Telecom Industry in India
The telecom industry is one of the fastest growing industries in India. India has nearly 200 million telephone lines making it the third largest network in the world after China and USA. With a growth rate of 45%, Indian telecom industry has the highest growth rate in the world. - Much of the growth in Asia Pacific Wireless Telecommunication Market is spurred by the growth in demand in countries like India and China. - India‘s mobile phone subscriber base is growing at a rate of 82.2%. - China is the biggest market in Asia Pacific with a subscriber base of 48% of the total subscribers in Asia Pacific. Compared to that India ’s share in Asia Pacific Mobile Phone market is 6.4%. Considering the fact that India and China have almost comparable populations, India’s low mobile penetration offers huge scope for growth. History of Indian Telecommunications Started in 1851 when the first operational land lines were laid by the government near Calcutta (seat of British power). Telephone services were introduced in India in 1881. In 1883 telephone services were merged with the postal system. Indian Radio Telegraph Company (IRT) was formed in 1923. After independence in 1947, all the foreign telecommunication companies were nationalized to form the Posts, Telephone and Telegraph (PTT), a monopoly run by the government's Ministry of Communications. Telecom sector was considered as a strategic service and the government considered it best to bring under state's control. The first wind of reforms in telecommunications sector began to flow in 1980s when the private sector was allowed in telecommunications equipment manufacturing. In 1985, Department of Telecommunications (DOT) was established. It was an exclusive provider of domestic and long-distance service that would be its own regulator (separate from the postal system). In 1986, two wholly government-owned companies were created: the Videsh Sanchar Nigam Limited (VSNL) for international telecommunications and Mahanagar Telephone Nigam Limited (MTNL) for service in metropolitan areas. In 1990s, telecommunications sector benefited from the general opening up of the


economy. Also, examples of telecom revolution in many other countries, which resulted in better quality of service and lower tariffs, led Indian policy makers to initiate a change process finally resulting in opening up of telecom services sector for the private sector. National Telecom Policy (NTP) 1994 was the first attempt to give a comprehensive roadmap for the Indian telecommunications sector. In 1997, Telecom Regulatory Authority of India (TRAI) was created. TRAI was formed to act as a regulator to facilitate the growth of the telecom sector. New National Telecom Policy was adopted in 1999 and cellular services were also launched in the same year. Telecommunication sector in India can be divided into two segments: Fixed Service Provider (FSPs), and Cellular Services. Fixed line services consist of basic services, national or domestic long distance and international long distance services. The state operators (BSNL and MTNL), account for almost 90 per cent of revenues from basic services. Private sector services are presently available in selective urban areas, and collectively account for less than 5 per cent of subscriptions. However, private services focus on the business/corporate sector, and offer reliable, high- end services, such as leased lines, ISDN, closed user group and videoconferencing. Cellular services can be further divided into two categories: Global System for Mobile Communications (GSM) and Code Division Multiple Access (CDMA). The GSM sector is dominated by Airtel, Vodfone-Hutch, and Idea Cellular, while the CDMA sector is dominated by Reliance and Tata Indicom. Opening up of international and domestic long distance telephony services are the major growth drivers for cellular industry. Cellular operators get substantial revenue from these services, and compensate them for reduction in tariffs on airtime, which along with rental was the main source of revenue. The reduction in tariffs for airtime, national long distance, international long distance, and handset prices has driven demand. Classification of Telecommunication services 1. Basic services 2. Cellular services 3. Internet Service Provider (ISP)

Cellular Service

There are five private service operators in each area, and an incumbent state operator. Almost 80% of the cellular subscriber base belongs to the pre-paid segment. 2. The DoT has allowed cellular companies to buy rivals within the same operating circle provided their combined market share did not exceed 67 per cent. Previously, they were only allowed to buy companies outside their circle.


Growth Drivers Opening up of international and domestic long distance telephony services are growth drivers in the industry. Cellular operators now get substantial revenue from these services, and compensate them for reduction in tariffs on air time, which along with rental was the main source of revenue. The reduction in tariffs for airtime, national long distance, international long distance, and handset prices has driven demand.

The Key players in the Telecom Market in India
Cellular Service provider: 1. BSNL 2. Airtel 3. Vodafone 4. Idea 5. Reliance 6. Tata indicom 7. Aircel 8. Spice 9. MTNL Subscribers: Wireless subscribers crosses 200 million mark Tele density reaches 21.20% The total number of telephone subscribers has reached 241.02 million at the end of August 2007 as compared to 232.87 million in July 2007. The overall teledensity has increased to 21.20% in August 2007 as compared to 20.52% in July 2007. In the wireless segment, 8.31 million subscribers have been added in August 2007 while 8.06 million subscribers were added in July 2007. The total wireless subscribers (GSM, CDMA & WLL(F)) base reaches 201.29 million at the end of August 2007. The wireline segment subscriber base stood at 39.73 million with a decrease of 0.16 million at the end of August 2007. Circle wise wire line subscriber base of service providers is given at following chart ..


