A

Summer Training Project Report

On
Financial Analysis of Bharti Airtel

Submitted for partial fulfilment of requirement for the award of degree

Of

Master of business administration

Of
Chandigarh business School Administration
Landran (Mohali)

Session 2017-19
By
Yashika Gautam
1723758
MBA II semester
Under the supervision of
Prof. Ms Bhupinderpreet Kaur
 DECLARATION

I hereby declare that the project report titled “Financial Analysis Of Bharti Airtel”
submitted for the degree of Master of Business Administration, is my original work and the
project report has not formed the basis for the award of any degree, diploma, associate-ship,
fellowship or similar other titles. It has not been submitted to any other University or
Institution for the award of any degree or diploma

(Signature of Student)

Name of the student

Yashika Gautam
Chandigarh business school of administration

Date:
Place:
 CERTIFICATE BY GUIDE

It is certified that Ms. Yashika gautam is a student of Chandigarh Business School of

Administration, Landra Her university roll no is 1723758
She has completed her project work titled Financial analysis of Bharati Airtel under my
guidance. This project fulfils the requirement of the curriculum prescribed by Chandigarh
business school administration, Landra for the said course.
I recommend this project work for evaluation & consideration for the award of degree to the
student

Supervisor’s signature:

Supervisor’s name:

Supervisor’s designation:
 ACKNOWLEDGEMENT

I express my sincere thanks to my project guide Mrs. Prof Bhupinder Preet Kaur Designation
Assistance professor Dept. Master of business administration for guiding me right form the
inception till the successful completion of the project report, I am grateful to (Director
principal, Head of department)
I wish to record my sincere thanks to Mr Rohit Bakshi for help and cooperation throughout
our project.

(Signature of student)
Name of the student
Yashika Gautam
 List of tables

Table No. Title of the Pg. No.

table

1.1 Quick Ratio

1.2 Debtors
turnover ratio
1.3 Returns on
investment
ratio
1.4 Equity shares
1.5 Capital
employed
1.6 Net assets
value
1.7 Debt equity
ratio
1.8 Proprietary
fund
1.9 Total assets
2.0 Share holder

2.1 Net sales

 Introduction About Telecom Industry

India is currently the world’s second-largest telecommunications market with a subscriber base
of 1.20 billion and has registered strong growth in the past decade and half. The Indian mobile
economy is growing rapidly and will contribute substantially to India’s Gross Domestic
Product (GDP), according to report prepared by GSM Association (GSMA) in collaboration
with the Boston Consulting Group (BCG). App downloads in the country grew approximately
215 per cent between 2015 and 2017.The liberal and reformist policies of the Government of
India have been instrumental along with strong consumer demand in the rapid growth in the
Indian telecom sector. The government has enabled easy market access to telecom equipment
and a fair and proactive regulatory framework that has ensured availability of telecom services
to consumer at affordable prices. The deregulation of Foreign Direct Investment (FDI) norms
has made the sector one of the fastest growing and a top five employment opportunity generator
in the country. The Indian telecom sector is expected to generate four million direct and indirect
jobs over the next five years according to estimates by Randstad India. The employment
opportunities are expected to be created due to combination of government’s efforts to increase
penetration in rural areas and the rapid increase in smartphone sales and rising internet usage.

History of telecom industry

India telecommunication network is the second largest in the world by number of telephone
users (both fixed and mobile phone) with 1.179 billion subscribers as on 31 July 2018. It has
one of the lowest call tariffs in the world enabled by mega telecom operators and hyper-
competition among them. As on 31 July 2018, India has Internet user-base with 460.24
million broadband internet subscribers in the country.
Major sectors of the Indian telecommunication industry are telephone, internet and television
broadcast industry in the country which is in an ongoing process of transforming into
employs an extensive system of modern network elements such as digital telephone
exchanges, mobile switching centres, media gateways and signalling gateways at the core,
interconnected by a wide variety of transmission systems using fibre-optics or Microwave
radio relay networks. The access network, which connects the subscriber to the core, is highly
diversified with different copper-pair, optic-fibre and wireless technologies. DTH, a
relatively new broadcasting technology has attained significant popularity in the Television
segment. The introduction of private FM has given a fillip to the radio broadcasting in India.
Telecommunication in India has greatly been supported by the INSAT system of the country,
one of the largest domestic satellite systems in the world. India possesses a diversified
communications system, which links all parts of the country by telephone, Internet, radio,
television and satellite.
 Introduction About the Company

Bharti Airtel

Bharti Airtel Limited is a leading global telecommunications company with operations in 20

