Act, Act, Act, Act, Act, Act, Act, Act, Act, Act, Act,

1961 1961 1961 1961 1961 1961 1961 1961 1961 1961 1961 1961 1961 1961 1961

Income Income Income Income Income Income Income Income Income Income Income Income Income Income Income

Tax Tax Tax Tax Tax Tax Tax Tax Tax Tax Tax Tax Tax Tax Tax

60,919 11,270 170 11,264 24,690 35,080 16,119 572 1,404 7,221 5,950 6,420 4,980 2,504 1,352,480 3,680 123,956 55,151 9,741 1,733,571

2000-01 2005-06 1997-98 2002-03 2003-04 2004-05 2006-07 1995-96 2001-02 2002-03 2004-05 2001-02 2002-03 2001-02 2005-06 2005-06 2006-07 2006-07 2006-07

ITAT ITAT High Court ITAT CIT (A) CIT (A) CIT (A) ITAT ITAT ITAT High Court ITAT ITAT ITAT CIT (A) CIT (A) CIT (A) CIT (A) CIT (A)

Income Tax Act, 1961 Income Tax Act, 1961 Income Tax Act, 1961 Income Tax Act, 1961 Sub-Total (C) Customs Act-1962 Sub-Total (D) (x)

Income Tax Income Tax Income Tax Income Tax

Custom Act

31,194 31,194

2006-07

Directorate of Revenue Intelligence, Chennai

The Company has no accumulated losses at the end of the financial year and it has not incurred cash losses in the current and immediately preceding financial year. Based on our audit procedures and as per the information and explanations given by the management, we are of the opinion that the Company has not defaulted in repayment of dues to a financial institution, bank or debenture holders.

(xi)

(xvii) According to the information and explanations given to us and on overall examination of the balance sheet of the Company, funds amounting to Rs. 24,142,737 thousand raised on short-term basis (representing capital creditors) have been used for long-term investment (representing fixed assets). (xviii) The Company has not made any preferential allotment of shares to parties or Companies covered in the register maintained under section 301 of the Companies Act, 1956. (xix) The Company has created security or charge in respect of debentures outstanding at the year end. The Company has not raised any money by public issues during the year. According to the information and explanations furnished by the management, which have been relied upon by us, there were no frauds on or by the Company noticed or reported during the course of our audit except few cases of fraud by employees and external parties aggregating an estimated Rs. 2,704 thousand detected by the management for which appropriate steps were taken to strengthen controls and recoveries are also being made.
65

(xii) According to the information and explanations given to us and based on the documents and records produced to us, the Company has not granted loans and advances on the basis of security by way of pledge of shares, debentures and other securities. (xiii) In our opinion, the Company is not a chit fund or a nidhi / mutual benefit fund / society. Therefore, the provisions of clause 4(xiii) of the Companies (Auditor’s Report) Order, 2003 (as amended) are not applicable to the Company. (xiv) In our opinion, the Company is not dealing in or trading in shares, securities, debentures and other investments. Accordingly, the provisions of clause 4(xiv) of the Companies (Auditor’s Report) Order, 2003 (as amended) are not applicable to the Company. (xv) According to the information and explanations given to us, the Company has given guarantee for loans taken by others from bank or financial institutions, the terms and conditions whereof in our opinion are not prima-facie prejudicial to the interest of the Company. (xvi) Based on information and explanations given to us by the management, term loans were applied for the purpose for which the loans were obtained.

(xx) (xxi)

For S.R. BATLIBOI & ASSOCIATES Chartered Accountants per Prashant Singhal Partner Membership No.:93283 Place : New Delhi Date : April 25, 2008

318 564.757.541 62.231 4.817.251.314 72.907.979.034 20 21 109.664.156.074 12.684 95.605 17.041 190.244 65.262 522.258 18.110 169. BATLIBOI & ASSOCIATES Chartered Accountants per Prashant Singhal Partner Membership No: 93283 Place : New Delhi Date: April 25.814.528 568.173.577 2. Loans and Advances Less: Current Liabilities and Provisions Current Liabilities Provisions Net Current Assets Miscellaneous Expenditure (To the extent not written off or adjusted) Total Statement of Significant Accounting Policies Notes to the Financial Statements 1 1.788 217.850.058 44.017 822.443.572 5.762 121.711 (53.139 2.353 18.475 50.056. ‘000) As at March 31.100.145 18.370 687.859.510.480 98.058.958 7.156 216.766 94. 2008 Particulars Schedule No.758.042.804.361 265.361 66 As per our report of even date For S.475 27.901 (58.034 5 281.621 268. 2007 (Rs. ‘000) SOURCES OF FUNDS Shareholder’s Funds Share Capital Share Application Money Pending Allotment Employee Stock Options Outstanding Less: Deferred Stock Compensation (Refer Note 22 on Schedule 20 and Note 28 on Schedule 21) Reserves and Surplus Loan Funds Secured Loans Unsecured Loans Deferred Tax Liability (Net) (Refer Note 14 on Schedule 20 and Note 27 on Schedule 21) Total APPLICATION OF FUNDS Fixed Assets Gross Block Less: Depreciation Net Block Capital Work in Progress Investments Current Assets. Loans and Advances Inventory Sundry Debtors Cash and Bank Balances Other Current Assets.516 90.029.152.791) 12 2.306.991.342 2.034 268.959.263 6 7 8 9 10 11 119.341 23.342 300. As at March 31.590.147.Balance Sheet as at March 31.390 29.945) 26.446.454.172 638.366. 2008 The Schedules referred to above and Notes to the Financial Statements form an integral part of the Balance Sheet For and on behalf of the Board Sunil Bharti Mittal Chairman & Managing Director Deven Khanna Corporate Director-Finance Akhil Gupta Joint Managing Director Vijaya Sampath Group General Counsel & Company Secretary Manoj Kohli President & CEO Sarvjit Singh Dhillon Chief Financial Officer & Director Strategy .099. 2008 (Rs.510.607 27.630 169.179 478.907.497 7.528.757.973 193.002.179.439.004 2 3 4 182.732.R.294.098.525 524.764.

558.013. Nil)] Tax Expense .970 40.91 32.137.027 16.834.837.986.577 19.365) 476.713 88.035. For the year ended March 31. 2007 (Rs.601.339.855.849.767 thousand for earlier years (March 31.057 177.212 88.835.545 55.005) 69.847. Depreciation.080 31. Amortisation.709 317.576 14.385 21.665.096 40.384.423 (241.872 2. 2008 Particulars Schedule No.852 17.800.398.513 387.849 11. Finance Expense (Net).343 30.012 For the year ended March 31.311 40.593 thousand)] .372 (1.289 18 19 106.332.682.Diluted (Refer Note 19 on Schedule 20 and Note 29 on Schedule 21) Statement of Significant Accounting Policies Notes to the Financial Statements As per our report of even date 13 14 15 16 17 132.28 21.26 20 21 The Schedules referred to above and Notes to the Financial Statements form an integral part of the Profit & Loss Account For and on behalf of the Board For S.140 46.005 (57.441.825 2.581 4.502 13. Depreciation.746 338. Amortisation. Charity and Donation and Taxation Licence fee & Spectrum charges (revenue share) Profit before Other Income.084 25.080 19.2007 Rs.655 16.252 118.Current Tax [Includes Tax of Rs.691.R. ‘000) 177.263.004.162 67 372.533.010 1.583 257.660.169 thousand for earlier years (March 31. 13.340 5. 2008 (Rs. BATLIBOI & ASSOCIATES Chartered Accountants per Prashant Singhal Partner Membership No: 93283 Place : New Delhi Date: April 25.623 62.286 144.194.341.958.349.609.396.396.797 32.922 413. ‘000) 256.265 502.Fringe Benefit Tax Profit after Tax Transferred from Debenture Redemption Reserve Profit brought forward Profit carried to Balance Sheet Earnings per share (in Rs) .333 33.Profit and Loss Account for the year ended March 31.600 2.429.809 55.958.057) 8.738 935.563.Deferred Tax (Refer Note 14 on Schedule 20 and Note 27 on Schedule 21) .838.87 254.414 10. 241.036 54. 2008 Sunil Bharti Mittal Chairman & Managing Director Deven Khanna Corporate Director-Finance Akhil Gupta Joint Managing Director Vijaya Sampath Group General Counsel & Company Secretary Manoj Kohli President & CEO Sarvjit Singh Dhillon Chief Financial Officer & Director Strategy . Other Income.293 62.686.725. Charity and Donation and Taxation Other Income Finance Expense (net) Depreciation Amortisation Charity and Donation Loss on Transfer of Telecom Infrastructure to Bharti Infratel Limited (Refer Note 2(b) on Schedule 21) Less : Amount withdrawn from Reserve for Business Restructuring (Refer Note 2(b) on Schedule 21) Profit before Tax MAT credit [Includes MAT credit of Rs.440 23.385. Finance Expense (Net).944.499 124.712 (187.316 INCOME Service Revenue Sale of Goods EXPENDITURE Access Charges Network Operating Cost of Goods Sold Personnel Sales and Marketing Administrative and Other expenditure Total Expenditure Profit before Licence Fee.214.378. 2007 Rs. 959.416 57.647.Basic Earnings per share (in Rs) .767) 72.108 220.358.

659.497) 185.123) (116.533.882 46.321) 1.804. 2008 (Rs.547 .441) 214.239 (8.589) 213.375.933) 81.804 185 76.384 28. Cash flow from operating activities: Net profit before tax Adjustments for: Depreciation Interest Expense Interest Income (Profit)/Loss on Sale of Assets (Net) (Profit)/Loss on sale of Investments Amortisation of ESOP Expenditure Amortisation of Deferred Revenue Expenditure Provision for Deferred Bonus Licence fee Amortisation Debts / Advances Written off Provision for Bad and Doubtful Debts/Advances (Net of write back) Liabilities / Provisions no longer required written back Provision for Gratuity and Leave Encashment Provision for Inventory for obsolete/ Damaged stock Unrealized Foreign Exchange (gain) /loss Loss from swap arrangements Provision for Wealth Tax (Net) Operating profit before working capital changes Adjustments for changes in working capital : .034) 227. 2007 (Rs.801 113.356 (662.266) (1.801) 117.598.870) 1.444 85.577 (11.804 (4.700.545 16.725.712 23.750.047) 1.150.191.094 1.319) (109.734) 104.079.693 1.484.122) (81.929.825 3.505) 331.904 (452.093) 30.889.774) 685. 2008 Particulars For the year ended March 31.075 (577.584 1.423 31.674 146.940) (329.480 (4.151.560 99.162.040 (218.386.070 2.032) (15. ‘000) A.832.(Increase)/Decrease in Other Receivables .605) 23.485.Cash Flow Statement for the year ended March 31.257. ‘000) For the year ended March 31.579.(Increase)/Decrease in Inventory .665.032) (79.280) (24.528.988) 32.229 (112.314.195.977.649 97.237 175.505 (6.958.121 1.094.274.483. Cash flow from investing activities: Purchase of fixed assets Proceeds from Sale of Fixed Assets Proceeds from Sale of Investments Purchase of Investments Interest Received Net movement in advances given to Subsidiary Companies Acquisition/amalgamation of Subsidiaries/ Joint Ventures (Refer note 5 below) Net cash used in investing activities (100.124.776.370 (245.233.833 (352.013.996) (8.172.350.547) 69.824 13.129.183 30.276 730.044.(Increase)/Decrease in Sundry Debtors .Increase/(Decrease) in Trade and Other Payables Cash generated from operations 68 Taxes (Paid) / Received Net cash from operating activities B.090) (331.562 (349) 110.779 (189.672.309 (98.725 1.010 2.958 (114.

4. (Refer Note 2(b) on Schedule 21).Rs 108.320 4. Assets transferred under the Scheme of arrangement has not been considered above. Cash and cash equivalents includes Rs 65.020.197 Total 5.055.833) (118.605 130.606 (19. ‘000) For the year ended March 31. Previous Year figures have been audited by other firm of Chartered Accountants and has been regrouped/reclassified. 2007.605 Notes : 1. 2008 Sunil Bharti Mittal Chairman & Managing Director Deven Khanna Corporate Director-Finance For and on behalf of the Board of Directors of Bharti Airtel Limited Akhil Gupta Joint Managing Director Vijaya Sampath Group General Counsel & Company Secretary Manoj Kohli President & CEO Sarvjit Singh Dhillon Chief Financial Officer & Director Strategy .995 3.622. 927.040 thousands) which are not available for use by the Company The following assets and liabilities acquired under the scheme of amalgamation have not been considered in the above Cash flow statement (Refer Note 2(a)(ii) on Schedule 21) Fixed Assets (Including CWIP and Pre-Operative expenditure and net of accumulated depreciation) 148. 6.837) 39. 2008 (Rs.004 7.390 32.804. the Company acquired 100% of the equity in Network i2i Limited at a purchase consideration of Rs. Cash flow from financing activities: Issue of Shares under ESOP Scheme (including share application) Proceeds from long term borrowings Receipts Payments Proceeds from short term borrowings Net movement in cash credit facilities and short term loans Interest Paid Gain /(Loss) from swap arrangements Net cash from financing activities Net Increase/(Decrease) in Cash and Cash Equivalents Opening Cash and Cash Equivalents Cash and Cash Equivalents acquired on amalgamation Cash and Cash Equivalents as at March 31.793 thousand).967 Loan Funds 523.395 5.804.591) (67.935 Current Liabilities and Provisions 284. 5.119.029. 2008 Cash and Cash Equivalents comprise: Cash and Cheques in hand Balance with Scheduled Banks 193.905. 3.884 thousands pledged with various authorities (March 31.570.909. to conform to the current year’s classification. wherever to the extent available.349.980.601 7.313.Particulars For the year ended March 31.804.852.320 3.R.390 1.529 Current Assets ( Other than Cash) 378.761.285 7.029. 2.279 (45.676. 2007 (Rs. 1.207 (3.268 (2.531 17.730.401.111 (2.648) 8. BATLIBOI & ASSOCIATES Chartered Accountants per Prashant Singhal Partner Membership No: 93283 Place : New Delhi Date: April 25.308 19.349) 7. As per our report of even date For S.605 749.134 5. ‘000) C.031.511) 14.074.078 69 During the year. Figures in brackets indicate cash out flow.450 Deferred Tax Assets 13.062.034) 3.916 thousand (amount payable to the erstwhile Shareholders Rs.

1.500.125) are allotted as fully paid up under the Scheme of amalgamation without payments being received in cash. (Refer Note 8 on Schedule 21) (d) 2.619 39.390.516.20.000) Equity shares of Rs.892 (502.959.000.979.754. ‘000) SCHEDULE : 1 SHARE CAPITAL Authorised 2.420) are allotted as fully paid up upon the conversion of Foreign Currency Convertible Bonds (FCCBs).979.2. 18.005 24.722.970 Equity Shares (March 31.2. ‘000) As at March 31.958 1.000. 2008 (Rs.396.203 57.000.088.959.516.889.907.734 Equity Shares (March 31.342 70 SCHEDULE : 2 RESERVES AND SURPLUS Capital reserve Revaluation reserve Reserve for Business Restructuring Opening balance Additions during the year Transferred to Profit and Loss Account during the year (Refer Note 2(b) of Schedule 21) 51.284 - - 553.055.Schedules annexed to and forming part of accounts Particulars As at March 31.074 Notes: (a) 1.225 630. 2007.311) 553.000 18.315. Subscribed and Paid up 1.934.198 Debenture Redemption reserve Opening balance Transferred to Profit and Loss Account during the year 21.446 Equity Shares of Rs.722. 2007.679 39.074 18.125 Equity Shares (March 31.083 21.088.259.259.342 18.623) 139. 2007. (b) 20.844 .897. 10 each) (Refer Notes below) 25.546 504.000. 2007 (Rs.785. 10 each Issued.000 (March 31.581 (413. 2007.581 38.390. 10 each fully paid up (March 31.500. 2007.1.445 Equity Shares (March 31.225 Securities Premium Opening balance Additions during the year 39.284 82.157 Equity Shares of Rs.445) are allotted as fully paid up upon the conversion of Optionally Convertible Redeemable Debentures (OCRD) without payment being received in cash (c) 21.2007 .000 25.19.591.181.895.970) issued as fully paid up bonus shares out of Share Premium account.

‘000) As at March 31.179.766) 55.964) - 117.143 50.675.716 .972.943 24.831 (66.000 1.158 182.252 95.194. 2008 (Rs.910 57.797 43. ‘000) SCHEDULE : 2 (Cont.443.475 1.246.664.748.127 (265.244 524.510 SCHEDULE : 4 UNSECURED LOANS Short Term Loans and Advances From Banks Other Loans and Advances From Banks From Others 4.) Profit and Loss Account Balance as per Profit and Loss Account Add : Adjustment (Refer Note 2(a)(ii) on Schedule 21) Less : Adjustment on account of application of Accounting Standard 15 (Revised) Acquired under the scheme of Amalgamation (Refer Note 2(a)(ii) on Schedule 21) Profit and Loss Account 118.655.525 55.172 41. 2007 (Rs.000 - 589.312 3.339.577 10.385 7.039.244 380.859.050 4.810 65.173.803.247 19.712 Note : Amount repayable within one year 17.Schedules annexed to and forming part of accounts Particulars As at March 31.132.129.581.285 2.107.524 4.342 SCHEDULE : 3 SECURED LOANS (Refer Note 13 on Schedule 21) Debentures Loans and Advances from Banks : -Term Loans Others Loans and Advances : -Term Loans -Vehicle Loans 500.398.597 71 Note : Amount repayable within one year 11.

317.195.477 thousand (Previous year Rs. 955 thousand (Previous year Rs.314 49.497 56.141. 955 thousand) represents land acquired on lease cum sale basis from Karnataka Industrial Areas Development Board 4. 1.973 97.697 96.376.743 3.482 281. 3.850.992 3. Capital Work In Progress includes Capital advances of Rs. 2007 Acquired under the scheme of merger For the year Sale / Adjustment during the year As at March 31. 1. Lease hold land of Rs.750.766 102.895 15.897 8.778 3.182 2.440 347.521 28 329 1.007.099.304 2.547.319.696 454.516 72.306.850.788 217.431 258.993 768.987. 2008 As at April 01.397 3.156.861.329.405 538.304 14.114.496 3.308 81.443 thousand) 2. 4.480 1.054 247 116.002 1.822. 7.600 97.595.299 thousand) on account of fluctuations in foreign exchange rates 3.781.041 72.771 11.634.349 4.811. ‘000) Net Block Value As at March 31.490. Addition to fixed assets during the year includes : Rs. 2007 INTANGIBLE ASSETS Software Bandwidth Licences TANGIBLE ASSETS Leasehold Land Freehold Land Building Leasehold Improvements Plant & Machinery Computers Office Equipment Furniture & Fixture Vehicles Vehicle on Finance Lease 83.512 213.578 thousand) and corresponding Accumulated Depreciation being Rs.099. 9.887.643.759.191 thousand gain) on account of fluctuation in Exchange rate 5.971 27.861 31. 2008 ranges between 7 to 17 years for Unified Access Service Licences and 14 years for Long Distance Licences 7.396 1.156.464 83. in respect of which registration of title in favour of the Company is pending 6.920 2.993 5.502 85.332 895.441 thousand (Previous year Rs.664 16.482 281.219 398.969 78.550 24.468 thousand) and Rs.134.913 1.674 5.907 2.042. Sale/Adjustment during the year of Plant & Machinery includes assets (including Capital Advance) transferred.517.516 563.023 thousand) 9.915 4.090.516 13.407 1.930 58.873.921.338 214.620 11.151. Capital work in progress includes goods in transit Rs.769 12.420 8.597 221.371 Notes: 1.041 90.424 thousand (Previous year Rs.217 439.511 875.019. 5.297 32.127.089.499 905. 1.117 28.303 348.302 5.758 616.182 2. 2008 is net of Rs.106 9.601 657.338 3.666 175.089.207.725 83.200 thousand (Previous year Rs.579 thousand of Gain (Previous year loss of Rs.448.694 454.190.366.948 3.177 1.516 72.989 62.037 132.625 21.099.141.703 60.471. 71. 2.110.148 5.081 21.892 547. 2.303 thousand (net of accumulated depreciation) at nil value (Refer Note 2(b) on Schedule 21) .397 55. 71.861.993.123. from the Company to Bharti Infratel Limited of Rs.068 765.477 thousand) respectively. Capital work in Progress as on March 31.457 158.002. 16 & 17 on Schedule 20 and Note 2(a)(ii).947 347. Computers include Gross Block of assets capitalised under finance lease Rs.055 thousand (Previous year Rs.196.571.894.SCHEDULE 5 : FIXED ASSETS (Refer Notes 4.042.534 678.702 81.009 406.554. 26.953 14.376 88.043 93.772 219.989 867 8.209 1.989 14.136 2.103 419. 2007 PARTICULARS As at April 01. 2(b).783 1.145 15. Freehold Land and Building includes Rs.822 416.376 563.973 416.042.479 167.817.975 thousand) 8.758. 220.569.522.689.837 thousand being gain (Previous year includes Rs.973 Additions during the year Sale / Adjustment during the year As at March 31. 2008 Depreciation/ Amortisation As at March 31.814.899 43.713 81.044 4.308 81.684. 2.641.794.521 83.233.521 9. 65.195.190 354.330 4.258 65.263 5.877 21.802.056.257 1.800 265.002 398. 5.468 43.386 TOTAL Capital Work In Progress 265.550 32.628.896 1.331 53.125. 210.413 21.595.510.772.471.715 224. The remaining amortisation period of licence fees as at March 31.315 5.513 7.783 1.156 216.475 27.606 58. as per the Scheme. 22 & 25 on Schedule 21) Gross Block Value Acquired under the scheme of merger 8.293 52. 26. 2008 72 (Rs.107 12.098 1.143 466.504 28 90.468 thousand (Previous year Rs.025.729 7.341 23.002 563.517.658.314 Previous Year 179.993 1.429.691.397 193.993 10.613.314 - GRAND TOTAL 265.479 184.822 32.117 50.576 470.369 190.

7) Bharti Airtel (Hongkong) Limited: 1 (Previous year 1)* Equity shares of HKD 1 each fully paid up. 8) Bharti Airtel (Canada) Limited: 100 (Previous year 100) Equity shares of Canadian Dollar (CAD) 1 each fully paid up. 10 each fully paid up.333 4 20. ‘000) As at March 31. 11) Bharti Infratel Limited: 50. (Refer Note 2(a) (ii) on Schedule 21) 4) Bharti Aquanet Limited 2.Government securities 27.902 - - . 10 each fully paid up.069 15.457 55.839 15.000 (Previous year 50.000.000 (Previous year Nil) Equity shares of USD 1 each fully paid up.549 508.501.000 104.228. 2) Bharti Airtel Services Limited: 100.000) Equity shares of Rs.973 261.000) Equity shares of Rs. 6) Bharti Airtel (UK) Limited: 1 (Previous year 1)* Equity shares of GBP 1 each fully paid up.705.500. 3) Satcom Broadband Equipment Limited: Nil (Previous year 24. 14) Bharti Airtel Holdings (Singapore) Pte.Mutual Funds. ‘000) SCHEDULE : 6 INVESTMENTS (Refer Note 8 on Schedule 20 and Note 21 on Schedule 21) Current. 10 each fully paid up.609 26. 2007 (Rs. 10) Network i2i Limited: 9.971 87.039 82.703 102. 13) Bharti Airtel Lanka (Private) Limited :100 (Previous year Nil) Equity shares of SLR 10 each fully paid up. 9) Bharti Airtel (Singapore) Limited: 100 (Previous year 100) Equity shares of Singapore Dollar (SGD) 1 each fully paid up.871 1.007 1.748 1. Unquoted .184 4 500 73 40. 2008 (Rs.000) Equity shares of Rs.734.181. Limited: 100 (Previous year Nil) Equity shares of Singapore Dollar (SGD) 1 each fully paid up.255.261 1.207.000 (Previous year Nil) Equity shares of Rs.836 1. Quoted .Government securities .000 - 5.836 8.980) Equity shares of Rs.169 Long Term : Trade (Un-quoted) Investment in Subsidiaries 1) Bharti Hexacom Limited: 166.Schedules annexed to and forming part of accounts Particulars As at March 31. other than trade.316.980 (Previous year 166. 25. 10 each fully paid up. 10 each fully paid up. 5) Bharti Airtel (USA) Limited: 200 (Previous year 200)* Equity shares of USD .000 (Previous year 1.000 (Previous year 100. Debentures and Bonds Long term.200) Equity shares of Rs.714 5.275.207. other than trade.139 5.080.501. 10 each fully paid up.859.0001 each fully paid up.748 1.000 248.(Refer Note 2(b) on Schedule 21) 12) Bharti Telemedia Limited :4.

125 93.237 - 43.742. 2) Forum I Aviation Limited: Nil (Previous year 3.) Investment in Joint Ventures 1) Bridge Mobile Pte Limited: 2.763 30.878 5.607 568.732.796.258.000) Equity Share of Rs 10 each (Refer Note 7(c) on Schedule 21) Others 1) IFFCO Kissan Sanchar Limited : 100.198 568.824 thousand (March 31.506 1.000. 30.2007 Rs.794.000 (Previous year 1.058. 2008 (Rs. ‘000) SCHEDULE : 6 (Cont.528.330 93. ‘000) As at March 31.253.145 478.301 (*Refer Note 21 on Schedule 21) Aggregate Market Value of Quoted Investments Aggregate amount of Quoted Investments Aggregate amount of Unquoted Investments SCHEDULE : 7 INVENTORY (Refer Note 7 on Schedule 20) Stock-In-Trade * 15.000) Equity shares of USD 1 each fully paid up.359 109.Schedules annexed to and forming part of accounts Particulars As at March 31. 37.465 7.363 thousand) 74 .896 15.000.000 Equity Shares (Refer Note 2(a)(viii) on Schedule 21) 92.000 50.607 478.200.528 5.179 1.145 * Net of Provision for diminution in value Rs.804.802. 2007 (Rs.

616 1.524 4.in Fixed deposits * .029.572 16.074.632 (5.794 (5.794) 1.656.2007 Rs.764.971 119.890 thousand)] Advance Wealth Tax (Net of Provision for tax Rs.009) 16.042) 16.040 thousand)] 66.042 (3.809 173.216 1.834 5.191.180 7.016.124 18.279 127.175. 2007 (Rs. 8.641.290 1.524 116.018.226 - .556 5.909.416.557 3.540.279 3.in Current Account .416.076.540.902 154 16.in Deposit Account as Margin Money 74.123 888. 17.732.281 (1.199.Schedules annexed to and forming part of accounts Particulars As at March 31.909.074.656.390 * [Includes Rs.834 25.616 27.789.040. considered good unless otherwise stated) Debts outstanding for a period exceeding six months -considered good -considered doubtful Less : Provision for doubtful debts Other debts -considered good -considered doubtful Less : Provision for doubtful debts 1. 2007 Rs.199.282 4.045. LOANS AND ADVANCES (Unsecured. 61.632) 2.412.124 1. ‘000) As at March 31.191. 108.399 41.872 1.605 75 SCHEDULE : 10 OTHER CURRENT ASSETS. ‘000) SCHEDULE : 8 SUNDRY DEBTORS (Refer Note 6 on Schedule 20 and Note 9 on Schedule 21) (Unsecured.686.789.076.040. considered good unless otherwise stated) Interest Accrued on Investment Advances Recoverable in cash or in kind or for value to be received* Considered good Considered doubtful Less: Provision Advance to ESOP Trust Advance Tax [Net of provision for tax Rs.974.162 thousand (March 31.009 (1. 608 thousand) 19.534 5.974.956 5.281) 25.687 28.804.441 (4.288 thousand pledged with various authorities (March 31.956 2.441) 28. 2008 (Rs.686.958 SCHEDULE : 9 CASH AND BANK BALANCES Cash in Hand Cheques in Hand Balances with Scheduled Banks .385 683.

607 thousand) MAT Credit 45.231 Provisions Gratuity (Refer Note 11 on Schedule 20 and Note 6 on Schedule 21) Leave Encashment (Refer Note 11 on Schedule 20 and Note 6 on Schedule 21) Wealth Tax Fringe Benefit Tax (March 31.676 1.481.762 121. 257. ‘000) SCHEDULE : 10 (Cont.799.487 119. 2008 (Rs.195 3.058 SCHEDULE : 11 CURRENT LIABILITIES AND PROVISIONS Current Liabilities Sundry Creditors : Total outstanding dues of Micro and Small Enterprises* Total outstanding dues of Creditors other than Micro and Small Enterprises* Advance Billing and Prepaid Card Revenue Interest accrued but not due on loans Other Liabilities Advance Received from customers Security Deposits (Refer Note 9 on Schedule 21) *Refer Note 19 on Schedule 21 76 83.853.) Advance Fringe Benefit Tax (Net of provision for tax Rs.540 thousand) Others (Refer Note 6(g) and 22 on Schedule 21) 380.2007 net of payment Rs.799.324 366.407.901 293.711 . 2007 (Rs.002.541 *Refer Note No 24 on schedule 21 for Loans and Advances to Companies under the same management.767 428. 187.373 464.475.270.701 458.152.294.538 26.121 3.057 17.Schedules annexed to and forming part of accounts Particulars As at March 31.480 98.155 68.878.451.446.515 732.916 2.098.155 18.681 3.538 83.610 94.439.541. 502.451.797 667.147.253.139 68.713 2.100.936 752.542 349 17.070 4.824 29. ‘000) As at March 31.913 3.