Market Share of the telecom Company in India





India Telecommunications policy
National Policy
In 1994 the Government of India issued its National Telecommunications Policy. The policy was issued in recognition of the "urgent need" to provide universal access to basic telecommunications services by 1997 and offers guidelines for entry of the private sector into basic telecommunications services. To facilitate private-sector participation, licensing procedures were established in the Department of Telecommunications in India, and equity participation for companies registered in India (with 51 or more percent Indian ownership) was anticipated. Private-sector licenses, however, were to be granted only for local (versus long-distance) telecommunications networks. An autonomous body, the Telecommunications Authority of India, was established to regulate private-sector activity.

Telephone system in India
India's telephone system, like many other aspects of telecommunications, is in the government sector, under the control of the Ministry of Information and Broadcasting. The modernization of the telephone system in India has been underway since 1986 when Mahanagar Telephone Nigam, a government corporation, was established to operate systems in Bombay and New Delhi, and Videsh Sanchar Nigam, also government owned, was set up as the overseas carrier. Progress was slow, however; the rest of the nation's service continued as a civil-service-run operation under the Department of Telecommunications until 1994 when basic telephone services were opened to privatesector competition.


The number of telephone connections in India rose from 800,000 in FY 1968 to 8 million in FY 1994. The system remains substandard by international standards, however, and there is a waiting list for connections of 2.8 million people. Sometimes several years elapse between application and installation of a telephone line. Close to 1 million new connections a year are being established in the mid-1990s. Plans for increasing the capacity of the system to handle more directly dialed calls were being implemented in the early 1990s, and 20 million lines should be in operation by FY 2000. This number is very low for a population that by then will probably exceed 1 billion. Telephone line density was less than 0.7 per 100 persons in 1994, one of the lowest densities among the major nations of Asia. There also are submarine telecommunications cables linking India with Malaysia and the United Arab Emirates. Although the government is a major manufacturer of telephone equipment, the private sector--especially foreign ventures--is becoming increasingly involved in manufacturing in the mid-1990s and paging, cellular phone service, and electronic mail are being introduced.




Macro Economic Developments Industrial Growth: The recently released numbers by CSO on Industrial production for 2007-08 were the lowest in 6 years, and show a significant slowdown with respect to growth over the previous year. In March 2008 Industry recorded a growth of 3% as against the 14.8% recorded in the previous year. It is felt by the business community that a number of fresh global factors coupled with domestic factors have impacted the industrial growth; running from recession (slowdown) in the west to rising fuel and commodity prices. Growth for the fiscal 2007-08 also suggests slowdown in the overall production. In 2007-08, growth numbers for all the three constituents of IIP showed slowdown. Mining, manufacturing and electricity grew by 3.8%, 2.9% and 3.7% in March 2008 as against 8.0%, 16.0% and 7.9% posted in the previous year respectively. Abysmally low growth was observed in use-based classification. Basic, intermediate and capital goods recorded growths that were way too low as compared to the growths posted in the previous fiscal. Consumer goods slipped sharply entering the negative territory posting a negative 0.1% growth compared to 15.8% growth in the previous year. Growth for beverages and tobacco, jute products, wood products, leather items and basic chemicals in 2007-08 surpassed that of the previous year while for the rest of the sector growth remained either subdued or negative. And for the month of March 2007-08, growths of particularly three products, beverages and tobacco, jute products and leather products represented speed up in production while that of metal products, textiles and transport turned negative. Core Infrastructure Industries: In March 2008, core infrastructure industries recorded a growth of 9.6%, marginally lower than the growth of 10.5 % posted in the previous year. During the month the growth in finished steel and cement surpass the growths posted in the same month of previous year. Growth comparison between 2007-08 and growth in the previous year shows deceleration in overall infrastructure industries in 2007-08 compared to the last. It was only in the case of coal where production exceed that of the previous year.


Telecommunications: Falling call charges are bringing 7 million connections on an average every month to the mobile phone network. Total phone connection registered crossed 300 million with mobile phone subscription surpassing 250 million. In 2007-08 net mobile phone additions were only 5 million connections short of 100 million. The fixed line connection however dropped by over a million in a year time. Inflation Trends : The yearly WPI based inflation averaged for the year 2007-08 eased to 4.7 %, well below the targeted inflation rate of 5-5.5% for 2007-08 compared to the average 5.4% recorded in 2006-07. Inflation stood at 7.4% in the last week of March 2008 compared with 5.9% a year ago. It has been seen that measures by the government brought wholesale price rise near 3% in the middle of the year, 2007-08 from 6% in the beginning but inflation was observed to rise by the year-end. High inflation was mainly on account of rising prices of food articles; dearer fuel prices and rise in the prices of some manufactured items. The recent weekly price rise released for the week ending 3 May 08 shows rd overall price index touch 7.83 %. In the recent policy stance some measures have addressed the causes of rising inflation, which will gradually show its effect on the inflation. Monetary Indicators: M3, money supply for the year 2007-08 rises by 20.3% (calculated over March end 2007 to March 2008) as against 21.3% in the previous year. Growth in the net bank credit to the government is seen to decline to 1.1% compared to 8.1% growth recorded previously. Growth in borrowing by the commercial sector was seen to slow to 20% vis-Ã -vis 25% growth seen in the previous year. The high forex inflows and valuation in the currencies have resulted into high accumulation of net foreign exchange assets of banks, resulting into a 38% rise over 25.7% in the previous year. There has been a slight drop to 20.1% in the previous fiscal in the non-monetary liabilities of the banks from 22.4% in the 2006-07. The RBI policy twists to encourage deposits was seen to have an impact as deposits swelled by almost the same rate as recorded in the previous year. Investments in the government and other securities too received attention representing 22.9% rise over the increase of 10.3% in the previous year. High interest rates however seem to discourage credit off take. Total credit off take of SCB grew by 21% in 2007-08 compared to 28% a year before, fully diverted to non-food items.