countries across Asia and Africa. Headquartered in New Delhi, India, the company ranks
amongst the top 4 mobile service providers globally in terms of subscribers. In India, the
company's product offerings include 2G, 3G and 4G wireless services, mobile commerce, fixed
line services, high speed DSL broadband, IPTV, DTH, enterprise services including national
& international long-distance services to carriers. In the rest of the geographies, it offers 2G,
3G wireless services and mobile commerce. Bharti Airtel had over 307 million customers
across its operations at the end of November 2014.Airtel is credited with pioneering the
business strategy of outsourcing all of its business operations except marketing, sales and
finance and building the 'minutes factory' model of low cost and high volumes. The strategy
has since been adopted by several operators. Airtel's equipment is provided and maintained by
Ericsson, Huawei, and Nokia Solutions and Networks[ whereas IT support is provided by IBM.
The transmission towers are maintained by subsidiaries and joint venture companies of Bharti
including Bharti Infratel and Indus Towers in India. Ericsson agreed for the first time to be
paid by the minute for installation and maintenance of their equipment rather than being paid
up front, which allowed Airtel to provide low call rates of ₹1 (1.5¢ US)/minute. Bharti Airtel
Limited is a leading global telecommunications company with operations in 16 countries across
Asia and Africa. Headquartered in New Delhi, India, the company ranks amongst the top 3
mobile service providers globally in terms of subscribers. In India, the company's product
offerings include 2G, 3G and 4G wireless services, mobile commerce, fixed line services, high
speed home broadband, DTH, enterprise services including national & international long-
distance services to carriers. In the rest of the geographies, it offers 2G, 3G, 4G wireless
services and mobile commerce. Bharti Airtel had over 413 million customers across its
operations at the end of March 2018. To know more please visit,
 History of the company
From the humble beginnings in the Indian telecom industry in 1986; Airtel has its roots
in Bharti Telecom Limited. Founded in 1986 by Sunil Bharti Mittal, the company was
the first in India to offer push button telephones, when the rest of the country was still
using rotary phones.
The first partnership they had was with Siemens AG of Germany, and they started
making push-button landlines in India rather than importing it from Taiwan, as it used
to be before.
The company then went on to launch various telecom technologies to the Indian market
and had innovation at its heart. Going on to acquire license to build a cellular network
in Delhi, Bharti Telecom Limited laid the ground work for the mobile operations of the
company in the year 1992. It began operations in Delhi in the year 1995 as Bharti Tele -
Ventures. The service was extended to various other states by various acquisitions and
partnerships.

Founder

This company is the brainchild of Sunil Mittal, who has worked hard for his company
from when he assembled landline phones to his purchase of a cellular network in India
when it was just a fledgling concept, to making it a household name within a span of a
mere 20 years
The company went through some amazing strategic planning. The goal was always
larger than life. Sunil Bharti Mittal rebranded all of his mobile telecom ventures under a
single brand-named Airtel in 2003. The company has grown to be India’s largest mobile
operator, with consistent hard work and everyday innovation.

Airtel had always adopted various cutting-edge strategies to be one step ahead of
competition. From acquiring regional operators in its early years, rebranding entire
operations under one umbrella to outsourcing activities to various corporations, Airtel
always set standards in the industry.
They are the only company who has every part of its operation except marketing, sales
and finance and building the 'minutes factory' model of low cost and high volumes,
outsourced. Their equipment partner is Ericsson, and Nokia and IT support is provided
by IBM. Airtel built a smart “Minutes Factory” model aiming at low cost and high-
volume output. By outsourcing daily operations and retaining core functions like
finance, sales, marketing and management, the brand built sustainable business model
that worked wonders over a period of time for the company.
The CEO of the company right now is Gopal Vittal, and the Chairman and Managing
Director is Sunil Mittal, the man himself.

Vision
Our vision is to enrich the lives of customers. Our obsession is to win customers for life
through an exceptional experience.

Mission
Hungers to win a customer for life
 Global Expansion

Airtel operates in India, Sri Lanka, Bangladesh, a few countries in African continent
and the Channel Islands. They are one of the largest mobile operator networks in the
world in terms of subscribers and has a commercial presence in over 20 countries.
Its area of operations includes:

 The Indian Subcontinent:

 Airtel India, in India
 Airtel Sri Lanka, in Sri Lanka
 Airtel Bangladesh, in Bangladesh
 Airtel Africa, which operates in 17 African countries:
 Burkina Faso, Chad, Democratic Republic of the Congo, Republic of the Congo, Gabon,
Ghana, Kenya, Madagascar, Malawi, Niger, Nigeria, Rwanda, Seychelles, Sierra Leone,
Tanzania, Uganda and Zambia.
 The British Crown Dependency islands of Jersey and Guernsey, under the brand name
Airtel-Vodafone, through an agreement with Vodafone
 PRODUCTS

Our Services

In India, the company's offers products and services both for the end consumer as well as for
businesses. The consumer business offers 2G, 3G and 4G wireless services, mobile
commerce, fixed line services, high speed DSL broadband, IPTV and Digital TV. The
enterprise services include national & international long-distance services to large enterprises
and carriers and tower infrastructure services. In the rest of the geographies (i.e. Africa), it
offers 2G, 3G wireless services and mobile commerce.

B2C - Services

Mobile Services
Cellular mobile services across 20* countries
Customer and revenue market leader in India

Telemedia Services
Offers fixed telephony and broadband internet. Services provided across 87* countries
Digital TV Services
Pan India DTH operations
Coverage across 639* districts

B2B – Services
Voice Services
Network Services
Data and Application Based
Data Center based services
Cloud based services
Digital Media services

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 Review of Literature

Singh and Pandey (2008)

In their research suggested that, for the successful working of any business
organization, fixed and current assets play a vital role, and that the management of working
capital is essential as it has a direct impact on profitability and liquidity. They studied the
working capital components and found a significant impact of working capital management on
profitability for Hindalco Industries Limited.

Chakraborty and Bandyopadhyay (2007)

In their research studied strategic working capital management, and its role in corporate
strategy development, ultimately ensuring the survival of the firm. They also highlight how
strategic current asset decisions and strategic current liabilities decisions had multi-
dimensional impact on the performance of a company.