Schedules annexed to and forming part of accounts
Particulars As at March 31, 2008 (Rs. ‘000) As at March 31, 2007 (Rs. ‘000)

SCHEDULE : 12 MISCELLANEOUS EXPENDITURE (To the extent not written off or adjusted) (Refer Note 15 on Schedule 20 and Note 28 on Schedule 21) Deferred Employee Compensation Expense* Opening Balance Add: Addition/ (Adjustments) during the year Less: Amortisation for the year** (6,594) (6,594) * Relating to Employee Stock Option Scheme 2001 and 2004 ** Net of stock compensation income of Rs. 3,886 thousand (March 31,2007 Rs. 13,828 thousand) Premium on Redemption of Debentures Opening Balance Less : Write back during the year Less : Amortisation for the year 3,448 (1,202) 2,246 -

26,630 20,218 4,378 2,034 2,034

75,952 32,648 16,674 26,630 26,630

77

Schedules annexed to and forming part of accounts
Particulars For the year ended March 31, 2008 (Rs. ‘000) For the year ended March 31, 2007 (Rs. ‘000)

SCHEDULE : 13 NETWORK OPERATING EXPENDITURE Interconnect charges and PSTN rentals Installation Power and Fuel Rent Insurance Repairs and Maintenance - Plant and Machinery - Others Leased Line and Gateway charges Internet access and bandwidth charges Others Total Network operating expenses SCHEDULE : 14 COST OF GOODS SOLD Opening Stock Add : Purchases Less : Simcard Utilisation Less : Internal issues / capitalised Less : Closing Stock * 478,145 2,353,696 800,728 1,124,004 568,607 338,502 * Net of Provision for diminution in value of Rs. 30,824 thousand (March 31, 2007 Rs. 28,904 thousand)
78

891,747 86,131 9,857,737 8,102,162 106,127 7,080,594 932,019 647,260 2,353,998 2,946,971 33,004,746

848,728 64,809 6,190,648 2,698,993 68,013 4,475,165 916,537 509,082 2,021,060 1,421,073 19,214,108

177,444 792,969 253,473 17,946 478,145 220,849

SCHEDULE : 15 PERSONNEL EXPENDITURE (Refer Note 11 on Schedule 20 and Note 6 on Schedule 21) Salaries, Wages and Bonus* Contribution to Provident and Other Funds Staff Welfare Recruitment and Training * Excluding amortisation of Deferred ESOP cost 11,942,494 416,416 619,846 363,096 13,341,852 9,848,560 367,822 553,160 493,872 11,263,414

SCHEDULE : 16 SALES AND MARKETING EXPENDITURE Advertisement and Marketing Sales Commission and Incentive Sim card utilisation Others 5,664,692 6,476,102 800,728 4,907,558 17,849,080 4,024,678 2,686,657 253,473 3,726,847 10,691,655

Schedules annexed to and forming part of accounts
Particulars For the year ended March 31, 2008 (Rs. ‘000) For the year ended March 31, 2007 (Rs. ‘000)

SCHEDULE : 17 ADMINISTRATIVE AND OTHER EXPENDITURE Legal and Professional Rates and Taxes Power and Fuel Traveling and Conveyance Rent Repairs and Maintenance 8,292,819 38,319 593,931 1,030,744 1,145,635 97,779 583,725 10,122 1,958,584 1,172,833 1,172,833 30,824 1,630,006 32,075 2,812,103 19,429,499 SCHEDULE : 18 OTHER INCOME Liabilities/Provisions no longer required written back Profit on Sale of Assets (Net) Miscellaneous 352,497 2,006,084 2,358,581 SCHEDULE : 19 FINANCE EXPENSE (Net) Interest : - On Term Loan - On Debentures - On Others Amortisation of Premium on Redemption of FCCB’s Exchange fluctuation loss (Net) Loss from swap arrangements Other Finance Charges Less : Income Profit on sale of Current Investments Interest Income : - from Current Investments and Fixed Deposits (Other than Trade) [Gross of TDS of Rs. 34,647 thousand (March 31, 2007 Rs. 8,306 thousand)] - from other advances 1,948,841 68,341 60,595 4,378 2,143,277 97,562 1,754,579 6,077,573 577,505 1,814,699 199,974 44,779 16,674 73,236 213,804 744,588 3,107,754 331,034 112,801 24,090 798,709 935,600 2,726,981 54,752 6,328,440 37,473 397,218 963,469 778,748 477,969 60,849 19,103 1,191,070 2,672,229 28,904 1,860,117 1,794,124 16,609,713

- Building - Others

Insurance Bad debts written off Provision for doubtful debts and advances Less : Provision for doubtful debts written back Provision for Diminution in value of inventory Collection and Recovery Expenses Loss on sale of assets (net) Miscellaneous Expenses

79

171,631 491,357 1,240,493 4,837,080

93,306 124,974 549,314 2,558,440

3. effective April 1. with respect to only those contracts having loss as per the year end valuation. hedge loss of Rs. DEPRECIATION / AMORTISATION Depreciation is provided on straight-line method.e.911 thousand has been debited to the Profit and Loss Account during the year. ‘Disclosure of Accounting Policies’. national long distance and international long distance services) has been capitalised as an intangible asset. with respect to only those contracts having loss as per the year end valuation. 1956. in accordance with the Announcement on Accounting for Derivatives issued by the ICAI. the Company has also changed its policy with respect to accounting for embedded derivative contracts. have now been accounted for on a marked-tomarket valuation on each contract basis. 2007. which upto March 31. 4. effective April 1. which upto March 31.in Note 3 below. ‘Disclosure of Accounting Policies’. cellular. 2. 1. Had the Company followed its earlier policy. 2008 SCHEDULE: 20 1. Entry Fee. the net profit after tax would have been higher by Rs. 2007 were not accounted. the Company has changed its policy with respect to accounting for foreign exchange hedge contracts & interest rate swaps. in accordance with the principle of prudence as enunciated in AS 1. As a result. have now been accounted for on a marked-to-market valuation on each contract basis. Site restoration cost obligations are capitalized when it is probable that an outflow of resources will be required to settle the obligation and a reliable estimate of the amount can be made. has been capitalised as an asset and the one time license fee paid by the Company for acquiring new licences (post NTP-99) (basic. as follows: 80 . Although these estimates are based upon management’s best knowledge of current events and actions. whichever is higher.Schedules annexed to and forming part of accounts STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31. are consistent with those used in the previous year. freight and other incidental expenses related to acquisition and installation. were accounted for based on the contracted hedged rate. including taxes & duties (net of cenvat credit). The accounting policies have been consistently applied by the Company and except for the changes in accounting policy discussed. 814. Capital work-in-progress is stated at cost. USE OF ESTIMATES The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of the financial statements and the results of operations during the reporting period end. 5.230.923 thousand. i. The intangible component of license fee payable by the Company for cellular and basic circles. As a result. or at the rates prescribed under schedule XIV of the Companies Act. FIXED ASSETS Fixed Assets are stated at cost of acquisition and subsequent improvements thereto. upon migration to the National Telecom Policy (NTP 1999). at the rates determined based on the estimated economic useful lives of assets. 537. 2007. 2007. BASIS OF PREPARATION The financial statements have been prepared to comply in all material respects with the Notified accounting standards by Companies Accounting Standards Rules. Further.080 thousand has been debited to the Profit and Loss Account during the year. 2006 other than the matter disclosed in Note 10 to this schedule and the relevant provisions of the Companies Act. 1956. CHANGES IN ACCOUNTING POLICIES In accordance with the Announcement on Accounting for Derivatives issued by the Institute of Chartered Accountants of India (ICAI). entered into for non speculation purpose. The financial statements have been prepared under the historical cost convention on an accrual basis except in case of assets for which revaluation is carried out. in accordance with the principle of prudence as enunciated in AS 1. net exchange loss of Rs. other than those covered under Accounting Standard (AS-11) “Effect of Changes in Foreign exchange Rates”. actual results could differ from these estimates.

Installation charges are recognised as revenue on satisfactory completion of installation of hardware and service revenue is recognised from the date of satisfactory installation of equipment and software at the customer site and provisioning of Internet and Satellite services. and is net of discounts and waivers. IUC and roaming charges. from sale of goods is recognised on transfer of all significant risks and rewards to the customer and when no significant uncertainty exists regarding realisation of consideration. Provision for doubtful debts The Company provides for amounts outstanding for more than 90 days in case of active subscribers and for entire outstanding from deactivated customers net off security deposits or in specific cases where management is of the view that the amounts for certain customers are not recoverable. Registration fees is recognised at the time of dispatch and invoicing of Start up Kits.Leasehold Land Building Building on Leased Land Leasehold Improvements Plant & Machinery Computer / Software Office Equipment Furniture and Fixtures Vehicles Useful lives Period of lease 20 years 20 years Period of lease or 10 years whichever is less 3 years / 5 years/ 10 years / 15 years/18 years/20 Years 3 years 5 years/2 years 5 years 5 years Software up to Rs. installation and provision of Internet and Satellite services. Revenue. Revenue from prepaid calling cards packs is recognised on the actual usage basis. For receivables due from the other operators on account of their NLD and ILD traffic. Processing fees on recharge is being recognised over the estimated customer relationship period or voucher validity period. Revenue on account of bandwidth service is recognised on time proportion basis in accordance with the related contracts. Fixed Assets costing upto Rs. Telemedia Services (Erstwhile Broadband & Telephone Services) and Enterprise Services Carriers Service revenue is recognised on completion of provision of services. Bandwidth capacity is amortised on straight line basis over the period of the agreement subject to a maximum of 15 years. 5 thousand are being fully depreciated within one year from the date of acquisition. REVENUE RECOGNITION AND RECEIVABLES Mobile Services Service revenue is recognised on completion of provision of services. Investing and other Activities Income on account of interest and other activities are recognised on an accrual basis. Service Revenue includes access charges passed on to other operators. The site restoration cost obligation capitalized is depreciated over the period of the useful life of the related asset. Service Revenues includes revenues from registration. 500 thousand is written off in the year placed in service. The Entry Fee capitalised is being amortised equally over the period of the license and the one time licence fee is being amortised equally over the balance period of licence from the date of commencement of commercial operations. net of discount. Dividends are accounted for when the right to receive the payment is established. net of discount. and is net of discounts and waivers. Enterprise Services Corporate Revenue. from sale of goods is recognised on transfer of all significant risks and rewards to the customer and when no significant uncertainty exists regarding realisation of consideration. not exceeding the activation revenue. as derived from the estimated customer churn period. are deferred and amortized over the related estimated customers relationship period. as applicable. 6. Service revenue includes income on roaming commission and access charges passed on to other operators. Activation Income Activation revenue and related direct activation costs. the 81 .

Exchange differences on forward contracts & plain vanilla currency options entered into for trading & speculation is recognized in the Profit & Loss account in the year in which the exchange rate changes. FOREIGN CURRENCY TRANSLATION. These are billed in subsequent periods as per the terms of the billing plans. Exchange Differences Exchange differences arising on the settlement of monetary items or on restatement of the Company’s monetary items at rates different from those at which they were initially recorded during the year. Non-monetary items which are carried in terms of historical cost denominated in a foreign currency are reported using the exchange rate at the date of the transaction. Revenue for this purpose identified as adjusted gross revenue as per the respective license agreements. if any. ‘The Effects of Changes in Foreign Exchange Rates’ Exchange differences on forward exchange contracts & plain vanilla currency options. Forward Exchange Contracts covered under AS 11. Conversion Foreign currency monetary items are reported using the closing rate. Other Derivative Instruments. 10. and Long Distance services provided from the bill cycle date to the end of each month. which is at variance to the treatment prescribed in Accounting Standard (AS-11) “Effect of Changes in Foreign exchange Rates” notified in the Companies (Accounting Standard) Rules 2006 dated December 7. not in the nature of AS 11. INVESTMENT Current Investments are valued at lower of cost and fair market value. Long term Investments are valued at cost. to hedge its risks with respect to foreign currency fluctuations and interest rate exposure arising out of import of capital goods using foreign currency loan. and non-monetary items which are carried at fair value or other similar valuation denominated in a foreign currency are reported using the exchange rates that existed when the values were determined. LICENSE FEES – REVENUE SHARE With effect from August 1. ‘The Effects of Changes in Foreign Exchange Rates’ The Company enters into various foreign currency option contracts & interest rate swap contracts that are not in the nature of forward contracts designated under AS 11 as such and contracts that are not entered to establish the amount of the reporting currency required or available at the settlement date of a transaction. At every period end all outstanding derivative contracts are fair valued on a marked-to- 82 . Net realizable value is the estimated selling price in the ordinary course of business. INVENTORY Inventory are valued at the lower of cost and net realisable value. other than that of temporary nature. 2006. not intended for trading & speculation purposes. Broadband and Telephone. As per legal advice received. 8. Accrued Billing revenue Accrued billing revenue represent revenues recognized in respect of Mobile. Provision is made for diminution in value to recognise a decline. 1999. are recognised is adjusted in the carrying cost of the respective fixed asset. or reported in previous financial statements. ACCOUNTING FOR FORWARD CONTRACTS & DERIVATIVES Initial Recognition Foreign currency transactions are recorded in the reporting currency. less estimated costs of completion and the estimated costs necessary to make the sale. by applying to the foreign currency amount the exchange rate between the reporting currency and the foreign currency at the date of the transaction. where such exchange difference is adjusted in the carrying cost of the respective fixed asset as per the legal advise obtained by the Company. are recognized as income or as expenses in the year in which they arise except in respect of liabilities for acquisition of fixed assets. 7. Cost is determined on First in First out basis. the Company has continued with its accounting policy to adjust foreign exchange fluctuation on loans/liability for fixed assets as per the requirement of Schedule VI of the Companies Act.Company provides for amounts outstanding for more than 120 days from the date of billing. net of any amounts payable to the operators or in specific cases where management is of the view that the amounts for these customers are not recoverable. 1956. 9. The premium or discount arising at the inception of forward exchange contracts is amortised as expense or income over the life of the contract. the variable Licence fee computed at prescribed rates of revenue share is charged to the Profit and Loss Account in the period in which the related revenues are recognised.

market basis and any loss on valuation is recognised in the profit and loss account, on each contract basis. Any gain on marked-to-market valuation on respective contracts is not recognized by the Company, keeping in view the principle of prudence as enunciated in AS 1, ‘Disclosure of Accounting Policies’. Any subsequent changes in fair values, occurring after the balance sheet date, is accounted in the subsequent period. Embedded Derivative Instruments The Company occasionally enters into contracts that do not in their entirety meet the definition of a derivative instrument that may contain “embedded” derivative instruments – implicit or explicit terms that affect some or all of the cash flow or the value of other exchanges required by the contract in a manner similar to a derivative instrument. The Company assesses whether the economic characteristics and risks of the embedded derivative are clearly and closely related to the economic characteristics and risks of the remaining component of the host contract and whether a separate, non-embedded instrument with the same terms as the embedded instrument would meet the definition of a derivative instrument. When it is determined that (1) the embedded derivative possesses economic characteristics and risks that are not clearly and closely related to the economic characteristics and risks of the host contract and (2) a separate, stand-alone instrument with the same terms would qualify as a derivative instrument, the embedded derivative is separated from the host contract, carried at fair value as a trading or non-hedging derivative instrument. The loss on marked-to-market valuation of the embedded derivative instrument is recognized in the Profit & Loss account for the period. Foreign exchange contracts for trading and speculation purpose Foreign exchange contracts intended for trading and/or speculation are fair valued on a marked-to- market basis and any loss on such valuation is recognised in the Profit & Loss Account for the period. 11. EMPLOYEE BENEFITS Short Term Employee Benefits Short term employee benefits are recognised in the period during which the services have been rendered. Long Term Employee Benefits a) Defined Contribution plan Provident Fund and employees’ state insurance schemes All employees of the Company are entitled to receive benefits under the Provident Fund, which is a defined contribution plan. Both the employee and the employer make monthly contributions to the plan at a predetermined rate (presently 12%) of the employees’ basic salary. These contributions are made to the fund administered and managed by the Government of India. In addition, some employees of the Company are covered under the employees’ state insurance schemes, which are also defined contribution schemes recognized and administered by the Government of India. The Company’s contributions to both these schemes are expensed in the Profit and Loss Account. The Company has no further obligations under these plans beyond its monthly contributions. Superannuation Plan Some employees of the Company are entitled to superannuation, a defined contribution plan which is administered through Life Insurance Corporation of India (“LIC”). Superannuation benefits are recorded as an expense as incurred. b) Defined Benefit plan Leave Encashment The Company has provided for the liability at year end on account of unavailed earned leave as per the actuarial valuation as per the Projected Unit Credit Method. Gratuity The Company provides for gratuity obligations through a defined benefit retirement plan (the ‘Gratuity Plan’) covering all employees. The Gratuity Plan provides a lump sum payment to vested employees at retirement or termination of employment based on the respective employee salary and years of employment with the Company. The Company provides for the Gratuity Plan based on actuarial valuations in accordance with Accounting Standard 15 (revised), “Employee Benefits“. The Company makes annual contributions to the LIC for the Gratuity Plan in respect of employees at certain circles.
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c) d)

Short term compensated absences are provided for based on estimates. Actuarial gains and losses are recognized as and when incurred.

12. PRE-OPERATIVE EXPENDITURE Expenditure incurred by the Company from the date of acquisition of license for a new circle or from the date of start-up of new ventures or business, up to the date of commencement of commercial operations of the circle or the new venture or business, not directly attributable to fixed assets are charged to the Profit and Loss account in the period in which such expenditure is incurred. 13. LEASES a) Where the Company is the lessee Lease Rentals with respect to assets taken on ‘Operating Lease’ are charged to the Profit and Loss Account on a straight-line basis over the lease term. Assets acquired on ‘Finance Lease’ which transfer risk and rewards of ownership to the Company are capitalized as assets by the Company at the lower of fair value of the leased property or the present value of the related lease payments or where applicable, estimated fair value of such assets. Amortization of capitalised leased assets is computed on the Straight Line method over the useful life of the assets. Lease rental payable is apportioned between principal and finance charge using the internal rate of return method. The finance charge is allocated over the lease term so as to produce a constant periodic rate of interest on the remaining balance of liability. b) Where the Company is the lessor Lease income in respect of ‘Operating Lease’ is recognised in the Profit and Loss Account on a straight-line basis over the lease term. Finance leases as a dealer lessor are recognized as a sale transaction in the Profit and Loss Account and are treated as other outright sales. Finance Income is recognized based on a pattern reflecting a constant periodic rate of return on the net investment of the lessor outstanding in respect of the lease. c) Initial direct costs are expensed in the Profit and Loss Account at the inception of the lease.

14. TAXATION Current Income tax and fringe benefit tax is measured at the amount expected to be paid to the tax authorities in accordance with Indian Income Tax Act, 1961. Deferred tax is measured based on the tax rates and the tax laws enacted or substantively enacted at the balance sheet date. Deferred tax assets are recognised only to the extent that there is reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realised. In situations where the company has unabsorbed depreciation or carry forward tax losses, all deferred tax assets are recognised only if there is virtual certainty supported by convincing evidence that they can be realised against future taxable profits. Unrecognised deferred tax assets of earlier years are re-assessed and recognised to the extent that it has become reasonably certain that future taxable income will be available against which such deferred tax assets can be realized. Minimum Alternative tax (MAT) credit is recognised as an asset only when and to the extent there is convincing evidence that the Company will pay normal income tax during the specified period. In the year in which the MAT credit becomes eligible to be recognized as an asset in accordance with the recommendations contained in Guidance Note issued by the ICAI, the said asset is created by way of a credit to the Profit and Loss account and shown as MAT Credit Entitlement. The Company reviews the same at each balance sheet date and writes down the carrying amount of MAT Credit Entitlement to the extent there is no longer convincing evidence to the effect that Company will pay normal Income Tax during the specified period. 15. MISCELLANEOUS EXPENDITURE Premium on redemption of debentures is recognised as an expense to the Profit and Loss Account over the period of the related contract. 16. BORROWING COST Borrowing cost attributable to the acquisition or construction of a qualifying asset is capitalised as part of the cost of that asset. Other borrowing costs are recognised as an expense in the period in which they are incurred.

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17. IMPAIRMENT OF ASSETS Assets that are subject to amortization are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognized for the amount by which the assets’ carrying amount exceeds its recoverable amount. The recoverable amount is the higher of the assets’ fair value less costs to sell and value in use. For the purpose of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash flows (cash generating units). 18. SEGMENTAL REPORTING a) Primary Segment The Company operates in four primary business segments viz. Mobile Services, Telemedia Services, Enterprise Services Carriers and Enterprise Services Corporate. b) Secondary Segment The Company has operations within India as well as with entities located in other countries. The operations in India constitute the major part, which is the only reportable segment, the remaining portion being attributable to others. 19. EARNINGS PER SHARE The earnings considered in ascertaining the Company’s Earnings per Share (‘EPS’) comprise the net profit after tax. The number of shares used in computing basic EPS is the weighted average number of shares outstanding during the year. The diluted EPS is calculated on the same basis as basic EPS, after adjusting for the effects of potential dilutive equity shares unless impact is anti dilutive. 20. WARRANTY AND ASSET RETIREMENT OBLIGATIONS (ARO) Provision for warranty and ARO is based on past experience and technical estimates. 21. PROVISIONS Provisions are recognised when the Company has a present obligation as a result of past event; it is more likely than not that an outflow of resources will be required to settle the obligation, in respect of which a reliable estimate can be made. These are reviewed at each balance sheet date and adjusted to reflect the current best estimates. 22. EMPLOYEE STOCK OPTIONS OUTSTANDING Employee Stock options outstanding are valued using Black Scholes / Lattice valuation option – pricing model and the fair value is recognised as an expense over the period in which the options vest. 23. CASH AND CASH EQUIVALENTS Cash and Cash equivalents in the Balance Sheet comprise cash in hand and at bank.
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Schedules annexed to and forming part of accounts
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2008
SCHEDULE: 21 NOTES TO ACCOUNTS 1. Bharti Airtel Limited (‘Bharti Airtel’ or ‘the Company’) incorporated in India on July 7, 1995, is a Company promoted by Bharti Telecom Limited (‘BTL’), a Company incorporated under the laws of India. The name of the Company has been changed from Bharti Tele-Ventures Limited (‘BTVL’) to Bharti Airtel Limited (‘Bharti Airtel’). a) New Operations i) The Company and Bharti Hexacom Limited (BHL) have entered into a scheme of arrangement for transfer pursuant to de-merger of North East Circle Undertaking from BHL to the Company effective April 1, 2005, which has been approved by the Board of Directors of the Company in their meeting held on July 26, 2005 and July 27, 2005 and the Board of Directors of BHL in their meeting held on July 20, 2005. The Company is in the process of filing the approved scheme in the High Court. The Company had entered into a scheme of amalgamation of Satcom Broadband Equipment Limited (SBEL) and Bharti Broadband Limited (BBL) with the Company effective October 1, 2005, which has been approved by the Hon’ble High Court of Delhi on April 17, 2007. The Company had filed the approved scheme with the Registrar of Companies, NCT of Delhi, and received certificate of registration on July 27, 2007. Accordingly, all assets and liabilities of erstwhile SBEL and BBL are recorded by the Company under pooling of interest method effective October 1, 2005. a. b. The difference between the carrying value of Investment in SBEL and BBL and value of net assets acquired under the Scheme of Rs. 43,127 thousand has been credited to Reserves and Surplus. The Company has not issued any shares to give an effect to the above scheme.

2.

ii)

iii) On April 3, 2007, Bharti Airtel (Singapore) Private Limited (BASPL), Singapore, has been incorporated for providing Voice Interconnection, Prepaid International Calling Services, International Private Leased Circuits and VSAT Trading. BASPL was granted the Facilities Based Operator (FBO) license by the Infocom Development Authority of Singapore (IDA) on July 6, 2007. iv) During the year ended March 31, 2008, Bharti Airtel Services Limited (BASL) (erstwhile Bharti Comtel Limited), the wholly owned subsidiary of Bharti Airtel, has sold it’s entire shareholding in Bharti Telemedia Limited (BTML) to Bharti Airtel, its parent Company and Bharti Enterprise Limited (BEL) in the ratio of 40% and 60%, respectively. v) On September 7, 2007, the Company acquired 49% of the Equity in Bharti Aquanet Limited, India, at a consideration of Rs 159,549 thousand making Bharti Aquanet Limited a 100% subsidiary of the Company.

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vi) On September 28, 2007, the Company acquired 100% of the Equity in Network i2i Limited, Mauritius, at a consideration of USD 133,400 thousand (Rs 5,313,916 thousand). The principal activity of the Network i2i Limited is operation and provision of telecommunication facilities and services utilising a network of submarine cable systems and associated terrestrial capacity. vii) On October 1, 2007, a new Company Bharti Airtel Holding (Singapore) Pte Limited has been incorporated in Singapore as an investment holding Company of the Company. viii) The Company has acquired 2% stake in a subsidiary of IFFCO Limited called IFFCO Kissan Sanchar Limited at a consideration of Rs. 50,125 thousand. ix) During the year ended March 31, 2008, the group has further invested USD 1,200 thousand towards 1,200 thousand shares of Bridge Mobile Pte Limited. The Company’s share in the Joint Venture has reduced from 12.5% as on March 31, 2007 to 10% as on March 31, 2008 due to the introduction of new shareholders and additional investment. x) Bharti Aquanet Limited (Aquanet) has filed a scheme of amalgamation (Scheme) with Bharti Airtel effective on the date of filing of Scheme approved by Hon’ble High Court with the Registrar of Companies. The

860 2. 3.639 168.239.721 3. 2008 and the above treatment has been followed in accordance with the treatment prescribed in the Scheme sanctioned by the Hon’ble High Court and there is no impact of it in the Profit & Loss Account. 2007 and has been filed on April 21. b) Scheme of arrangement for Transfer of Telecom Infrastructure The scheme of arrangement (“the Scheme”) between Bharti Airtel Limited and Bharti Infratel Limited (‘BIL’) for transfer of assets and liabilities of passive telecom infrastructure undertaking.003 44. 2008 in the Delhi High Court for its approval. 2008 amounting to Rs.015 6. .181 382.603.198 thousand in the Balance Sheet as of March 31. accordingly.686.974 1.690 4.396.e.181. been given effect to in these financial statements and pursuant to the terms of the Scheme. Contingent liabilities a) Total Guarantees outstanding as at March 31. 24. 13.632 216.194 415. based on legal advice.195 276.627 thousand (March 31. as defined in the Scheme (‘the Telecom Infrastructure’).191. 11. b) Claims against the Company not acknowledged as debt: (Excluding cases where the possibility of any outflow in settlement is remote): (Rs. ‘000) Particulars (i) Taxes. Delhi and Haryana on January 31.825 68. 2008 i. 2007 and filed with the Registrar of Companies. The Reserve for Business Restructuring arising there on net of (i) above stands at Rs.561 410.377 217.471 133. 1. Corporate Guarantees outstanding as at March 31.720. 2007 Rs. 2008 As at March 31. (i) the Company has transferred the Telecom Infrastructure worth Rs.694 542.195. 2007 Rs.115 87 Unless otherwise stated below.077.989.350 19.785.005 thousand to BIL at Nil value (ii) the Company has revalued its investments in BIL and recorded the same at its fair value of Rs.198.Scheme was approved by the Board of Directors of Bharti Airtel and Aquanet in their meeting held on April 26. as per the Scheme. the management believes that.888 31. the outcome of these contingencies will be favorable and that a loss is not probable. 2007 and December 17. 82.811 thousand) have been given to banks and financial institutions on behalf of Group Companies.890 thousand (March 31.433 182. Duties and Other demands (under adjudication / appeal / dispute) -Sales Tax (see 3 (c) below) -Service Tax (see 3 (d) below) -Income Tax (see 3 (e) below) -Custom Duty (see 3 (f) below) -Stamp Duty -Entry Tax (see 3 (g) below) -Municipal Taxes -Access Charges / Port Charges (see 3 (i) below) -DoT demands (including 3 (h) below) -Other miscellaneous demands (ii) Claims under legal cases including arbitration matters (including 3 (j) below) As at March 31.931 84. 882. from Bharti Airtel to BIL was approved by the Hon’ble High Court of Delhi vide order dated November 26.829 2. 2007 333.203 thousand.255 1. 57.773 thousand) have been issued by banks and financial institutions on behalf of the Company. the Effective Date of the Scheme. The Scheme has.787 1. 2008 amounting to Rs.

Comissioner of Service Tax Commissioner (Appeals) Joint Commissioner Commissioner (Appeals) Commissioner (Appeals) Commissioner (Appeals) Commissioner of Service tax Service Tax Service Tax Service Tax Service Tax Service Tax Service Tax Service Tax Service Tax Service Tax 547 157 1. 1994 Tax Provisions) Act.213 1.174 Service Tax Service Tax 591 51.871 199 14 Period to which it relates 2001-02 2002-03 2003-04 2004-05 2002-03 1996-97 1997-98 2004-05 2004-05 2003-04 2003-04 2006-07 2006-07 2003-04 2004-05 2006-07 2004-05 2006-07 2002-03 2003-04 2005-06 2006-07 2007-08 2002-03 2003-04 2004-05 2005-06 1997-98 1998-99 Forum where the dispute is pending Assessing Officer Assessing Officer Assessing Officer Assessing Officer Appelate Tribunal DCCT .613 62.233 143. details of unpaid amounts relating to Income Tax.999 1.729 200 32.1948 UP Trade Tax Act.1948 UP Trade Tax Act. 1994 Tax Provisions) Act.302 1.1948 UP Trade Tax Act.670 168. Director( Enforcement) Assessing Officer Assessing Officer Asst Commissioner Trade Tax-Noida Joint Commisoner Appeals Joint Commisoner Appeals Joint Commisoner Appeals High Court of Karnataka tribunal Deputy commisoner Appeal Karnataka Sales Tax Karnataka Sales Tax Karnataka Sales Tax Karnataka Sales Tax Haryana Sales tax West Bengal Sales Tax Act West Bengal Sales Tax Act UP Trade Tax Act.1948 UP Trade Tax Act.785 157 157 2003-04 2003-04 2005-06 2004-05 2004-05 2002-03 2006-07 2004-05 2004-05 Sub Total (B) .1991 Madhya Pradesh Commercial Tax Act.275 611 750 1.388 2.250 1.1948 UP Trade Tax Act.000 2.592 155 298 96 1.069 206 75 400 650 256.130 3.000 928 150 500.1991 Sub Total (A) 88 Finance (Service Finance (Service Finance (Service Finance (Service Finance (Service Finance (Service Finance (Service Finance (Service Finance (Service Finance (Service Finance (Service Act. Excise and Service Tax Appelate Tribunal. 1994 Tax Provisions) Act.1948 Central Sales Tax Act Central Sales Tax Act Gujrat Sales Tax Act Kerala Sales Tax Act Andhra VAT Act Punjab Sales Tax Act Punjab Sales Tax Act UP Trade Tax Act.1948 UP Trade Tax Act.927 1.1948 UP Trade Tax Act. 1994 Tax Provisions) Act.626 15. 1994 Tax Provisions) Act. 1994 Tax Provisions) Act.419 1.1948 UP Trade Tax Act. Director( Enforcement) Jt. 1994 Tax Provisions) Act.1948 Karnataka Sales Tax Madhya Pradesh Commercial Tax Act. 1994 Tax Provisions) Act. 1994 Tax Provisions) Act.930 2001-02 2002-03 Supritendent of Mohali Appeal filed with Customs. 1994 Tax Provisions) Sales Sales Sales Sales Sales Sales Sales Sales Sales Sales Sales Sales Sales Sales Sales Sales Sales VAT Sales Sales Sales Sales Sales Sales Sales Sales Sales Sales Tax Tax Tax Tax Tax Tax Tax Tax Tax Tax Tax Tax Tax Tax Tax Tax Tax Tax Tax Tax Tax Tax Tax Tax Tax Tax Tax Sales Tax 825.797 402 14 4. 1994 Tax Provisions) Act.035 501 320 7.180 252 150 5.Appellate Stage The Appelate authority Assessing Officer Joint Commisoner Appeals Assessing Officer Joint Commisoner Appeals Joint Commisoner Appeals Assessing Officer Joint Commisoner Appeals Joint Commisoner Appeals Assisstant Commissioner of Sales Tax Assessing Officer Assisstant Commissioner (CT) Jt. Service Tax and Custom Duty together with forum where dispute is pending as at March 31.1948 UP Trade Tax Act.992 144 Amount Deposited (in Rs ‘000) 3. 2008 is set out below: Name of the Statutes Nature of the Dues Amount Disputed (in Rs ‘000) 411 1.Of the above. Mumbai Commissioner of Central Excise (Appeals) Commissioner of Central Excise (Appeals) Asstt.650 611 750 385 146 206 75 400 650 127.1948 UP Trade Tax Act.733 252 500 35. Sales Tax.

