Bharti Airtel Limited · NSE:BHARTIARTL
Bharti Airtel — Kotak India Investor Conference - India Unplugged (September 2006)
29 slides from Bharti Airtel's conference presentation, September 2006
Slide 1: Indian Telecom: A Success Story of Reforms
Indian Telecom …… A SUCCESS STORY OF REFORMS September 2006
Slide 2: Disclaimer
Disclaimer The information contained in this presentation is only current as of its date. All actions and statements made herein or otherwise shall be subject to the applicable laws and regulations as amended from time to time. There is no representation that all information relating to the context
Slide 3: India
India …moving towards forefront of world economy 3 Mobile Services Broadband & Telephone Services Enterprise Services
Slide 4: India – a paradigm shift
India – a paradigm shift India in 1992-93 India Today Political instability Political stability Zero forex reserves High forex reserves High interest rates Low interest rates Poor stock market activity Buoyant stock mkt. activity High inflation Low inflation Negligible exports
Slide 5: India – strong fundamentals
India – strong fundamentals A healthy GDP composition A well diversified & globally competitive industrial base A large & sophisticated financial system – ¾ robust capital markets ¾ over 9,000 listed companies An acknowledged leader in knowledge driven industries Emerging leader in biotech
Slide 6: India – demographics advantage
India – demographics advantage Demographic breakdown 1.1 billion population 0-4 yrs 121 109 220 5-14 yrs 54% of the Indian population is less than 25 yrs 239 of age 15-24 yrs 231 199 211 One quarter of the world’s youth lives in India 25-34 yrs 157 35-44 yrs 159 By 2013, the net addition to
Slide 7: Indian economy – drivers of future growth
Indian economy – drivers of future growth Infrastructure Investments, supported by 1. Investments government policies and private-public initiatives Corporate capex recovery is aided by high capacity utilization levels and free cash flows Strong growth in urban areas due to services and outsou
Slide 8: Year 2000 vs. Year 2020 predictions
Year 2000 vs. Year 2020 predictions US Japan Germany UK France Italy Canada China Brazil Mexico India Russia 0 5,000 10,000 15,000 20,000 25,000 GDP (US$bn) ¨ India ….poised to become 3rd largest economy Source: KPMG, Goldman Sachs 8 Mobile Services Broadband & Telephone Services Enterprise Services
Slide 9: The “Confidence” called India
The “Confidence” called India Fourth-largest economy on purchasing power parity basis One of the fastest growing economies, second only to China 3rd in investor confidence for FDI investments India offers the best return on investment among emerging markets Mobile Services Broadband & Telephone Serv
Slide 10: Indian Telecom
Indian Telecom ……………..poster boy of reforms 10 Mobile Services Broadband & Telephone Services Enterprise Services
Slide 11: Indian telecom – a snapshot
Indian telecom – a snapshot 1992 2006 - Total Telecom Base ~ 7 Mln ~ 165 Mln 5th largest in the world - Mobile Sub Base - ~ 114 Mln 4th largest in the world - Mobile Penetration - ~ 10 % Lowest in the world - ARPU - < USD 10 One of lowest - Mou/Sub/Month - > 400 minutes 2nd highest after US - Realis
Slide 12: Indian telecom – growth trajectory
Indian telecom – growth trajectory 165 120 114 165 16.0% 14.0% Telecom subscribers (Mn) 100 Mobile Subscribers (Mn) 125 % 12.0% 80 R 30 AG Tele-density 86% 10.0% C R 60 CA G 85 8.0% 6.0% 40 45 4.0% 20 23 2.0% 1 0 5 0.0% Mar-99 Mar-00 Mar-01 Mar-02 Mar-03 Mar-04 Mar-05 Aug-06 Mar-99 Mar-00 Mar-01 Mar
Slide 13: Indian mobile – comparison with China – net additions
Indian mobile – comparison with China – net additions 5.8 mn 6.0 4.7 mn 0.3 mn 5.5 mn Subscriber addition (in Mn) 4.5 2.0 mn 3.0 2.7 mn 1.5 0.0 Aug-05 Oct-05 Dec-05 Feb-06 Apr-06 Jun-06 Aug-06 India China ¨ Outpacing China Source: TRAI’s report on “Service Performance Indicators” dated January 31, 2
Slide 14: Indian wireless – performance versus global peers
Indian wireless – performance versus global peers Top 5 – Subscriber Base (As at Mar 31’06) Country Mobile Subs (Mn) Rank China 409.7 1 US 214.3 2 Russia 132.1 3 India 96.7 4 Japan 96.5 5 Top 5 – QE Mar’06 Net Additions Countries Net Adds (Mn) % of Total Net Adds China 16.3 18.3% India 14.7 16.5% US
Slide 15: Competitive landscape
competitive landscape no. of no. of mobile mobile mobile market services offered operational subscribers technology share (Aug - 06) circles (of 23) (mn) a. Private GSM 1. Bharti Integrated GSM 23 22.5% 25.6 2. Hutch Mobile GSM 16 18.0% 20.4 3. Idea Mobile GSM 11 8.6% 9.7 4. Others Mobile GSM - 5.1%