Raheman and Nasr (2007)

In their study made an attempt to show the effect of different variables of working capital
management including average collection period, inventory turnover in days, average payment
period, cash conversion cycle, and current ratio on the net operating profitability of Pakistani
firms. They selected a sample of 94 Pakistani firms listed on Karachi Stock Exchange for a
period of six years from 1999 - 2004 and found a strong negative relationship between variables
of working capital management and profitability of the firm. They found that as the cash
conversion cycle increases, it leads to decreasing profitability of the firm and managers can
create a positive value for the shareholders by reducing the cash conversion cycle to a possible
minimum level.

Lazaridis and Tryfonidis (2006)

They conducted a cross sectional study by using a sample of 131 firms listed on the
Athens Stock Exchange for the period of 2001 - 2004 and found statistically significant
relationship between profitability, measured through gross operating profit, and the cash
conversion cycle and its components (accounts receivables, accounts payables, and inventory).
Based on the results analysis of annual data by using correlation and regression tests, they
suggest that managers can create profits for their companies by correctly

Research methods and procedure

Purpose of The Research
the purpose of this research was to analyse the common financial issues across the India in
Bharti airtel. This research study will be very helpful in the closure of the open issues which
have a huge financial impact.
Research Design
Research is defined as human activity based on intellectual applications in the investigation
of matter. The primary purpose for applied research is discovering interpreting and the
development of methods and systems for the advancement of human knowledge on a wide
variety of scientific matters of our world and the universe. Research can use the scientific
method but need not do so.

Data collection
Secondary Data
In this particular research only, secondary data was used. It was provided by Bharti Airtel,
Service Management and Transitions Team. A console file for issues in India in June 17 was
provided for undertaking this research.

Instruments used
The data was analysed with the help of MS-Excel and presented with the help of Bar Graph
and Pivot tables

The secondary source data can be divided in to mainly two parts

Accounting Section

Finance

GPA (global partner accounting)

Airtel site

External

Information for published material

Annual reports of the company

Balance sheet and profits and loss accounts

Pdf

There was a primary data which was through discussion held with the concerned company
officials from financial department. The primary data was obtained through survey method
i.e. personal interview method.
Techniques of analysis
The data are analysed through ratio analysis common size balance sheet , comparative
balance sheet fund flow analysis

Limitations of study
The study is limited to Bharti Airtel and the finding need not apply in similar sense to other
firms

The interferences that have been framed only on the basis of financial statement

Based on limited information it is not possible to arrive at a proper conclusion

Limitations of financial analysis

Objectives of the study

To ascertain the overall profitability of the company

To analyse trends on the basis of ratios for consecutive 5 years

To gain insight as to how a financial statement can be used to predict future

To analyse working capital funds with the help of ratios

Finance
Finance management is the managerial activity which is concerned with the planning and
control of firms’ financial resource. as a separate activity or discipline it is recent of origin. It
was a branch of economics ln1890 still today it has no unique body of knowledge of its own
and drawn heavily or economics it is theoretical concept. The subject of financial
management ins of immense interest to both academicians and practicing managers. It is of
great interest to academicians because the subject is still developing and are still certain areas
where controversies exist for which no enormous solution have been reached as yet the most
crucial decisions of then firm are those which related to fiancé and an understanding of the
theory of financial management provides than with conceptual and analytical insights to
make those decision skilfully
Meaning of finance
Finance is a term describing the study and system of money, investments, and other financial
instruments. Some people prefer to divide finance into three distinct categories: public
finance, corporate finance, and personal finance. There is also the recently emerging area of
social finance. Behavioural finance seeks to identify the cognitive (e.g. emotional, social, and
psychological) reasons behind financial decisions.

Definition of finance
Ray G Jones and Dean Dudley observe that the finance come indirectly from Latin words
Finnis

In simple words finance is economics and accounting “economics is proper utilization of

scare resources and accounting economics is proper utilization of scare resource and
accounting is keeping a record or tract of things

Kenneth Ridgeley and Ronald burns accent financing is the process of organizing the flow of
funds so that a business can carry out its objectives in the most efficient manner of meeting
its obligations they are due

Financial analysis
Financial analysis is the analysis of financial statement of the company to assess its financial
health and soundness of management “financial statement analysis involves a study of the
financial statement of a company to ascertain its prevailing state of affairs and there off. Such
study would enable the public and the investors to ascertain whether one company is more
profitable than the other and also to state the cause and factors that are probably responsible.

Ratio Analysis
Ratio analysis is a tool brought into play by individuals to carry out an evaluative analysis of
information in the financial statements of a company. These ratios are calculated from current
year figures and then compared to past years, other companies, the industry, and also the
company to assess the performance of the company. Besides, ratio analysis is used
predominantly by proponents of financial analysis.
As stated by Investopedia, there are numerous ratios that can be estimated from the financial
statements pertaining to a business company’s activity, performance, liquidity, and financing.
of the most common ratios include the debt-equity ratio, price-earnings ratio, asset turnover,
earnings per share, and working capital.
Classification of Ratios:

Ratios can be classified in number of ways keeping in view the particular purpose. Ratios

indicating profitability are calculated on the basis of the profit and loss account those

indicating financial position are computed on the basis of balance sheet. This classification is

rather crude and unsuitable to determine the profitability and financial position of business. to

achieve these purpose ratios may be classified as

Liquidity ratio

Return on investment

Solvency ratio

Efficiency turnover ratio

Profitability ratio

Capital market ratio

Liquidity ratio

Current ratio

Quick or acid test ratio

Debtors ratio

Debtor’s turnover ratio

Creditors ratio
Current ratio (working capital ratio)

quick ratio (acid test ratio)

= quick assets /current liabilities

Ratio 14 15 16 17 18

Current ratio 0.93 0.73 0.61 0.49 0.49

Quick ratio 0.98 0.75 0.55 0.78 0.74

Debt equity 0.13 0.26 0.38 0.59 0.64

ratio

Long term debt 0.53 0.50 0.37 0.25 0.11

equity

Analysis the liquid and solvency ratio of the company for the year

The liquidity of the company for the year 2014-2015 is 0.93 and 2016-17 is 0.49 the current

ratio has been decreased by the 0.49% in the year of 2017-2018 and it remains constant.