504 130. 2007 .919 11.694 thousand) for the imports of special software on the ground that this would form part of the hardware along with which the same has been imported. The management is of the view that the probability of the claims being successful is remote. based on legal advice. 2008 was Rs.829 thousand (March 31. it is probable that its tax positions will be sustained and accordingly. 2008 comprised the cases relating to i. 1961 Act. 217. 1961 1961 1961 1961 Income Income Income Income Income Income Income Income Income Income Income Income Income Income Income Income Income Income Income Tax Tax Tax Tax Tax Tax Tax Tax Tax Tax Tax Tax Tax Tax Tax Tax Tax Tax Tax Sub Total (C) Customs Act-1962 Sub Total (D) Custom Act 31. the material proposed to be taxed not covered under the specific category. Chennai c) Sales tax The claims for sales tax as of March 31.741 1.270 170 5.404 7.Rs.080 16.504 1.Rs. The management believes that. This position has been challenged by the Company in the respective states.954 Period to which it relates 2000-01 2005-06 1997-98 2002-03 2003-04 2004-05 2006-07 1995-96 2001-02 2002-03 2004-05 2001-02 2002-03 2001-02 2005-06 2005-06 2006-07 2006-07 2007-08 Forum where the dispute is pending Income Tax Appellate Tribunal Income Tax Appellate Tribunal Hon’able HC of State Income Tax Appellate Tribunal Commissioner of Income Tax (Appeal) Commissioner of Income Tax (Appeal) Commissioner of Income Tax (Appeal) Income Tax Appellate Tribunal Income Tax Appellate Tribunal Income Tax Appellate Tribunal Hon’able HC of State Income Tax Appellate Tribunal Income Tax Appellate Tribunal Income Tax Appellate Tribunal Commissioner of Income Tax (Appeal) Commissioner of Income Tax (Appeal) Commissioner of Income Tax (Appeal) Commissioner of Income Tax (Appeal) Commissioner of Income Tax (Appeal) Income Income Income Income Income Income Income Income Income Income Income Income Income Income Income Income Income Income Income Tax Tax Tax Tax Tax Tax Tax Tax Tax Tax Tax Tax Tax Tax Tax Tax Tax Tax Tax Act. 1961 Act.082 24.420 4.733. d) Service tax The service tax demands as at March 31. 1961 Act. Act. 1961 Act. Classification issues have been raised whereby.980 2. 1961 Act.956 55.480 3.571 Amount Deposited (in Rs ‘000) 60.Name of the Statutes Nature of the Dues Amount Disputed (in Rs ‘000) 60.690 35. 1961 Act. 31. 2008 relate to: i. 1961 Act.221 5. in view of the Company. 2007 .352.950 6. . Act.980 2. recognition of a reserve for those tax positions will not be appropriate.690 572 960 6. 1961 Act.119 572 1.919 11. demanded Rs. 1961 Act.151 9.954 26. 89 e) Income tax demand under appeal Income tax demands under appeal mainly included the appeals filed by the Company before various appellate authorities against the disallowance of certain expenses being claimed under tax by income tax authorities. 1961 Act.194 2006-07 Directorate of Revenue Inteligence. 3. ii. in some states. on the grounds that the specific entry tax is ultra vires the constitution. ii.420 4. 1961 Act. 2008 (March 31.950 6. roaming revenues charged from other operators.270 170 11.194 thousand as at March 31. 1961 Act.488 26.264 24.350 thousand) included in Note 3 (b) above.680 123. g) Entry tax In certain states an entry tax is levied on receipt of material from outside the state.971 5. 1961 Act.194 31. Act. 44. and subscriber receivables written off. the appropriateness of the declarations made by the Company under the relevant sales tax legislations which was primarily procedural in nature. The amount under dispute as at March 31. 1961 Act. 1961 Act. The view of the Company is that such imports should not be subject to any custom duty as it would be an operating software exempt from any custom duty. and the applicable sales tax on disposals of certain property and equipment items. f) Custom duty The custom authorities.

No amounts have been paid or accrued towards these demands. if any. Crystal Technologies Private Limited (‘Crystal’). non availability of spectrum.125 equity shares of Rs. the outcome of these contingencies will be favourable and that a loss is not probable. operational hazards. as applicable within a period of eight years from the import of capital goods. The erstwhile promoter of Bharti Broadband Limited has undertaken to reimburse the Company in the event of the claim being payable.14% as at March 31. DSS has filed an application for restoration of the suit on which notice has been issued to Bharti Airtel and other defendants. DSS. an intermediary. The Export Promotion Capital Goods Scheme. which has been appealed to in the Delhi High Court by DSS and subsequently transferred to District Court. has been issued 2. an award for damages.722. k) Bharti Mobinet Limited (‘BMNL’) Litigation Bharti Airtel is currently in litigation with DSS Enterprises Private Limited (DSS) (0. access charges (pre-IUC period) and Non-CLI calls. Export Obligation Bharti Airtel has obtained licenses under the Export Promotion Credit Guarantee (‘EPCG’) Scheme for importing capital goods at a concessional rate of custom duty against submission of bank guarantee and bonds. etc. 50.h) DoT Demands i) The Company has received demands from DoT pertaining to Bharti Broadband Limited (now merged with Bharti Airtel Limited) amounting to Rs. Pending settlement of these claims. Under the terms of the respective schemes. The management believes that. Accordingly. no amounts have been accrued although some have been paid under protest.34 per cent equity interest in erstwhile Bharti Cellular Limited (BCL)) for an alleged claim for specific performance in respect of alleged agreements to sell the equity interest of DSS in erstwhile Bharti Mobinet Limited (BMNL) to Bharti Airtel. The management believes that. In respect of the same transaction. The suit was subsequently dismissed as frivolous. This suit was dismissed in default on the ground of non-prosecution. or more than. DSS has also filed a suit against a previous shareholder of BMNL and Bharti Airtel challenging the transfer of shares by that shareholder to Bharti Airtel. Subsequently. j) Others/Miscellaneous Others mainly include disputed demands for consumption tax. five times the CIF value of imports in respect of certain licenses and eight times the duty saved in respect of licenses where export obligation has been refixed by the order of Director General Foreign Trade. 90 . 194. the Company has disclosed the related amount as contingent liability. a minority shareholder in BCL. the outcome of these contingencies would not result into any liability.563 thousand against which an appeal has been filed before Hon’ble TDSAT (included in note 3 (b) above). The management believes that. Ministry of Finance. 4. These claims are under litigation at various forum or at stages of mutual discussion for settlement. based on legal advice. disputes before consumer forum and with respect to labour cases and a potential claim for liquidated damages. The Company has not been able to meet its roll out obligations fully due to certain non-controllable factors like Telecommunication Engineering Center testing. Foreign Trade Policy 2004-2009 as issued by the Central Government of India. Since the amalgamation of BCL and erstwhile Bharti Infotel Limited (BIL) with Bharti Airtel.843 thousand included in Note 3 (b) above regarding termination of its appointment as a consultant to negotiate with DSS for the sale of DSS stake in erstwhile BMNL to Bharti Airtel. The case filed by DSS to enforce the sale of equity shares before the Delhi High Court had been transferred to District Court and was pending consideration of the Additional District Judge. The Company has received show cause notices from DoT for 14 of its circles for non-fulfillment of its roll out obligations. in accordance with Clause 5. The Company is confident that this show cause notice would not result into liability. covers both manufacturer exporters and service providers. of Bharti Airtel arising out of above litigation cannot be currently estimated. 2008. the outcome of these contingencies will be favourable and that a loss is not probable. the Company is required to export goods of FOB value equivalent to. export of telecommunication services would also qualify. An interim stay has been granted by the Delhi High Court with respect to the commencement of arbitration proceedings. based on legal advice. 10 each bringing the share of DSS in Bharti Airtel down to 0. has initiated arbitration proceedings against the Company demanding Rs. no amounts have been accrued or paid in regard to this dispute. The liability. ii) i) Access charges/Port charges The Company has several claims from BSNL relating to transit charges.2 of the Policy. Accordingly. Standing Advisory Committee of Radio Frequency Allocations clearance. Accordingly. DSS has also initiated arbitration proceedings seeking direction for restoration of the cellular license and the entire business associated with it including all assets of BCL/BMNL to DSS or alternatively.

009. 2007 Rs.363 (4.778 thousand (March 31.367 8. the Company has commitments to pay Rs.953 1.103 299. Employee benefits a) During the year.261 91 # Included in Salaries.109 Unfunded 20.370. wages and bonus (Refer Schedule 15) @ Includes contribution to defined contribution plan for key managerial personnel (Refer Note 16 below) Defined Benefit Plans (Rs.50% 7.087.768) 88. 8. 25.666) 15.667 27. Wages and Bonus (Refer Schedule 15) b) The assumptions used to determine the benefit obligations are as follows : Particulars Discount Rate Expected Rate of increase in Compensation levels Expected Rate of Return on Plan Assets Expected Average remaining working lives of employees (years) Gratuity 7.00% N/A 25.603.323 1.215 Leave Encashment # Unfunded 190.85 years Leave Encashment 7. 6.819 18.093 For the Year ended March 31.190. ‘000) Particulars Gratuity # Funded Current service cost Interest cost Expected return on plan assets Actuarial (gain) / loss Past service cost Curtailment and Settlement cost / (credit) Net cost 94. 2007 Rs. 63. b) Under the IT Outsourcing Agreement.106 Total 115.029 212.401 4 (13.184 thousand (March 31. the Company has recognized the following amounts in the Profit and Loss Account Defined Contribution Plans (Rs.499 thousand). 2007 Rs.491 81. a) Estimated amount of contracts to be executed on capital account and not provided for (net of advances) Rs.074 Employer’s Contribution to Provident Fund *@ Employer’s Contribution to Super annuation Fund # Employer’s Contribution to ESI * * Included in contribution to provident and other funds (Refer Schedule 15) # Included in salaries. 1. 2007 366.186 26.00% 7.748 3. 6.Accordingly the Company was required to export goods of FOB value of Rs.304 thousand) comprising finance lease and servicing charges.764 (4. 71.764) 75.705.695 197.173 1.610 thousand).50% 7.806 thousand (March 31.50% 25.85 years . 2008 415. ‘000) Particulars For the Year ended March 31. 5.

613 100.206 thousand (March 31. The Company was not informed by LIC of the investments made by the LIC or the break-down of plan assets by investment type.676) d) The expected rate of return on plan assets was based on the average long-term rate of return expected to prevail over the next 15 to 20 years on the investments made by the LIC.682 345.850 115. 2007 71.116) Gratuity Unfunded 112. ‘000) Particulars Funded Change in Projected Benefit Obligation (PBO) Projected benefit obligation at beginning of year Current service cost Interest cost Benefits paid Curtailment and Settlement cost Contribution by plan participants Past service cost Actuarial (gain) / loss Projected benefit obligation at year end Change in plan assets : Fair value of plan assets at beginning of year Expected return on plan assets Actuarial gain / (loss) Employer contribution Contribution by plan participants Settlement cost Benefits paid Fair value of plan assets at year end Net funded status of the plan Net amount recognized 244. 2004.819 18.676 (464. via the Indian Sub-Continent & Middle East) and will also provide long term technical support to a consortium of sixteen Telecom operators in various countries including the Company.529) 65.764 (4.367 8.186 26.764 (4. ‘000) Particulars For the Year ended March 31.529) 65.363 (21.401 (102. 437. 220.475) 70.217) 61. (Rs. Investment in Joint Ventures : a) Vide a supply contract and construction and maintenance agreement executed on March 27.257 (100.491 (201.578 103.219 (21.258) 8.257) (100. 2008 218.620 63.257) Total 356.247 (280.103 464.676) (464.526 4.121 218.093 20.708 222.c) Reconciliation of opening and closing balances of benefit obligations and plan assets (Rs. This was based on the historical returns suitably adjusted for movements in long-term government bond interest rates. 2007 Rs.542 190.452 thousand in the venture for 8.764 (123. Estimated amounts of benefits payable within next year are Rs.051% share. e) f) The Company made annual contributions to the LIC of an amount advised by the LIC.295 445. The discount rate is based on the average yield on government bonds of 20 years. Alcatel Submarine Networks of France and Fujitsu Ltd.116) (280.042 92 g) Movement in provision for Deferred Bonus Plan Opening Balance Add: Addition during the year Less : Utilized during the year Closing Balance 7.049. b) The Company entered into a Joint Venture with 9 other overseas mobile operators to form a regional alliance called the Bridge Mobile Alliance incorporated in Singapore as Bridge Mobile Pte Limited.943 thousand). of Japan provided the SEA-ME-WE-4 Cable Systems (broadly described as a submarine cable system linking South East Asia and Europe.546 thousand during the year towards upgradation of capacity. The Company has further paid an advance of Rs. 91.247 (380. The principal activity of the venture is creating and developing regional mobile services and managing the Bridge Mobile Alliance .373) Leave Encashment Unfunded 366.733) 23.921 146. The Company has invested Rs.373) (380.667 27.219 (21. which is included under Capital work in progress.733) 23.127) 81.042 107.526 4.172 For the Year ended March 31.757 94. 2.363 63.

603 68. in 2.56 = USD 1. 2009 at 111. (net) Investments Current assets Cash and bank Loans and advances Current liabilities and provisions Unsecured Loans As at March 31. The FCCBs are convertible at any time on or after June 12.000 thousand. in whole or in part.000. The Issuer will. The FCCBs may also be redeemed in whole.030 4.000 Zero Coupon Convertible Bonds due 2009 (the “FCCBs”).84 percent of their principal amount. 43. 2004 (or such earlier date as is notified to the holders of the FCCBs by the Issuer) up to April 12. dollars on May 12.776) 3. 2009. 43. amounting to Rs.966) For the year ended March 31. 43.S. 2007 31. The FCCBs may be redeemed.852) Profit and Loss Account Service revenue Other income Expenses Operating expenses Selling. dollars at the rate of Rs. 2007: USD 1. 233.541 4.449 2. 10 each of the Issuer (“Shares”) at an initial Conversion Price (as defined in the “Terms and Conditions of the FCCBs”) of Rs.50%) c) The Company has sold it’s 14.713 2. 2009 by holders into fully paid equity shares with full voting rights with a par value of Rs.800 (Rs. dollars at the “prevailing rate” (as defined in the “Terms and Conditions of the FCCBs”) for each of 30 consecutive “Trading Days” (as defined in the “Terms and Conditions of the FCCBs”).982 (6.763 thousand. Rs. ‘000) Particulars Balance Sheet Reserve and surplus Fixed assets. which are included in the Balance Sheet and Profit and Loss Account respectively.S. During the year ended March 31.200 thousand ordinary shares of USD 1 each which is equivalent to an ownership interest of 10% as at March 31. 2007 (18.237 thousand. at the option of the Issuer at any time on or after May 12. general and administration expenses Finance expenses/(income) Depreciation (Loss) 8. 92.492 5.732 8. Unless previously converted. The FCCBs may also be redeemed in whole.955 As at March 31. ‘000) Particulars For the year ended March 31.411 10. and income and results of the joint venture. 2007 and prior to April 12. d) The following represent the Company’s share of assets and liabilities. 2008 (March 31. is greater than 120 percent of the “Conversion Price” (as defined in the “Terms and Conditions of the FCCBs”) then in effect translated into U. subject to satisfaction of certain conditions.Programme. at any time at the option of the Issuer at their Early Redemption Amount in the event of certain changes relating to taxation in India.286 24. at their “Early Redemption Amount” (as defined in the “Terms and Conditions of the FCCBs”) at the date fixed for such redemption if the “Closing Price” (as defined in the “Terms and Conditions of the FCCBs”) of the Shares translated into U.245 1. the FCCBs will be redeemed in U. repurchase at the Early Redemption Amount such FCCBs at such time as the Shares cease to be listed or admitted to trading on the NSE or upon the occurrence of a “Change 93 .325) 11.00.S.674 19.00. the last of which occurs not more than five days prior to the date upon which notice of such redemption is published. at any time at the option of the Issuer at their Early Redemption Amount if less than 5 percent in aggregate principal amount of the FCCBs originally issued is outstanding.56 = USD 1. 2005 the Company issued USD 115.17 per share with a fixed rate of exchange on conversion of Rs. 2008 14. at the option of any holder of any FCCBs.28% shareholding at cost in Forum I Aviation Limited to its subsidiary Bharti Airtel Services Limited.478 11.419 25.200 thousand.751 (1.417 11. The Company has invested USD 2. ownership interest 12.335 15. 2008 (19. The Conversion Price is subject to adjustment in certain circumstances.782 34.393) 9.770 (3. and not in part. redeemed or purchased and cancelled. (Rs.

10. 576. No. 571. titles. 2007 Rs.724.000 9. These FCCBs are listed in the Singapore Exchange Securities Trading Limited (the “SGX-ST”). 10.603. 2007 Total 9. 3. spares tools and accessories • All rights. represents refundable security deposits received from subscribers on activation of connections granted thereto and are repayable on disconnection.407.040 42.000 94 Vehicle Loan From Bank Total 24.of Control” (as defined in the “Terms and Conditions of the FCCBs”) in respect of the Issuer. 2.967 1. b) Investment in subsidiaries of Bharti Airtel. 13.824 equity shares) of the Company are held by Bharti Tele-Ventures Employee’s Welfare Trust issued at the rate of Rs. 2008.317. The Loans and Advances granted to subsidiaries are repayable on demand and repayments made during the year are as mutually agreed. .314 equity shares of the Company at the option exercised by the bond holders which is as follows: Date of Allotment May 15. Secured by Hypothecation of Vehicles of the company. of shares allotted 1. interests in the accounts.314 FCCB value (USD) 6.011 thousand (March 31. Billing Revenue in the Profit and Loss Account is net of Rebates and Discounts Rs.000 into 1. 2007. The Company has during the year ended March 31. 2007 November 6.000 Rs.500. As at March 31. 50 Non-convertible Redeemable Debentures of Rs.878.645 equity shares (March 31. 51.244 Note : Following shall be excluded from Securities as mentioned above:a) Intellectual properties of Bharti Airtel.244 524.000 230. 500. 2007 September 12. book debts and insurance policies.70%. 2008 Converted FCCBs equivalent to USD 9.729 thousand). office equipment. if any and security deposits received from channel partners.230. net of outstanding.36 per equity share fully paid up. c) Licenses issued by DoT to provide various telecom services. Particulars of securities charged against secured loans taken by the Company are as follows : Particulars Amount Outstanding (Rs ’000) Security Charges Debentures 11.214.500. 12.000 2.307 467. 2. Sundry debtors are secured to the extent of the amount outstanding against individual subscribers by way of security deposit received from them.487 thousand (March 31. 11. and monies deposited and investments made there from and in project documents. 2007 Rs.230.000 thousand each repayment commencing from Dec 2009 • First ranking pari passu charge on all present and future tangible movable and freehold immovable assets owned by Bharti Airtel Limited including plant and machinery.724. furniture and fixtures fittings. 3.610 thousand) included under Current Liabilities.

392 924.680.809 2.095 For the year ended March 31.242 11. 2008 For the year ended March 31.689.764 81.709 115.442 332.917 15. 2007 Expenditure On account of : Interest Professional & Consultation Fees Travelling Roaming Charges (Incl.720 2.541 (Rs. 1956 to the directors (including managing director) is: (Rs.704 12.284 154.681 5.358 10.515 393.980 232. 2007 101. Commission) Membership & Subscription Staff Training & Others Network Services Annual Maintenance Bandwidth Charges Access Charges Software Marketing Upfront fee on borrowings Point of Presence Charges Directors Commission Swap loss Total Earnings Roaming Revenue Billing Revenue Swap income Total 15.072.755. not included above .412 12.182 10.078 538.225.678.705 15. 2007 29.661 8.462.170 204. ‘000) Particulars For the year ended March 31. The aggregate managerial remuneration under section 198 of the Companies Act.147 55.095 48. CIF Value of Imports : 1.128 73.976.601 2. ‘000) Particulars For the year ended March 31.498 10.062 10.988 95 16.081 2.678. Expenditure / Earnings in Foreign Currency (on accrual basis) : (Rs.903 8.710 572.693.634 2.022 243. 2008 48.445.140 For the year ended March 31.351.934.027 1. ‘000) Particulars Capital Goods Total For the year ended March 31.726 157.143 309.330 30. the amount pertaining to directors is not ascertainable and.932 444.664 178.204 Whole Time Directors Salary Contribution to Provident fund and other funds Reimbursements and Perquisites Performance Linked Incentive Total Remuneration payable to whole time directors Non Whole Time Directors Commission Sitting Fees Total amount paid /payable to non whole time directors Total Managerial Remuneration Liability for Gratuity and Leave Encashment is provided on actuarial basis for the Company as a whole.642 276.152. 2008 101.134 29.227 8.988 29.204 470 150.422 600 11.760 59.972 16.433 1.485 6.062.903 739 11.120 264.558 12. therefore.695 18.14.099.515 2.075 15.976.466 13.

000 44. 2008 24.000 3.080 32. (iii) The cumulative amount of excess remuneration paid to the whole time director of the Company pending approval of Central Government pertaining to earlier years is Rs. pending approval of the Central Government is Rs.Computation of net profit in accordance with Section 349 of the Companies Act.140 For the year ended March 31. 1.022 24. Accordingly the rates of depreciation followed by Company are higher than the minimum prescribed rates as per schedule XIV.703 46.403 15.684. 565 thousand) and is refundable by the director.281 243.000 102.712 276.684. to extent available with the Company). 2007 67. Auditors Remuneration : (Rs. 3.114 thousand (March 31. 2000 respectively] (March 2003: Rs.204 Net Profit before tax from ordinary activities Add: Remuneration to whole time director’s Add: Amount paid to non whole time directors Add: Depreciation and amortisation provided in the books * Add: Profit/(Loss) on sales of fixed assets Add: Provision for doubtful loans and advances Add: Provision for wealth tax Less: Depreciation under section 350 of the Companies Act.423 264.518 2.000 2.703 185 24. 669 thousand for the year ended March 31. and calculation of remuneration payable to directors (Rs.080 71. ‘000) Particulars For the year ended March 31. 2000 and Rs.101 462.943 thousand [Rs. (ii) The Central Government’s approval is pending against the application made by erstwhile Bharti Cellular Limited (BCL) in respect of excess remuneration paid to Whole time Directors of Rs.833 4. 3. Sundry Creditors include amount payable to Micro and Small Enterprises as at March 31. 2007 Rs.206. 1.534 96 Audit Fee* Certification Fee * Reimbursement of Expenses * Other Fees* Total * Excluding Service Tax 19. 2007: Rs. 2008 of Rs Nil (March 31.114 thousand) and is refundable by Directors.063 thousand (March 31.172.642 4. 2007 46.725. 4.832.274 thousand for the five month period ended August 31.571 5.016 30. 2007 Rs Nil) (based on the information. 565 thousand (March 31.498 11.837.553 For the year ended March 31.088. 1956 Net Profit / (Loss) for the year under Section 349 Maximum amount paid / payable to non whole-time directors restricted to 1% Maximum amount paid / payable to whole-time directors restricted to 11% Amount Paid / Payable to Directors * The Company provides depreciation on fixed assets based on useful lives of assets that are lower than those implicit in schedule XIV of the Companies Act.943 thousand) payable to the former Whole time Director which exceeds the limits prescribed by Schedule XIII of the Companies Act.013. 2007: Rs. 1956.063 thousand).075 1. (i) The Central Government’s approval is pending against the application made by erstwhile Bharti Mobile Limited (BML) in respect of remuneration of Rs. 1956.065 7. 2008 69. . 1. 4.712 232.257. (iv) The cumulative amount of excess remuneration paid to Managing Director and Whole time Directors (erstwhile ‘BIL’) pertaining to earlier years.182 11. ‘000) Particulars For the year ended March 31.471 712.837. 18. 17. 1956.150 3.

127.277.507 9. (‘000) 56.395 50.683 7.084 1.629 10 79.994 3.268 Year ended March 31. 2008 2007-08 2007-08 Qty Value Qty Value Qty Value Nos.20.176 .761 9.145 Simcards (Refer Note 2 below) TDMA/PAMA VSATs Assembly sets (Refer Note 3 below) Internet Modem & others (1) Includes cost transferred from Fixed Assets. (‘000) Purchases Sales/Internal Year ended (Refer note 1 below) Utilisation March 31.885 14.817 6.317.696 2006-07 Particulars Year ended March 31.356 3.063 1.2.364.524 61 Value (‘000) 464.607 Simcards (Refer Note 2 below) TDMA/PAMA VSATs Assembly sets (Refer Note 3 below) Internet Modem & others .969 792.572 568.995 49.636 28.183.2. (2) Excludes value of simcards issued free of cost.792 454. (‘000) 30.046 482.444 Purchases (Refer note 1 below) 2006-07 Qty Value Nos.933 1.513 28.432.876 746.439 1.761 9.510 229 3.163.132 Value (‘000) 172.155 177. 2007 Qty Nos.562 1.146.114 1.145 Acquired Under scheme of Amalgamation Qty Value Nos. 6.390 478. (‘000) 45.994 3. (‘000) Nos.136.432 442 34. 97 .352 6.390 478. (3) The quantitative information for TDMA / PAMA VSATs Assembly sets has not been given since they constitute voluminous small items.605. (‘000) Nos.568 11.524 61 Value (‘000) 464.144.969 Sales/Internal Utilisation 2006-07 Qty Value Nos.472 50.734 492. 21.027 1. 21. 2007 Qty Nos.189. 2006 Qty Nos.317. Quantitative Information 2007-08 Particulars Year ended March 31.353.

740 58.Institutional Plus Growth I261 ING Vysya Liquid Fund Super Institutional .Government Securities National Saving Certificate Deposits Total (B) Other than Trade (Quoted).850.286 10.634.099.Mutual Funds.705.591 77.175 11.836 Other than Trade (Quoted).053 - 1.069 27.Growth UCC .000 750. 2008 (No.000 500.726.574 25.30% REC Secured Bonds Total (A) Other than trade (Unquoted).495 13.Plus .836 1.000 1.466. 2008 Cost 27.000 500.000 250.020 20.007 1.152 151.Instl.516.018.Growth* Principal Cash Management Fund Liquid Option Instl.Super Institutional Growth Templeton India TREASURY MANAGEMENT ACCOUNT Super Institutional Plan .Growth OCFPG HSBC Cash Fund . Growth Kotak Liquid premium UTI Liquid Fund Birla Sun Life Cash Manager .000 1.000 1.166 26.316 15.437.488.069 18 1.832 12.MFHSBC0004 Templeton Floating Rate Income Fund-Short Term Plan-Institutional Option .972.000. Prem.932 7.166. 2007 (No.847 95. Plan .Growth-Auto Redemption Lotus India Liquid Fund .043.913 11.653.675.846 1.Growth Option B503G Birla Cash Plus .714 98 .949.169 8.613 94.Growth G69 Standard Chartered Liquidity Manager .839 184 As at March 31.936. The details of investments required as per Schedule VI of the Companies Act 1956 are provided below: (a) Details of Investments held as at March 31.000 500.230 1. of Units) 30 As at March 31.583.000 50. Debentures and Bonds HDFC Liquid Fund .000 1.565 208. of Units) 30 As at March 31. . Plan .Growth Fund Tata Dynamic Fund Reliance Interval Fund DSP Liquid Plus Institutional Plan Growth Principal Cash Management Liquid Fund Prudential ICICI Institutional Liquid Plan Fund Total (C) TOTAL (A) + (B) + (C) 61.711 116.000 750.000 163.800 39 1.Growth P31ISG ICICI Prudential Institutional Liquid Plan .359 121.462.Growth TFRSIG TATA Floating Rate Short Term Inst.485 16.694 88.Growth Plan DBS Chola Short Term Floating Rate Fund-Cumulative Principal Floating Rate Fund . Growth Kotak Floater DWS Insta Cash Plus Fund .305 479. 2008 (Rs.139.000 78.903.000 500.000.982 41.010 254.522 450.000 152.Super IP HDFC Floating rate Short term-Wholesale Plan Fidelity Liquid Plus Fund-Super IP UTI Liquid Fund-IP Standard Chartered Fixed Maturity Plan-Quarterly series 25 HDFC FMP 90D AIG India Short Term Fund Reliance FRF-Growth Principal Floating Rate Fund .000.824 62.502 5.FMP-Insti.373 200.182 647.435.246 300.Government Securities 7.Growth Reliance Liquid Fund .871 25. Prem.SMP-Insti.113 750.000 50.934.000.Institutional Plus .378 43.000.676 129.000 750.000 150.726.000 25.Super Institutional Plan .641 99.228.Premium Plus Plan .734.236 25.000 250.000 15. ‘000) Particulars As at March 31.Institutional Option .934.000 1.000 250.451 145.002 563.399.789 44.871 1.Growth AIG India Liquid Fund AIG India Treasury Plus Fund DBS Chola Liquid Fund .261 15.000.940 113.000 250. 2007 Cost 25.490 59.21.723 39.741.007 500.000 750.255.637.834 37.419 117.560.998.791 149.