Fiscal Trends: Revenue collections from tax sources up to February 2008 stood at Rs 466163 crore growing at a low 26% than the rate of tax collection in the previous year . Corporation tax mopped Rs 139506 (30 % of the total tax collected) collected at a rate of 37%. Revenue received from the income tax sources spiked by 42.4% compared to 30% recorded in the previous year. Cumulative growth in revenue up to February 2008 from customs slipped to 19% compared to 34% growth posted in the previous year. A slightly higher increase in excise was seen than what was recorded in the previous year. Stock Market Trends: The four-month-old gradual meltdown in the Indian stock market is due to the gloom sensed in the western markets. The blow was also seen to hit the other Asian markets. Series of events like the sub prime crisis surfaced in September 2007 and followed by a recession in the US and European markets have impacted the index to fall beyond any quick repair. However favorable strong domestic indicators have recently overshadowed the global factors making the domestic stock market indices climb up. Foreign Trade : Indian merchandise exports fell short by USD 4.5 billion from the target set for the year 2007-08. Cumulatively there has been an increase in merchandise exports by 23% in 2007-08 over the previous year. Import bill in US dollar terms increased by 27% in 2007-08 touching USD 235 billion. Trade deficit widened from USD 60 billion to USD 80 billion. Growth in merchandise exports (in USD terms) of important products to developed nations was observed to suffer a slowdown while exports to developing nations accelerated. Main items for exports that exceeded the growths in the previous year were agricultural products (rice), ores and minerals and gems and jewelry. Growth in non-bulk imports increased faster compared to that of last year where as growth of bulk items was seen to slow down. Foreign Exchange Reserves: Foreign exchange reserves surpassed the USD 300 billion mark in February 2008 and crossed USD 310 billion in the successive month. Most of the reserve money, more than 90 percent has been in the form of foreign currency assets and stood at 299 billion expressed in USD terms. In the first week of April 2008 foreign currency assets crossed USD 300 billon mark and Gold position was seen to widen to USD 10 billion. Reserve tranche position in the IMF increased to USD 490 million in April 2008 from USD 427 million in the previous month of the year.


Capital Inflows: Total foreign investment inflows touched USD 60 billon in 2007-08, where direct investment attracted 50 percent of the total investment and the rest was received as portfolio investments. Foreign direct investment inflows received in 2007-08 were USD 7 billion in excess of direct inflows received in the previous year. Trends in the Exchange Rates: Indian Rupee against the USD turned weak, strongly favoring the Indian exports and raising the import bill. Indian Rupee is heading towards Rs 44/ USD level. It touched Rs 43.15 in May 2008 and gradually began to trade weak at Rs 40 from the third week of April 2008. From January to May 22 Rupee depreciated by 7% and as against the US dollar. Rupee ro was also seen to pick up from Rs 57/ Euro in January 2008 to Rs 68/ Euro in May 2008, weakening by 11%.




Reliance Infocomm was founded by Dhirubhai Ambani. Between 1999 to 2002 Reliance Infocomm built 60,000 km of fibre optic backbone in India. This network was commissioned on December 28, 2002.

During the twelve months ended March 31, 2007, revenues of the Wireless business increased by 46% to Rs. 10,728 crore (US$ 2,489 million) from Rs. 7,364 crore (US$ 1,709 million). Wireless EBITDA increased to Rs. 3,984 crore (US$ 924 million) from Rs. 2,250 crore (US$ 522 million). Margins expanded to 37% from 31%. EBITDA of the Global business increased by 98% during the twelve months ended March 31, 2007 to Rs. 1,271 crore (US$ 295 million). EBITDA margins increased to 24% from 12% last year. In the same period, the Broadband business achieved revenue growth of 123% to Rs. 1,144 crore (US$ 265 million), and EBITDA increased by more than 6 times, to Rs. 519 crore (US$ 120 million). The EBITDA margin crossed 45% in the twelve months ended March 31, 2007, from 15% in the corresponding period in the previous year.