There was decreased negative value is founded by 0.49% in year 2017-18 increased positive
value found by 12.33% in year of 2017-2018 and increased 63.41% in 2014-15

Interpretation from the above table we can indicate that the current assets are very less

compared to current liability of the company. The company does have enough current assets
in meeting their liability, so the company can’t meet immediate emergencies.

The company need to increase current assets in order to meet its short-term obligation. We

can conclude that the ratio isn’t favourable as the current asset is less than the current
liabilities
Management efficiency ratio

Debtors turnover ratio

= credit sales/ avg. debtors

Ratio 2014 2015 2016 2017 2018

Inventory 45380.45 5903.87 11377.42 15986.28 8517.94

turnover ratio

Debtors 22.63 20.27 18.60 19.51 14.25

turnover ratio

Investment 45380.45 5903.87 11377.42 15968.28 8517.94

turnover

Fixed assets 0.86 0.85 0.79 0.69 0.51

Total assets 0.84 0.78 0.65 0.71 0. 51

turnover ratio

Assets 0.70 0.64 0.48 0.40 0.33

turnover ratio

Analysis the debtor’s turnover ratio of the company for the year 2014-2015
12.28 times

2015-2016 is 20.64 times, 2016-2017 15.30 times 2017-2018 16.97 times the debtor’s

turnover ratio has been increased by 82.90% in the year 2014-2015 and in 2015-2016 it

decreased by 31.8. there was increase positive value Is found by 10.92% in year 2016-17 and
increased by 8.72% in the year 2017-18.

Interpretation

higher turnover signifies the speedy and effective collection. lower turnover indicates
sluggish and inefficient collecting leading to the doubts that receivables might contain
significant doubts debts. receivables collection period is expressed in number of days here the

company in 1st year 1month to collection and after decline then after increase company does
not maintain lower collection period.

Returns on investment ratio

1) Return on net worth

2) Earing per share

3) Cash earnings per share

4) Return on capital employed

Return on net worth

PAT -preference dividend*100/net worth

Year Pat difference Net worth Ratio

dividend
2014 6244.19 20241.49 9.89

2015 7743.84 27643.97 23.78

2016 9426.15 36737.18 6.96

2017 7716.20 44111.60 -9.80

2018 5266.00 49429.60 0.07

Analysis

The return on net worth of the company for the year 2014 is 30.85, 2015 is 28.01 and

2016 is 25.66, 2017 is 17.49 and 2018 is 10.65 the return on net worth has been

decreased by 9.21% in the year of 2014 and decreased by 8.39% in the year 2015-

2016 and again decreased by 31.84% in the year 2016-17 and again deceased by
39.11% in the year
Interpretation

asper a net worth ratio states the return that shareholder could receive on their

investment in a company. here the company continuous declines year by year this not

well for company. But actually, is right because bank rate is low like 12% is good for
investors

PAT/NO OF EQUITY SHARES

EARING PER SHARE

YEAR PAT NO OF RATIO

EQUITY
SHARES
2014 6244.19 189.79 32.60
2015 7743.84 189.82 40.79
2016 9426.15 379.75 24.82
2017 7716.90 379.75 24.82
2018 5266.00 379.75 13.87

Analysis

The earning per share of the company for the year 2014 is 32.90, 2015 is 40.79 and

2016 is 24.82, 2017 is 13.87. the earnings per share has increased by 23.98% in the

year 2018 and decreased by 39.15% in the year 2014-15 and again decreased by
18.13% in the year 2015-16 and again decreased by 31.74% in the year 2016-
Interpretation

As per eps ratio is concern the portion of a company profit allocated to each

outstanding share of common stock. Earing per share serve as an indicator of a

company’s profitability here the company shows high profitability, so it is good for
company as well as investors.

Return on capital employed

PBIT/CAPTIAL EMPLOYED

Earing per share

Year PBIT Capital ratio

employed
2014 9450.20 56009.10 16.87
2015 11194.72 41776.10 26.80
2016 8747.65 35357.53 24.72
2017 7599.87 26811.63 28.35
2018 7514.80 11565.07 0.64

Analysis

The return on capital employed of the company for the year 2014 is 16.87%, 2015 is

26.80 and 2016 is 24.72 is 2017 is 28.35 and 2018 is 0.64 the return on capital

employed has increased by 14.59% in the year 2014-15 and again decreased by
97.47% in the year

Interpretation

It is expressed as percentage and can be very revealing about the industry a company

operates in the skills of the management and occasionally the general business
climate. here the company continuous increase efficiency. it is good for the company.
 Solvency ratio

Net assets value

Debt equity ratio

Int coverage ratio

Debt service coverage ratio

Proprietary ratio

Total assets to debt ratio

Liabilities to equity ratio

Net assets value

Net worth/no. equity shares

Year Net worth No of equity Ratio

shares
2014 20241.49 189.79 106.65
2015 27643.97 189.82 145.63
2016 36737.18 379.75 96.74
2017 44111.60 379.75 116.14
2018 49429.60 379.75 130.16

Analysis

The return on net assets value of the company for the year 2014 is 106.55 2015 is 145.63 and

