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BSE CODE: 532454

NSE Code:
BHARTIAIRTEL

BHARTI AIRTEL

Established July 07,


1995

Company Overview:
Shareholding Pattern

Others; 6%
MFs, FIs and banks;
8%
Promoters
- Indian; 45%
FIIs; 18%
PromotersForeign; 22%

Bharti Airtel, the giant of the Indian Telecom industry, is the flagship
company of the Bharti Group. Indias first private telecom service
provider; it currently operates in all the 23 telecom circles. It is the largest
wireless services provider in the country. Bharti Airtels businesses have
been structured into 3 strategic business units Mobile Services,
Telemedia Services and Enterprise Services. Under its Mobile services, it
uses the GSM technology to provide mobile and fixed wireless services
across all the 23 circles to around 100 million customers. Around 2.9
million customers use Airtel Telemedia services either for broadband and
internet services, or the recently launched DTH and IPTV services. The
Enterprise Services provide an integrated set of telecom services to
corporate customers, national and international long distance services to
carriers and passive infrastructure services pertaining to telecom
operations.

Market and Financial Information:


KEY FINANCIALS

2005

Financial Year Ended March 31,


2006
2007
2008
2009

Based on the Income Statement (in Rs. Millions)


Revenues

81,558

116,64
1

184,20
2

270,122

373,521

EBITDA

30,658

41,636

74,407

114,018

152,858

PBT

15,832

23,455

46,784

73,115

85,910

PAT

12,116

20,279

40,621

63,954

78,590

61.92%

43.02%

57.92%

46.64%

38.28%

217,244

291,279

Revenue Growth (in %)

Based on the Balance Sheet (in Rs. Millions)


Stockholders' Equity

53,200

73,624

114,88
4

Net Debt

41,171

84,022

94,371

42,867
157,75
1

40,886

Capital Employed

41,738
115,36
2

258,130

375,301

35,097
(34,343
)

48,699
(51,666
)

84663
(93,940
)

123,244
(218,043
)

137,115
(166,944
)

754

(2,967)

(9,277)

(94,799)

(29,829)

EBITDA Margin

37.60%

35.70%

40.40%

42.20%

40.90%

Return on Capital Employed

15.70%

21.50%

31.60%

33.30%

30.70%

Interest Coverage Ratio

9.65

17.45

26.47

29.51

30.38

Net Debt to Shareholder's Equity

0.77

0.57

0.37

0.19

0.29

EPS (Basic)

6.53

10.78

21.43

34.23

41.4

Based on the Cash Flow (in Rs. Millions)


Cash Flow from operations
Capital Expenditure
Free Cash Flow
Key Ratios

The companys revenues have witnesses a CAGR of 46.3% over the past
five years despite the consistent fall in tariffs witnessed in the industry, a

BSE CODE: 532454


NSE Code:
BHARTIAIRTEL

BHARTI AIRTEL

Established July 07,


1995

clear result of the large number of new customers added by the company
every year. In fact, over the last 1 year, the company witnessed a 51.52%
increase in the number of customers. The companys EBITDA has also
grown at a CAGR of 49.43%.
Segment-wise share of revenue
Passive Infrastructure
100%
90%
80%

Enterprises Services Corporate

70%
60% Enterprises Services Carriers
50%
40%
30%

Bharti Airtel operates in five segments, namely Mobile Services,


Telemedia Services, Enterprise Services Carriers, Enterprise Services
Corporate and Passive Infrastructure Services.

20%
10% Mobile Services
0%
2008

2009

Segment-wise share of Net Income


Passive Infrastructure
100%
Enterprises Services Corporate

60% Enterprises Services Carriers


40%

Telemedia Services

20%
0%

Mobile Services
2008

The company has been also to generate a consistent ROCE (average


26.56%), a clear indicator of the efficiency with which the management
has been able to use the increased shareholders equity and debt.

Lines of Business:

Telemedia Services

80%

The company has had negative free cash flows over the past 4 years
despite having strong cash flows from operations due to the large capital
expenditure undertaken by it. The same has been financed through an
increase in shareholders equity and net debt.

2009

The Mobile Services segment contributes the largest portion (over 70%) to
the companys revenues as well as profits. The company uses GSM
technology to offer mobile services and has a 24% market share in this
segment. It registered a Y-o-Y growth of 39% in gross revenue.
The company provides broadband and telephone services in 15 circles
under the Telemedia Services segment. The company focuses on cities
with high revenue potential under this segment. It registered a Y-o-Y
growth of 17% in gross revenue.
The Enterprise Services Carriers segment provides long distance
wholesale voice and data services to carrier customers. It contributes
around 14% to the companys revenues and 23% to the companys net
income. Other business units of Airtel are also serviced by this segment.
The Enterprise Services Corporate segment provides a complete suite of
telecom services to corporate in various industry segments like BFSI, IT,
ITES, etc. The services offered include internet, MPLS-VPN, Audio and
Video Conferencing, Toll free services, etc.
The Passive Infrastructure Services segment provides services to all
telecom operators in India. It operates in this segment through its
subsidiary Bharti Infratel. Bharti Infratel owns 27,548 towers in 11 circles.
It also owns a 42% share in Indus Towers (a joint venture between Bharti
Infratel, Vodafone and Idea Cellular).

BSE CODE: 532454


NSE Code:
BHARTIAIRTEL

BHARTI AIRTEL
Recent M&As

BHARTI AIRTEL MTN Deal


Estimated Deal Size
$23 Billion
Combined RevenuesS Bil $20 Billion
Total Subscribers O
200 Million

Established July 07,


1995

Bharti Airtel was in talks recently to acquire a 49% stake in Africas


largest telecom company MTN to become one of the top 5 telecom
operators in the world. MTN would also get a 36% economic interest in
Bharti in return for the 49% stake. This was the second round of talks
between the two companies after the initial round had failed last year over
disputes regarding the structure of the combined entity.
The deal was expected to create strong synergistic benefits for the two
companies and help them to lower their overhead costs. However, the deal
could not come through and on September 30, 2009 due to the lack of
regulatory approval from the South African Government.

Share Holding Pattern (%)


Promoters Share (%)
67.7
Free Float (%)Market Data32.3
Sector
-Foreign Institutions
19.4Telecom
Market
Cap
(Rs.
Cr.)
116742.38
-Domestic
7.8
Beta
(BSE)
0.86
Institutions
Relative
Performance (%age)
52
Week
High/Low
-Others
5.1495/272
NIFTY1110449
Stock Over
Average DailyStock
Volume
NIFTY
Face Value (Rs.)
10
1P/E
Month
(9.46%)
(x) FY-09 (10.41%) (0.95%) 13.1
6 Months
(19.95%) 35.29%
(55.24%)
12 Months

(13.57%)

55.59%

(69.16%)

Bharti Airtel currently plans to acquire a 100% stake in Luxembourgbased Millicoms operations in Sri Lanka.

Stock Price Performance


The Bharti Airtel share has been underperforming over the last 1 year as
compared to the indices. The wave of financial crisis hit the overall stock
market last year and the Bharti Airtel stock also suffered due to it.
However, weak quarterly results in financial year 09-10 with declining
wireless revenues and EBITDA have caused the share to buck the uptrend
of the stock market. The following graph shows the relative price
performance of the stock when compared with NIFTY stock under:

Relative Price Performance


1200
1000
800
600
400
200
0

Bharti Airtel
NIFTY

Customers:
As on 31st March, 2009, the company had a customer base of 92,923,248
mobile and 2,726,239 telemedia customers. It also has large corporate
from various industries like IT, BFSI, Telecom, etc. as its customers.