Slide 16: Indian mobile – growth potential
Indian mobile – growth potential… Various market estimates CS (Yr '10) 392 Subs in Country Pen / Pop Mn. Macquarie (Yr '10) 349 India in 2010 (if) 300 27% ABN (Yr '10) 320 Current Status (Mar'06) Gartner (Yr '09) 300 china 410 31% philippines 36 41% LB (Yr '10) 300 thailand 32 51% SSKI (Yr '10) 258
Slide 17: The Road Map: Bharti Airtel Limited
The Road Map Bharti Airtel Limited ……………..a case in point 17 Mobile Services Broadband & Telephone Services Enterprise Services
Slide 18: Bharti – past to present
Bharti – past to present Inception Today 1995 2006 Revenues: US$ 14.2 mn Revenues: US$ 2,613 mn EBITDA: US$ 1.5 mn EBITDA: US$ 980 mn Net profit: US$ 1.2 mn Net profit: US$ 507 mn Net worth: US$ 12.9 mn Market cap: US$ 18 bn Revenues, EBITDA, Net profit for full year ended march 31,
Slide 19: Integrated play - service offerings
Integrated play - service offerings Bharti Airtel Limited Broadband & Mobile services Enterprise services Telephone services Carriers Corporates ¨ deriving synergies….financial & operational 19 Mobile Services Broadband & Telephone Services Enterprise Services
Slide 20: Mobile services
mobile services customer base (Aug'06) 25.65 mn mobile market share (Aug'06) 22.5% net additions (Aug'06) 1.31 mn operational (as at end of Jun'06) mobile minutes carried (Q1FY07) 28.19 Bn Min census towns 4,026 non census towns & villages 101,614 population covered 46% strategy mass market 20 Mobil
Slide 21: Broadband & telephone services
broadband & telephone services customer base (Aug'06) 1.59 mn DSL customers (% of total cust.) ~27.6 % net additions (Aug'06) 43 k coverage (as at end of Jun'06) 92 cities strategy selective 21 Mobile Services Broadband & Telephone Services Enterprise Services
Slide 22: Enterprise services – carriers NLD
enterprise services – carriers NLD Voice Network Jalandhar Chandigarh Delhi Jaipur Lucknow Ahmedabad Bhopal Kolkata Nagpur Mumbai Hyderabad Bangalore Chennai Coimbatore Ernakulam captive traffic (group traffic) 2/3 rd NLD minutes carried (Q1FY07) 2.88 Bn Min optic fibre laid ~ 35,000 Km Legend Exist
Slide 23: Enterprise services – carriers ILD
enterprise services – carriers ILD Major international carriers connected to the ILD gateways through i2i, SMW4, SMW3 and Flag Submarine cable systems Legend SEA-ME-WE-4 Connectivity to West i-2-i i-2-i Connectivity to East SEA-ME-WE-4 ILD minutes carried (Q1FY07) 753 Mn Min Other Int’l Connectivity
Slide 24: Enterprise services - corporates
enterprise services - corporates Mobile services Voice services Satellite services Managed data & Internet services competition limited segment one stop telecom solution 1000 top large corporates target 2,000 - 3,000 medium multi location companies leveraging integrated play Managed e - Managed cust
Slide 25: Overall financial performance
overall financial performance Amount in USD Million Quarter Ended Parameters June 30, June 30, Y-o-Y 2006 2005 Growth Subscribers (000's) 24,577 13,191 86% Revenues 841 549 53% EBITDA 327 205 60% EBITDA Margin 39.0% 37.4% Cash Profit from Operations 291 202 44% Earning before tax 187 130 44% Net Pro
Slide 26: Our partners - alliances with best in class
our partners - alliances with best in class Strategic Equity Partners Business Partners Asia’s telecom power house IBM Daksh World’s leading mobile Mphasis telecommunications Hinduja TMT company Tele Tech Nortel 26 Mobile Services Broadband & Telephone Services Enterprise Services
Slide 27: Transformational business innovations – outsourcing & capex
transformational business innovations – outsourcing & capex Outsourcing Vendors Features/ Advantages Deals Pricing linked to capacity - US$ per erlang Payments linked to Network usage and network quality Assured network outsourcing & service level agreements (SLAs) quality Maintenance Ease
Slide 28: Our vision
Our vision By 2010 Airtel will be the most admired brand in India: loved by more customers targeted by top talent benchmarked by more businesses 28 Mobile Services Broadband & Telephone Services Enterprise Services
Slide 29: India – outlook
India – outlook “The question is no longer whether India can fly but how high” (Prime Minister Dr. Manmohan Singh) 29 Mobile Services Broadband & Telephone Services Enterprise Services
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