2016 is 96.74 2017 is 116.16 and 2018 is 130.16. the net assets value has increased by

b36.55% in the year 2014-15 decreased by 33.57% in the year 2015-2016 and again increased
by 20.01% in the year 2017-2018 and again increased by 12.05% in the year 2018
 Interpretation

The net asset value in companies is the book value deducting liabilities and intangible

assets from the total assets. For cop companies the net assets value is always used in

market book ratio or price ratio to compare the net assets value of the company
with the market value . here condition of company is good due to high profitability

Debt equity ratio

Long term debt/share holder fund

Year Long term Share holder Ratio

debt fund
2014 6570.43 20241.49 0.32
2015 7713.65 27643.97 0.29
2016 5038.92 36737.18 0.14
2017 11897.50 44111.60 0.27
2018 14129.40 49429.60 0.28

Analysis

The debt equity ratio of the company for the year 2014 is 0.32, 2015 is 0.14, 2016 is 0.27 and

2017 is 0.28. the debt equity ratio has decreased by 9.38% in the year 2014 and decreased by

51.72% in the year 2015 increased by 92.29% in the year 2016 and again increased by 3.70%
in the year 2017-18

Interpretation

A measure of a company financial leverage calculated by divining total liabilities by

stockholder equity it indicates what proportion of equity and debt the company is using to

finance its assets / here the company ratio so good in the current situation as to a previous
year. This is good for the company
Proprietary ratio

Proprietary fund / total assets

Year Proprietor Total assets Ratio

fund

2014 20241.49 26811.84 0.75

2015 27643.97 35357.62 0.78
2016 36737.18 41776.12 0.88
2017 44111.60 56009.10 0.79
2018 49429.60 63559.00 0.78

Analysis

The proprietary ratio of the company for the year 2014 is 0.75, 2015 is 0.78 and 2016 is 0.88

and 2017 is 0.78 the propitiatory ratio has increased by 4.00% in the year 2014-15 and

increased by 11.54% in year of 2016-17 and decreased by 10.23% units the year of 20114-15
and again decreased by 12.1% in the year 2017-18

Interpretation

Proprietary ratio refers to a ratio which helps the creditors of the company in seeing that their

capital or loans which is the creditor have given to the company are safe. Ideal ratio is <! So
here the company has all year is <1 so it is good for company
Total assets to debt ratio

Total assets/long term debt

Year Total assets Long term debt Ratio

2014 26811.84 6570.43 4.08
2015 35357.62 7713.65 4.58
2016 41776.12 5038.92 8.29
2017 56009.10 11897.50 4.71
2018 63559.00 14129.40 4.50

Analysis

The total assets to debt ratio of the company for the year 2014 is 4.08, 2015 is 4.58, 2016 is

8.71 and 2017 is 4.50 the total assets have increased by 12.25% in the year 2014 and

increased by 81.00% in the year of 2015 and decreased by 43.81% in the year of 2016 and
again decreased by 4.46% in the year 2017-18

Interpretation

As per the total assets to debt ratio is concern ratio between assets and long-term debt. In the

ratio total assets more than long term debt. So here the company total assets is high 2015 but
company can’t maintain that so improve that point is actually it is good
Liabilities to equity ratio

Total liabilities/shareholders’ equity

Year Total liabilities Shareholders’ Ratio

equity
2014 26811.84 20241.49 1.32
2015 35357.62 27643.97 1.28
2016 41776.12 36737.18 1.14
2017 56009.10 44111.60 1.27
2018 63559.00 49249.60 1.28
2018 63559.00 49249.60 1.28

Analysis

The liabilities to equity ratio of the company for the year 2014 is 4.08, 2015 is 4.58 and 2016

is 8.71 and 2017 is 1.28 the liabilities to equity ratio has decreased by 3.03% in the year 2015

and decreased by 10.94% in the year 2016 and increase d by 11.40% in the year 2017 and
again decreased by 0.79% in the year of 2018

Interpretations

The liability to equity ratio is the relationship between the capital contributed by creditors

and the capital contributed by shareholders it also shows the extent to which shareholders

equity can file a company obligations ton creditors in the event of liquidation here the

company increase their equity year by year ideal ratio is I here company is work on more
than I so it is good for the company
 Efficiency ratios or turnover ratio
Fixed assets turnover ratio
Net worth turnover ratio
Working capital turnover ratio
Fixed assets turnover ratio

Net sales/net block of fa

Year Net sales Net block of fa Ratio

2014q 2576.11 19030.65 1.35
2015 34048.32 25013.36 1.36
2016 35609.54 28024.97 1.27
2017 38015.80 40700.80 0.93
2018 41603.80 43984.30 0.94

Analysis

The net worth ratio of the company for the year of 2014 is 4.08 ,2015 is 4.58 ,2016 is 8.29

2017 is 8.71 and 2018 is 0.84 the net worth turnover ratio has decreased by 3.15% in the year

2014 in the decreased by 21.14% in the 2016 and decreased by 11.30% in the year 2017 and
again decreased by 2.32% in the year 2018

Interpretation

As per as net worth turnover ratio is concern it shows the relationship between the net worth

& net sales. Ideal ratio is 1.5 but company is not performance better in this case ratio is
continues decline. It is not good for the company
Working capital turnover ratio

Net sales/working capital

Year Net sales Working capital Ratio

2014 25761.11 (-) 5922.44 (-) 4.35
2015 34048.32 (-) 4000.26 (-)8.51
2016 35609.54 (-)3616.91 (-)9.85
2017 38015.50 (-)3002.30 (-)12.66
2018 41603.80 6115.20 6.80