As on 31-Mar-08 31-Mar-07 31-Dec-05 Assets Rs mn %BT Rs mn %BT Rs mn Gross Block 192021.10 35.32 182859.10 41.87 1980.88 Net Block 148834.50 27.38 159414.80 36.51 1662.36 Capital WIP 71175.60 13.09 21856.00 5.00 0.00 Investments 138441.30 25.47 54344.20 12.44 120741.01 Inventory 2012.20 0.37 985.10 0.23 0.00 Receivables 10932.10 2.01 8021.10 1.84 0.00 Other Current 172208.70 31.68 192064.30 43.98 31589.57 Assets Balance Sheet 543604.40 100.00 436685.50 100.00 153992.95 Total(BT) Liabilities Rs mn %BT Rs mn %BT Rs mn Equity Share 10320.10 1.90 10223.10 2.34 6116.15 Capital Reserves 218038.40 40.11 173462.60 39.72 147834.27 Total Debt 202864.30 37.32 145678.40 33.36 0.00 Creditors and 47462.50 8.73 25244.30 5.78 10.51 Acceptances Other current 64919.10 11.94 82077.10 18.80 32.02 liab/prov. Balance Sheet 543604.40 100.00 436685.50 100.00 153992.95 Total(BT) %BT 1.29 1.08 0.00 78.41 0.00 0.00 20.51

100.00 %BT 3.97 96.00 0.00 0.01




As on 31-Mar-08 31-Mar-07 31-Dec-05 OPBIT/Prod.cap.empl.(%) 13.33 8.30 -0.09 PBIT/Cap. Employed (%) 8.30 6.90 0.07 PAT/Networth (%) 11.33 10.49 0.05 Tax/PBT (%) 0.68 0.51 31.25 Total Debt/Networth (x) 0.89 0.79 0.00 Long Term Debt/Networth (x) 0.53 0.76 0.00 PBDIT/Finance Charges (x) 12.57 19.42 0.00 Current Ratio (x) 1.65 1.87 742.81 RM Inventory (days 0.00 0.00 0.00 consumption) FG inventory (days cost of sales) 0.00 0.00 0.00 Receivables (days gross sales) 29.74 31.21 0.00 Creditors (days cost of sales) 201.00 159.01 172.75 Op. curr. assets (days OI) 350.00 566.00 379727.00



As on( Months )

Profit / Loss A/C Net Sales Operating Income 134172.80 100.00 117293.80 100.00 22.77 100.01 (OI) OPBDIT 47985.20 35.76 44860.90 38.25 6.12 26.87 OPBDT 44140.80 32.90 42537.10 36.27 6.12 26.87 OPBT 25704.20 19.16 23936.90 20.41 -21.25 -93.31 Non-Operating 338.30 0.25 275.00 0.23 109.80 482.23 Income Extraordinary/Prior 0.00 0.00 0.00 0.00 -6.32 -27.74 Period Tax 178.00 0.13 123.40 0.11 25.70 112.87 Profit after 25864.50 19.28 24088.50 20.54 56.54 248.30 tax(PAT) Cash Profit 44301.10 33.02 42688.70 36.39 83.90 368.49 Dividend-Equity 1548.00 1.15 1022.30 0.87 0.00 0.00

31Dec05(9) Rs mn %OI Rs mn %OI Rs mn %OI 134161.90 99.99 117252.60 99.96 0.00 0.00 31-Mar08(12) 31-Mar07(15)



Tata Teleservices Limited (TTSL) is part of the Tata Group of Companies, an Indian Conglomerate. It runs the brand name Tata Indicom in India in various telecom circles of India. The company forms part of the Tata Group's prescence in the Telecommunication Industry in India, along with Tata Teleservices (Maharashtra) Limited (TTML) and VSNL. TTSL was incorporated in 1995 and was the first company to offer CDMA Mobile services in India, specifically in the state of Andhra Pradesh. In December 2002, the company acquired the erstwhile Hughes Telecom (India) Ltd. which was renamed Tata Teleservices (Maharashtra) Limited. In September 2007, Tata Indicom launched the Talk World plan, an International Long Distance Plan. Tata is the direct competitor with Reliance, both CDMA operators in India. The company provides unified telecommunication solutions including mobile, fixed wireless, fixed line and broadband. Other competitors are Vodafone, Airtel, Aircel, Idea, MTNL, BSNL providing GSM based mobile telephony. The company was first in India to provide free intra network calling within city limits. They launched a unique scheme providing lifetime rental free connectivity on its mobile and fixed wireless for a one time charge.

Tata Teleservices is part of the INR Rs. 119000 Crore (US$ 29 billion) Tata Group, that has over 87 companies, over 250,000 employees and more than 2.8 million shareholders. With a committed investment of INR 36,000 Crore (US$ 7.5 billion) in Telecom (FY 2006), the Group has a formidable presence across the telecom value chain.


Tata Teleservices spearheads the Group’s presence in the telecom sector. Incorporated in 1996, Tata Teleservices was the first to launch CDMA mobile services in India with the Andhra Pradesh circle.

Starting with the major acquisition of Hughes (India) Limited [now renamed Tata Teleservices (Maharashtra) Limited] in December 2002 the company swung into an expansion mode. With the total Investment of Rs 19,924 Crore, Tata Teleservices has created a Pan India presence spread across 20 circles that includes Andhra Pradesh, Chennai, Gujarat, Karnataka, Delhi, Maharashtra, Mumbai, Tamil Nadu, Orissa, Bihar, Rajasthan, Punjab, Haryana, Himachal Pradesh, Uttar Pradesh (E), Uttar Pradesh (W), Kerala, Kolkata, Madhya Pradesh and West Bengal. Having pioneered the CDMA 3G1x technology platform in India, Tata Teleservices has established a robust and reliable 3G ready telecom infrastructure that ensures quality in its services. It has partnered with Motorola, Ericsson, Lucent and ECI Telecom for the deployment of a reliable, technologically advanced network. The company, which heralded convergence technologies in the Indian telecom sector, is today the market leader in the fixed wireless telephony market with a total customer base of over 3.8 million. Tata Teleservices’ bouquet of telephony services includes Mobile services, Wireless Desktop Phones, Public Booth Telephony and Wireline services. Other services include value added services like voice portal, roaming, post-paid Internet services, 3-way conferencing, group calling, Wi-Fi Internet, USB Modem, data cards, calling card services and enterprise services. Some of the other products launched by the company include prepaid wireless desktop phones, public phone booths, new mobile handsets and new voice & data services such as