052 3.973 432.880.632 823.254.301.617 1.Growth Option DWS Money Plus Fund .Institutional Plus Growth I261 ING Vysya Liquid Fund Super Institutional .935.315 200.Growth G69 Standard Chartered Liquidity Manager .791 67.367 .880.Growth Plan Templeton Floating Rate Income Fund-Short Term Plan-Institutional Option .530.543 821. Plan .941 HDFC Liquid Fund .Growth TLMG TATA Liquidity Management Fund .394.000 1.292 681.Plus-Growth Lotus India Liquid Plus Fund .15.148 700.264.673 .357 1.790.645 313.637.838 157.510 8.975 70.Super Inst.Growth 719.560.796.000 7.165 3.032 485.485.000 544.364 4.085.810.309.507 7.253.367 150.966.Growth Reliance Liquid Fund . .327.860.935.745 1.461.641 1.083 164.Growth B503G Birla Cash Plus .478 1.443 3.560.300. .260.860 2.083 70.214.000 78.364 1.Institutional Growth UTI Money Market Fund .559.636.Growth Option DWS Insta Cash Plus Fund .099.116.276.050.082 92.850 961.992.293.735 .Institutional Plus .301.838 157.120.IG .104 307.Growth P31ISG ICICI Prudential Institutional Liquid Plan 13.009.825.238 4.994 820.627 138. ‘000) 16.056 3.817. ‘000) 99.212.595.982.574 Reliance Monthly Interval Fund-Series-Institutional 25.571 260.735 3.592.Growth-Auto Redemption Reliance Liquid Fund . 2007 Units (Rs.936.502 151.050 1.MFHSBC0004 HSBC Liquid Plus-Inst.315 4.997.892.745 116.883.400.420 7.405.848.589.018 320.373.684.353.122 307.751 Mutual Funds / Bonds B46 Birla Sun Life Cash Manager .637.333.423 640.136 20.403 250.000 70.940 Growth Plan DSP Merrill Lynch Liquidity Fund.000 250.855.845.345 115.852 3.574 254. Prem.364 4.Premium Plus Plan .790.615 3.359.359 67.502 Kotak Liquid (Institutional Premium) .544 205.653.621 320.Institutional Plus .825.160.142 820.644 3.374.123 3.Growth Option 94.595.864.367 138.601 234.426 3.236.861.113 249.503 3.809 263.741 .270.667.592.909 151.503.345 Plan Growth DSP Merrill Lynch Liquid Plus Institutional Plan Growth 48.173.573.839 4.559.Growth Templeton India Treasurey Management Account Super Institutional Plan .Institutional Option .030.020.996 59.019.339.915 .600 780.000 Sale / Redemption Proceeds Units (Rs.239 51.154.400.610.941 358.413.238 .000 4.991.Growth M17G ABN AMRO Money Plus Institutional Growth M46 ABN AMRO CASH FUND .429.364 2.FMP-Insti.327 719.335.423.Particulars Balance as on April 1.Institutional Plan .Growth Principal Cash Management Fund Liquid Option Instl.883 .822 1.Institutional .684. ‘000) 24.886 2.152 Purchased During the Year Units (Rs.560 4.075.236.592.Growth G69 Standard Chartered Liquidity Manager .042.658.665.596 8.224.435.270.179 129.436.225 3.114 149.330.961 Kotak Flexi Debt Scheme .824 4.607.128 .255 3.Institutional 7.836 1.510 7.034.290 20.376 306.345 1.123 4.030.000 776.760 1.Growth OCFPG HSBC Cash Fund .600 731.70.292 759.617 .008 40.094 424.002 433.971 640.284.196.491.456.959.530.996 59.484.475.Growth Templeton Floating Rate Income Fund-Long Term Plan-Institutional Option .097 9.Instl.869 2.227 .Growth TFRSIG TATA Floating Rate Short Term Inst.966.911.495 Prem.236 .915 5.416 .794.794.722.000 154.087 5.552 4.844 11.011.355.140 3.983 5.575 504.Growth Plan DBS Chola Short Term Floating Rate Fund-Cumulative Reliance Liquidity Fund-Growth Plan-Growth Option Principal Floating Rate Fund .Growth 12. 10.229 825.454.735 6.000 3.819.140 99 5.911.694 10.384 253.676 Super Institutional Growth NFSG CANFLOATING RATE Short Term Growth Fund TATA Fixed Horizon Fund 9 Scheme C .794.993 37.008.Institutional 64.121 164.227 4.Growth* 8.Growth Birla Sun Life Liquid Plus Instl.023 70.737 4.287.Plus .377 3.094 424.600 8.091.775.934 1.696.965 4.Plus .030 970.000 64.305 9.335.676 970.470.027 19. Growth DWS Short Maturity Fund .580.052 8.832 Plan .000 3.858 883.993 37.070 233.263.026. Plan .496.269.299.011.330 1.000 254.205.603.173.831.010 28.655.Growth I312 ING Vysya Liquid Plus Fund .413.000 883.652 206.Growth Fidelity Cash Fund .507 122.608 1.000 9.652 Kotak Liquid (Institutional Premium Plan) .941 299.731.663 327. .384 294.Growth UCC .116 15.675.Growth UTI Liquid Cash Plan Institutional .Growth Plan Lotus India Liquid Fund .645 313.434 350.Growth 5.659.108 5.Institutional Option .932 TDBG TATA Dynamic Bond Fund Option B .19.516 .000 116.445 1.033.711 117.955.160.116.548 373.299.185.059 6.Growth Option - .358.Growth TFLG TATA Floater Fund .

944 58.544.053 25.391.878 445.39.175.620.860 940.116 100.137 34.473 51.733 276.860 .857 126.40.159.000.828 3.000.019 .067 1.251 2.792 315.000 7.000 20.081.217 22.000 80.000 250.721 4.487.970 285.174.733 238.597.74.000 1.003.000 .000 20.000 7.949 .759 1.25% State Bank Of Indore 2017 Bonds-8.000 87.959 392. Growth 7.623.021 200.159.099.892 495.537 3.89.906 .114 663.000 40.78.30% GOI Fertilisers SPL Bonds 2023 Bonds-8.537 670.923.085.739.207 10.003.959 175.792 330.432.000 11.000 .000 14.004.Growth Option ABN AMRO Short Term Income Fund-IP-Growth (earlier ABN AMRO FRF-IP-Growth) Can Bank Floater-ST HSBC FRF-STP-Growth DBS Chola Liquid Fund .245.966 .263.000 .624.Super Institutional Plan .547 71.000 200.Short Term Plan .711 8.762 4.335.492 50.041 5.223 50 50.519 400.942.049 39.665.718.759. ‘000) 30 - Purchased During the Year Units (Rs.790.76.000 6.566 200.910 48.414 150.297 90.630 50 49.Growth * 27 ICICI Prudential Flexible Income Plan .000.561.544.561.825.253.003.751 483.966 990. 2007 Units (Rs.000 445.736.652.796.ING Vysya Bank Ltd Bonds-10.718.359 2.227 89.000 11.000 11.961 500.000 100.004.000 60 1.676.166 787.444 3.302 1.097 915.Super IP Grindlays FRF-IP-LTP-Plan B Canliquid Plus Fund HDFC Floating rate Short term-Wholesale Plan DSP ML Cash Plus Fund-IP JM High Liquidity-Super IP UTI Liquid Plus Fund-IP JM Money Manager Fund-Super Plus Plan .099 4.000 .872.34.049 2.614 3.839 175.297 90.25.000.620.273 123.000.Growth DBS Chola Interval Income Fund-Monthly Plan A AIG India Liquid Fund Tata Liquid Fund-SHIP JP Morgan India Liquid Plus Fund DWS Credit Opportunities Cash Fund AIG India Treasury Plus Fund DWS Money Plus Fund .684.097.978 60 189.000 250.920.000 37.000 120.736.478 4.000 120.166 34.990 256.972.198 52.183.000.Growth Templeton Floating Rate INCOME FUND Long Term Plan Super Institutional Option .790.000 22.000 355.000.25.779 100 B84 Birla Sun Life Short Term Fund .Growth UTI Liquid Cash Plan Institutional .30% Bank of Baroda 2022 Uper Tier II Total Non Trade 7.30% GOI Fertilisers SPL Bonds 2023 9.191.041 201.000 283.115 357.984.000.294 3.710.023 220.225 .202.Growth Birla Sunlife Interval Income Fund-Monthly Plan Series-I Fidelity Liquid Plus Fund-Super IP UTI Liquid Fund-IP ABN AMRO Interval Fund-Monthly Plan Series-A Lotus India Fixed Maturity Plan-1 Month-Series III Tata Fixed Income Portfolio Fund-A2 SUNDARAM BNP PARIBAS MONEY FUND SUPER IP Standard Chartered Fixed Maturity Plan-Quarterly series 25 HDFC FMP 90D SBI Magnum Insta Cash-Cash Plan AIG India Short Term Fund Reliance FRF-Growth Principal Floating Rate Fund .363.614 3.000 500.796 100.353.990 256.796.000 .664.908.762 4.39.965 4.665.009 126.906 1.30% GOI Fertilisers SPL Bonds 2023 Bonds-8. ‘000) 100.207 10.755 .081.684.11.20.349 283.462.37.000.91.994 80.128 1.000 6.910 48.778 58.214 47.036 25.485.000 1.Growth Kotak Floater HDFC Floating Rate Income Fund .198.755 1.755 .356.443.402.000 200.295.198.238 60.530.000 58.25.062 521.389.350 4.131. ‘000) Sale / Redemption Proceeds Units (Rs.024 3.461 450.000 1.354 201.568 2.291 390.SMP-Insti.186.347 5.576.000 147.796 87.038.813 403.Particulars Balance as on April 1.690.460.049 .116 .871 50 50 500.272 .Growth Option UTI Fixed Income Interval Fund-Monthly Interval Plan DWS Insta Cash Plus Fund .339 3.033 133.682 120.759.755 250.Growth C122 DBS Chola Freedom Income STP-Inst.300 252.295.000 220.281 74.232 3.291 .004.133.-Cum-Org Templeton India SHORT TERM INCOME PLAN Institutional .004.846 3.603 1.377 151.30% REC Secured Bonds 2013 Bond .062 425.414 14.643 445.731 104.597.173 925.993 3.997.566 .074 20.245.429 3.931 53.700.022 3.000 76.736.159 71.624.868 100.363.442 34.015 3.612 36.019 787.30% GOI Fertilisers SPL Bonds 2023 Bonds-8.013 251.396.485.942.825.893 287.753 50.250.664 480.086.723 .128 .753 50.225 3.336.001.185 996.612 36.

000 159.000 100.181.000 24. ‘000) 24.763 30.816 Sale / Redemption Proceeds Units (Rs.000 248.973 102. 2007 Units (Rs.342 Purchased During the Year Units (Rs.000 1.000.056.275. 101 . ‘000) 166.Particulars Balance as on April 1.549 404.200.316.225.980 100.378.270.902 5.207.000 4.000 5.802.139 0 0 48.752 Trade investment Investment in Subsidiaries Bharti Hexacom Limited Bharti Airtel Services Limited Satcom Broadband Equipment Ltd @ Bharti Aquanet Limited Bharti Airtel (USA) Limited* Bharti Airtel (UK) Limited * Bharti Airtel (Hongkong) Limited * Bharti Airtel (Canada) Limited Bharti Infratel Limited# Bharti Telemedia Limited Network i2i Limited Bharti Airtel Singapore Private Limited Bharti Airtel Holding (Singapore ) Pte Limited Bharti Airtel Lanka (Private) Limited Investment in Joint Ventures Bridge Mobile Pte Limited Forum I Aviation Limited Others IFFCO Kissan Sanchar Ltd Total Trade Investments Total Investment * Share Application Money @ Refer Note 2(a) on Schedule 21 # Pursuant to Scheme of Arrangement Investment in Bharti Infratel Limited has been fair valued.125 88.465 7.272.474 50.973 30.000 278.000 1 1 100 1.836 8.867 277.200 1.080.748 1.000 3.000 104.148 82.000.000 900.203 40.184 4 500 43.514 31.859. ‘000) 1.200 3.501.039 20.973 175.000.457 55.000 5.000 200 1 1 100 50.000 248.773 18.859.

152 55.886) 638.326.156 49. is given below: Site Restoration Cost: (Rs.214.094 (1.653.682.400.152 55.664.886) 25.008 12.439 40.820) 192.600.593.837.029.534 (131.197 41.183 44.059.399) 4.027 5.886) 119.407 (20.857.134 (131.069 61.483 1.902 389.104.143.415.864 101.488.384.365) - 5.152 181.118 35.899 43.798 63.Primary For the year ended March 31.197 6.767) 372.742.736 3.720) .545 3.419 (131.467 11.956.886) 2.063.741.541 For the year ended March 31.198.301.022 21.837.956.938.541.696 11.481 83. The movement of provision in accordance with AS–29 ‘Provisions.343.198.028 Opening Balance Addition during the year Less : Transferred under the scheme of arrangement* Closing Balance *Transferred to Bharti Infratel Limited as per the scheme of arrangement (Refer Note 2(b) on Schedule 21).257.682.354 128.891 Enterprise Services Corporate 9.895.088.503 4.197 6.136.283) 259.954.857.136.474.028 1.082 5.033 119.835.487 20.857 Others Eliminations Total Revenue Service Revenue/Sale of Goods and Other Income Inter Segment Revenue Total Revenue Results Segment Result.644.684 61.828. Information about Business Segments .786 106.471 5.148 1.047.767 6.534 49.684 187.080 69.950.122 3.935 186.944.133 42.696 11. Contingent liabilities and Contingent Assets’ issued by Institute of Chartered Accountants of India.211. ’000) Reportable Segments Mobile Services Telemedia Services Enterprises Services Carriers 21.141.001 97.327 27.696 50.768 - (31.443.625.677 74.956.965 25.365) 62.835.677 259.393.540 55.698 5.388.028 33. 23.994 149.943 19. A provision is recognized for the costs to be incurred for the restoration of these premises at the end of the lease period.722 7.202 13.089.386.293 (1.213.562.956.318 6.340 (241.617 (131.388.22.080 (8.817 (3.479) 8.863 28.283) (3.234.Current Tax -MAT Credit . 2007 1.475.513 206.544.521. It is expected that this provision will be utilized at the end of the lease period of the respective sites as per the respective lease agreements.919 7.622.304) 1.749 18.423 8.Fringe Benefit Tax .196.Deferred Tax (Credit)/ Charge Net Profit/(Loss) after tax 102 Other Information Segment Assets Inter Segment Assets Advance Tax (Net of provision for tax) Total Assets Segment Liabilities Inter Segment Liabilities Deferred Tax Liability Total Liabilities Capital Expenditure Depreciation and amortisation 200.600.059. ‘000) Particulars For the year ended March 31.393.393.712 3.550.059.326.720 5.388.600.980) 10.2008 (Rs.921 11.053.767) 372.011 6.768.201.293 (1.725.738.257.150.551 611.408.977.441.316.558. 2008 3.867. Profit/(Loss) Net Finance Expense/( Income ) Net Profit/(Loss) Provision for Tax .267.857 (15.902 - 111.030.079 51.552 1.857 5.459.136.317 638.027.140.140.540.556 245.120.308 34. The Company uses various premises on lease to install the equipment.340 (241.922 389.944.804.768 (31.

879.605.743 24.265 267.137.295. Profit/(Loss).876 33.617.383 88.057.299.964.140.690.772.018 35.410 11.756 14.221.879.230 9.517) (187.226 187.295. 5. Inter segment Assets / Liabilities represent the inter segment account balances. 6.745. Also refer Note 7 of Schedule 20.115) 17.939 663.012 8.613 22. 103 .249.004.544 Others Eliminations Total Revenue Service Revenue / Sale of Goods and Other Income Inter Segment Revenue Total Revenue Results Segment Result.471 111.502 33.259 - (21.674.385.745 11.195 2.697 143.687 4.162 40. pre-operative expenses pending allocation.610.590 3.970 476. Inter segment revenues excludes the provision of telephone services free of cost among group companies. Segment assets include fixed assets. Profit / (Loss) Net Finance Expense / (Income) Net Profit / (Loss) MAT Credit Provision for Tax Fringe Benefit Tax Deferred Tax Expense Net Profit/(Loss) after tax Other Information Segment Assets Inter Segment Assets Advance Tax (Net of provision for tax) MAT Credit Total Assets Segment Liabilities Inter Segment Liabilities Provision for FBT (net of payment) Deferred Tax Liability Total Liabilities Capital Expenditure Depreciation and amortisation 131.561 38.183 13.077) 2.970 476.661 8.018 1.367.195. These transactions have been eliminated in consolidation.366. Assets & Liabilities.876 175.115) 14.906 869.057 190.152.446 18.745 33. The accounting policies used to derive reportable segment results are consistent with those described in the “Significant Accounting Policies” note to the financial statements.057) 5.927.590 3.537.013.115) 173.137.960 2.866. 2.419 34.570.939.857.383 134.819 14.788 173.558.372 254.382 4.057 268.440 46.885.939. Current Liabilities and Provisions.567 3.195 2.745 11.567 17.712 (187.928.939.552 1.057) 5.714.930 66.493 61.553.354.838 12.513 32.652 - 24.720 24.921.253.299. ’000) Reportable Segments Mobile Services Broadband & Telephone Services 21.885.793.808.137.259 (21.295.783) 153.332.285.813. Segment Liabilities include Secured and Unsecured Loans.621 153.751.138.939 (114. 7.590 9.154 (7.210 70.071 151.495.047 9.307.617 47. Others represents the unallocated revenue.929.077 783.964) - 13.440 (4.For the year ended March 31.088 Enterprises Services Carriers 17. 4.115) Notes: 1.885.875.650.727. Others are accounted for on terms established by management on arm’s length basis.495.727. 8.152 2.943 178.248.993.231 33.961 23. current assets and miscellaneous expenditure to the extent not written off.477 (114.943 48.076) 178.893.727.597 10. capital work in progress.488.079.249.299.076) (1.254 Enterprise Services Corporate 7.018 1.017.162 (9.848 2.905 43.226 187.051 10.072 (114.602 45.895.252.303.522 7.991 16.572.644) (425.520.182.966) 27.721.558.204 21.466. Capital expenditure pertains to gross additions made to fixed assets during the year.876 33.577 (114.305.366.177.137. Segment results represents Profit/(Loss) before finance expenses and tax.372 254.100 6.621 (30.377. 3.995 38.885. 2007 (Rs.

393. as identified and certified by the management are: List of Related Parties: Key Management Personnel : 104 Sunil Bharti Mittal Akhil Gupta Manoj Kohli Other Related Parties Name of the Related Party Bharti Hexacom limited Bharti Aquanet Limited Bharti Airtel (Services) Limited Bharti Telemedia Limited Bharti Airtel (USA) Limited Bharti Airtel Lanka (Private) Limited Bharti Infratel Lanka (Private) Limited Bharti Airtel (UK) Limited Bharti Airtel (Canada) Limited Bharti Airtel (Hongkong) Limited Bharti Infratel Limited Bharti Infratel Ventures Limited Network i2i Limited Bharti Airtel Holding (Singapore) Pte Limited Bharti Airtel Singapore Private Limited Forum I Aviation Limited Relationship Subsidiary Company Subsidiary Company Subsidiary Company Subsidiary Company Subsidiary Company Subsidiary Company Subsidiary Company Subsidiary Company Subsidiary Company Subsidiary Company Subsidiary Company Subsidiary Company Subsidiary Company Subsidiary Company Subsidiary Company Joint Venture of Subsidiary . deferred tax asset and miscellaneous expenditure to the extent not written off.491 389.391. Others represents the unallocated revenue.992 12.301 97.254. the remaining portion being attributable to others.746 16. ‘000) Particulars Segment revenue from external customers based on geographical location of customers (including Other Income) Within India Others Carrying amount of segment assets by geographical location Within India Others Cost incurred during the year to acquire segment assets by geographical location Within India Others As at March 31.272.693 3.743 Notes: 1. Capital Work in Progress. is presented below : (Rs.835. 2007 243. The information relating to the geographical segments in respect of operations within India. Cost incurred to acquire segment assets pertain to gross additions made to Fixed Assets during the year.071 94.338.308 82.772. 2. 24.Information about Geographical Segment – Secondary The Company has operations within India as well as with entities located in other countries. Related Party Disclosures : In accordance with the requirements of Accounting Standards (AS) -18 on Related Party Disclosures. Assets include Fixed Assets.490.857.444 7.004 500.935 166.382.739 82.354. 3. Current Assets.677 382. 2008 As at March 31.007 2.971. which is the only reportable segment.943 264.879. the names of the related parties where control exists and/or with whom transactions have taken place during the year and description of relationships.466.378 268.931 259.054.388. assets and acquisition of segment assets of the Company.089.951 178. Investments.

Bridge Mobile Pte Limited Singapore Telecommunications Limited Bharti Telesoft Limited Bharti Teletech Limited Bharti Tele-Ventures Employees Welfare Trust Bharti Wal-Mart Private Limited Bharti Enterprises Limited Bharti Retail Private Limited Bharti Foundation Bharti Electoral Trust Jasmine Project Private Limited Tamarind Project Private Limited Bharti Venturetech Limited Joint Venture Entity having significant influence Entity where Key Management Personnel exercises significant influence Entity where Key Management Personnel exercises significant influence Entity where Key Management Personnel exercises significant influence Entity where Key Management Personnel exercises significant influence Entity where Key Management Personnel exercises significant influence Entity where Key Management Personnel exercises significant influence Entity where Key Management Personnel exercises significant influence Entity where Key Management Personnel exercises significant influence Entity where Key Management Personnel exercises significant influence Entity where Key Management Personnel exercises significant influence Entity where Key Management Personnel exercises significant influence 105 .

666 56.527 3.093 (57.633 (2.633 634.314) (2.450) 990.382) (240) (240) (240) (18.531 117 (335.150) 5.338.286) Bharti Bharti Bharti Airtel Airtel Airtel (Canada) (Hongkong) (Singapore) Limited Limited Limited Bharti Telemedia Limited Bharti Bharti Network Singapore Infratel Airtel Lanka i2i TeleLimited (Private) Limited communication Limited Limited (37.045 23.531 17.076) (12.124) 3.912 (31.740 (57.440) 3.531 864.876.169.484 1.382) (11.345.106 Related Party Transaction for 2007-08 (Rs.327 342.170.486 890.013) (2.871) (240) 28.604) 110.000 26.142) 634.664 (1.338.(1.095 (527.327 990.725.166.279 (527.737) .633 (2.275.746) 634.960.746) .450) (40.937.760 904 865.107 (6.279 - Nature of transaction Purchase of fixed assets Sale of fixed assets Rendering of services Receiving of services Fund transferred/includes expenses incurred on behalf of others Fund received/includes expenses incurred on behalf of Company Employee related transaction incurred on behalf of others Employee related transaction incurred on hehalf of Company Salary Donation Amount received on exercise of ESOP options Purchase of shares of Subsidiary Companies Subscription to share capital Interest charged on funds transferred Closing balance Unsecured Loan Creditors Loans and Advances Debtors Closing Balance Maximum Loans and Advances outstanding during the year .773) (3.148) (20.382) (3.643.658.535) 443.912 (11.553.253 1.812) 25.139) 25.484 1.450) (11.633 79.346 342.532) Bharti Aquanet Limited Bharti Airtel (Services) Limited (8.115) 1.531 890.708) 634.(17.597 2.(1.266) (1.700 Bharti Airtel (USA) Limited 308.327 (404.627.790. ‘000) Bharti Hexacom Limited (101.091.698 (1.091.279 110.399) 939 1.376.265 (850.685) (143.913 (280) Bharti Airtel (UK) Limited (4.811) (1.462.912 342.912 (3.170.901 (15.902) 990.604) 634.780 1.020) 110.117 .164.346) 6.514) 342.091.863.780 1.484 890.328) (527.593 1.928) (174.583.

524 5.000 (14.607 189.486) (8.685) (1.197) 200.Related Party Transaction for 2007-08 (Rs.515) 523.791 13.750) 119.252 (50.252 (50.222 (15.015 3.939 31 202 15.179) (1.642 (14.043 .994) 5.666) 681 4.900 115 (3.(2.085 (10.043 - outstanding during the year Note :- Refer Note 16 on Schedule 21 for Managerial Remuneration paid to key managerial personnel (other than Manoj Kohli) 107 .122 3.873) 13.689) Limited Private Limited Limited Private Private dation Limited Private Trust Ventures Wal-Mart Telesoft Teletech Projects Projects Foun.252 147 (50.998 (1.463) (3.197) (3.685) 147 3.197) 119.515) 523.043 119.791 (48.441 (440) 454 1.658.020) 32.043 147 3.015 (77) (36.685) (1.800) 580 (1.970 53.785) (52.586) 2.263 1.791 12.791 12. ‘000) Forum I Aviation Mobile Pte Limited Limited Limited Limited Limited Employees’ Welfare Trust (27.900 119.087 (556.131) (5.252 523.515) 523.707) (89.Enterprises Retail Electoral TeleBridge Bharti Bharti Bharti Jasmine Tamarind Bharti Bharti Bharti Bharti Bharti Bharti Venturetech Limited Manoj Kohli Nature of transaction Purchase of fixed assets Sale of fixed assets Rendering of services Receiving of services Fund transferred/includes expenses incurred on behalf of others Fund received/includes expenses incurred on behalf of Company Employee related transaction incurred on behalf of others Employee related transaction incurred on Behalf of Company Salary Donation Amount received on exercise of ESOP options Purchase of shares of Subsidiary Companies Subscription to share capital Interest charged on funds transferred Closing balance Unsecured Loan Creditors Loan and Advances Debtors Closing Balance Maximum Loans and Advances 3.474) 104.543.

574 972.463 56.184) 23 (75.’000) Bharti Hexacom Limited (20.073.468 1.186 861.628 123.381) 16.604 (738.816 12. .764 2.816 9.227 2.Broadband band Equipment Limited Limited Bharti Comtel Limited Bharti Infratel Limited Bharti Telemedia Limited Bharti Airtel (USA) Limited Bharti Airtel (UK) Limited Bharti Bharti Singapore Airtel Telecom Tele(Canada) Limited communication Limited Limited Bharti Telesoft Limited Bharti Bharti TeleTeletech Ventures Limited Employee’s Welfare Trust 81.891) 1.239 68.673) 5.649) 4.414) 906.787 133.489 (879.601) 423.490) (3.456) 8.249) 487.074 (55.436) (27.080 608.111) (64.031 521 20 43.463 56.772 (44.488 18.306 (4.126 799.062) (833.590 4.518 (31.403 - Purchase of fixed assets Sale of fixed assets Rendering of services Receiving of services Fund transferred/includes expenses incurred on behalf of others Fund received/includes expenses incurred on behalf of Company Employee related transaction incurred on behalf of others Employee related transaction incurred on hehalf of Company Salary Amount received on exercise of ESOP options Subscription to share capital Interest charged on funds transferred Closing balance Unsecured Loan Creditors Loan and Advances Debtors Closing Balance Note: Refer Note 16 on Schedule 21 for Managerial Remuneration paid to Key managerial personnel (other than Manoj Kohli).242) 29.675 (38) (975) 8.212 50.126 26.449.518 (1.078 799.816) 1.239 68.704) 1.436) (27.078 9.830 (1.490 111.971) 13.466 70.359.078 972.479 20 20 20 56.207.682 57.064 860.126 799.064 (4.937 (10.967 (138.108 Related Party Transaction for 2006-07 (Rs.078 9.840) 35 (8.682 (41.746 133.457) 1.463 861.601) 423.772 21 21 21 (500) (104.881 (253.753) (6) 57.436) Bharti Aquanet Limited Bharti Satcom Broad.654) 583 (13) (183.223) 9.155) (2.682 57.986 (27.787 133.787 Manoj Kohli Nature of transaction 30.351 (5.

the fixed assets received are accounted for as a finance lease transaction.366. the asset and liability are recorded at the fair value of the leased assets at the inception. 2008 is as follows: (Rs.026 165. The lease rental receivable proportionate to actual kilometers accepted by the customer is credited to the Profit and Loss Account on a straight-line basis over the lease term.738 As at March 31.885 1. 2007 281.969. Since the entire amount payable to the vendor towards the supply of fixed assets during the year is accrued. The breakup of net Deferred Tax Asset/ (Liability) as on March 31. 2008 and accordingly.371. other disclosures as per AS 19 are not applicable.019.375) (638.255.345.936 2.648.413 As at March 31. 27.126. Leases a) Operating lease .953 5.693.621) . 2007 109 (4. Accordingly.427.368. The Company entered into a composite IT outsourcing agreement. 2008 11.059) 92.291 38. 2007 3.559 4.269) 1.734 1. Due to the nature of the transaction.741 9. it is not possible to compute gross carrying amount.775 153.025 (2. ‘000) Particulars Lease Rentals Obligations on non cancelable leases : Not later than one year Later than one year but not later than five years Later than five years Total b) Operating Lease – As a Lessor i) The Company has entered into a non-cancelable lease arrangement to provide approximately 100. there are no minimum lease payments outstanding as at the year-end in relation to these assets and accordingly.804.684) (3.242.758.765 As at March 31.965 160.887 105. These assets are depreciated over their useful lives as in the case of the Company’s own assets.000 Fiber pair kilometers of dark fiber on indefeasible right of use (IRU) basis for a period of 15 years.25.029 As at March 31.As a Lessee The lease rentals charged during the year for cancelable/non-cancelable leases relating to rent of building premises and cell sites as per the agreements and maximum obligation on long-term non-cancelable operating leases are as follows: (Rs. ‘000) Particulars Deferred Tax Assets / (Liabilities) arising from : (i) Provision for doubtful debts / advances charged in the financial statements but allowed as deduction under the Income Tax Act in future years (to the extent considered realisable) (ii) Depreciation claimed as deduction under the Income Tax Act but chargeable in the financial statements in future years (iii) Other expenses claimed as deduction under the Income Tax Act but chargeable in the financial statements in future years (Net) (iv) Less : Transfer under the scheme of arrangement (Refer Note 2(b) of Schedule 21) Net Deferred Tax Asset/(Liability) 3.509. whereby the vendor supplied fixed assets and IT related services to the Company. depreciation for the year and accumulated depreciation of the asset given on operating lease as at March 31.095 3.693. The future minimum lease payments receivable are: (Rs. 2008 As at March 31.743 2.436 1. Based on the risks and rewards incident to the ownership. ‘000) Particulars Not later than one year Later than one year but not later than five years Later than five years Total As at March 31. disclosures required by AS 19 is not provided.991 ii) 26.477.073 (32. 2008 377.120.

(iv) All above options are planned to be settled in equity at the time of exercise and have maximum period of 7 years from the date of respective grants.840.367. Employee stock compensation (i) Pursuant to the shareholders’ resolutions dated February 27.000 equity shares at a price of Rs. 22. 2001 and September 28. The grant of options to the employees under the ESOP Scheme is on the basis of their performance and other eligibility criteria. 2005. 2001. 2001 and September 25. the Company introduced the “Bharti Tele-Ventures Employees’ Stock Option Plan” (hereinafter called “the Old Scheme”) under which the Company decided to grant. the Company issued a total of 1. 110 The options under this plan have an exercise price of Rs. 2001. 1961. The Company issued bonus shares in the ratio of 10 equity shares for every one equity share held as at September 30. options to the employees of the Company and its subsidiaries. The plans existing during the year are as follows: a) 2001 Plan under the Old Scheme The options under this plan have an exercise price of Rs. from time to time. the Company announced a new Employee Stock Option Scheme (hereinafter called “the New Scheme”) under which the maximum quantum of options was determined at 9.99% being the substantively enacted tax rate for Indian companies under the Income Tax Act. 565 per equity share to the Trust. 28. (ii) On August 31.440. as a result of which the total number of shares allotted to the trust increased to 15. 2001.000 equity shares.The tax impact for the above purpose has been arrived at by applying a tax rate of 33. (iii) Pursuant to the shareholders’ further resolution dated September 6. 70 per share and vest on a graded basis as follows: Vesting period from the grant date For options with a vesting period of 48 months: On On On On completion completion completion completion of of of of 12 24 36 48 months months months months Vesting schedule 10% 20% 30% 40% c) Super-pot Plan under the Old Scheme The options under this plan have an exercise price of Rs Nil per share and vest on a graded basis as follows: Vesting period from the grant date Vesting schedule 30% 30% 40% For options with a vesting period of 36 months: On completion of 12 months On completion of 24 months On completion of 36 months .50 per share and vest on a graded basis as follows: Vesting period from the grant date For options with a vesting period of 36 months: For options with a vesting period of 42 months: On On On On On On On On On On On completion completion completion completion completion completion completion completion completion completion completion of of of of of of of of of of of 12 24 36 12 18 30 42 12 24 36 48 months months months months months months months months months months months Vesting schedule 20% 30% 50% 15% 15% 30% 40% 10% 20% 30% 40% For options with a vesting period of 48 months: b) 2004 Plan under the Old Scheme.276 options to be granted to employees from time to time on the basis of their performance and other eligibility criteria.