Analysis

The working capital turnover or ratio of the company for the year 2014 is -4.35 and in 2015

is -8.51 and 2016 is -9.85 and 2017 is -12.66 and 2018 is 6.80. the working capital turnover

ratio has decreased by 95.63% in the year of 2014 and decreased by 28.55% I the year of
2015

Interpretation

The working capital turnover ratio of the concern to increasing the ratio indicates that

working capital is more e active. It is supporting comparatively higher level of of production

sales it is being used more intensively. here company is not performing well due to negative
working capital this is not good for the company

Profitability ratio

Gross profit ratio

Profit before tax ratio

Operating ratio
Profit before deprecation or interest tax ratio

PBDIT/net sales*100

Year PBIT Net sales Ratio

2014 10766.45 25761.11 41.79%
2015 11953.93 34048.32 35.11%
2016 15084.80 35609.54 42.36%
2017 13643.90 38015.80 35.89%
2018 13430.80 41603.80 32.28%

Analysis

The PBIT ratio of the company for the year 2014 is 41.79% and 2015 is 35.11% and 2016 is

42.36% and 2017 is 35.89% and 2018 is 32.28% the PBIT ratio has decreased in by 15.98%

in the year of 2015 increased by 20.65% in 2016 in the year of 2017 is decreased by
15.27% in the year of 2018

Interpretation

Financial metric is used to assess the a company profitability by comparing its revenue and

with earning more specially a bit is derived from revenue this metric would indicate the

percentage of a company is remaining after operating expense here high ratio indicates the
good position in marketed this is good for company

Net profit sales

Net profit/net sales*100

 Year Net profit Net sales Ratio

2014 6244.19 25761.11 24.24%

2015 7743.84 34048.32 22.74%

2016 9426.15 35609.25 26.47

2017 7716.90 38015.80 20.30%

2018 5266.00 41603.80 12.66%

Analysis

The net profit ratio of the company for the year 2014 is 24.43% is 2015 is 22.74% and 2016

is 26.47% and 2017 is 20.30% and 2018 is 12.66% the net profit ration has decreased by

6.19% in the year of 2015 decreased by 16.40% in the year of 2016 again decreased by
23.31% in the year of 2017 is is 37.63% in the year 2018

Interpretation

This ratio is measured of the overall profitability net profit is arrived at after taking into

accounts both the operating and non-operating items of incomes and expense the ratio

increased what portion of the net sales is left for the owners after all expense have been met.

Here the company high profit in 2015 then decline this is not good for company. Company
should be maintained the NP ratio

Capital market ratio

Price earnings ratio

Market price to nav ratio

Market capitalisation ratio

Price earnings ratio

Market price of share/earning per share

 Year MPS EPS RATIO
2014 420.00 32.90 12.77
2015 508.30 40.79 12.46
2016 174.60 24.82 7.03
2017 270.70 20.32 13.32
2018 273.30 15.09 18.11

Analysis

The net profit ratio of the company for the year 2014 is 12.77 , 2015 is 12.46 and 2016 is

7.03 and 2017 is 13.32 and is 2018 is 18.11 the net profit ratio has decreased by 2.43 in the

year of 2014 and in the year if 2015 by 43.57% in the year of of 2016 I s increased by
89.47% in the year of 2017-18 again decreased by 35.90%

Interpretation

The p/e looks at the relationship between stock price and the company earning here the

company has a high p/e ratio in the last year it suggests that stocks undervalued, and investor
can earn it.

Market price to nav ratio

Market price share/nav

Year MPS NAV RATIO

2014 420.00 106.65 3.94
2015 508.30 145.63 3.49
2016 174.60 96.74 1.80
2017 270.70 116.16 2.33
2018 273.30 130.16 2.10
Analysis

the market price of nav ratio of the company for the year of 2014-15 is 3.94 and 2015-16 is

1.80 and 2016-17 is 2.33 and 2017-18 is 2.10 and the market price of ratio has decreased by

11.42% in the year of 2015-16 increased by 29.44% in the year of 2016-17 decreased by
9.87% in the year

Interpretation

As per the ratio is concern the investment potential of a share. It also offers opponent to the

company to buy back its own shares from the market. Hear the company has higher ratio
represent the ability to buy own share in the market ideal ratio is 2 so all year is above the 2.
Balance sheet of 2 years
Consolidated Summarized Balance Sheet

As at As at
Particulars Mar 31, Mar 31,
2018 2017
Assets
Non-current assets
Property, plant and equipment
Capital work-in- 706,079
progress Goodwill 52,089
620,088
Other intangible assets 328,070
23,942
Intangible assets under 837,855
338,082
development 45,423 824,181
Investment in joint ventures and 86,839 84,443
associates
82,277
Financial Assets
- Investments
5,769 44,187
- Derivative instruments 2,031 4,732
- Security deposits 9,703 9,630
- Others 5,814 16,653
Income tax assets (net) 25,505 22,716
Deferred tax assets (net) 29,330 26,195
Other non-current assets 36,319 53,488
2,170,826 2,150,614
Current assets
Inventories 488
Financial Assets 693
- Investments
16,923
68,978
- Derivative instruments
2,060
8,941
- Trade receivables
47,402
58,830
- Cash and cash equivalents
12,817
47,886
- Bank deposits
38,166
18,820
- Others
19,737
27,462
Other current assets 44,445
103,380
Assets-held-for-sale 0
0
334,990 182,038
Total Assets 2,505,816 2,332,652