BREW games, Voice Portal, picture messaging, polyphonic ring tones, interactive applications like news, cricket, astrology, etc. Tata Indicom redefined the existing prepaid mobile market in India, by unveiling their offering – Tata Indicom ‘Non Stop Mobile’ which allows customers to receive free incoming calls. Tata Teleservices today has India’s largest branded telecom retail chain and is the first service provider in the country to offer an online channel to offer postpaid mobile connections in the country. Tata Teleservices has a strong workforce of 6000. In addition, TTSL has created more than 20,000 jobs, which will include 10,000 indirect jobs through outsourcing of its manpower needs. Today, Tata Teleservices Limited along with Tata Teleservices (Maharashtra) Limited serves over 21 million customers in over 4000 towns. With an ambitious rollout plan both within existing circles and across new circles, Tata Teleservices offers world-class technology and user-friendly services in 20 circle


As on 31-Mar07 Rs mn 44698.40 31047.10 3404.40 17480.40 47.20 9551.90 31-Mar06 Rs mn 39864.96 29366.64 1478.09 15310.67 38.02 7375.71 31-Mar05 Rs mn 30857.31 22718.66 5131.68 8904.56 19.65 6089.45

Assets %BT %BT Gross Block 52.18 49.26 Net Block 36.24 36.29 Capital WIP 3.97 1.83 Investments 20.41 18.92 Inventory 0.06 0.05 Receivables 11.15 9.11 Other Current 24130.50 28.17 27363.36 33.81 33453.58 Assets Balance Sheet 85661.50 100.00 80932.49 100.00 76317.59 Total(BT) Liabilities Rs mn %BT Rs mn %BT Rs mn Equity Share 2850.00 3.33 2850.00 3.52 2850.00 Capital Reserves 60250.40 70.34 57042.76 70.48 53678.85 Total Debt 1976.10 2.31 982.50 1.21 0.00 Creditors and 8145.30 9.51 9337.42 11.54 12421.38 Acceptances Other current 12439.70 14.52 10719.81 13.25 7367.36 liab/prov. Balance Sheet 85661.50 100.00 80932.49 100.00 76317.59 Total(BT)

%BT 40.43 29.77 6.72 11.67 0.03 7.98 43.83 100.00 %BT 3.73 70.34 0.00 16.28 9.65 100.00



As on 31-Mar-07 31-Mar-06 31-Mar-05 OPBIT/Prod.cap.empl.(%) 18.75 19.64 13.49 PBIT/Cap. Employed (%) 11.45 13.20 18.51 PAT/Networth (%) 7.43 8.01 11.00 Tax/PBT (%) 33.46 32.58 24.79 Total Debt/Networth (x) 0.03 0.02 0.00 Long Term Debt/Networth (x) 0.00 0.00 0.00 PBDIT/Finance Charges (x) 596.41 15.67 9.63 Current Ratio (x) 1.64 1.73 2.00 RM Inventory (days 0.00 0.00 0.00 consumption) FG inventory (days cost of sales) 0.00 0.00 0.00 Receivables (days gross sales) 86.26 71.20 67.29 Creditors (days cost of sales) 95.72 120.40 174.22 Op. curr. assets (days OI) 199.00 201.00 364.00


31-Mar31-Mar31-Mar07(12) 06(12) 05(12) Profit / Loss A/C Rs mn %OI Rs mn %OI Rs mn Net Sales 40418.30 97.34 37809.53 97.81 33030.39 Operating Income 41524.00 100.00 38657.30 100.00 33778.73 (OI) OPBDIT 10464.20 25.20 10349.26 26.77 7755.35 OPBDT 10445.80 25.16 9619.56 24.88 6513.73 OPBT 6532.50 15.73 6025.84 15.59 4074.05 Non-Operating 965.40 2.32 1517.68 3.93 908.61 Income Extraordinary/Prior -455.60 -1.10 -430.48 -1.11 3288.81 Period Tax 2356.70 5.68 2317.62 6.00 2050.52 Profit after 4685.60 11.28 4795.42 12.40 6220.95 tax(PAT) Cash Profit 8598.90 20.71 8389.15 21.70 8660.62 Dividend-Equity 1282.50 3.09 1282.50 3.32 1710.00 As on( Months )

