Investor Presentation - Amazon Simple Storage Service · Investor Presentation ... Sunil Bharti Mittal, Chairman & Group CEO ... Other indicators on the slide are based on QE Mar,

Investor Presentation

Bharti Airtel LimitedApril 2009

DisclaimerThe 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 has been taken care off in the presentation and neither we undertake any obligation as to the regular updating of the information as a result of new information, future events or otherwise. We will accept no liability whatsoever for any loss arising directly or indirectly from the use of, reliance of any information contained in this presentation or for any omission of the information. The information shall not be distributed or used by any person or entity in any jurisdiction or countries were such distribution or use would be contrary to the applicable laws or Regulations. It is advised that prior to acting upon this presentation independent consultation / advise may be obtained and necessary due diligence, investigation etc may be done at your end. You may also contact us directly for any questions or clarifications at our end.

This presentation contain certain statements of future expectations and other forward-looking statements, including those relating to our general business plans and strategy, our future financial condition and growth prospects, and future developments in our industry and our competitive and regulatory environment. In addition to statements which are forward looking by reason of context, the words ‘may, will, should, expects, plans, intends, anticipates, believes, estimates, predicts, potential or continue’ and similar expressions identify forward looking statements.

Actual results, performances or events may differ materially from these forward-looking statements including the plans, objectives, expectations, estimates and intentions expressed in forward looking statements due to a number of factors, including without limitation future changes or developments in our business, our competitive environment, telecommunications technology and application, and political, economic, legal and social conditions in India. It is cautioned that the foregoing list is not exhaustive

This presentation is not being used in connection with any invitation of an offer or an offer of securities and should not be used as a basis for any investment decision.

Investor Relations :- http://www.bhartiairtel.inFor any queries, write to: [email protected]

“The information contained herein does not constitute an offer of securities for sale in the United States. Securities may not be sold in the United States absent registration or an exemption from registration under the U.S. Securities Act of 1933, as amended. Any public offering of securities to be made in the United States will be made by means of a prospectus and will contain detailed information about the Company and its management, as well as financial statements. No money, securities or other consideration is being solicited, and, if sent in response to the information contained herein, will not be accepted.”

3

Mobile Services Telemedia Services Enterprise Services

Advantage India

Deep Domestic Demand…Huge Growth Potential

Population: 1.1 billion→ increasing urbanisation→ relatively large youth population

GDP Growth (Real) : ~7.3%→ second highest growing economy

GDP Size (PPP adjusted): US$ 3 trillion→ fourth largest economy in the world

Telecom penetration: 36.98% (429.72 mntelecom subs)

→ one of the lowest→ Govt. target to reach 500 mn.

telecom subs by 2010Broadband penetration: 0.54% (6.22 mn)

→ one of the lowest→ Govt. target to reach 20 mn.

Broadband subs by 2010

Note: (1) Telecom and Broadband penetration is as at March 31st 2009, as per TRAI press release.

4


The Company...Bharti Airtel

Bharti Airtel – an integrated telco

Wireless Services

2G/3GRural Market

Telemedia Services

Fixed Line

Broadband

DTH (Media)/IPTV

Enterprise Services

CarriersCorporate

Passive Infrastructure Services

Fully integrated telecom player…end to end telecom offerings

5


3rd LARGEST wireless operator in the world1

LARGEST TELECOM company listed on Indian Stock Exchanges

Bharti Airtel - placing in the world and India

LARGEST private INTEGRATED telecom company in India

LARGEST WIRELESS operator in India

LARGEST private FIXED LINE operator in India

Note: (1) 3rd largest wireless operator in the world refers to in-country (single country) operator based on the number of subscribers.

6


Latest Results – Q4 FY08/09

Key operating and financial metrics

Q4 FY 09 Y-on-Y

Customers 96.65 mn 50.0%

Revenue $ 1,928 mn 25.6%

EBITDA $ 785 mn 23.1%

Cash Profit $ 743 mn 24.8%

Net Income $ 440 mn 20.9%

EBITDA Margin 40.7%

Net Profit Margin 22.8%

ROCE 30.8%

ROE 32.6%

Continued Strong Performance

Wireless Customer market share leadership at 24.0%.