50 324.00 1.660 742 163 755 6 70.50 22.50 270 853 825 167 131 128 853 22.25 22.00 70.50 1.50 22. forfeited and outstanding at the year-end is as follows: (Shares in Thousands) As of March 31.25 22. exercised.50 0.50 22.76 to 3.00 131 44 50 37 37 22.50 22.94 111 . 2008 Number of Weighted Weighted stock average average options exercise remaining price (Rs.25 to 5.25 to 4.25 70.00 70.) contractual life (in Years) As of March 31.50 22.25 70.76 to 4.00 70.00 2.d) 2006 Plan under the Old Scheme The options under this plan have an exercise price of Rs 10 per share and vest on a graded basis from the effective date of grant as follows: Vesting period from the grant date For options with a vesting period of 48 months: e) 2005 Plan under the New Scheme The options under this plan have an exercise price in the range of Rs 221 to Rs 922 per share and vest on a graded basis from the effective date of grant as follows: Vesting period from the grant date For options with a vesting period of 48 months: On On On On completion completion completion completion of of of of 12 24 36 48 months months months months Vesting schedule 10% 20% 30% 40% On completion of 36 months On completion of 48 months Vesting schedule 50% 50% (v) The information concerning stock options granted.) contractual life (in Years) 2001 Plan Number of shares under option: Outstanding at beginning of year Granted Exercised Cancelled or expired Outstanding at the year end Exercisable at end of year Weighted average grant date fair value per option for options granted during the year/period at less than market value 2004 Plan Number of shares under option: Outstanding at beginning of year Granted Exercised Cancelled or expired Outstanding at the year end Exercisable at end of year Weighted average grant date fair value per option for options granted during the year/period at less than market value Superpot Plan Number of shares under option: Outstanding at beginning of year Granted Exercised Cancelled or expired 25 17 2 52 24 3 755 207 70 478 478 70. 2007 Number Weighted Weighted of stock average average options exercise remaining price (Rs.00 3.00 70.

which may be shorter than the term of the options.66 5.58 1.25 As of March 31.020 1.251 300 17 141 1. 2008 6.44 to 6.68% to 8.66 851.164 238.251 1. 226.589 1. (vii) The balance of deferred stock compensation as on March 31.27 6.51 474.00% For the year ended March 31. 2008 Number of Weighted Weighted stock average average options exercise remaining price (Rs.09% to 41. 2007 Rs.393 - 10.316 10.863 249 793 3. 687.00 10. 2007 6.25% 48 to 66 months 40. 2007 Rs.841 289 287.47 value per value for options granted during the year/period at less than market value Scheme 2005 Number of shares under option: Outstanding at beginning of year Granted Exercised Cancelled or expired Outstanding at the year end Exercisable at end of year 3. 2007 Number Weighted Weighted of stock average average options exercise remaining price (Rs.00 10.92 287.04 238. 522. 2008 is Rs.00 370.60 4.(Shares in Thousands) As of March 31.) contractual life (in Years) 6 6 3.863 value per option for options granted during the year/period at less than market value 112 (vi) The fair value of the options granted was estimated on the date of grant using the Black-Scholes / Lattice valuation model with the following assumptions For the year ended March 31.79 2.020 58 1.00 10.45% to 8. .16% 0.66 203.) contractual life (in Years) 25 4.164 165 568 3.00% Particulars Risk free interest rates Expected life Volatility Dividend yield The volatility of the options is based on the historical volatility of the share price since the Company’s equity shares became publicly traded.11% 48 to 66 months 41.343 thousand).500 thousand (March 31.03 287.258 thousand) and total employee compensation cost recognized for the year then ended is Rs.92 474.25 Outstanding at the year end Exercisable at end of year Weighted average grant date fair value per value for options granted during the year/period at less than market value 2006 Plan Number of shares under option: Outstanding at beginning of year Granted Exercised Cancelled or expired Outstanding at the year end Exercisable at end of year 1.14 5. 324.316 65 1.33% 0.77% to 46.03 398.44 to 6.00 645.25 Weighted average grant date fair 300.353 thousand (March 31.46 Weighted average grant date fair 1.47 249.60 345.

031 41.) Weighted average number of equity shares outstanding during the year Dilutive effect on weighted average number of equity shares outstanding during the year* Weighted Average number of Equity shares and Equity Equivalent shares for computing Diluted EPS As at March 31.379 235.696 1. 2008: Notional Value Sr No A For a) b) c) For a) b) c) Particulars Loan related exposures * Forwards Options Interest Rate Swaps Total Trade related exposures * Forwards Options Interest Rate Swaps Total C D Embedded Derivative Unhedged foreign currency borrowing & Investment in Subsidiaries 6.458 1.895. effective April 1.601 3.958 1. ’000) Marked-to-market loss recognized in P&L 579. 894. Forward Contracts & Derivative Instruments The Company’s activities expose it to a variety of financial risks. 2008 10 1.991 thousand (including Rs. 2007.708 80.891 20.494 2.181.125 5.292. 2008.688.044.903 (Rs. 2008. Since the above changes have been effective April 1. 2007.378.424. The Company uses derivative financial instruments such as foreign exchange contracts. 1.952 Diluted effect on weighted average number of equity shares and profit attributable is on account of Foreign Currency Convertible Bonds and Employee Stock option plan (ESOP).531 814.197.654 As at March 31.549.493.650 1. Earnings per share: (Basic & Dilutive) Particulars Nominal value of equity shares (Rs. The following table details the status of the Company’s exposure as on March 31.928. 30. the Company has continued with its accounting policy to adjust foreign exchange fluctuation on loans/liability for fixed assets as per the requirement of Schedule VI of the Companies Act.778 2. the previous year comparative figures have not been disclosed.884. 2006.002 18. including the effects of changes in foreign currency exchange rates and interest rates. Option contracts and interest rate swaps to manage its exposures to interest rate and foreign exchange fluctuations.835 10.29.887.946 thousand for the year ended March 31.230. for the year ended March 31. 2.080 113 B *All derivatives are taken for hedging purposes only As per legal advice received.897.396. 1956.545. which is at variance to the treatment prescribed in Accounting Standard (AS-11) “Effect of Changes in Foreign exchange Rates” notified in the Companies (Accounting Standard) Rules 2006 dated December 7. .815 47.897.898.230. The Company. the net profit after tax would have been higher by Rs.687.080 thousand towards embedded derivatives) in the profit & loss account. 2007 10 1. Had the treatment as prescribed by the Companies (Accounting Standard) Rules 2006 been followed. has changed its accounting policy for accounting of derivatives on a markedto-market basis and has consequently recorded loss of Rs.910 36.

Such change in estimate did not have a material impact on depreciation and amortization for the year. The Company has undertaken to provide financial support. Bharti Airtel (USA) Limited. 32.31. Bharti Airtel (UK) Limited. During the current year. Bharti Airtel Holding (Singapore) Pte Limited and Bharti Telemedia Limited. Bharti Airtel (Canada) Limited. the Company has reassessed the economic lives of certain fixed assets. to conform to the current year’s classification. to its subsidiaries Bharti Airtel Services Limited. 114 . and based thereon changed the depreciable lives of these assets effective October 1. Bharti Airtel Hongkong Limited. 33. wherever to the extent available. Previous year figures have been audited by other firm of Chartered Accountants and has been regrouped/reclassified. 2007.

Balance Sheet Date II 7 0 6 0 9 31 . BROAD-BAND & LONG DISTANCE COMMUNICATION SERVICES For and on behalf of the Board SUNIL BHARTI MITTAL Chairman & Managing Director AKHIL GUPTA Joint Managing Director VIJAYA SAMPATH Group General Counsel and Company Secretary MANOJ KOHLI President & CEO SARVJIT SINGH DHILLON Chief Financial Officer & Director Strategy Place : New Delhi Date: April 25. 3 2 .Balance Sheet Abstract and Company’s General Business Profile I Registration Details Registration No.2 0 0 8 State Code 5 5 Capital raised during the year (Amount in Thousands) Public Issue N I L Bonus Issue N I L Rights Issue N I L Private Placement N I L III Position of mobilisation and deployment of funds (Amount in Thousands) Total Liabilities 2 6 8 7 5 7 0 3 4 Paid up Capital 1 8 9 7 9 0 7 4 Secured Loans 5 2 4 2 4 4 Share Application Money Pending Allotment 1 2 3 1 8 Employee Stock Options Outstanding 5 6 4 0 1 7 Net Fixed Assets 2 1 7 8 1 7 2 6 3 Net Current Assets ( 5 8 5 9 0 7 9 1 ) Total Assets 2 6 8 7 5 7 0 3 4 Reserves & Surplus 1 8 2 8 5 9 5 2 5 Unsecured Loans 6 5 1 7 9 1 7 2 Deffered Tax Liabilities (Net) 6 3 8 6 8 4 Sources of funds Application of funds Investments 1 0 9 5 2 8 5 2 8 Micscellaneous Expenditure 2 0 3 4 115 IV Performance of the Company (Amount in Thousands) Turnover 25 7 0 3 5 0 9 6 Profit / (Loss) Before Tax 6 9 7 2 5 4 2 3 Earning per Share in Rs. 9 1 Total Expenditure 1 8 9 6 6 8 2 5 4 Profit / (Loss) After Tax 6 2 4 4 1 9 2 2 Dividend Rate N I L V Generic names of three principal products / services of the company (as per monetary terms) Item code No.0 3 . 2008 DEVEN KHANNA Corporate Director-Finance . (ITC code) Product Description N O T A P P L I C A B L E BASIC AND CELLULAR TELEPHONE SERVICES.

Limited Bharti Airtel Lanka (Pvt.882 388.657) (323) (103.0001 CAD 1 (c) Extent of Holding 100% 68.000 100 100 100 4.723) (95.882 388.000 9.500.231 (11.466 6.004) Place : New Delhi Date : April 25.10/Rs.080.839 (19. In Thousands) 30.000 1 200 100 (b) Face Value Rs.10/GBP 1 USD 0. in Thousands) 53.037 2.582) (1.058) (319. 2008 . since it became a Subsidiary so far as they concern the members of the Company (Rs.000 166.201) On behalf of the board Sunil Bharti Mittal Chairman & Managing Director Deven Khanna Corporate Director-Finance Akhil Gupta Joint Managing Director Vijaya Sampath Group General Counsel & Company Secretary Manoj Kohli President & CEO Sarvjit Singh Dhillon Chief Financial Officer & Director Strategy NIL (8.058) (319.004) 5 Financial Year of the Subsidiary ended on : 31-03-2008 31-03-2008 31-03-2008 31-03-2008 31-03-2008 31-03-2008 31-03-2008 31-03-2008 31-03-2008 31-03-2008 31-03-2008 31-03-2008 Shares of the Subsidiary held by the company on the above dates: (a) Nos.980 100.000.89% 100% 100% 100% Net aggregate amount of profit / losses of the Subsidiary for the above financial year so far as they concern members of the Company (Rs.) (a) Dealt with in the Accounts of the Company for previous financial years NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL (b) Not dealt with in the Accounts of the Company for previous financial years (Rs.000 50.) Limited Bharti Telemedia Limited Network i2i Limited Bharti Bharti Infratel Airtel (UK) Limited Limited Bharti Airtel (USA) Limited (Rs’ 000) Bharti Bharti Airtel Airtel (Canada) (Hongkong) Limited Limited 116 1 Name of Subsidiary Bharti Aquanet Limited 2 31-03-2008 3 1 HKD 1 100% 4 NIL (8.10/SGD 1 SGD 1 SLR 10 Rs.839 (19.006 110.10/USD 1 Rs.501.10/Rs.723) (95. RELATING TO SUBSIDIARY COMPANIES Bharti Hexacom Limited Bharti Bharti Bharti Airtel Airtel Airtel Services (Singapore) Holding Limited Limited (Singapore) Pte.221) 207.STATEMENT PURSUANT TO SECTION 212 OF THE COMPANIES ACT 1956.476 (16.582) (1.221) 207. 2.89% 100% 100% 100% 100% 40% 100% 92.245 6.067.434) (323) (103.) (a) Dealt with the accounts of the Company for the year ended 31-03-2008 NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL (b) Not dealt with in the Accounts of the Company for the year ended 31-03-2008 (Rs.278.201) Net aggregate amount of profits / (Losses) for the previous financial years of the Subsidiary.

which is at variance to the requirements of Companies (Accounting Standard) Rules 2006 dated December 7. The relevant Indian Generally Accepted Accounting Principles in the absence of such Scheme would not permit this fair valuation or utilization of Reserves for Business Restructuring. of the profit for the year ended on that date. An audit includes examining. 4.Consolidated Financial Statements with Auditors’ Report Auditors’ Report to The Members of Bharti Airtel Limited 1. Our responsibility is to express an opinion on these financial statements based on our audit.396. For S. 2. Note 2(b) on Schedule 22 to these financial statements. issued by the Institute of Chartered Accountants of India. These financial statements are the responsibility of the Group’s management.198 thousand as Reserve for Business Restructuring in the books of the Company and utilization of this Reserve for write off of losses on transfer of Telecom Infrastructue Undertaking Rs.:93283 Place : New Delhi Date : April 25. This treatment was mandated and formed as integral part of the scheme of arrangment.785.990 thousand. on a test basis. We report that the consolidated financial statements have been prepared by the Group in accordance with the requirements of Accounting Standards (AS) 21. Those Standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. of the cash flows for the year ended on that date. 57. evidence supporting the amounts and disclosures in the financial statements. 2008. 24. Note 24 on Schedule 22. we draw attention to: a. We have audited the attached consolidated Balance Sheet of Bharti Airtel Limited and its subsidiaries and joint ventures [together referred to as the ‘the Group’ as described in Note 3 on Schedule 21] as at March 31. Financial Reporting of Interests in Joint Ventures. We believe that our audit provides a reasonable basis for our opinion. as well as evaluating the overall financial statement presentation. BATLIBOI & ASSOCIATES Chartered Accountants per Prashant Singhal Partner Membership No. effective from January 31. 3. and (c) in the case of the consolidated cash flow statement. In our opinion and to the best of our information and according to the explanations given to us.396. (b) in the case of the consolidated profit and loss account. the value of its business restructuring reserve and fixed assets would have been both lower by Rs. 2006. recognition of the difference between its book value and fair value Rs.R. 2008 117 . 2008 and also the consolidated Profit and Loss account and the consolidated cash flow statement for the year ended on that date annexed thereto.005 thousand where the Company has followed such treatment prescribed in the Scheme of Arrangement as sactioned by Hon’ble High Court of Delhi vide order dated November 26. 24. the consolidated financial statements give a true and fair view in conformity with the accounting principles generally accepted in India: (a) in the case of the consolidated balance sheet. 2008. where based on a legal opinion. We conducted our audit in accordance with auditing standards generally accepted in India. Consolidated Financial Statements and Accounting Standard (AS) 27. 1956. Without qualifying our opinion. 2007. b. of the state of affairs of the Group as at March 31. 5. Had the Company accounted for this as per generally accepted accounting principles instead of as per the above Scheme. An audit also includes assessing the accounting principles used and significant estimates made by management. the Company has continued with its accounting policy to adjust foreign exchange fluctuations related to purchase of fixed assets to the cost of fixed assets as per the requirement of Schedule VI of the Companies Act. regarding the revaluation of investments in Bharti Infratel Limited (‘BIL’) at fair value.

‘000) SOURCES OF FUNDS Shareholder’s Funds Share Capital Share Application Money Pending Allotment Employee Stock Options Outstanding Less: Deferred Stock Compensation (Refer Note 23 on Schedule 21 and Note 21 on Schedule 22) Reserves and Surplus Loan Funds Secured Loans Unsecured Loans Deferred Tax Liability (Net) (Refer Note 15 on Schedule 21 and Note 20 on Schedule 22) Minority Interest (Refer Note 3 on Schedule 21 and Note 9 on Schedule 22) Total APPLICATION OF FUNDS Fixed Assets Gross Block Less: Depreciation Net Block Capital Work-in-Progress Investments Current Assets. Loans and Advances 118 Less: Current Liabilities and Provisions Current Liabilities Provisions Net Current Assets Miscellaneous Expenditure (To the extent not written off or adjusted) Total Statement of Significant Accounting Policies Notes to the Financial Statements 1 1.034.063 7 48. 2008 Particulars Schedule No.078.699.575. As at March 31.579 1.342 300.421 8 9 10 11 12 1.979.801 6.903.182 1.679 5 423.422 205.017 822. ‘000) As at March 31.445.624.078.679 21 22 As per our report of even date The Schedules referred to above and Notes to the financial statements form an integral part of the Balance Sheet For and on behalf of the Board of Directors of Bharti Airtel Limited Sunil Bharti Mittal Chairman & Managing Director Deven Khanna Corporate Director-Finance Akhil Gupta Joint Managing Director Vijaya Sampath Group General Counsel & Company Secretary Manoj Kohli President & CEO Sarvjit Singh Dhillon Chief Financial Officer & Director Strategy For S.318 564.629 172.031 (59.452.132.688.655 325.453 35.155.194.074 12.142.257.Consolidated Balance Sheet as at March 31.140 281.075 2.043.578 141. 2008 .172.258 18.542 100.231 172.004 2 3 4 197.353 18.899 17.977.520.471. 2007 (Rs.140 13 2.097. Loans and Advances Inventory Sundry Debtors Cash and Bank Balances Other Current Assets.224.178 76.402.R.971 64.370 687.236 326.493) 912.768 50.034 326.426 45. 2008 (Rs.132.026 104.948.729.492 2.270 148.142.489) 26.417 582.387.138.434.142 18.262 522.245 7.149 10.756 24.494.708.295 28.870 95.121 2. BATLIBOI & ASSOCIATES Chartered Accountants per Prashant Singhal Partner Membership No: 93283 Place : New Delhi Date: April 25.199.130.959.598 95.108 97.729.610 361.160.234.251.075 8.823 229.398.071 (83.402.067 28.712.752.406.005 4.

183 40.522 14.732. Pre-operative expenditure. BATLIBOI & ASSOCIATES Chartered Accountants per Prashant Singhal Partner Membership No: 93283 Place : New Delhi Date: April 25.429.917.488. 326.690 35.554 19. (Diluted) (Refer Note 20 on Schedule 21 and Note 23 on Schedule 22) Statement of Significant Accounting Policies 21 Notes to the Financial Statements 22 As per our report of even date 57.448 91.208 34.406.202. 2007 (Rs ‘000) 183. Finance Expenses (Net).058.Deferred Tax (Refer Note 15 on Schedule 21 and Note 20 on Schedule 22) . Amortisation.000.183 317.855.103.842. Charity and Donation and Taxation Other Income 19 Finance Expense (Net) 20 Depreciation Less : Amount withdrawn from Reserve for Business Restructuring as per Scheme (Refer Note 2(b) on Schedule 22) Amortisation Pre-operative Expenditure written off 6 Charity and Donation Loss on Transfer of Telecom Infrastructure to Bharti Infratel Ltd (Refer Note 2 (b) on Schedule 22) Less : Amount withdrawn from Reserve for Business Restructuring (Refer Note 2(b) on Schedule 22) Profit before Tax MAT credit [Includes MAT credit of Rs.208 16.080 5.817 8.359.022 31.796.115.585 1.899.009 14.891 413.Fringe Benefit Tax Profit after Tax Minority Interest (Refer Note 3 on Schedule 21 and Note 9 on Schedule 22) Profit for the year Transferred from Debenture Redemption Reserve Profit brought forward Profit carried to Balance Sheet Earnings per share in Rs.311 41.Current Tax [Includes Tax of Rs. 2007 Rs.391.586 92.196.543 1.402 120.189.Consolidated Profit and Loss Account for the year ended March 31.056 709.353.211 502.396.953.892 2.342.136 744.966 184.238) 402.659 41.606 438.427 11.118.474 270.714. Other Income. Pre-operative expenditure.954.41 119 The Schedules referred to above and Notes to the Financial Statements form an integral part of the Profit and Loss Account For and on behalf of the Board of Directors of Bharti Airtel Limited Sunil Bharti Mittal Chairman & Managing Director Deven Khanna Corporate Director-Finance Akhil Gupta Joint Managing Director Vijaya Sampath Group General Counsel & Company Secretary Manoj Kohli President & CEO Sarvjit Singh Dhillon Chief Financial Officer & Director Strategy For S.122.952.054 1.623 thousand for earlier years (March 31.521) 9.564. 2008 Particulars Schedule No.005 (57. 2008 .790.335 21.625) 46.025.591 1.514 55.916 34.942 1.005) 73.R.157.889 (366.297 (1.591 24. Finance Expenses (Net).396. 2008 (Rs ‘000) 268.475 INCOME Service Revenue Sale of Goods EXPENDITURE Access Charges Network Operating Cost of Goods Sold Personnel Sales and Marketing Administrative and Other Profit before Licence Fee.19 5.169 thousand for earlier years (March 31. For the year ended March 31.474 (398.593 thousand)] .565 54. Depreciation.800.180 3. Nil) ] Tax Expenses .278.367. 959.388 388. Charity and Donation and Taxation Licence fee and Spectrum charges (revenue share) Profit before Other Income.638 114.486.875 12.088 55.43 21.388.621.783.394.017.336.140 For the year ended March 31.492. 2007 Rs. 13.501 26.623 64. (Basic) Earnings per share in Rs.111.102.378.574 16.394 482.416 24.416 14 15 16 17 18 41.353 32.751 271.989 74.123.163 63. Depreciation.610 21.486.012.863 2.216 20.121 129.23 34.703.986 64.204.727.915 140. Amortisation.

013) (8.287) 1.244. 2008 Particulars For the year ended March 31.844. Cash flow from investing activities: Purchase of fixed assets Proceeds from Sale of fixed assets Proceeds from Sale of Investments Purchase of Investments Interest Received Payment for Acquisition of Subsidiaries (Refer note 4 below) Net cash used in investing activities 73.535 (125.148) 123.207.474 34.639) 262.702) 25.168.(Increase)/Decrease in Sundry Debtors .604) 64.145 568.827 (582.544 16.312 (4.835 132.804 185 79.740 100.(Increase)/Decrease in Inventory .533 1.396 (4.147) (370) 213.867.180 3. 2007 (Rs ‘000) A.508 1.311 2.149) 259.950 5.052) (522.788) 227.826.342.509.709) (10.219.178.463 (277.289.410 89.609) 336.243 (448.049 1.508.742) 1.674 268.209.098) (273.923) (5.813 (99.562 (349) 118.123) (184.461 (138.425 191. Cash flow from operating activities: Net profit before tax Adjustments for: Depreciation Interest Expense Interest Income (Profit)/Loss on Sale of Assets (Net) (Profit)/Loss on sale of Investments Amortisation of ESOP Expenditure Amortisation of Deferred Revenue Expenditure Amortisation of Goodwill Provision for Deferred Bonus Licence fee Amortisation Bad Debts/Advances Written off Provision for Bad and Doubtful Debts/Advances (Net of write back) Liabilities / Provisions no longer required written back Provision for Gratuity and Leave Encashment Provision for Inventory for obsolete/Damaged stock Unrealized Foreign Exchange (gain)/loss Provision for Warranty Loss from swap arrangements Provision for Wealth Tax (Net) Operating profit before working capital changes Adjustments for changes in working capital : .794.193 (9.386.654) .121.677 (83.486.697 (221.Cash Flow Statement for the year ended March 31.458) (333.Increase/(Decrease) in Trade and Other Payables Cash generated from operations Taxes (Paid)/Received Net cash from operating activities B.663.634 (86.365 (221.783.859.983) 1.676 1.247.216.321.424.714.786 2.804 2.760.184 43.669 (12.678) 84.174.375. 2008 (Rs ‘000) For the year ended March 31.274.901) 268.992 (386.133.431 46.589.022.889 24.115.301) 136.876.113 17.330 175.984.627) (15.799.(Increase)/Decrease in Other Receivables 120 .045 (136.265 97.565.266) 37.607.

561.831 7. 4 During the year.Particulars For the year ended March 31. the Company acquired 100% of the equity in Network i2i Limited at a purchase consideration of Rs.663) 8.017.627 8.R.595.034. 5. 192.192 8.771.531 48.272 3. 121 As per our report of even date For S.707 7.067 39.592) 31. 927.034.982.034) 3. BATLIBOI & ASSOCIATES Chartered Accountants per Prashant Singhal Partner Membership No: 93283 Place : New Delhi Date: April 25.Rs.520. 2008 Cash and Cash Equivalents comprise: Cash and Cheques in hand Balance with Scheduled Banks 20.010. 2007.879.932) (67.256) (118.008.062.346 thousand) which are not available for use by the Company.185.313.825 5.292 5.170.717.723.310 375.215 (1.183 (3.793 thousand). 2 Previous year figures have been audited by other firm of Chartered Accountants and has been regrouped/reclassified.987.647) 59.500 193.631.899 Notes : 1 Figures in brackets indicate cash out flow.242 7. 2008 Sunil Bharti Mittal Chairman & Managing Director Deven Khanna Corporate Director-Finance For and on behalf of the Board of Directors of Bharti Airtel Limited Akhil Gupta Joint Managing Director Vijaya Sampath Group General Counsel & Company Secretary Manoj Kohli President & CEO Sarvjit Singh Dhillon Chief Financial Officer & Director Strategy . 142.000 19.520.589 (2. 2008 (Rs ‘000) For the year ended March 31.316.899 108.916 thousand (amount payable to the erstwhile Shareholders Rs.520.356 (19.573 thousands pledged with various authorities (March 31.275 (45. 3 Cash and cash equivalents includes Rs. wherever to the extent available. 2007 (Rs ‘000) C.899 1.067 797.510. Cash flow from financing activities: Proceeds from fresh issue of Share Capital (including Share Premium) Issue of Shares under ESOP Scheme (including share application) Increase in Minority Interest pursuant to issue of right shares Proceeds from long term borrowings Receipts Payments Proceeds from short term borrowings Net movement in cash credit facilities and short term loans Interest Paid Gain/(loss) from swap arrangements Net cash from financing activities Net Increase/(Decrease) in Cash and Cash Equivalents Opening Cash and Cash Equivalents Cash Acquired on Acquisition of Network i2i Cash and Cash Equivalents as at March 31. to conform to the current year’s classification.776) 15.

000 18.959.1.722.581 (413.000.2007.074 18.000.970 Equity Shares (March 31.990 21.619 39. 10 each Issued.889.181. 2007.390.074 18. Subscribed and Paid up 1.907. 10 each) (Refer Notes below) Notes: (a) 1.157 Equity Shares of Rs.892 (502.088.754.979.2.390.2.516.445) are allotted as fully paid up upon the conversion of Optionally Convertible Redeemable Debentures (OCRD) without payment being received in cash.000.000 (March 31.516.19.581 38. (c) 21.979.500.000 25.934.125) are allotted as fully paid up under the Scheme of amalgamation without payments being received in cash. 10 each fully paid up (March 31.970) issued as fully paid up bonus shares out of Share Premium account.396. (b) 20.2007 .208 24.500.958 1.284 - 553.722.1.546 504. 2008 (Rs.342 SCHEDULE : 2 RESERVES AND SURPLUS 122 Revaluation Reserve Reserve for Business Restructuring Opening balance Additions during the year Less : Transferred to Profit and Loss Account during the year * Less : Depreciation on Fair Valued Assets transferred to Profit & Loss Account during the period in accordance with the Scheme of Arrangement * * (Refer Note 2(b) of Schedule 22) Debentures Redemption Reserve Opening balance Transferred to Profit and Loss Account during the year 21. (Refer Note 10 on Schedule 22) (d) 2.259.679 39.342 18.20.125 Equity Shares (March 31.225 Securities Premium Opening balance Additions during the year 39.055.396.000) Equity shares of Rs.005 388. 25.445 Equity Shares (March 31.959.734 Equity Shares (March 31.446 Equity Shares of Rs.895.311) 553.259.000.844 .Schedules annexed to and forming part of consolidated accounts Particulars As at March 31.203 57. ‘000) As at March 31. 2007.623) 139. 2007.088. ‘000) SCHEDULE : 1 SHARE CAPITAL Authorised 2.315.225 630. 2007 (Rs.897. 2007.284 82.420) are allotted as fully paid up upon the conversion of Foreign Currency Convertible Bonds (FCCBs).591.

133) 55. non-cumulative.916 (7.000 58.790.157.768 1.434.260 3.402 95.339 197.121 10.450.598 380.452.750 4.000 589.406.150. 2007 (Rs ‘000) SCHEDULE : 2 (Cont. Convertible Debentures of Rs.914) 120.615.163 .354 1.864 SCHEDULE : 4 UNSECURED LOANS Interest Free. 10.803.255.943 13.810 95.748.521 4.855.285 2.002 13. 2008 (Rs ‘000) As at March 31.145.247 19.246.042.610 3.050 57.870 Note: Amount repayable within one year 19.Schedules annexed to and forming part of consolidated accounts Particulars As at March 31.417 55.116.090.561 41.007.222 4.887 123 Note : Amount repayable within one year 69.129.000 each (Refer Note 14 on Schedule 22) Short Term Loans and Advances From Banks Other Loans and Advances From Banks From Others 30.492 SCHEDULE : 3 SECURED LOANS (Refer Note 15 on Schedule 22) Debentures Loans and Advances from Banks : -Term Loans -Cash Credit Other Loans and Advances : -Term Loans -Vehicle Loans 500.688.624.925 (69.) Profit and Loss Account Balance as per Profit and Loss Account Add : Adjustment Less : Adjustment on account of application of Accounting Standard 15 (Revised) Profit and Loss Account Reserve arising on dilution of Equity in Subsidiary Company 120.039 50.244 582.293 24.