%OI 97.78 100.00 22.96 19.28 12.06 2.69 9.74 6.07 18.42 25.64 5.06

“Bharti Airtel” formerly known as Bharti Tele-Ventures Limited (BTVL) is among India's largest mobile phone and Fixed Network operators. With more than 60 million 23

subscriptions as of 13th February 2008.[2] It offers its mobile services under the Airtel brand and is headed by Sunil Mittal. The company also provides telephone services and Internet access over DSL in 14 circles. The company complements its mobile, broadband & telephone services with national and international long distance services. The company also has a submarine cable landing station at Chennai, which connects the submarine cable connecting Chennai and Singapore. The company provides reliable end-to-end data and enterprise services to the corporate customers by leveraging its nationwide fiber optic backbone, last mile connectivity in fixed-line and mobile circles, VSATs, ISP and international bandwidth access through the gateways and landing station. Airtel is the largest cellular service provider in India in terms of number of subscribers. Bharti Airtel owns the Airtel brand and provides the following services under the brand name Airtel: Mobile Services (using GSM Technology), Broadband & Telephone Services (Fixed line, Internet Connectivity(DSL) and Leased Line), Long Distance Services and Enterprise Services (Telecommunications Consulting for corporates). Leading international telecommunication companies such as Vodafone and SingTel held partial stakes in Bharti Airtel. In April 2006 Bharti Global Limited was awarded a telecommunications license in Jersey in the Channel Islands by the local telecommunications regulator the JCRA. In September 2006 the Office of Utility Regulation in Guernsey awarded Guernsey Airtel with a mobile telecommunications license. In May 2007 Jersey Airtel and Guernsey Airtel announced the launch of a relationship with Vodafone for island mobile subscribers. In July 2007, Bharti Airtel signed an MoU with Nokia-Siemens for a 900 million dollar expansion of its mobile and fixed network.[3] In August 2007, the company announced it will be launching a customized version of Google search engine that will provide an 'array of services' to its broadband customers.

As on Assets 31-Mar-08 31-Mar-07 31-Mar-06 Rs mn %BT Rs mn %BT Rs mn %BT


Gross Block 249127.84 66.84 238058.10 95.12 155936.85 Net Block 168814.81 45.29 175002.21 69.92 113921.49 Capital WIP 27510.79 7.38 23758.16 9.49 23412.50 Investments 93794.36 25.16 5802.47 2.32 4763.43 Inventory 568.61 0.15 478.14 0.19 177.44 Receivables 27764.57 7.45 14185.17 5.67 10761.71 Other Current 54274.06 14.56 31047.17 12.41 21844.67 Assets Balance Sheet 372727.20 100.00 250273.31 100.00 174881.25 Total(BT) Liabilities Rs mn %BT Rs mn %BT Rs mn Equity Share 18979.07 5.09 18959.34 7.58 18938.79 Capital Reserves 161365.83 43.29 77092.58 30.80 38290.11 Total Debt 65703.42 17.63 53108.05 21.22 47962.91 Creditors and 83799.54 22.48 69472.46 27.76 44447.50 Acceptances Other current 42879.34 11.50 31640.88 12.64 25241.94 liab/prov. Balance Sheet 372727.20 100.00 250273.31 100.00 174881.25 Total(BT)

89.17 65.14 13.39 2.72 0.10 6.15 12.49

100.00 %BT 10.83 21.89 27.43 25.42





As on 31-Mar-08 31-Mar-07 31-Mar-06 OPBIT/Prod.cap.empl.(%) 68.34 40.84 34.61 PBIT/Cap. Employed (%) 35.41 38.62 30.86 PAT/Networth (%) 34.62 41.99 35.16 Tax/PBT (%) 12.56 11.43 8.44 Total Debt/Networth (x) 0.36 0.55 0.84 Long Term Debt/Networth (x) 0.34 0.51 0.52 PBDIT/Finance Charges (x) 18.24 24.87 12.13 Current Ratio (x) 0.65 0.45 0.47 RM Inventory (days 0.00 0.00 0.00 consumption) FG inventory (days cost of sales) 0.00 0.00 0.00 Receivables (days gross sales) 39.43 29.10 34.98 Creditors (days cost of sales) 199.61 237.01 222.90 Op. curr. assets (days OI) 88.00 88.00 92.00



31-Mar31-Mar31-Mar08(12) 07(12) 06(12) Profit / Loss A/C Rs mn %OI Rs mn %OI Rs mn Net Sales 257035.10 99.09 177944.34 99.49 112286.81 Operating Income 259393.68 100.00 178855.85 100.00 112916.42 (OI) OPBDIT 106162.84 40.93 71867.27 40.18 40133.04 OPBDT 100182.83 38.62 68973.32 38.56 36870.21 OPBT 68517.01 26.41 45440.31 25.41 22546.83 Non-Operating 1208.42 0.47 573.40 0.32 311.13 Income Extraordinary/Prior 1682.37 0.65 -476.16 -0.27 -881.45 Period Tax 8965.87 3.46 5205.28 2.91 1855.71 Profit after 62441.92 24.07 40332.26 22.55 20120.79 tax(PAT) Cash Profit 94107.75 36.28 63865.28 35.71 34444.18 Dividend-Equity 0.00 0.00 0.00 0.00 0.00 As on( Months )