Equity and liabilities 19,987 19,987

Equity 675,357 654,576
Share capital 695,344 674,563
Other Equity 88,139 68,750
Equity attributable to owners of 783,483 743,313
the Parent
Non-controlling interests ('NCI')
849,420 896,373
Non-current liabilities 5,409 2,726
Financial Liabilities 44,547 15,681
- Borrowings 22,117 22,335
- Derivative instruments 7,212 7,471
- Others 10,606 9,429
Deferred revenue 623 727
Provisions 939,934 954,742
Deferred tax liabilities (net)
Other non-current liabilities 129,569 129,442
134,346 47,062
Current liabilities
283 2,335
Financial Liabilities
277,675 268,537
- Borrowings
140,605 90,212
- Current maturities of long term
48,666 48,785
borrowings
- Derivative instruments
2,384 2,215
- Trade Payables
11,058 11,239
- Others
37,813 34,770
Deferred revenue 0 0
Provisions 782,399 634,597
Current tax liabilities (net) 1,722,333 1,589,339
Other current liabilities 2,505,816 2,332,652
Liabilities-held-for-sale

Total liabilities
Total equity and liabilities
Analysis and Interpretation
Income is increased as a camper to pervious year due to sales increase
Expenditure more than the previous year this bad for company that why decline in profits
margin
Share holder fund is increased as a camper to pervious year this is good for the company
In applications of fund is not proper managed by the company because net working capital is
in negative, but we show some improvement in this. So, this is not good for the company
As all aspects of the vertical analysis part over all the company tries to increase his
performance by increase his efficacy
Profit & Loss account of ------------------- in Rs. Cr. -------------------

Bharti Airtel
Mar 18 Mar 17 Mar 16 Mar 15
12 mths 12 mths 12 mths 12 mths
INCOME
Revenue from Operations [Gross] 53,663.00 62,276.30 60,300.30 55,496.40
Revenue from Operations [Net] 53,663.00 62,276.30 60,300.30 55,496.40
Total Operating Revenues 53,663.00 62,276.30 60,300.30 55,496.40
Other Income 235.60 184.30 172.90 5,193.00
Total Revenue 53,898.60 62,460.60 60,473.20 60,689.40
EXPENSES
Purchase of Stock-In Trade 0.00 0.00 0.00 71.40
Operating and Direct Expenses 13,951.20 14,536.00 28,776.00 14,602.50
Employee Benefit Expenses 1,720.90 1,738.50 1,864.80 1,691.50
Finance Costs 5,069.00 2,912.50 1,974.50 1,409.10
Depreciation and Amortisation 13,048.60 12,203.40 9,575.30 7,559.70
Expenses
Other Expenses 20,186.00 22,308.90 7,348.30 19,699.90
Total Expenses 53,975.70 53,699.30 49,538.90 45,034.10
Mar 18 Mar 17 Mar 16 Mar 15
12 mths 12 mths 12 mths 12 mths
Profit/Loss Before Exceptional, -77.10 8,761.30 10,934.30 15,655.30
Extraordinary Items and Tax
Exceptional Items -604.10 - -679.90 0.00
17,270.80
Profit/Loss Before Tax -681.20 -8,509.50 10,254.40 15,655.30
Tax Expenses-Continued Operations
Current Tax -220.40 -4.50 2,055.80 3,109.20
Less: MAT Credit Entitlement 0.00 0.00 0.00 779.00
Deferred Tax -540.00 1,420.60 418.30 124.60
Total Tax Expenses -760.40 1,416.10 2,474.10 2,454.80
Profit/Loss After Tax and Before 79.20 -9,925.60 7,780.30 13,200.50
Extraordinary Items
Profit/Loss from Continuing 79.20 -9,925.60 7,780.30 13,200.50
Operations
Profit/Loss for The Period 79.20 -9,925.60 7,780.30 13,200.50
Analysis and interpretation
It is equally and probably more to study analysis the portability of the company at different
steps or at intermediate levels of business activities in relation to net sales. it may be observed
that in case of Bharti airtel profit has decline at every intermediate stage. however, since
absolute figures are not amendable to further analysis

TRENDS AND RATIO ANALYSIS

Quarter
Particulars Ended
Mar-18 Dec-17 Sep-17 Jun-17 Mar-17
Total revenues 196,343 203,186 217,769 219,581 219,346
Access charges 20,287 19,539 25,603 25,016 22,761
Cost of goods sold 2,462 2,800 2,579 2,153 2,093
Net revenues 173,594 180,846 189,588 192,412 194,493
Operating Expenses (Excel 86,528 88,128 90,384 93,847 94,175
Access Charges, cost of goods
sold & License Fee) 17,475 17,542 19,720 20,820 20,850
Licence Fee 70,341 75,871 80,037 78,231 79,928
EBITDA 51,646 54,567 60,417 60,539 59,505
Cash profit from operations 21,061 27,008 32,898 29,878 29,643
before Derivative and Exchange
1,836 2,256 3,662 2,855 2,508
Fluctuations
4,416 8,381 12,988 14,816 12,515
EBIT
4,588 7,200 7,316 6,579 5,572
Share of results of Joint
3,754 2,859 2,592 2,518 1,107
Ventures/Associates
834 4,341 4,724 4,060 4,465
Profit before Tax
398 1,593 1,455 402 865
Profit after Tax (before
exceptional items) 4,190 5,607 5,861 6,177 4,706
Non-Controlling Interest 3,361 2,548 2,430 2,505 972
Net income (before 829 3,058 3,430 3,673 3,734
exceptional items) Exceptional 64,657 74,838 65,857 38,082
items (net of tax) 11,214 5,199 12,374 41,847
Profit after tax (after 3,071,442 3,060,093 2,958,339 2,911,547
exceptional items)
Non-Controlling Interest
Net income
Capex 62,824
Operating Free Cash Flow (EBITDA - 7,517
Capex) 3,119,402
Cumulative Investments
Mar-18 Dec-17 Sep-17 Jun-17 Mar-17