2008 As at March 31.108 81.089 8.036.388 81.846 1.428 6.728. 1.501 571.043.617.981. Addition to fixed assets during the year includes :Rs.994 70.655 361.063 229.586 79.385 As at March 31.029.613.577.472 706.752.258 4.993 5.794.423 1.494.691.288 thousand) 7.117 936.072 967.150 thousand (March 31.546 28 329 1.810 thousand (March 31.625 thousand) 2.851. 8.768 6.843.997.278 14.399.516 13. Capital work in progress includes goods in transit Rs. 216. 2008 is net of Rs. 3.729. 5.020 2.455 621. Leasehold land of Rs. 2007 Rs.432.895 176.685 1.000 64.422 8.669.430 83.413 22.167.108 3.210 36.328 2.029. Capital work in Progress as on March 31. 2007 INTANGIBLE ASSETS Goodwill Software Bandwidth Licence TANGIBLE ASSETS Leasehold Land Freehold Land Building Leasehold Improvements Plant and Machinery Computers Office Equipment Furniture & Fixture Vehicles Vehicles on Finance Lease 5.897 8.165 21.392.729.155. 3.423 560.895 83.958. 71.468 thousand) and Rs.297.509.125.459 thousand of Gain (March 31.482 16.234 13.350 139.408 1.730 654.956 thousand) on account of fluctuations in foreign exchange rates 3.113. 2007 For the year Sale / Adjustment during the year As at March 31.342 1. 26.579 76.428.708.858 83.657 1.897.157 25.031 5.422 36.244 269.786 1.295 214. Building includes building on leasehold land Rs. 2008 ranges between 10 to 20 years .792.124 SCHEDULE 5 : FIXED ASSETS (Refer Note 4.194.297 248.711 60.357 thousand) 10.989 4.492 482.924 2.933 97. 2007 Rs. 3. 2007 Rs.747 thousand loss) on account of fluctuation in Exchange rate 5.5.689.468 thousand (March 31.148 65.441.066 76.199.488.317 54.765 81.16 and 19 on Schedule 22) Gross Block Value Additions during the year Sale / Adjustment during the year 2.401 7. 955 thousand (March 31.761 354 3.144.224.989 4.336.327 thousand being gain (March 31.361 Notes: 1.704 59.068 1.025.280.684 - GRAND TOTAL Previous Year 281. Freehold Land and Building includes Rs.534 450.657 437.582 9.688.289.974 234.343 176.311 780.711 611.527.423 898.922. in respect of which registration of title in favour of group is pending 6. The remaining amortisation period of Goodwill as at March 31.627.156 230.288 thousand (March 31.059 30. 2007 includes Rs.168. 2008 As at March 31.953 14.924 4.373.209.788.993 768.203 621.566 354.997.675 209.709 1. 2007 Rs.389 491.303 726.622.562 564.315 247 121.587 4.062 2. 1.017.302.754 423.964.827 96. 3.844 2.348 281.178 223. 2007 Rs.199.155.475.951 60.307 60.615 568.742 1.614.422 52.922.8.145 15.365 12. Capital Work In Progress includes : Capital advances of Rs.943 1.095. 71.463 3.351 7.17 and 18 on Schedule 21 and Note 2(b).178 223.038 31. 17.249 5.822.634.610 24.111.655 325.754 423. 2008 As at April 01.905 3.993 7. 2007 Rs.222 5.477 thousand) respectively.684 190.823 97.224.952 288. 2007 Rs.158 468.940.844 2.926 83.095.699.572.923.408. 2007 Rs.219.943 2.836 55.165 93.277. 2.752 50.892.882 103.417.116 29. 4.932 1.947 22. 2008 ranges between 7 to 17 years for Unified Access Service Licence and 14 years for Long Distance Licences 8. The remaining amortisation period of licence fees as at March 31.453 205.463 767. 2007 loss of Rs.250 thousand (March 31.165 564.375 4.489 thousand) and corresponding Accumulated Depreciation being Rs. 955 thousand) represents land acquired on lease cum sale basis from Karnataka Industrial Areas Development Board 4.993 976.155.535 207. Computers include Gross Block of assets capitalised under finance lease Rs.702 2.797 thousand) 9.572.6.277 5.897.586 32.248 - TOTAL Capital Work In Progress 281.157 14.086 thousand (March 31.586 11.756 35.607 1.614 358.619.667. 2007 Depreciation Net Block (Rs ‘000) PARTICULARS As at April 01.229. 186.178 76.477 thousand (March 31.184.763 185.508 365.199. 17.259 81. 26.157 93.992.10.

565 8.355 - 73 109 812 368 9 2.074 8.Plant and Machinery Power and Fuel Rent Others Sub total Personnel Expenses Salaries Contribution to Provident and Other Funds Staff Welfare Recruitment and Training Sub total Selling Expenses Advertisement and Marketing Sub total Administrative and Other expenses Legal and Professional Power and Fuel Traveling and Conveyance Repairs and Maintenance charges . 2007 Additions during the year Network Operating Expenses Repairs and Maintenance . ‘000) As at March 31.Others Insurance Miscellaneous Sub total Finance Expenses Other Bank/Finance Charges Depreciation Other Income Total Less : Transferred to Profit and Loss Account Total amount carried to Balance sheet - - 390 272 644 25 1.Schedules annexed to and forming part of consolidated accounts Particulars As at March 31. ‘000) SCHEDULE : 6 PRE-OPERATIVE EXPENDITURE PENDING ALLOCATION (Refer note 13 on Schedule 21) Opening Balance as on April 1. 2007 (Rs.229 3.355 1. 2008 (Rs.565 - .331 - 3.622 - 1.977 135 963 547 5.600 125 - 518 213 4.

295 126 912.492 1.408 thousand (March 31.113 thousand (March 31.469. other than trade. Debentures and Bonds Long term. 80.142.475. ‘000) SCHEDULE : 7 INVESTMENTS (Refer Note 9 on Schedule 21) Current. 23.Government securities Long Term.714 3.069 48. Quoted .361 48.126 1.096 thousand) .142 912.016.142.Schedules annexed to and forming part of consolidated accounts Particulars As at March 31.824 53. Unquoted .043.585 1.142 * Includes Goods in Transit Rs. ‘000) As at March 31.295 1.Government securities .871 1.075 48.421 1.755 25. other than trade. 81.836 50.653 thousand) * Net of Provision for diminution in value Rs. trade.097. 2007 Rs. unquoted . 2007 Rs.Mutual Funds.471.251 1. 2007 (Rs. 2008 (Rs.097.Others IFFCO Kissan Sanchar Limited : 100.443. 43.000 Equity Shares (Refer Note 2(a)(ix) on Schedule 22) Total Investments Aggregate Market Value of Quoted Investments Aggregate Value of Quoted Investments Aggregate Value of Unquoted Investments 27.836 SCHEDULE : 8 INVENTORY (Refer Note 8 on Schedule 21) Stock-In-Trade* 1.125 48.

314.397.767 5.173.383) 16.in Fixed deposits * .747.305 1.115 (1.438 4.129 5.017 thousand pledged with various authorities (March 31.397.013 95.812 1.314.397.000. 138.752 (5.398.in Current Account .367.115) 24.000.352.940 2.352.208.451 (5.245 16.397.899 127 * [Includes Rs.099 702.747.608 1.359 thousand)] . 2008 (Rs.Schedules annexed to and forming part of consolidated accounts Particulars As at March 31. 2007 Rs.561.367.067 1.451) 4.520.752) 2.208. 2007 (Rs. ‘000) As at March 31. considered good unless otherwise stated) Debts outstanding for a period exceeding six months -Considered good -Considered doubtful Less : Provision for doubtful debts Other debts -Considered good -Considered doubtful Less : Provision for doubtful debts 4.946 1.881.150.075 SCHEDULE : 10 CASH AND BANK BALANCES Cash in Hand Cheques in Hand Balances with Scheduled Banks .in Deposit Account as Margin Money 143.946 18.712.836.034.556 7.722 4. ‘000) SCHEDULE : 9 SUNDRY DEBTORS (Refer Note 7 on Schedule 21 and Note 11 on Schedule 22) (Unsecured.940 5.305 28. 187.987 8.964 4.383 (1.129 24.

023.091 822.530 4.681 3.426 SCHEDULE : 12 CURRENT LIABILITIES AND PROVISIONS (Refer Note 2(b) on Schedule 22) Current Liabilities : Sundry Creditors : Total outstanding dues of Micro and Small Enterprises* Total outstanding dues of creditors other than Micro and Small Enterprises 103.987 308.223.594.600 27.930. LOANS AND ADVANCES (Refer Note 2(b) on Schedule 22) (Unsecured. 2007 (Rs.903.031 .528 5.453 141.632.913.575.874 46.805 thousand) Advance Wealth Tax (Net of Provision for tax Rs.971 16.535 thousand (March 31.431.632.Schedules annexed to and forming part of consolidated accounts Particulars As at March 31.026 104. 2008 (Rs.521 17.196 366.130.916 2.974 6.223.337) 16.146 28.234.005 128 428.071 384.265.222.385.431.580.748 3. ‘000) SCHEDULE : 11 OTHER CURRENT ASSETS.984 732.914 72.337 (3.488 154 765.743.270 148.684 28.153 100.082 4.898 (4.216 752.602.764.222.265.271 4.094 2.138. 8.940.971 269.300 3. 2007 Rs.801 72.530 116.931.402.808 62.684 Advance Billing and Prepaid Card Revenue Interest accrued but not due on loans Other Liabilities Advance Received from customers Security Deposits (Refer Note 11 on Schedule 22) * Refer Note 26 on Schedule 22 for Loans & Advances to Companies under the same management Provisions Gratuity (Refer Note 12 on Schedule 21 and Note 6 on Schedule 22) Leave Encashment (Refer Note 12 on Schedule 21 and Note 6 on Schedule 22) Warranty (Refer Note 16(ii) on Schedule 22) Wealth tax Fringe benefit tax (Net of amounts paid Rs 274. considered good unless otherwise stated) Interest Accrued on Investment Advances recoverable in cash or in kind or for value to be received Considered good Considered doubtful Less : Provision Advance to ESOP Trust Advance Tax [Net of provision for tax Rs.898) 27. 17.602. 716 thousand) MAT Credit 24. ‘000) As at March 31.535 571.430 thousand) Others (Refer Note 6(g) and 16(i) on Schedule 22) 103.225 thousand)] Fringe Benefit Tax (Net of provision for tax Rs.908 3.809 225.257.263 349 6.490 525.445.781 7.914 19. 544.300 127.

217 4.886 thousand (March 31. 3.594) - 3.649 16.447 (1. 2007 (Rs. 2007 Rs.594) (6.952 32.034 2.034 75. ‘000) As at March 31.828 thousand) Premium on Redemption of Debentures Opening Balance Less: Write back during the year Less: Amortisation for the year 26.246 - * Relating to Employee Stock Option Scheme 2001 and 2004 ** Net of stock compensation income of Rs.201) 2. 2008 (Rs.674 26.Schedules annexed to and forming part of consolidated accounts Particulars As at March 31.629 26.378 2. 13. ‘000) SCHEDULE : 13 MISCELLANEOUS EXPENDITURE (To the extent not written off or adjusted) (Refer Note 16 on Schedule 21 and Note 21 on Schedule 22) Deferred Employee Compensation Expense * Opening Balance Add: Adjustments during the year Less: Amortisation for the year ** (6.629 129 .629 20.

880 837.450 71.807.793 thousand) 912.554 10.423 11. 43.099 912.411 569.349 20.409 4.295 1.755 2. ‘000) SCHEDULE : 14 NETWORK OPERATING EXPENDITURE Interconnect charges and PSTN Rentals Installation Power and Fuel Rent Insurance Repairs and Maintenance .391.407 1.311 1.860 19.523 660.493 5.361 260.454 3.284.349 2.851.164 1.273 2.278 32.392.859.543 SCHEDULE : 15 COST OF GOODS SOLD Opening Stock Add : Purchases Less : Simcard Utilisation Less : Internal issues / capitalised Less : Closing Stock * * Net of obsolete inventory written off of Rs.027 260.875 895.490.142.311 5. 2007 Rs.412 524.113 thousand (March 31.500 1.Schedules annexed to and forming part of consolidated accounts Particulars For the year ended March 31.655.372. Wages and Bonus* Contribution to Provident and Other Funds Staff Welfare Recruitment and Training * Excluding amortisation of Deferred ESOP Cost 12.536.012.367 1.800.559 614.076.773.409 114.Others Leased Line and Gateway charges Internet access and bandwidth charges Others 928.136 130 SCHEDULE : 16 PERSONNEL EXPENDITURE (Refer Note 12 on Schedule 21 and Note 6 on Schedule 22) Salaries.058.515 756.588.656 6.427 SCHEDULE : 17 SALES AND MARKETING EXPENDITURE Advertisement and Marketing Sales Commission and Incentive Simcard Utilisation Others 6.544 10.142 744.826 2.429.356 14.155 126.299.212 4. ‘000) For the year ended March 31. 2008 (Rs.788 419.874. 2007 (Rs. 18.168 420.208 .189.453 125.054.567 89.555 6.508 837.332.999 721.142 3.878 7.540.532 962.Plant and Machinery .342.009 376.335 4.284.680.288 12.308.013.453.

080 SCHEDULE : 20 FINANCE EXPENSE (NET) 131 6.903 582.890 333.301 15.619 678.637 16.025.701.179 thousand)] .692.196.804 3.847 1.996. ‘000) For the year ended March 31.Others Insurance Bad debts written off Provision for doubtful debts / advances Less : Provision for doubtful debts written back Provision for diminution in value of inventory Collection and Recovery Loss on sale of assets (net) Miscellaneous 9.948.852 2.022.Building .266 97.994 46.118.On Debentures .121.841 68.353 65.113 1.807 1.566.121 SCHEDULE : 19 OTHER INCOME Liabilities/ Provisions no longer required written back Profit on Sale of Assets (Net) Miscellaneous 386.564.891 16.378 1.213 54.609 1.082.726 611.458 965.409.441 2.461 1.676 1.278. 24.796.488.292 791.133 1.799.699 172.Schedules annexed to and forming part of consolidated accounts Particulars For the year ended March 31. 40. 2007 Rs.827 2.from other advances . 2008 (Rs.215 804.467 213.370.752 2.844 17.075.415 2.428 2.281 613. ‘000) SCHEDULE : 18 ADMINISTRATIVE AND OTHER EXPENDITURE Legal and Professional Rates and Taxes Power and Fuel Traveling and Conveyance Rent Repairs and Maintenance .779.200 21.087 4.562 6.030 thousand (March 31.814.892 Interest : .377 422.On Others Amortisation of Premium on Redemption of FCCBs Other Finance Charges Exchange fluctuation loss (Net) Loss from swap arrangements (Net) Less : Income Profit on sale of Current Investments Interest Income : .788 198.391 12.515 22.639 2.545 5.854.from Current Investments and Fixed Deposits (Other than Trade) [Gross of TDS Rs.485 47.On Term Loan .690 149.216.776 64.674 758.901 127.711 1.341 63.389 505.475 .250.216.213 5.500 50.845 1.311 2.207.870 75.992 1.Other Finance Income 1.242 101.586 138. 2007 (Rs.073.099.699 1.992 43.

2008. 2008 SCHEDULE: 21 The significant accounting policies adopted by Bharti Airtel Limited (‘Bharti Airtel’ or the Company) and its subsidiaries and joint ventures (hereinafter referred to as the “Group”) in respect of these Consolidated Financial Statements. BASIS OF PREPARATION These consolidated financial statements have been prepared to comply in all material respects with the generally accepted accounting principles in India including the mandatory accounting standards issued by the Institute of Chartered Accountants of India (‘ICAI’) to reflect the financial position and the results of operations of the Group. Further.28% Bharti Infratel Limited India Bharti Telemedia Limited (‘BTML’) [Refer Note (b)] India 92. with respect to only those contracts having loss as per the year end valuation. in accordance with the principle of prudence as enunciated in AS 1. 2008 100% 100% India Singapore India Subsidiary Joint Venture Joint Venture of Subsidiary Subsidiary Subsidiary 68. CHANGES IN ACCOUNTING POLICIES In accordance with the Announcement on Accounting for Derivatives issued by the Institute. with respect to only those contracts having loss as per the year end valuation. the Company has changed its policy with respect to accounting for foreign exchange hedge contracts & interest rate swaps.00% 14. hedge loss of Rs. effective April 1. These consolidated financial statements are prepared under the historical cost convention on the accrual basis of accounting and reporting requirements of Accounting Standard (‘AS’) 21 ‘Consolidated Financial Statements’ issued by ICAI and AS-27. 2007. lease. are set out below. ‘Disclosure of Accounting Policies’. were accounted for based on the contracted hedged rate. consolidated as per Para 3 below for the year ended March 31. 1. maintain. sell. 537. 2007 were not accounted. Had the Company followed its earlier policy. entered into for non speculation purpose. Financial Reporting of Interests in Joint Ventures. 2. operate and run Aircrafts / Helicopters etc. 2007. PRINCIPLES OF CONSOLIDATION These accounts represent consolidated accounts of the Group and its majority owned subsidiaries and joint ventures as follows: 132 Entity Bharti Aquanet Limited (‘BAQL’) Bharti Airtel Services Limited (‘BASL’) (erstwhile Bharti Comtel Limited) Bharti Hexacom Limited (‘BHL’) Bridge Mobile Pte Limited Forum I Aviation Limited Country of Incorporation India India Principal Service Submarine Cable landing station Administrative support to Bharti Airtel and VSAT equipment trading. 1. are consistent with those used in the previous year. which upto March 31. hire. the Company has also changed its policy with respect to accounting for embedded derivative contracts.89% 40% . which upto March 31.923 thousand.911 thousand has been debited to the Profit and Loss Account during the year. 2007. net exchange loss of Rs. Passive Infrastructure for Mobile Services DTH Venture Relationship Subsidiary Subsidiary Shareholding as at March 31. have now been accounted for on a marked-to-market valuation on each contract basis. 3. in accordance with the Announcement on Accounting for Derivatives issued by the Institute.080 thousand has been debited to the Profit and Loss Account during the year. As a result. effective April 1. in accordance with the principle of prudence as enunciated in AS 1.230. the net profit after tax would have been higher by Rs.89% 10. 814.STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31. other than those covered under Accounting Standard (AS-11) “Effect of Changes in Foreign exchange Rates”. As a result. The accounting policies have been consistently applied by the Company and except for the changes in accounting policy discussed in note 2 below. have now been accounted for on a marked-to-market valuation on each contract basis. Cellular Mobile and Broadband and Telephone Services Mobile Services Buy. ‘Disclosure of Accounting Policies’.

where Bharti Airtel or its subsidiaries own directly or indirectly more than 50 percent of voting rights of a Company’s share capital. has been capitalised as an asset and the one time license fee paid by the Group for acquiring new licences (post NTP-99) (basic. c) The equity and net income attributable to minority shareholders’ interest are shown separately in the Balance Sheet and Profit and Loss Account. The consolidated financial statements are prepared using uniform accounting policies for like transactions and other events in similar circumstances. jointly owned entities. In case the acquired company does not have a Licence. 2008 100% International calling services and wholesale switching data products Bharti Airtel (UK) United Kingdom International calling services and Limited wholesale switching data products Bharti Airtel Hong Kong International calling services and (Hong Kong) Limited wholesale switching data products Bharti Airtel (Canada) Canada International calling services and Limited wholesale switching data products Bharti Airtel Singapore International calling services and (Singapore) Private wholesale switching data products Limited Bharti Airtel Lanka Sri Lanka Mobile Services (Pvt) Limited Network i2i Limited Mauritius Submarine Cable System Bharti Airtel Holdings Singapore Investments (Singapore) Pte Limited Indus Towers Limited India Passive Infrastructure Services Bharti Infratel India Passive Infrastructure Services Ventures Limited a) Subsidiary Subsidiary Subsidiary Subsidiary 100% 100% 100% 100% Subsidiary Subsidiary Subsidiary Joint Venture Subsidiary 100% 100% 100% 42% 100% For the purpose of this consolidation. i. Entry Fee. Capital work-in-progress is stated at cost. 133 GOODWILL Goodwill is stated as an excess of the purchase consideration over Bharti Airtel’s interest in the net identifiable assets acquired. have been accounted for as subsidiaries. ‘Consolidated Financial Statements’ issued by the Institute of Chartered Accountants of India. FIXED ASSETS Fixed Assets are stated at cost of acquisition and subsequent improvements thereto. assets and liabilities and cash flows on a line-by-line basis with similar items in the Group’s financial statements.e. e) 4. The intangible component of license fee payable by the Group for cellular and basic circles. d) The Group’s interests in jointly controlled entities are accounted for by proportionate consolidation. Goodwill is carried at cost less accumulated amortisation and is amortised on a straight-line basis over the remaining period of the service licence of the acquired Company. Inter-Company balances have been eliminated in the consolidation.Entity Bharti Airtel (USA) Limited Country of Incorporation United States of America Principal Service Relationship Subsidiary Shareholding as at March 31. Site restoration cost obligations are capitalized when it is probable that an outflow of resources will be required to settle the obligation and a reliable estimate of the amount can be made. DEPRECIATION / AMORTISATION Depreciation is provided on straight-line method. 5. at the rates determined based on the estimated economic useful lives of assets as follows: . freight and other incidental expenses related to acquisition and installation. upon migration to the National Telecom Policy (NTP 1999). accordingly BTML has been consolidated with the Company in accordance with AS 21. Goodwill is amortised over 10 year period from the date of acquisition. including taxes & duties (net of cenvat credit). cellular. 6. national long distance and international long distance services) has been capitalised as an intangible asset. respectively. b) The Company controls the majority of the Board of Directors of BTML. The Group combines its share of the joint ventures’ individual income and expenses.

are deferred and amortized over the related estimated customers relationship period. Investing and other Activities Income on account of interest and other activities are recognised on an accrual basis. and is net of discounts and waivers. Registration fees is recognised at the time of dispatch and invoicing of Start up Kits Installation charges are recognised as revenue on satisfactory completion of installation of hardware and service revenue is recognised from the date of satisfactory installation of equipment and software at the customer site and provisioning of Internet and Satellite services. 7. Revenue. Fixed Assets costing upto Rs. Service revenue includes income on roaming commission and access charges passed on to other operators. The site restoration cost obligation capitalized is depreciated over the period of the useful life of the related asset. net off security deposits. Service Revenue includes access charges passed on to other operators. Bandwidth capacity is amortised on straight line basis over the period of the agreement subject to a maximum of 15 years. . 500 thousand is written off in the year placed in service. not exceeding the activation revenue. Dividends are accounted for when the right to receive the payment is established. from sale of goods is recognised on transfer of all significant risks and rewards to the customer and when no significant uncertainty exists regarding realisation of consideration. REVENUE RECOGNITION AND RECEIVABLES Mobile Services Service revenue is recognised on completion of provision of services. installation and provision of Internet and Satellite services. Processing fees on recharge is being recognised over the estimated customer relationship period or voucher validity period. from sale of goods is recognised on transfer of all significant risks and rewards to the customer and when no significant uncertainty exists regarding realisation of consideration. Revenue from prepaid calling cards packs is recognised on the actual usage basis. Provision for doubtful debts The Group provides for amounts outstanding for more than 90 days in case of active subscribers and for entire outstanding from deactivated customers. net of discount. 5 thousand are being fully depreciated within one year from the date of acquisition. and is net of discounts and waivers. net of discount. Activation Income Activation revenue and related direct activation costs. or in specific cases where management is of the view that the amounts from certain customers are not recoverable. as applicable. Revenue on account of bandwidth service is recognised on time proportion basis in accordance with the related contracts. Service Revenues includes revenues from registration. Telemedia Services (Erstwhile Broadband & Telephone Services) and Enterprise Services Carriers Service revenue is recognised on completion of provision of services. Enterprise Services Corporate 134 Revenue. as derived from the estimated customer churn period. The Entry Fee capitalised is being amortised equally over the period of the license and the one time licence fee is being amortised equally over the balance period of licence from the date of commencement of commercial operations.Leasehold Land Building Building on Leased Land Leasehold Improvements Plant & Machinery Computer / Software Office Equipment Furniture and Fixtures Vehicles (Useful lives) Period of lease 20 years 20 years Period of lease or 10 years whichever is less 3 years / 5 years/ 10 years / 15 years/18 years/20 Years 3 years 5 years/2 years 5 years 5 years Software up to Rs.

Conversion Foreign currency monetary items are reported using the closing rate. 8. not intended for trading and speculation purposes. Non-monetary items which are carried in terms of historical cost denominated in a foreign currency are reported using the exchange rate at the date of the transaction. are recognized as income or as expenses in the year in which they arise except in respect of liabilities for acquisition of fixed assets. 2006. The premium or discount arising at the inception of forward exchange contracts is amortised as expense or income over the life of the contract. 1956. ACCOUNTING FOR FORWARD CONTRACTS & DERIVATIVES Initial Recognition Foreign currency transactions are recorded in the reporting currency. These are billed in subsequent periods as per the terms of the billing plans. net of any amounts payable to the operators. are recognised is adjusted in the carrying cost of the respective fixed asset. by applying to the foreign currency amount the exchange rate between the reporting currency and the foreign currency at the date of the transaction. Accrued Billing revenue Accrued billing revenue represent revenues recognized in respect of Mobile. 9. INVENTORY Inventory is valued at the lower of cost and net realisable value. Net realizable value is the estimated selling price in the ordinary course of business. or reported in previous financial statements. INVESTMENTS Current Investments are valued at lower of cost and fair market value. Broadband and Telephone and Long Distance services provided from the bill cycle date to the end of each month. Cost is determined on First in First out basis. Exchange Differences Exchange differences arising on the settlement of monetary items or on restatement of the Company’s monetary items at rates different from those at which they were initially recorded during the year.For receivables due from the other operators on account of their NLD and ILD traffic and IUC charges. Exchange differences on forward contracts and plain vanilla currency options entered into for trading and speculation is recognized in the profit & loss account in the year in which the exchange rate changes. to hedge its risks with respect to foreign currency fluctuations and interest rate exposure arising out of import of capital goods using 135 . ‘The Effects of Changes in Foreign Exchange Rates’ The Company enters into various foreign currency option contracts & interest rate swap contracts that are not in the nature of forward contracts designated under AS 11 as such and contracts that are not entered to establish the amount of the reporting currency required or available at the settlement date of a transaction. other than that of temporary nature. the Group provides for amounts outstanding for more than 120 days from the date of billing. less estimated costs of completion and the estimated costs necessary to make the sale. not in the nature of AS 11. or in specific cases where management is of the view that the amounts from the operators are not recoverable. Other Derivative Instruments. Long term Investments are valued at cost. Revenue for this purpose is defined as adjusted gross revenue as per the respective license agreements. As per legal advice received. and non-monetary items which are carried at fair value or other similar valuation denominated in a foreign currency are reported using the exchange rates that existed when the values were determined. FOREIGN CURRENCY TRANSLATION. if any. the variable Licence fee computed at prescribed rates of revenue share is charged to the Profit and Loss Account in the period in which the related revenues are recognised. the Company has continued with its accounting policy to adjust foreign exchange fluctuation on loans/liability for fixed assets as per the requirement of Schedule VI of the Companies Act. where such exchange difference is adjusted in the carrying cost of the respective fixed asset as per the legal advise obtained by the Company. LICENSE FEES – REVENUE SHARE With effect from August 1. Forward Exchange Contracts covered under AS 11. 1999. 10. ‘The Effects of Changes in Foreign Exchange Rates’ Exchange differences on forward exchange contracts and plain vanilla currency options. Provision is made for diminution in value to recognise a decline. 11. which is at variance to the treatment prescribed in Accounting Standard (AS-11) “Effect of Changes in Foreign exchange Rates” notified in the Companies (Accounting Standard) Rules 2006 dated December 7.

Long Term Employee Benefits a) 136 Defined Contribution plan Provident Fund and employees’ state insurance schemes All employees of the Group are entitled to receive benefits under the Provident Fund. In addition. both monetary and non-monetary are translated at the closing rate. the assets and liabilities. carried at fair value as a trading or non-hedging derivative instrument. These contributions are made to the fund administered and managed by the Government of India. In translating the financial statements of a non-integral foreign operation for incorporation in financial statements. is accounted in the subsequent period. Superannuation Plan Some employees of the Group are entitled to superannuation. The Group’s contributions to both these schemes are expensed in the Profit and Loss Account. occurring after the balance sheet date. The Company assesses whether the economic characteristics and risks of the embedded derivative are clearly and closely related to the economic characteristics and risks of the remaining component of the host contract and whether a separate. Both the employee and the employer make monthly contributions to the plan at a predetermined rate (presently 12%) of the employees’ basic salary.market basis and any loss on such valuation is recognised in the Profit & Loss Account for the period. 12.foreign currency loan. . Any gain on marked-to-market valuation on respective contracts is not recognized by the Company. keeping in view the principle of prudence as enunciated in AS 1. which are also defined contribution schemes recognized and administered by the Government of India. income and expense items are translated at exchange rate at the date of transaction for the period. non-embedded instrument with the same terms as the embedded instrument would meet the definition of a derivative instrument. The Group has no further obligations under these plans beyond its monthly contributions. At every period end all outstanding derivative contracts are fair valued on a marked-tomarket basis and any loss on valuation is recognised in the profit and loss account. Embedded Derivative Instruments The Company occasionally enters into contracts that do not in their entirety meet the definition of a derivative instrument that may contain “embedded” derivative instruments – implicit or explicit terms that affect some or all of the cash flow or the value of other exchanges required by the contract in a manner similar to a derivative instrument. some employees of the Group are covered under the employees’ state insurance schemes. ‘Disclosure of Accounting Policies’. Translation of Integral and Non-Integral Foreign Operation The financial statements of an integral foreign operation are translated as if the transactions of the foreign operation have been those of the Group itself. and all resulting exchange differences are accumulated in a foreign currency translation reserve until the disposal of the net investment. stand-alone instrument with the same terms would qualify as a derivative instrument. on each contract basis. which is a defined contribution plan. Any subsequent changes in fair values. a defined contribution plan which is administered through Life Insurance Corporation of India (“LIC”). the embedded derivative is separated from the host contract. b) Defined Benefit plan Leave Encashment The Group has provided for the liability at year end on account of unavailed earned leave as per the actuarial valuation as per the Projected Unit Credit Method. When it is determined that (1) the embedded derivative possesses economic characteristics and risks that are not clearly and closely related to the economic characteristics and risks of the host contract and (2) a separate. EMPLOYEE BENEFITS Short Term Employee Benefits Short term employee benefits are recognised in the period during which the services have been rendered. Superannuation benefits are recorded as an expense as incurred. The loss on marked-to-market valuation of the embedded derivative instrument is recognized in the profit & loss account for the period. Foreign exchange contracts for trading and speculation purpose Foreign exchange contracts intended for trading and/or speculation are fair valued on a marked-to.

not directly attributable to fixed assets are charged to the Profit and Loss account in the period in which such expenditure is incurred. c) Initial direct costs are expensed in the Profit and Loss Account at the inception of the lease. estimated fair value of such assets. PRE-OPERATIVE EXPENDITURE Expenditure incurred by the Group from the date of acquisition of license for a new circle or from the date of startup of new ventures or business. The Gratuity Plan provides a lump sum payment to vested employees at retirement or termination of employment based on the respective employee salary and years of employment with the Group. TAXATION Current Income tax and fringe benefit tax is measured at the amount expected to be paid to the tax authorities in accordance with Indian Income Tax Act. Assets acquired on ‘Finance Lease’ which transfer risk and rewards of ownership to the Group are capitalized as assets by the Group at the lower of fair value of the leased property or the present value of the related lease payments or where applicable. LEASES a) Where the Group is the lessee Lease Rentals with respect to assets taken on ‘Operating Lease’ are charged to the Profit and Loss Account on a straight-line basis over the lease term. The Group provides for the Gratuity Plan based on actuarial valuations in accordance with Accounting Standard 15 (revised).” The Group makes annual contributions to the LIC for the Gratuity Plan in respect of employees at certain circles. c) d) Short term compensated absences are provided for based on estimates. “Employee Benefits. Deferred tax assets are recognised only to the extent that there is reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realised.Gratuity The Group provides for gratuity obligations through a defined benefit retirement plan (the ‘Gratuity Plan’) covering all employees. Lease rental payable is apportioned between principal and finance charge using the internal rate of return method. Finance Income is recognized based on a pattern reflecting a constant periodic rate of return on the net investment of the lessor outstanding in respect of the lease. up to the date of commencement of commercial operations of the circle or the new venture or business. Minimum Alternative Tax (MAT) credit is recognised as an asset only when and to the extent there is convincing evidence that the Group will pay normal income tax during the specified period. In the year in which the MAT credit becomes eligible to be recognized as an asset in accordance with the recommendations contained in guidance Note issued by the Institute of Chartered Accountants of India. Actuarial gains and losses are recognized as and when incurred. Finance leases as a dealer lessor are recognized as a sale transaction in the Profit and Loss account and are treated as other outright sales. 137 15. 14. The Group reviews the same at each balance sheet date and writes down the carrying amount of MAT Credit Entitlement to the extent there is no longer convincing evidence to the effect that Group will pay normal Income Tax during the specified period. b) Where the Group is the lessor Lease income in respect of ‘Operating Lease’ is recognised in the Profit and Loss Account on a straight-line basis over the lease term. Deferred tax is measured based on the tax rates and the tax laws enacted or substantively enacted at the balance sheet date. The finance charge is allocated over the lease term so as to produce a constant periodic rate of interest on the remaining balance of liability. 13. In situations where the Group has unabsorbed depreciation or carry forward tax losses. 1961. . Unrecognised deferred tax assets of earlier years are re-assessed and recognised to the extent that it has become reasonably certain that future taxable income will be available against which such deferred tax assets can be realized. the said asset is created by way of a credit to the profit and loss account and shown as MAT Credit Entitlement. Amortization of capitalised leased assets is computed on the Straight Line method over the useful life of the assets. all deferred tax assets are recognised only if there is virtual certainty supported by convincing evidence that they can be realised against future taxable profits.