%OI 99.44 100.00 35.54 32.65 19.97 0.28 -0.78 1.64 17.82 30.50 0.00

Spice Communications is a joint venture between Spice corp. (India)- the flagship company of MCorp Global” that first introduced India to mobile phone services and has


interests in the field of telecommunications, office automation and information technology and DISTACOM (Hong Kong)-a company with over 20 years of experience in mobile communication which was responsible for bringing mobile telephony to Hong Kong along with Hutchison Telecom. Spice Corp was the first private sector organization to make a strategic shift into the telecommunications arena in 1995 as it launched India's first Cellular Service network in the metro of Calcutta. Spice Communications is one of the largest high value networks in India. Starting operations in June 1997, Spice today is also the singular cellular operator in Punjab with an extensive highway coverage that links nearly 76 key towns and cities, accounting for 95% of the urban population and over 1000 villages across the state. Spice Punjab has already achieved coverage of 95% District head quarters as per DoT tender conditions, having already covered 14 out of 15 Districts HQs, including Chandigarh. Launched over nine years ago under the brand name of "Spice Telecom", the Company's cellular services have already built up a strong customer base of over 1.5 million in two of India's most challenging and lucrative markets – Punjab and Karnataka.

FOREIGN PARTNERS The Foreign partners for Spice Communications Karnataka are Distacom, AIG and Prudential.

INFRASTRUCTURE VENDORS The infrastructure vendors are Siemens and Motorola.

LAUNCH OF SERVICE Launched over six years ago under the memorable brand name of "Spice", the Company offers cellular services in Punjab and Karnataka. Spice Karnataka launched its services in April 1997. 28

Pre-paid /post-paid Service Spice Communications Limited is presently operating Cellular Phone Services in the states of Punjab and Karnataka. The pre-paid service in Karnataka operates under the brand name "Simple" and In Punjab under the brand name “spice”.



As on Assets Gross Block Net Block Capital WIP Investments Inventory Receivables Other Current Assets Balance Sheet Total(BT) Liabilities Equity Share Capital Reserves Total Debt Creditors and Acceptances Other current liab/prov. Balance Sheet Total(BT)

31-Dec-07 Rs mn 18399.59 12376.84 1429.27 971.71 18.92 656.71 7827.81 23281.26 Rs mn 6899.25 -2776.62 15437.33 1917.10 1804.20 23281.26

%BT 79.03 53.16 6.14 4.17 0.08 2.82 33.62 100.00 %BT 29.63 -11.93 66.31 8.23 7.75 100.00

31-Dec-06 Rs mn 12222.04 5876.04 441.30 0.00 6.59 544.53 2158.35 9026.81 Rs mn 5519.40 -11183.85 12079.13 1406.52 1205.61 9026.81

%BT 135.40 65.10 4.89 0.00 0.07 6.03 23.91 100.00 %BT 61.14 -123.90 133.81 15.58 13.36 100.00



As on OPBIT/Prod.cap.empl.(%) PBIT/Cap. Employed (%) PAT/Networth (%) Tax/PBT (%) Total Debt/Networth (x) Long Term Debt/Networth (x) PBDIT/Finance Charges (x) Current Ratio (x) RM Inventory (days consumption) FG inventory (days cost of sales) Receivables (days gross sales) Creditors (days cost of sales) Op. curr. assets (days OI)

31-Dec-07 28.25 28.75 91.71 2.13 3.74 2.00 5.24 2.29 0.00 0.08 25.02 95.30 221.00

31-Dec-06 6.29 7.25 13.66 -1.29 -2.13 -2.02 1.52 1.04 0.00 0.39 25.54 84.17 126.00



As on( Months ) Profit / Loss A/C Net Sales Operating Income (OI) OPBDIT OPBDT OPBT Non-Operating Income Extraordinary/Prior Period Tax Profit after tax(PAT) Cash Profit Dividend-Equity

31-Dec07(12) Rs mn 9578.49 14044.65 6702.00 5353.12 3499.32 384.20 -20.62 82.21 3780.69 5634.50 0.00

%OI 68.20 100.00 47.72 38.12 24.92 2.74 -0.15 0.59 26.92 40.12 0.00

31-Dec06(6) Rs mn 3891.65 3933.10 883.55 284.99 -410.79 28.83 0.00 4.92 -386.88 308.90 0.00

%OI 98.95 100.00 22.46 7.25 -10.44 0.73 0.00 0.13 -9.84 7.85 0.00


As India's leading GSM Mobile Services operator, IDEA Cellular has licenses to operate in 11 circles. With a customer base of over 17 million, IDEA Cellular has operations in Delhi,Maharashtra, Goa, Gujarat, Andhra Pradesh, Madhya Pradesh, Chattisgarh, Uttaranchal, Haryana, UP-West, Himachal Pradesh and Kerala. IDEA Cellular's footprint currently covers approximately 45% of India's population and over 50% of the potential telecom-market. Idea Cellular is a wireless telephony company operating in various states in India. It initially started in 1995 as a join venture between the Tatas, Aditya Birla Group and AT&T by merging Tata Cellular and Birla AT&T Communications. Initially having a very limited footprint in the GSM arena, the acquisition of Escotel in 2004 gave Idea a truly pan-India presence covering Maharashtra (excluding Mumbai), Goa, Gujarat, Andhra Pradesh, Madhya Pradesh, Chattisgarh, Uttar Pradesh (East and West), Haryana, Kerala, Rajasthan and Delhi (inclusive of NCR). The company has its retail outlets under the "Idea n' U" banner. The company has also been the first to offer flexible tarrif plans for prepaid customers. It also offers GPRS services in urban areas.