As a % of Total revenues
Access charges 10.3% 9.6% 11.8% 11.4% 10.4%
Cost of goods sold 1.3% 1.4% 1.2% 1.0% 1.0%
Net revenues 88.4% 89.0% 87.1% 87.6% 88.7%
Operating Expenses (excluding
access charges, cost of goods sold & 44.1% 43.4% 41.5% 42.7% 42.9%
license fee)
Licence Fee 8.9% 8.6% 9.1% 9.5% 9.5%
EBITDA 35.8% 37.3% 36.8% 35.6% 36.4%
Cash profit from operations before
Derivative and Exchange 26.3% 26.9% 27.7% 27.6% 27.1%
Fluctuations
EBIT 10.7% 13.3% 15.1% 13.6% 13.5%
Share of results of JV / Associates 0.9% 1.1% 1.7% 1.3% 1.1%
Profit before Tax 2.2% 4.1% 6.0% 6.7% 5.7%
Profit after Tax (before exceptional 2.3% 3.5% 3.4% 3.0% 2.5%
items)
Non-Controlling Interest 1.9% 1.4% 1.2% 1.1% 0.5%
Net income (before exceptional 0.4% 2.1% 2.2% 1.8% 2.0%
items)
Profit after tax (after exceptional 2.1% 2.8% 2.7% 2.8% 2.1%
items)
Non-Controlling Interest 1.7% 1.3% 1.1% 1.1% 0.4%
Net income 0.4% 1.5% 1.6% 1.7% 1.7%

Trend analysis interpretation

 In sale continually increasing. This is good performance of the company that is

currently company is marketed leader in telecom industry

 As per the profit after tax concern high profit sow the high performance of the

company here the company 2015-16 is very high but company should maintain that

profitability.

 Share holder funds continuous up by creating the good image in the market that show
the goodwill of the company
 Total debt of the company is in year 2016-17is very low camper the base of the year

of 2014-15 this is good for company but in a year 2015-16 is very high so that not

maintain by the company

 Net current assets of the company are in negative that is not good for the company

 Total assets/ total liability of the company is continues increasing that shows turnover
year by year that’s good for the company.

Recommendations

 The company should maintain an adequate cash and bank balance order to meet the

emergency requirements

 The current ratio of the company has decreasing year to year the company must utilize

their current assets accurately

 The sales of the company go increasing better to increase sales for more profit in

future.

 Net profit of the company goes on increasing better to increasing sales for more profit

in future.

 The net working capital of the company has negative. shows excess of current

liabilities over current assets. it must positive for future years

 Loans for the company increasing in year of 2015 compare to previous year. it shows

that the profit was distributed to their interest better should be not for the same for the

next year.

 Better to maintain high return on shareholder investment

 Better to curtail the debenture interest to avoid paying interest

 For the smooth operation of the company If must make sure that it is liquid in the
coming year because right now a lot rests on the operation of the business.
Reference Material
 https://www.investopedia.com/terms/f/finance.asp
 www.bhartiairtel.com
 www.moneycontrol.com
 www.economicindiatimes.com
 www.wiki.org
 http://economictimes.indiatimes.com/topic/startups
 http://www.referralsaasquatch.com/23-articles-on-startup-growth-you-cant-afford-to-
miss
 www.timesofinida.com

Books:
 Financial Statement Analysis (Subramanyam)
 The analysis and use of financial statements (White, Gerald)
 Business Analysis Valuation (Krishna G. Palepu)

 Research papers:
 www.researchgate.com
 EXECUTIVE SUMMARY
THE STUDY AIMS TO PROVIDE A BROAD UNDERSTANDING of the common issues
arising in industry and at ace (airtel centre of elance)
Transition is the process of migration knowledge system and operating capabilities between
outsourcing environments (opco/circle) to a house operating (Ace) it is necessary to formulate
and capture the end to end transition methodology to ensure high quality and smooth transition
The problem discussed in this project report is regarding the common open issues arising in
India how these are to be closed. Another problem discussed here is about the financial; impact
of these common open uses under different opcos and circle.
At then of the study we conclude that some common issues are in open in one or more the
opcos/ circle and closed in India. For India there are total of 61 issues having a financial impact
of $930,170k out of these the closed issues had and impact of $2900k while the open issues
have an impact of $927,270k
 Chaptalization
Executive Summary…………………………………………….
Chapter 1 Introduction………………………………………………….
a) Introduction about telecom
b) History about telecom
Chapter 2 Company Profile…………………………………………….
a) Introduction
b) History
c) Vision, mission
d) Global expansion
e) Products
f) Services
Chapter 3 Review of Literature……………………………………….
a) Research methods and procedure
b) Purpose of the study
c) Data collection
d) Instruments
e) Limitations
Chapter 4 Financial Analysis
a) Ratio analysis
b) Review of Methodology
c) Analysis
d) Interpretation
Chapter 5 Conclusion and Recommendations
Chapter 6 Bibliography
Growth Chart of airtel

PRODUCT WISE PERFORMANCE

REVENUE GENERATING FROM SERVICES