For the purpose of assessing impairment. EARNINGS PER SHARE The earnings considered in ascertaining the Group’s Earnings per Share (‘EPS’) comprise the net profit after tax. 17. Mobile Services. which is the only reportable segment. 24. PROVISIONS Provisions are recognised when the Group has a present obligation as a result of past event. Enterprise Services Carriers. after adjusting for the effects of potential dilutive equity shares unless impact is anti dilutive. CASH AND CASH EQUIVALENTS Cash and Cash equivalents in the Balance Sheet comprise of cash in hand and at bank. 18. The number of shares used in computing basic EPS is the weighted average number of shares outstanding during the year. SEGMENTAL REPORTING a) Primary Segment The Group operates in five primary business segments viz. 20. Enterprise Services Corporate and Passive Infrastructure Services. WARRANTY & ASSET RETIREMENT OBLIGATIONS (ARO) Provision for warranty & ARO is based on past experience and technical estimates. An impairment loss is recognized for the amount by which the assets’ carrying amount exceeds its recoverable amount. The operations in India constitute the major part. 21.16. assets are grouped at the lowest levels for which there are separately identifiable cash flows (cash generating units). it is more likely than not that an outflow of resources will be required to settle the obligation. Telemedia Services. IMPAIRMENT OF ASSETS Assets that are subject to amortization are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. MISCELLANEOUS EXPENDITURE Premium on redemption of debentures is recognised as an expense in the profit and loss account over the period of the related contract. Other borrowing costs are recognised as an expense in the period in which they are incurred. in respect of which a reliable estimate can be made. EMPLOYEE STOCK OPTIONS OUTSTANDING Employee Stock options outstanding are valued using Black Scholes / Lattice valuation option – pricing model and the fair value is recognised as an expense over the period in which the options vest. 22. b) Secondary Segment The Group has operations within India as well as with entities located in other countries. 23. the remaining portion being attributable to others. 138 . These are reviewed at each balance sheet date and adjusted to reflect the current best estimates. 19. The diluted EPS is calculated on the same basis as basic EPS. The recoverable amount is the higher of the assets’ fair value less costs to sell and value in use. BORROWING COST Borrowing cost attributable to the acquisition or construction of a qualifying asset is capitalised as part of the cost of that asset.

its parent Company. the Group has further invested USD 1. International Private Leased Circuits and VSAT Trading. has sold it’s entire shareholding in Bharti Telemedia Limited (BTML) to Bharti Airtel.355 139 vii) On October 1. 2008) and 3. 50. is a company promoted by Bharti Telecom Limited (‘BTL’). 10.439) 5. Mauritius. non-cumulative. has been incorporated for providing Voice Interconnection. Bharti Airtel (Singapore) Private Limited (BASPL).200 thousand towards 1. 2007. the Company has consolidated BTML as a subsidiary and has disclosed the investment of BEL in BTML as minority interest in the Consolidated Financial Statements in accordance with Accounting Standard 21 ‘Consolidated Financial Statements’. 5.025. vi) On September 28. 2007. a company incorporated under the laws of India.00% as on March 31.400 thousand (Rs. 2005. iv) During the year ended March 31. 1995. Bharti Airtel Limited (‘Bharti Airtel’ or ‘the Company’) incorporated in India on July 7. 2005. unsecured and interest free Debentures of Rs. Singapore. 2008). the Group has acquired 49% of the equity in Bharti Aquanet Limited. 2005. 2005 and July 27.NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31. a subsidiary of Indian Farmers Fertilizers Co-operative Limited (IFFCO).549 thousand making Bharti Aquanet Limited a 100% subsidiary of the Company. v) On September 7. 2007 to 10. towards 4.355 thousand in the Consolidated Financial Statements. Prepaid International Calling Services. at a consideration of USD 133. 2007. and Bharti Enterprise Limited (BEL) in the ratio of 40% and 60%.916 5.825 shares issued as on March 31.000 each (of which 3. 2008 SCHEDULE: 22 NOTES TO ACCOUNTS 1.395.5% as on March 31.313. The name of the Company has been changed from Bharti Tele-Ventures Limited (‘BTVL’) to Bharti Airtel Limited (‘Bharti Airtel’). The Group’s share in the Joint Venture has reduced from 12. in Bharti Infratel Limited. ‘000) Particulars Net Assets acquired on acquisition Purchase consideration Goodwill on acquisition Amount (81.200 thousand shares of Bridge Mobile Pte Limited. 2008. ix) The Group has acquired 2% stake in IFFCO Kissan Sanchar Limited. The Company is in the process of filing the approved scheme in the High Court.203.050 Equity Shares of Rs. which has been approved by the Board of Directors of the Company in their meeting held on July 26. a new Company Bharti Airtel Holdings (Singapore) Pte Limited has been incorporated in Singapore as an investment holding Company of the Group. The Company had filed the approved scheme with the Registrar of Companies. 2005 and the Board of Directors of BHL in their meeting held on July 20. Since the Group controls majority of the composition of the Board of Directors of BTML. all assets and liabilities of erstwhile SBEL and BBL are recorded by the Company under pooling of interest method effective October 1. at a consideration of Rs. at a consideration of Rs.550 fully and compulsory convertible. the Group acquired 100% of the equity in Network i2i Limited. BASPL was granted the Facilities Based Operator (FBO) license by the Infocom Development Authority of Singapore (IDA) on July 6. Bharti Airtel Services Limited (BASL) (erstwhile Bharti Comtel Limited). and received certificate of registration order on July 27. respectively. the wholly owned subsidiary of Bharti Airtel.313. 2005. 159. viii) During the year ended March 31.125 thousand. The principal activity of the Network i2i Limited is operation and provision of telecommunication facilities and services utilising a network of submarine cable systems and associated terrestrial capacity. The details of net assets and goodwill on the date of acquisition is set out below : (Rs.575 Debentures issued as on March 31. 5. 2007.916 thousand) and recognized goodwill of Rs. 2008 due to the introduction of new shareholders and additional investment. 2007. NCT of Delhi.395.35 billion in aggregate. 10 each (of which 3. 2007. x) Leading international investors have invested an amount of USD 1. 2007. . The group had entered into a scheme of amalgamation of Satcom Broadband Equipment Limited (SBEL) and Bharti Broadband Limited (BBL) with the Company effective October 1. 2008. a) New Operations i) The group and Bharti Hexacom Limited (BHL) have entered into a scheme of arrangement for transfer pursuant to de-merger of North East Circle Undertaking from BHL to the Company effective April 1. which has been approved by the High Court on April 17. ii) iii) On April 3. India. 2. Accordingly.

‘000) Particulars Fair Value of Assets and Liabilities Fixed Assets Capital Work in Progress (Including Capital Advances) Current Assets Current Liabilities Deferred Tax Liability Amount Transferred to General Reserve Amount 89. b) Scheme of Arrangement of Transfer of Telecom Infrastructure The Scheme of Arrangement ("the Scheme") between Bharti Airtel Limited and Bharti Infratel limited (‘BIL’) for transfer of assets and liabilities of passive telecom infrastructure undertaking.600. 2007 and December 17. a subsidiary of Bharti Airtel Lanka (Private) Limited.xi) On March 4. the Effective Date of the Scheme.048 (10. xii) Bharti Aquanet Limited (Aquanet) has filed a Scheme of amalgamation (Scheme) with Bharti Airtel effective on the date of filing of Scheme approved by High Court with the Registrar of Companies. 2008.324 2. The Reserve for Business Restructuring arising there on net of (i) above and depreciation stands at Rs 24. 2008 i. Delhi & Haryana on January 31. The Scheme has.990 thousand in the Balance Sheet as of March 31. 2008 and the above treatment has been followed in accordance with the treatment prescribed in the Scheme sanctioned by the Hon’ble High Court & there is no impact of it in the Profit & Loss Account. as per the Scheme. 2007 Rs. accordingly. 2007 respectively and has been filed on April 21.203 thousand .558. 882.396. 11. Pursuant to the terms of the Scheme. 1.143) 82. b) Claims against the Group not acknowledged as debt : (Excluding cases where the possibility of any outflow in settlement is remote): . charged or suffered by BIL on the respective assets transferred by BAL under the Scheme in excess of that which would be chargeable on the original book value of these assets. as defined in the Scheme (‘the Telecom Infrastructure’).198.890 thousand (March 31. 2007 Rs. Corporate Guarantees outstanding as at March 31.811 thousand) have been given to banks and financial institutions on behalf of Group Companies. 14.005 thousand to BIL at Nil value (ii) the Company has revalued its investments in BIL and recorded the same at its fair value of Rs 82. from Bharti Airtel to BIL was approved by the Hon'ble High Court of Delhi vide order dated November 26. in Sri Lanka with the principal business of providing passive infrastructure services.832.423.e.788.608.359.502. the Company’s subsidiary. 2008 in the Delhi High Court for its approval. The assets and liabilities have been recorded at following fair values [based on independent fair valuation report for fixed assets and capital work-in progress and management estimate for others] and the amount of the General Reserve is computed as below: (Rs.193) (1. the transferred Telecom Infrastructure Undertaking is recorded by the Company at their respective fair values and an equivalent amount is credited to General Reserve. 2008 amounting to Rs. Contingent Liabilities a) Total Guarantees outstanding as at March 31.396. The general reserve shall constitute free reserve available for all purposes of the BIL and to be utilised by BIL at its own discretion considers proper including in particular for off-setting any additional depreciation that may be charged by BIL.181. In the Books of BIL.942 thousand) have been issued by banks and financial institutions on behalf of the Group. (i) the Company has transferred the telecom Infrastructure worth Rs 57.656 140 3. 2007 and filed with the Registrar of Companies. a new Company Bharti Infratel Lanka (Private) Limited has been incorporated.526 thousand (March 31.620 2. as if there had been no revaluation or transfer of these assets under the aforesaid Scheme sanctioned by the Hon'ble Delhi High Court. 2008 amounting to Rs. been given effect to in these financial statements and pursuant to the terms of the Scheme. The Scheme was approved by the Board of Directors of Bharti Airtel and Aquanet in their meeting held on April 26. The additional depreciation means depreciation provided.

2008 relate to: i.466 3. 2007 362. the outcome of these contingencies will be favourable and that a loss is not probable. h) Entry tax In certain states an entry tax is levied on receipt of material from outside the state. The management believes that. e) Income tax demand under appeal Income tax demands under appeal mainly included the appeals filed by the Group before various appellate authorities against the disallowance of certain expenses being claimed under tax by income tax authorities. it is probable that its tax positions will be sustained and accordingly. 2008 was Rs. the outcome of these contingencies will be favourable and that a loss is not probable.530.239.974 1. 2008 comprised the cases relating to: i.561 417.DoT demands (including 3 (i) below) . on the grounds that the specific entry tax is ultra vires the constitution.282. stating that only the admitted amounts based on the guidelines would need to be paid by the Group. based on legal advice. 2007 .Access Charges / Port Charges (see 3 (f) below) .661 68. c) Sales tax The claims for sales tax as of March 31. The management believes that. The amount under dispute as of March 31.(Rs.Service Tax (see 3 (d) below) . The view of the Group is that such imports should not be subject to any custom duty as it would be an operating software exempt from any custom duty.433 243. g) Customs duty The custom authorities.406 4. Classification issues have been raised whereby.Entry Tax (see 3 (h) below) .Rs.Income Tax (see 3 (e) below) .551 1. and the applicable sales tax on disposals of certain property and equipment items. ii. in some states. BSNL has raised a demand requiring the Group to pay the interconnect charges at the rates contrary to the guidelines issued by TRAI. 2008 (March 31. 2008 As at March 31. and subscriber receivables written off. the appropriateness of the declarations made by the Group under the relevant sales tax legislations which was primarily procedural in nature.478 305. ii. Accordingly.194 thousand as of March 31. the material proposed to be taxed not covered under the specific category.808 308.533 231. based on legal advice.132 Unless otherwise stated below. ‘000) Particulars (i) Taxes Duties and other demands (under adjudication / Appeal / dispute) .255 1.181 441.735.617 587. recognition of a reserve for those tax positions will not be appropriate. roaming revenues charged from other operators. 587.Sales Tax (see 3 (c) below) . 3. in view of the Group.080 19.466 141 .194 681.Customs Duty (see 3 (g) below) .505 3. the management believes that.579 183.694 542.193 2. The management is of the view that the probability of the claims being successful is remote. This position has been challenged by the Group in the respective states.196.989. The Group filed a petition against that demand with the Telecom Disputes Settlement and Appellate Tribunal (‘TDSAT’) which passed a status quo order.072 31.494 84. no amounts have been accrued although some have been paid under protest.Municipal Taxes .693 136.694 thousand) for the imports of special software on the ground that this would form part of the hardware along with which the same has been imported. based on legal advice. d) Service tax The service tax demands as of March 31. f) Access charges Interconnect charges are based on the IUC agreements between the operators although the IUC rates are governed by the IUC guidelines issued by TRAI.320 7.Stamp Duty . 31. demanded Rs.Other miscellaneous demands (ii) Claims under legal cases including arbitration matters (including 3 (j) below) As at March 31.

in accordance with Clause 5. or more than. 85. a minority shareholder in BCL. DSS has filed an application for restoration of the suit on which notice has been issued to Bharti Airtel and other defendants. as applicable within a period of eight years from the import of capital goods. 50. operational hazards.143. based on legal advice. 10 each bringing the share of DSS in Bharti Airtel down to 0. 5.044.380 thousand). The management believes that.34 per cent equity interest in erstwhile Bharti Cellular Limited (BCL) for an alleged claim for specific performance in respect of alleged agreements to sell the equity interest of DSS in erstwhile BMNL to Bharti Airtel.477 thousand (March 31. Accordingly.185 thousand). etc. An interim stay has been granted by the Delhi High Court with respect to the commencement of arbitration proceedings. no amounts have been accrued or paid in regard to this dispute. DSS. five times the CIF value of imports in respect of certain licenses and eight times the duty saved in respect of licenses where export obligation has been refixed by the order of Director General Foreign Trade. 8.080 thousand) included in Note 3 (b) above. the outcome of these contingencies will be favourable and that a loss is not probable. b) Under the IT Outsourcing Agreement. 2008.125 equity shares of Rs. an award for damages.806 thousand (March 31. Subsequently. disputes before consumer forum and with respect to labour cases and a potential claim for liquidated damages. Accordingly. The Group has received show cause notices from DoT for 14 of its circles for non-fulfillment of its roll out obligations. The Group is confident that this show cause notice would not result into liability. ii) j) Others Others mainly include disputed demands for consumption tax. The erstwhile promoter of Bharti Broadband Limited has undertaken to reimburse the Group in the event of the claim being payable. 4. In respect of the same transaction. based on legal advice. 2007 Rs. 231. Ministry of Finance. 194. This suit was dismissed in default on the ground of non-prosecution. the outcome of these contingencies will be favourable and that a loss is not probable. of Bharti Airtel arising out of above litigation cannot be currently estimated.14% as of March 31.Rs. 2007 Rs. The Group has not been able to meet its roll out obligations fully due to certain non-controllable factors like Telecommunication Engineering Center testing. an intermediary.014 thousand (March 31. has been issued 2. Under the terms of the respective schemes.724. Foreign Trade Policy 2004-2009 as issued by the Central Government of India. Export Obligation The Group obtained licenses under the Export Promotion Credit Guarantee (‘EPCG’) Scheme for importing capital goods at a concessional rate of customs duty against submission of bank guarantee and bonds. The liability. k) Bharti Mobinet Limited (‘BMNL’) Litigation Bharti Airtel is currently in litigation with DSS Enterprises Private Limited (0. Standing Advisory Committee of Radio Frequency Allocations clearance. 2007: Rs.213. covers both manufacturer exporters and service providers. a) Estimated amount of contracts to be executed on capital account and not provided for (net of advances) Rs. 26. The suit was subsequently dismissed as frivolous. has initiated arbitration proceedings against the Group demanding Rs.843 thousand included in Note 3 (b) above regarding termination of its appointment as a consultant to negotiate with DSS for the sale of DSS stake in erstwhile BMNL to Bharti Airtel. export of telecommunication services would also qualify.705. 77. . The Export Promotion Capital Goods Scheme.009.722.thousand (March 31. 2007 .304 thousand) comprising finance lease and servicing charges. No amounts have been paid or accrued towards these demands. 6.2 of the Policy. The case filed by DSS to enforce the sale of equity shares before the Delhi High Court had been transferred to District Court and was pending consideration of the Additional District Judge. DSS has also filed a suit against a previous shareholder of BMNL and Bharti Airtel challenging the transfer of shares by that shareholder to Bharti Airtel. Accordingly the Group was required to export goods of FOB value of at least Rs. the Group is required to export goods of FOB value equivalent to. non availability of spectrum. Crystal Technologies Private Limited (‘Crystal’). the Group has commitments to pay Rs. if any. i) DoT Demands i) The Group has received demands from DoT pertaining to Bharti Broadband Limited (now merged with Bharti Airtel Limited) amounting to Rs. which has been appealed to in the Delhi High Court by DSS and subsequently transferred to District Court. DSS has also initiated arbitration proceedings seeking direction for restoration of the cellular license and the entire business associated with it including all assets of BCL/BMNL to DSS or alternatively. 142 The management believes that. Since the amalgamation of BCL and erstwhile Bharti Infotel Limited (BIL) with Bharti Airtel. 1.563 thousand against which an appeal has been filed before Hon’ble TDSAT (included in note 3 (b) above).

228 372.781 (525.019) 83.987) (144.173 39.037 4.236 3. Wages and Bonus (Refer Schedule 16) @ Includes Contribution to define Contribution plan for Key managerial personnel Defined Benefit Plans (Rs.803) 83.38 years (c) Reconciliation of opening and closing balances of benefit obligations and plan assets (Rs.577 64.803) 52.940 (102.502 (144.6.940 (4.892 199.987) .807 83.527 47. ‘000) Particulars Employer’s Contribution to Provident Fund *@ Employer’s Contribution to Super annuation Fund # Employer’s Contribution to ESI * For the year ended March 31.807 (202.803) 87.636 145.037 4.549 18.486 354.801 78.913) (428.00% 7.A 28.094 231.529) 70.529) 70. 2008 530.781) (525. 2007 405.772 (4.003 28.502 (284. Employee Benefits (a) During the year.803) 27.529) 9.168 (4.683 For the year ended March 31.994 (21.075) (284. Wages and Bonus (Refer Schedule 16) (b) The assumptions used to determine the benefit obligations are as follows : Particulars Discount Rate Expected Rate of increase in Compensation levels Expected Rate of Return on Plan Assets Expected Average remaining working lives of employees (years) Gratuity 7.803) 27.913) (428.50% 7.897 343.411 Leave Encashment # Unfunded 231.449) 68.075) Gratuity Unfunded Total Leave Encashment Unfunded 384.707 # Included in Salaries.953 15.003 28.781) 143 122.00% N.089 251.803 (4.803 (4.38 years Leave Encashment 7.185 27.168 27.410 Gratuity # Unfunded 47.772 (21. ‘000) Particulars Funded Change in Projected Benefit Obligation (PBO) Projected benefit obligation at beginning of year Current service cost Interest cost Benefits paid Curtailment and Settlement cost Contribution by plan participants Past service cost Actuarial (gain) / loss Projected benefit obligation at year end Change in plan assets : Fair value of plan assets at beginning of year Expected return on plan assets Actuarial gain / (loss) Employer contribution Contribution by plan participants Settlement cost Benefits paid Fair value of plan assets at year end Net funded status of the plan Net amount recognized 250.299 97.316 1.994 (21.920) (124.184 9.001 Total 145.50% 28.287 144.323 * Included in Contribution to Provident and Other Funds (Refer Schedule 16) # Included in Salaries.489 64.50% 7. the Group has recognized the following amounts in the Profit and Loss Account Defined Contribution Plans (Rs.636 9.549 18.896 525. ‘000) Particulars Funded Current service cost Interest cost Expected Return on plan assets Actuarial (gain) / loss Past service cost Curtailment and Settlement cost/(credit) Net gratuity/Leave encashment cost 97.913 499.

2. 2004.994 thousand). 2008 265.312 thousand (March 31. Pursuant to the aforesaid agreement. 2007 Rs.546 thousand during the year towards upgradation of capacity. Investment in Joint Ventures : a) Vide a Supply contract and Construction and maintenance agreement executed on March 27.000 thousand along with other partners.000 thousand (March 31.049.44.000 equity shares of Rs.200 thousand. 144 d) The Group entered into a Joint Venture with 6 other parties to form an aircraft chartering company called the Forum I Aviation Limited incorporated in India. Alcatel Submarine Networks of France and Fujitsu Ltd. c) The Group has entered into a joint venture agreement on December 8. taking the cumulative investment in the Joint Venture to Rs. via the Indian Sub-Continent & Middle East) and will also provide long term technical support to a consortium of sixteen Telecom operators in various countries including the Group.237 thousand. (g) Movement in provision for Deferred Bonus Plan (Rs.200 thousand ordinary shares of USD 1 each which is equivalent to an ownership interest of 10. Bharti Infratel Limited has acquired 50. 40.000 thousands Rs. For the year ended March 31. ownership interest 12.28% as at March 31.763 thousand. 2008 (March 31. 2007 with Vodafone Essar Limited and Idea Cellular Limited to form an independent tower company (“Indus Towers Limited”) to provide passive infrastructure services in 16 circles of India. 500 thousand. The Group has further invested in the ordinary shares of Rs. 10.00% as at March 31. (e) The Group made annual contributions to the LIC of an amount advised by the LIC.131 b) The Group entered into a Joint Venture with 9 other overseas mobile operators to form a regional alliance called the Bridge Mobile Alliance incorporated in Singapore as Bridge Mobile Pte Ltd.843 For the year ended March 31. which is equivalent to an ownership interest of 14.000 thousand . 92. 2008. The principal activity of the venture is operating aircrafts on charter basis. and income and results of the joint venture. . which are included in the Balance Sheet and Profit and Loss Account respectively.28%). 2. 2007 73. 437. 10 each in Indus Towers Limited on December 17. The Group has invested USD 2. e) The following represent the Group’s share of assets and liabilities. This was based on the historical returns suitably adjusted for movements in long-term government bond interest rates. For this purpose Bharti Infratel Ventures Limited has been incorporated as a wholly owned subsidiary of Bharti Infratel Ltd wherein the relevant assets are to be transferred for ultimate merger in the Indus Towers Limited. The Group has invested Rs.131 108. in 2. ownership interest 14. The Group has further paid an advance of Rs. 2007: Rs. The principal activity of the venture is creating and developing regional mobile services and managing the Bridge Mobile Alliance Programme.267 233. amounting to Rs. which is included under Capital work in progress. 30. ‘000) Particulars Opening Balance Addition during the year Less : Utilized during the year Closing Balance 7.555 139. The discount rate is based on the average yield on government bonds of 20 years. The Company and Vodafone Essar Limited will hold approximately 42% each in the Indus Tower Limited and the balance 16% will be held by Idea Cellular Limited. 10 each amounting to Rs. of Japan provided the SEA-ME-WE-4 Cable Systems (broadly described as a submarine cable system linking South East Asia and Europe.509 265.452 thousand in the venture for 8.051% share. 43.50%). 2007 for an aggregate value of Rs. The Group was not informed by LIC of the investments made by the LIC or the break-down of plan assets by investment type.(d) The expected rate of return on plan assets was based on the average long-term rate of return expected to prevail over the next 15 to 20 years on the investments made by the LIC.2007: USD 1.622 191. (f) Estimated amounts of benefits payable within next year are Rs. 98.

975 (18.926 145 Minority interest represents that part of the net results of operations and of the net assets of a subsidiary attributable to interests which are not owned.411 10.538 60.449 2. Ltd.027 (19.504 27.346 31. ‘000) Particulars Balance Sheet Reserve and surplus Fixed assets.(Rs.452 34.713 2. general and administration expenses Finance expenses/(Income) Depreciation Profit/(Loss) 8. 100 per cent equity interest in Bharti Aquanet Limited by Bharti Airtel 100 per cent equity interest in Network i2i by Bharti Airtel Total 9.2007 764. ‘000) Nature of Transaction On Acquisition of 68.311 (1.89 per cent equity interest in BHL by Bharti Airtel 100 per cent equity interest in SBEL by Bharti Airtel 100 per cent equity interest in BBL by SBEL Proportionate consolidation of Bridge Mobile Pte.030 4.230 273. Goodwill The following is the detail of goodwill in the consolidated financial statements of Bharti Airtel as at March 31.2008 813.236 As at March 31.184. ‘000) Particulars For the year ended March 31.335 15.163 10.189 875.800 (Rs.837 5.286 24. 2008: (Rs.346 31.393) 9.370) 13.872 27.578 5.948. 2007 Profit and Loss Account Service revenue Other income Expenses Operating expenses Selling.492 5.250 428.000.650 3.782 34.825. 2007 482.2008 3. ‘000) Particulars Share Capital Share Premium Reserve arising under Scheme of Arrangement * Share of Opening Reserve Particulars As at March 31.770 (3.860 4.649 33.674 19.782 23.367) 4.802 10.568 For the year ended March 31.419 25.858 As at March 31. 2007 31.829 For the year ended March 31.852) For the year ended March 31. 2008 1.070 92.395.142.231 Share of current Year Profit/(Loss) Total * Refer Note 2(b) on Schedule 22 . 2008 17.2007 3.852) As at March 31.355 8.133 3.860 4.056.627.563 27.613.070 92. 2008 As at March 31. net Investments Current assets Sundry debtors Cash and bank Loans and advances Current liabilities and provisions Unsecured Loans (34.218 1. directly or indirectly through subsidiary (ies) by Bharti Airtel as follows: (Rs.183 1.056.316 35. As at March 31.

000 each. at any time at the option of the Issuer at their Early Redemption Amount if less than 5 percent in aggregate principal amount of the FCCBs originally issued is outstanding. During the year ended March 31. 233. 2007 Total No. the last of which occurs not more than five days prior to the date upon which notice of such redemption is published.36 per equity share fully paid up. .56 = USD 1. The Conversion Price is subject to adjustment in certain circumstances. 3. 2009 at 111. the FCCBs will be redeemed in U. 4. 13. Bharti Infratel limited issued 3. 2008 Converted FCCBs equivalent to USD 9. 10 each of the Issuer (“Shares”) at an initial Conversion Price (as defined in the “Terms and Conditions of the FCCBs”) of Rs.230. dollars on May 12.00. These Interest Free Unsecured Convertible Debentures are convertible into equity shares of Bharti Infratel Limited at September 30. 10. represents refundable security deposits received from subscribers on activation of connections granted thereto and are repayable on disconnection.00. 14. 2009 or earlier subject to occurring of certain events.17 per share with a fixed rate of exchange on conversion of Rs.594. 2007 Rs. repurchase at the Early Redemption Amount such FCCBs at such time as the Shares cease to be listed or admitted to trading on the NSE or upon the occurrence of a “Change of Control” (as defined in the “Terms and Conditions of the FCCBs”) in respect of the Issuer.000 2.000 230. 2. 43.645 equity shares (March 31.724. The FCCBs may be redeemed. at their “Early Redemption Amount” (as defined in the “Terms and Conditions of the FCCBs”) at the date fixed for such redemption if the “Closing Price” (as defined in the “Terms and Conditions of the FCCBs”) of the Shares translated into U. dollars at the rate of Rs. and not in part.S. 2007 November 6.56 = USD 1.603.824 equity shares) of the Group are held by Bharti Tele-Ventures Employee’s Welfare Trust. The Issuer will.040 42. 614.453 thousand (March 31. net of outstanding.230. The FCCBs are convertible at any time on or after June 12. 51.724.967 1.10.023.000 146 11.791 thousand (March 31.000 9. dollars at the “prevailing rate” (as defined in the “Terms and Conditions of the FCCBs”) for each of 30 consecutive “Trading Days” (as defined in the “Terms and Conditions of the FCCBs”). of shares allotted 1. 2007 September 12.500. 12.307 467. These FCCBs are listed in the Singapore Exchange Securities Trading Limited (the “SGX-ST”).317.025.429 thousand). issued at the rate of Rs. 2008.153 thousand) included under Current Liabilities. 2007 and prior to April 12.575 number of compulsorily Convertible unsecured and interest free Indian Rupee denominated debentures (‘Interest free Unsecured Convertible Debentures’). 2005 the Group issued USD 115.S. having a face value of Rs.S. 2007 2.500. The Group has during the year ended March 31. The FCCBs may also be redeemed in whole.214. is greater than 120 percent of the “Conversion Price” (as defined in the “Terms and Conditions of the FCCBs”) then in effect translated into U. Billing Revenue in the Profit and Loss Account is net of Rebates and Discounts Rs. Rs. 2004 (or such earlier date as is notified to the holders of the FCCBs by the Issuer) up to April 12. Unless previously converted. 631. 2007 Rs.314 equity shares of the Group at the option exercised by the bond holders which is as follows: Date of Allotment May 15.314 FCCB value (USD) 6. During the year March 31. 43. redeemed or purchased and cancelled. in whole or in part. The FCCBs may also be redeemed in whole.84 percent of their principal amount. at the option of any holder of any FCCBs. at any time at the option of the Issuer at their Early Redemption Amount in the event of certain changes relating to taxation in India.000 into 1.000 Zero Coupon Convertible Bonds due 2009 (the “FCCBs”). if any and security deposits received from channel partners. 2008. 2009 by holders into fully paid equity shares with full voting rights with a par value of Rs. As at March 31. subject to satisfaction of certain conditions. 2009.000. at the option of the Issuer at any time on or after May 12. Sundry debtors are secured to the extent of the amount outstanding against individual subscribers by way of security deposit received from them.