Initially the Birlas, the Tatas and AT&T Wireless each held one-third equity in the company. But following AT&T Wireless' merger with Cingular Wireless in 2004, Cingular decided to sell its 32.9% stake in Idea. This stake was bought by both the Tatas and Birlas at 16.45% each. Tata's foray into the cellular market with its own subsidiary, Tata Indicom, a CDMAbased mobile provider, cropped differences between the Tatas and the Birlas. This dual holding by the Tatas also became a major reason for the delay in Idea being granted a license to operate in Mumbai. This was because as per Department of Telecom (DOT) license norms, one promoter could not have more than 10% stake in two companies operating in the same circle and Tata Indicom was already operating in Mumbai when Idea filed for its license. The Birlas thus approached the DOT and sought its intervention, and the Tatas replied by saying that they would exit Idea but only for a good price. On April 10, 2006, the Aditya Birla Group announced its acquisition of the 48.18% stake held by the Tatas at Rs. 40.51 a share amounting to Rs. 44.06 billion. While 15% of the 48.14% stake was acquired by Aditya Birla Nuvo, a company in-charge of the Birlas' new business initiatives, the remaining stake was acquired by Birla TMT holdings Private Ltd., an AV Birla family owned company.Currently, Birla Group holds 98.3% of the total shares of the company. Idea has successfully launched 3 more new circles (states) in India viz. Rajasthan, Himachal Pradesh and UP (East) to make itself a pan-India player. Recently, Idea got licenses to operate in Mumbai & Bihar. They are awaiting the spectrum from DoT.


As on


Assets Rs mn %BT %BT Gross Block 110119.83 99.45 94.21 Net Block 78881.56 71.24 59.03 Capital WIP 9411.27 8.50 6.76 Investments 139.31 0.13 0.18 Inventory 276.15 0.25 0.24 Receivables 1985.93 1.79 2.03 Other Current 20039.30 18.10 23805.44 31.76 15377.21 Assets Balance Sheet 110733.52 100.00 74960.66 100.00 40490.28 Total(BT) Liabilities Rs mn %BT Rs mn %BT Rs mn Equity Share 26353.61 23.80 25928.60 34.59 22595.27 Capital -15813.4 -23827.3 Reserves -8723.32 -7.88 -21.10 9 7 Total Debt 65147.59 58.83 42505.04 56.70 33986.07 Creditors and 16854.57 15.22 16108.74 21.49 5433.94 Acceptances Other current 11101.07 10.03 6231.77 8.31 2302.37 liab/prov. Balance Sheet 110733.52 100.00 74960.66 100.00 40490.28 Total(BT)

31-Mar07 Rs mn 70619.64 44247.89 5065.15 138.31 179.10 1524.77

31-Mar06 Rs mn 31663.73 20087.42 959.05 3070.31 88.11 908.18

%BT 78.20 49.61 2.37 7.58 0.22 2.24 37.98 100.00 %BT 55.80 -58.85 83.94 13.42 5.69 100.00


As on 31-Mar-08 31-Mar-07 31-Mar-06 OPBIT/Prod.cap.empl.(%) 20.85 17.39 13.36 PBIT/Cap. Employed (%) 20.00 17.85 12.19 PAT/Networth (%) 59.24 49.63 -101.94 Tax/PBT (%) 0.70 1.17 2.26 Total Debt/Networth (x) 3.70 4.20 -27.58 Long Term Debt/Networth (x) 3.19 3.48 -11.92 PBDIT/Finance Charges (x) 5.64 4.46 2.84 Current Ratio (x) 0.80 1.14 2.12 RM Inventory (days 0.00 0.00 0.00 consumption) FG inventory (days cost of sales) 0.00 0.01 0.01 Receivables (days gross sales) 10.79 12.75 16.52 Creditors (days cost of sales) 138.07 203.40 154.26 Op. curr. assets (days OI) 84.00 205.00 296.00



31-Mar31-Mar31-Mar08(12) 07(12) 06(12) Profit / Loss A/C Rs mn %OI Rs mn %OI Rs mn Net Sales 67199.90 99.74 43664.00 99.53 20070.68 Operating Income 67374.45 100.00 43871.37 100.00 20171.58 (OI) OPBDIT 22818.84 33.87 14964.42 34.11 7314.13 OPBDT 18663.81 27.70 11554.64 26.34 4722.93 OPBT 9896.19 14.69 4836.59 11.02 1247.56 Non-Operating 1272.42 1.89 253.93 0.58 37.49 Income Extraordinary/Prior -651.30 -0.97 -10.55 -0.02 0.00 Period Tax 73.69 0.11 59.36 0.14 29.02 Profit after 10443.62 15.50 5020.61 11.44 1256.03 tax(PAT) Cash Profit 19211.24 28.51 11738.66 26.76 4731.40 Dividend-Equity 0.00 0.00 0.00 0.00 0.00 As on( Months )

%OI 99.50 100.00 36.26 23.41 6.18 0.19 0.00 0.14 6.23 23.46 0.00


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