70%.296 4.866.611.387 3. furniture and fixtures fittings. is given below: i) Site Restoration Cost: (Rs. 50 Non-convertible Redeemable Debentures of Rs.528 For the year ended March 31.263 For the year ended March 31. Contingent liabilities and Contingent Assets' issued by Institute of Chartered Accountants of India.263 9.15. The movement of provision made for site restoration cost and warranty charges in accordance with AS-29 'Provisions.633 3. '000) Particulars Opening Balance Addition during the year Closing Balance ii) Warranty Charges: (Rs.951 147 . 2007 2. book debts and insurance policies. titles.354 Secured by Hypothentification of all current assets both present and future.180 5. Vehicle Loan from Bank Total 24.131 For the year ended March 31. interests in the accounts.419 1. including book debts.031 7. b) Investment in subsidiaries of Bharti Airtel.951 2.claim bills and contracts of the Company Secured by Hypothecation of Vehicles of the company. spares tools and accessories • All rights.757 2.598 Note: Following shall be excluded from Securities as mentioned above: a) Intellectual properties of Bharti Airtel.323.477. '000) Particulars Opening Balance Addition during the year Less: Utilised / reversed during the year Closing Balance For the year ended March 31.244 582. c) Licenses issued by DoT to provide various telecom services.000 thousand each repayment commencing from Dec 2009 500.000 • First ranking pari passu charge on all present and future tangible movable and freehold immovable assets owned by Bharti Airtel Limited including plant and machinery. 2008 3.532 3. office equipment.477. Particulars of securities charged against secured loans taken by the Group are as follows: Particulars Amount Outstanding (Rs’000) Security charges Debentures 11. 10. 16. Cash Credit 58.801. 2007 1.monies. 2008 2.receivables. and monies deposited and investments made there from and in project documents.

429.994 116.142.986 (1.110 159.169.163 63.149 21.750 26.650 1.656.504 50.238) (398.289.550) 78.951 1.081 5.048 91.954 11.991) 12.095 10.445 44.585) 2.585) 474.379 20.000. 2008 (Rs.729.268.236 168.192.732 59.536.987.030 (223.496 1.289 467.023.625) 1.396. ‘000) Reportable Segments Revenue Service Revenue/Sale of Goods and Other Income Inter Segment Revenue Total Revenue Results Segment Result.238) (398.697.279.052. Profit/(Loss) Net Finance Expense/(Income ) Net Profit/(Loss) Provision for Tax .067 (1.456 131.360 6.505 48.924 2.260 6.149 244.776 10.817 134.690 (9.507.200) 6.263 27.848 3.536.981 (40.239.962 182.043.988.690 17.986 (1.142.445.289.637.120.471.506.584 41.207 105.879 22.164 5.204.034 (223.069) 272.496 Mobile Services Telemedia Services Enterprises Services Carriers Enterprise Services Corporate Passive Infrastructure Others Eliminations Total 2.639 (4.Fringe Benefit Tax .196.821 7.108.225.637.092.603.108.182 218.604 765.455.820.543 11.363 .458 11.615.752 1.539 10.394.752 28.882 272.632.214.388 52.879 235.618.Deferred Tax (Credit)/Charge MAT Credit Minority Interest Net Profit/(Loss) after tax Other Information Segment Assets Inter Segment Assets Deferred Tax Asset MAT Credit Total Assets Segment Liabilities Inter Segment Liabilities Minority Interest Provision for tax (Net of Advance Tax) Deferred Tax Liability Total Liabilities Capital Expenditure Depreciation and amortisation 148 59.345 28.270.000.768.233 36.085 13.973.889.667.268 123.903 28.926.237.828 3.102.903 3.571) 9.394 9.903 21.412 (223.362.518.682.458 3.086.550) (567.380.798.097.098 6.597.625) (567.082 5.253.430.245 64.17.881) 5.655.297 7.585) 765.918.069) 2. Information about Business Segments .285.201 264.769 75.278.Primary For the year ended March 31.770 58.365.502.146 213.268.891 473.063.732 1.149 8.474 9.155.764.729.218.036 27.522.616 81.804 1.915 82.884.242.410.734.297 402.120.988 202.192.433 5.028.301.353.113 (17.036 24.524.353.863 (40.387.959 33.242.245.917.620 (223.097 65.Current Tax .798.505.002 (26.196.585.245.236 2.245.146 - 44.690 73.659 11.462.278.445 - 27.947 5.120.831) 38.120.115.003 5.216 43.487 103.611.247.114.650 (61.650 6.953.942 1.585) 257.918.615) 218.550) (567.085.253.003 5.297 402.026.938.075.850 40.003 1.

802.599 476. Capital Work in Progress. Segment Assets include Fixed Assets. Investments. Segment results represents Profit/(Loss) before Finance Expenses and Tax. 3.143 (10.250. 10.893 4.899 11.606 271. Capital expenditure pertains to gross additions made to fixed assets during the year excluding goodwill.117) 185.940 10.151. Profit/(Loss).336.698.769.312.247.908.499.606 271.698.318 6.748 2.826.143 - (2.601 22. ‘000) Reportable Segments Mobile Services Broadband & Telephone Services 21.621.893 11.116 1.596.595 7.274) (19.659 438.410 14. These transactions have been eliminated in consolidation.024.638. 149 .392 116.948.414 33.095 1.202 262.189.448 366.304.233) 262.637 5.188 27.224.042.361 26.330 45.022.253 14.869 10.512.631.521 58.058.827 689. Current Liabilities and provisions.975. 4. Inter segment Assets/Liabilities represent the inter segment account balances 7.427.276.488.441 Enterprise Services Corporate 7.825 24. 2008.804.233) 14.751 482.320.324 9.488.189 34. Segment Liabilities include Secured and Unsecured loans.448.214 150.653.492.392 2. Others are accounted for on terms established by management on arm's length basis.333 93.207.530) 9.143 3.127.293.252 17.935 Enterprises Services Carriers 17.204) 410.453 39.783 10.893 5.731 141.417.807.107.117) 34.911.211 276.940.171 157.062 (23.698.299 67.320 34.035) (366.060. 5.225.577 9. During the year the name of Broadband and Telephone services segment has been changed to Telemedia Services.274) 6.889.819.127.183 40.914 185. Current Assets and Miscellaneous Expenditure to the extent not written off.636.387.475 46.193 43.058. The accounting policies used to derive reportable segment results are consistent with those described in the "Significant Accounting Policies" note to the financial statements.636.485.806) (156.713 15.664.599 34.038.367 67.701.279 186.739.966) Notes: 1.226 Others Eliminations Total Revenue Service Revenue/Sale of Goods and Other Income Inter Segment Revenue Total Revenue Results Segment Result.448 366.272.276 (23.469.848.166 1.036 12.636 2.243.231 6.543.719 1.813 9.908.889 (366.095 1.468.017 39. 6.320.950. Inter segment revenues excludes the provision of telephone services free of cost among group companies.695 32.863 11.387. the company under the Scheme of Arrangement has transferred its passive infrastructure into Bharti Infratel Limited has considered it as a separate segment from February 1.For the year ended March 31. Assets & Liabilities.025 74.125 8.295 3.589 3.344 (116.537.739.404) (425.413 1.627 (115. During the year.108 22.188 161.748 2. 8. Profit/(Loss) Net Finance Expense/(Income ) Net Profit/(Loss) MAT Credit Provision for Tax Fringe Benefit Tax Deferred Tax Expense Minority Interest Net Profit/(Loss) after tax Other Information Segment Assets Inter Segment Assets Advance Tax (Net of provision for tax) MAT Credit Total Assets Segment Liabilities Inter Segment Liabilities Minority Interest Provision for FBT (net of payment) Deferred Tax Liability Total Liabilities Capital Expenditure Depreciation and amortisation 138.293.491.783.604.659 438.980 18.333.982 201.095 35.432. Also refer Note 19 of Schedule 22.822 (115.293.914 853.129. 2.217 47.751 - (156.030 34. 9.361.533.560) 2.283.521) 5.336. Pre-operative Expenses Pending Allocation.158 (116.207.806) (156.521) 5.806) 49.521 276.475 (4.114 (7.753 122.320.364 2.889.356.064.855.786 785. Others represents the Unallocated Revenue.468. 2007 (Rs.704 851.

the names of the related parties where control exists and/or with whom transactions have taken place during the year and description of relationships.989 2.Information about Geographical Segment .622 500.918.Secondary The Group has operations within India as well as with entities located in other countries. Deferred Tax Asset and Miscellaneous Expenditure to the extent not written off. Assets include Fixed Assets. which is the only reportable segment. Investments. Assets and acquisition of Segment Assets of the Group. The information relating to the Geographical segments in respect of operations within India.060. ‘000) Particulars Segment Revenue from external customers based on geographical location of customers (including Other Income) Within India Others Carrying amount of Segment Assets by geographical location Within India Others Cost incurred during the year to acquire segment assets by geographical location Within India Others As at March 31. 18.863. Related Party Disclosures : In accordance with the requirements of Accounting Standards (AS) -18 on Related Party Disclosures.565 16. 2008 As at March 31.914 272.739 93.171 215.306 276.496 466. Current Assets.320.878. 2007 256.439.950 7.750 172.940.592.054.391.207.301 218.697.137 185. 'Others' represents the Unallocated Revenue.290 93.361 Notes: 1.777 12. (Rs.270.800 474.835. Capital Work in Progress. 2008. 3.623.865 4. as identified and certified by the management are: List of Related Parties : Key Management Personnel : Sunil Bharti Mittal Akhil Gupta Manoj Kohli 150 Other Related Parties Name of the Related Party Singapore Telecommunication Limited Bharti Telesoft Limited Bharti Teletech Limited Bharti Tele-Ventures Employees Welfare Trust Bharti Wal-Mart Private Limited Tamarind Projects Private Limited Jasmine Projects Private Limited Bharti Enterprise Limited Bharti Retail Private Limited Bharti Foundation Bharti Electoral Trust Bharti Venturetech Limited Relationship Entity having significant Influence Entity where Key Management Personnel exercises significant influence Entity where Key Management Personnel exercises significant influence Entity where Key Management Personnel exercises significant influence Entity Entity Entity Entity Entity Entity Entity Entity where Key Management Personnel exercises significant influence where Key Management Personnel exercises significant influence where Key Management Personnel exercises significant influence where Key Management Personnel exercises significant influence where Key Management Personnel exercises significant influence where Key Management Personnel exercises significant influence where Key Management Personnel exercises significant influence where Key Management Personnel exercises significant influence . is presented below for the year ended March 31.043.653. the remaining portion being attributable to others. Cost incurred to acquire Segment Assets pertains to gross additions made to Fixed Assets during the year. 2.931 272.

998 200.586) (1.707) (89.020) Closing balance 110.252 (50.(2.122 3.043 119.164.873) 13.000 - 681 - (14.515) 523. 232.658.791 3.179) (1.543.607 189.020) 119.197) (3.279 Maximum Loans & Advances during the year Note: 1) Payment made to Key Management Personnel (excluding Manoj Kohli) is Rs.785) (52.463) (3.900 1.197) 53.642 31 - 202 - - Bharti TeleVentures Employee’s Welfare Trust (14.182 thousand) 151 .791 3.015 12.015 12.658.666) - 15.087 - 79.515) 523.107 (1.043 119.279 Closing Balance 110. 2007: Rs.914) 4.222 (77) (36.524 5.791 (440) 104.498 thousand (March 31.328) 454 147 147 147 3.252 3.Related Party Transaction for 2007-08 Bharti Wal-Mart Private Limited Bharti Telesoft Limited Bharti Teletech Limited Jasmine Projects Private Limited Tamarind Bharti Bharti Projects Foundation Enterprises Private Limited Limited Bharti Retail Private Limited Bharti Electoral Trust Bharti Venturetech Limited (Rs ‘000) Manoj Kohli Nature of transaction Singapore Telecommunication Limited 1.939 (556.486) (8.252 (50.085 (10.994) 5.043 - 32.750) .791 523.441 (15.900 115 13.265 (850. 264.960.197) (3.043 119.263 1.279 Unsecured Loan Creditors Loan and Advances Debtors - 110.013) - Purchase of fixed assets Sale of fixed assets Rendering of services Receiving of services Fund transferred/includes expenses incurred on behalf of others Fund received/includes expenses incurred on behalf of Company Employee related transaction incurred on behalf of others Employee related transaction incurred on behalf of Company Salary Donation Amount received on exercise of ESOP options Purchase of shares of Subsidiary Companies (2.252 (50.515) 523.

816 (879.126 57.937 4.649) (1.828) (6) (2.078 799.787 - 30.436) (10.078 9.436) (27. 232.359.682 799.078 9.746 133.’000) Manoj Kohli Nature of transaction Bharti Telecom Limited Singapore Telecommunication Limited Bharti Telesoft Limited Bharti Teletech Limited Bharti Foundation Bharti Tele-Ventures Employee’s Welfare Trust - 9.403 - Purchase of fixed assets Sale of fixed assets Rendering of services Receiving of services Fund transferred/includes expenses incurred on behalf of others Fund received/includes expenses incurred on behalf of Company Employee related transaction incurred on behalf of Company Salary Donation Amount received on exercise of ESOP options Closing balance Creditors Loan and Advances Debtors - Closing Balance Note: 1) Payment made to Key Management Personnel (excluding Manoj Kohli) is Rs.682 (27.816) 12.126 57.127 thousand) .078 9.182 thousand (March 31.062) (833. 194.682 799.489 - - 81. 2006: Rs.436) (27.787 133.073.152 Related Party Transaction for 2006-07 (Rs.126 57.764 768 768 768 768 1.986) 26.

711. 2007 281. ‘000) Particulars Not later than one year Later than one year but not later than five years Total As at March 31.876 11.726 Unearned Finance Income 513 94 607 Present value 8.131 40. Leases a) Operating Lease .126. whereby the vendor supplied fixed assets and IT related services to the Group.331 4.008 As at March 31.765 As at March 31.970 11.427. depreciation for the year and accumulated depreciation of the asset given on operating lease as at March 31. 2008 377.396.As a Lessor The service charges recognised as income during the year for cancelable arrangements relating to services for cell sites as per the agreements is Rs 536.734 1.559 4. ‘000) Particulars Lease Rentals debited to Profit and Loss Account Obligations on non-cancelable leases: Not later than one year Later than one year but not later than five years Later than five years Total b) i) Operating Lease . 2007 3.line basis over the lease term.255.As a Lessor During the year the Group has given certain VSAT assets under finance lease.119 As at March 31. ‘000) Particulars Not later than one year Later than one year but not later than five years Total e) Gross Investment 20.327 Gross Investment 8. 2008 and their present value is as follows: (Rs.19.436 1. These assets are depreciated over their useful lives as in the case of the Group's own assets.243 2.936 2.509. d) Finance Lease .019.104 29.637. Accordingly.841 Unearned Finance Income 2.743 2.619 thousand.616 8. The reconciliation between the total of minimum lease payments as at March 31. ‘000) Particulars Not later than one year Later than one year but not later than five years Later than five years Total c) Service Charges .737 9.966. Due to the nature of the transaction.As a Lessor The Group has entered into a non-cancelable lease arrangement to provide approximately 100.529 5.026 165.172 64.095 3.738 As at March 31. The future minimum lease payments receivable are : (Rs. . 2008 8. the fixed assets received are accounted for as a finance lease transaction.756 2.348. Based on the risks and rewards incident to the ownership.711 27. 2008 and accordingly. The lease rental receivable proportionate to actual kilometers accepted by the customer is credited to the Profit and Loss Account on a straight .705 19. 2007 (Rs. the asset and liability are recorded at the fair value of the leased assets at the inception.937. disclosures required by AS 19 are not provided.514 Present value 18.991 ii) 153 The Group entered into a composite IT outsourcing agreement.121 393 2.368.965 160.000 Fiber pair kilometers of dark fiber on indefeasible right of use (IRU) basis for a period of 15 years.As a Lessee The lease rentals charged during the year for cancelable/non-cancelable leases relating to rent of building premises and cell sites as per the agreements and maximum obligation on long-term non-cancelable operating leases are as follows: (Rs. it is not possible to compute gross carrying amount.

2001. (ii) On August 31.000 equity shares at a price of Rs. the Group issued a total of 1.276 options to be granted to employees from time to time on the basis of their performance and other eligibility criteria. options to the employees of the Group and its subsidiaries.535) 1. The Group issued bonus shares in the ratio of 10 equity shares for every one equity share held as of September 30.404 As at March 31. The plans existing during the year are as follows: a) 154 2001 Plan under the Old Scheme The options under this plan have an exercise price of Rs. 2001 and September 25. ‘000) Particulars Deferred Tax Assets/(Liabilities) arising from : (i) Provision for doubtful debts/advances charged in the financial statements but allowed as deduction under the Income Tax Act in future years (to the extent considered realisable) (ii) Depreciation claimed as deduction under the Income tax Act but chargeable in the financial statements in future years (iii) Other expenses claimed as deduction under the Income Tax Act but chargeable in the financial statements in future years (Net) Net Deferred Tax Asset / (Liability) As at March 31. other disclosures as per AS 19 are not applicable.000 equity shares. as a result of which the total number of shares allotted to the trust increased to 15. from time to time. 2001 and September 28. the Group announced a new Employee Stock Option Scheme (hereinafter called "the New Scheme") under which the maximum quantum of options was determined at 9. 2001. 1961. 2001. Employee stock compensation (i) Pursuant to the shareholders' resolutions dated February 27. (iv) All above options are planned to be settled in equity at the time of exercise and have maximum period of 7 years from the date of respective grants. 22. 21.440.Since the entire amount payable to the vendor towards the supply of fixed assets during the year is accrued.182) The tax impact for the above purpose has been arrived at by applying a tax rate of 33. 565 per equity share to the Trust.149) (2. (iii) Pursuant to the shareholders' further resolution dated September 6. 20.99% being the substantively enacted tax rate for Indian companies under the Income Tax Act.722 (7. The grant of options to the employees under the ESOP Scheme is on the basis of their performance and other eligibility criteria.035. there are no minimum lease payments outstanding as at the year-end in relation to these assets and accordingly.840.50 per share and vest on a graded basis as follows: Vesting period from the grant date For options with a vesting period of 36 months: For options with a vesting period of 42 months: On On On On On On On On On On On completion completion completion completion completion completion completion completion completion completion completion of of of of of of of of of of of 12 24 36 12 18 30 42 12 24 36 48 months months months months months months months months months months months Vesting schedule 20% 30% 50% 15% 15% 30% 40% 10% 20% 30% 40% For options with a vesting period of 48 months: .312.729. the Group introduced the "Bharti Tele-Ventures Employees' Stock Option Plan" (hereinafter called "the Old Scheme") under which the Group decided to grant.387.982 (4.307 (2.424.345. The breakup of Net Deferred Tax Asset / (Liability) into major components of the respective balances is as follows: (Rs. 2007 1.211) 223. 2008 3. 2005.237.367.

) contractual life (in Years) life (in Years) 155 2001 Plan Number of shares under option: Outstanding at beginning of year 131 Granted Exercised 44 Cancelled or expired 50 Outstanding at the year end 37 Exercisable at end of year 37 Weighted average grant date fair value per option for options granted during the year/period at less than market value 22.b) 2004 Plan under the Old Scheme.50 324.25 to 5.50 22.50 22.94 0.50 270 853 825 167 131 128 853 22.50 22.25 to 4. 922 per share and vest on a graded basis from the effective date of grant as follows: Vesting period from the grant date For options with a vesting period of 48 months: On On On On completion completion completion completion of of of of 12 24 36 48 months months months months Vesting schedule 10% 20% 30% 40% (vi) The information concerning stock options granted. Nil per share and vest on a graded basis as follows: Vesting period from the grant date For options with a vesting period of 36 months: On completion of 12 months On completion of 24 months On completion of 36 months Vesting schedule 30% 30% 40% d) 2006 Plan under the Old Scheme The options under this plan have an exercise price of Rs.50 22. 10 per share and vest on a graded basis from the effective date of grant as follows: Vesting period from the grant date For options with a vesting period of 48 months: On completion of 36 months On completion of 48 months Vesting schedule 50% 50% e) 2005 Plan under the New Scheme The options under this plan have an exercise price in the range of Rs.50 22. 70 per share and vest on a graded basis asfollows: Vesting period from the grant date For options with a vesting period of 48 months: On On On On completion completion completion completion of of of of 12 24 36 48 months months months months Vesting schedule 10% 20% 30% 40% c) Super-pot Plan under the Old Scheme The options under this plan have an exercise price of Rs.25 .50 1.) contractual price (Rs. 2007 Number of Weighted Weighted Number Weighted Weighted stock average average of stock average average options exercise remaining options exercise remaining price (Rs. 221 to Rs.50 22. forfeited and outstanding at the year-end is as follows: (Shares in Thousands) As of March 31. 2008 As of March 31.25 22. exercised. The options under this plan have an exercise price of Rs.

00 70.251 Granted 300 Exercised 17 Cancelled or expired 141 Outstanding at the year end 1. 2007 Number of Weighted Weighted Number Weighted Weighted stock average average of stock average average options exercise remaining options exercise remaining price (Rs.(Shares in Thousands) As of March 31.44 to 6.25 5.76 to 3.00 70.25 70.863 287.00 370.44 to 6.841 289 1.25 4.316 65 1.92 287.00 10.66 203.00 10.25 156 4.589 1.00 1.00 - 2.66 5.251 1.00 70.020 1.00 70.58 6.660 742 163 755 6 70.60 474.04 238.00 70.164 165 568 3.) contractual life (in Years) life (in Years) 2004 Plan Number of shares under option: Outstanding at beginning of year Granted Exercised Cancelled or expired Outstanding at the year end Exercisable at end of year Weighted average grant date fair value per option for options granted during the year/period at less than market value Superpot Plan Number of shares under option: Outstanding at beginning of year Granted Exercised Cancelled or expired Outstanding at the year end Exercisable at end of year Weighted average grant date fair value per value for options granted during the year/period at less than market value 2006 Plan Number of shares under option: Outstanding at beginning of year 1.47 249.66 851.27 25 17 2 6 6 52 24 3 25 755 207 70 478 478 70.00 10.00 3.14 1.020 58 1.863 249 793 3.03 287.25 - 3.92 (vi) The fair value of the options granted was estimated on the date of grant using the Black-Scholes / Lattice valuation model with the following assumptions .60 345. 2008 As of March 31.79 2.47 per value for options granted during the year/period at less than market value Scheme 2005 Number of shares under option: Outstanding at beginning of year Granted Exercised Cancelled or expired Outstanding at the year end Exercisable at end of year Weighted average grant date fair value per option for options granted during the year/period at less than market value 3.00 645.03 398.76 to 4.316 10.46 10.) contractual price (Rs.393 Exercisable at end of year Weighted average grant date fair value 300.51 474.164 238.

650 1. (ii) The Central Government's approval is pending against the application made by erstwhile BCL in respect of excess remuneration paid to whole time Directors of Rs.884.943 thousand [Rs. (iv) The cumulative amount of excess remuneration paid to Managing Director and Whole time Directors by erstwhile BIL pertaining to earlier years. (Rs. (iii) The cumulative amount of excess remuneration paid to the whole time director by Bharti Airtel pending approval of Central Government pertaining to earlier years is Rs. 2007 6.378.424. 2007 Rs.835 10.11% 48 to 66 months 41.601 3.887. pending approval of the Central Government is Rs. 2000 and Rs 669 thousand for the year ended March 31.696 1. including the effects of changes in foreign currency exchange rates and interest rates.379 235.33% Nil For the year ended March 31.815 47. 565 thousand (March 31.895.063 thousand).943 thousand) payable to the former Whole time Director which exceeds the limits prescribed by Schedule XIII of the Companies Act.080 157 41.654 As at March 31.258 thousand) and total employee compensation cost recognized for the year then ended is Rs. 3. 2008 6.897.114 thousand (March 31.09% to 41. ’000) Marked-to-market loss recognized in P&L 579. 1.897. 2008 Nominal value of equity shares (Rs.197. Forward Contracts & Derivative Instruments The Group's activities expose it to a variety of financial risks. 4.343 thousand).353 thousand (March 31. which may be shorter than the term of the options.958 1. 22.549. 1. 324. The Group uses derivative financial instruments such as foreign exchange contracts. 522. 687. 4.952 23. 565 thousand) and is refundable by the director.928.500 thousand (March 31.687.274 thousand for the five month period ended August 31.125 5.45% to 8. 2008 is Rs.891 20. 1.493.002 18.910 36.230.531 814.181. 2007 Rs.458 1. 2007 10 1. 2007 Rs.700 Total B Total C D Embedded Derivative Unhedged foreign currency borrowing * All derivatives are taken for hedging purposes only .063 thousand (March 31. 1956.77% to 46.Particulars Risk free interest rates Expected life Volatility Dividend yield For the year ended March 31. (i) The Central Government's approval is pending against the application made by erstwhile Bharti Mobile Limited (BML) in respect of remuneration of Rs.396. 2008: Sr No A Particulars For a) b) c) For a) b) c) Loan related exposures * Forwards Options Interest Rate Swaps Trade related exposures * Forwards Options Interest Rate Swaps Notional Value (Rs.68% to 8. 2000 respectively](March 2003: Rs. The following table details the status of the Group's exposure as on March 31.16% Nil The volatility of the options is based on the historical volatility of the share price since the Group's equity shares became publicly traded. (vii) The balance of deferred stock compensation as on March 31. 2007 Rs.898.114 thousand) and is refundable by Directors. 3.25% 48 to 66 months 40.903 493.) Weighted average number of equity shares outstanding during the year Dilutive effect on weighted average number of equity shares outstanding during the year* Weighted Average number of Equity shares and Equity Equivalent shares for computing Diluted EPS 10 1.494 2. ’000) As at March 31. Option contracts and interest rate swaps to manage its exposures to interest rate and foreign exchange fluctuations.778 2. Earnings per Share Particulars *Diluted effect on weighted average number of equity shares and profit attributable is on account of Foreign Currency Convertible Bonds and Employee stock option plan (ESOP) 24. 226.292.688.708 80. 2007 Rs.

effective April 1. the accumulated losses of Bharti Airtel Services Limited. 2007 Rs Nil) (based on the information.230. 2006. the accounts for the above entities are prepared on a going concern basis. 2007. 25.589 thousand. in view of the support from Bharti Airtel. 2007. Bharti Airtel (Canada) Limited. to conform to current year's classification. the previous year comparative figures have not been disclosed. and based thereon changed the depreciable lives of these assets effective October 1.991 thousand (including Rs. The Group.080 thousand towards embedded derivatives) in the profit & loss account. As at March 31. Previous year figures have been audited by other firm of Chartered Accountants and has been regrouped/reclassified. 28. Bharti Airtel Holding (Singapore) Pte Limited and Bharti Telemedia Limited exceed the net worth of the respective Companies. Since the above changes have been effective April 1. 158 . Bharti Airtel (USA) Limited. Sundry creditor includes amount payable to Micro and Small enterprises as at March 31. 870. to the extent available with the group). the net profit after tax would have been higher by Rs. 2007.044. 27. 2008 of Rs Nil (March 31. During the current year. the Group has continued with its accounting policy to adjust foreign exchange fluctuation on loans/liability for fixed assets as per the requirement of Schedule VI of the Companies Act.As per legal advice received. has changed its accounting policy for accounting of derivatives on a marked-tomarket basis and has consequently recorded loss of Rs. the Group has reassessed the economic lives of certain fixed assets. 1. Bharti Airtel Hongkong Limited. Such change in estimate did not have a material impact on depreciation and amortization for the year. Had the treatment as prescribed by the Companies (Accounting Standard) Rules 2006 been followed. which is at variance to the treatment prescribed in Accounting Standard (AS-11) "Effect of Changes in Foreign exchange Rates" notified in the Companies (Accounting Standard) Rules 2006 dated December 7. the holding Company. 1956. for the year ended March 31. 2008. 2008. wherever to the extent available. Bharti Airtel (UK) Limited. 26. 2. However.

298 538 102.607 70.817.028) 1.Statement pursuant to exemption received under Section 212 (8) of the Companies Act.830 638. however consolidated financials statement of the Group include Turnover and Profit from the date of acquisition i.330 3.996.603 18.121.930.728 30.048 86.36 0.075) 1.657) 418.000 (112.270 1.139 (11.000 6.566 (11.037 290.560. 2008.157 30.306.917 57.860 110.897.267) 41.124.983 5.011 57.621) 102.286 Canada Srilanka Singapore of America India Hongkong (330) (8.417.050 291.514 500 26.896 511.087) 490.960 20.144 1.581) Taxation Taxation Assets Liabilities Other than Before for Capital* Reserves Total Total Investments Turnover Profit Provision Profit After Taxation Proposed Dividend Sr.494 1.803 2.300.113.657) 95.096 (236.685 3.799 40.574) 77.114) 3. September 2007 to March 31.918 (330) 500 330 (442.000 (239.201) (103.678 290.966) 999.860 25. Name of the No.217) 6.723) (323) (216.250 25. Subsidiary Company Registration 1 Bharti Hexacom Limited 2 Bharti Aquanet Limited 3 Network i2i Limited # 4 Bharti Airtel Services Limited 5 Bharti Airtel (Singapore) Private Limited 6 Bharti Infratel Limited 7 Bharti Telemedia Limited 8 Bharti Airtel (UK) Limited United Kingdom 9 Bharti Airtel (Canada) Limited 10 Bharti Airtel Lanka (Private) Limited 11 Bharti Airtel Holdings (Singapore) Pte Limited 12 Bharti Airtel (USA) Limited United States 13 Bharti Infratel Ventures Limited 14 Bharti Airtel (Hongkong) Limited * Including Share Application money # The above mentioned Turnover and Profit pertaining to Network i2i is for the period ended April 2007 to March 2008.004) 102.241.e.602 (238.433 359.333 (15.231 (11.201) (103.567 9.368 140.609 4 0.004) (330) (8.257 42.756 528.03 404.232.230 (35.336.755.168 12.158 4.382 3.933 4.000 3.058) (1.470 786. 2008 (Rs ‘000) Country of Investment in Subsidiary India India Mauritius India Singaore India India 87.225 (3.441 159.723) (323) (319.378.766 58.938 31.1956 relating to subsidiary companies for the year ended March 31.051) (19.000 254.447.630.215 4.202 219.061 12.03 323 (113.657) 1.058) (1.984 30.110 699. 159 .964 13.329 (323) 0.765.470.721) (19.730 (231.

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