Total minutes on network carried in Q4 – 150 billion

Total employee strength – 24,538

Balance sheet strength:

Assets - $ 12 billion

Net debt - $ 629 million*

Net debt to EBITDA - 0.25 times*

Note: * Net Debt is excluding fully and compulsory convertible, non-cumulative, unsecured and interest free Debentures of US$ 738.

7


performance dashboard - 3 line graph

Productivity Indicators = growing revenues + cost efficiencies + capital productivity

98,24596,33490,203

84,833

78,191

33%34% 35% 35% 34%

74% 74% 73% 72% 70%

50,000

60,000

70,000

80,000

90,000

100,000

110,000

Q4F

Y08

Q1F

Y09

Q2F

Y09

Q3F

Y09

Q4F

Y09

Am

ount

in R

s. M

n

30.0%

40.0%

50.0%

60.0%

70.0%

Gross Revenue (Rs mn.) (LHS) Opex to Gross Rev (RHS) Capital Productivity

8


Segment investment & contribution

Revenue

84%9%

18%4% 7% 1%

Mobile Services Telemedia ServicesEnterprise Services - Carriers Enterprise Services - CorporatesPassive Infrastructure Services Others

EBITDA

65%9%

20%

5% 7% -3%


Note: (1) Revenue and EBITDA is gross of inter segment eliminations.

INVESTMENTS

49%

11%13%1%

24% 1%


few recent recognitionsBharti Airtel top honors at the 7th edition of the Frost & Sullivan ICT awards 2008 in the categories of Large Enterprise Telecom Services, Wholesale Data Services and Mobile Service.

Bharti Airtel and IFFCO joint venture recently bagged the ‘Best Content Service’award and the Gujarat E-GRAM project executed by Bharti Airtel has won ‘Best Project Management’ award at the World Communications Awards held at London

Bharti Airtel was voted as India’s most innovative company in a survey conducted by The Wall Street Journal.

Airtel won the Platinum Trusted Brand Award in the Mobile Service Provider Category in the Reader’s Digest Asia Trusted Brand’s Survey.

Airtel was chosen as the 2nd most trusted service brand in India in the ‘Most Trusted Brands 2008 Survey’ conducted by the Economic Times - Brand Equity

Awarded with top honors at the GSMA Mobile World Congress Conference 2008 in Barcelona for the category “Best Billing/ Customer Care solution.”

Adjudged as the ‘Best Carrier India‘ at the Telecom Asia Award 2008

Sunil Bharti Mittal, Chairman & Group CEO

GSM Association Chairman’s Award 2008

Chosen for Padma Bhushan Awards in 2007

Sarvjit Dhillon, Group Director

Best Performing CFO in Telecommunications Sector by CNBC-TV18 in March 2009

10


Wireless Services

11


Sub Base : 391.76 mn→second largest market

Wireless Penetration: 33.7%→lowest in the world

HHI Index: very high→one of the most competitive market

Prepaid Base: 90%+→one of the highest in the world

Usage per sub per month:Minutes: 430

→one of the highestARPU: ~ US$ 5.95

→one of the lowestRate per minute: 1.4 cents

→ one of the lowest in the worldVAS: ~ 9%

→One of the lowest

KPIs…Indian Wireless Market

MUM

HP

DELHI

AP

CHN

MADHYA PRADESH`

TNKER

PB

DEL

UP(W)

MP

RAJUP(E)

KK

OR

HAR

JK

BH

WBGUJ

MAH

AS

NE

Metros

A Cat.

B Cat.

C Cat.

MUM

HP

DELHI

AP

CHN

MADHYA PRADESH`

TNKER

PB

DEL

UP(W)

MP

RAJUP(E)

KK

OR

HAR

JK

BH

WBGUJ

MAH

AS

NE

Metros

A Cat.

B Cat.

C Cat.

MUM

HP

DELHI

AP

CHN

MADHYA PRADESH`

TNKER

PB

DEL

UP(W)

MP

RAJUP(E)

KK

OR

HAR

JK

BH

WBGUJ

MAH

AS

NE

Metros

A Cat.

B Cat.

C Cat.

Metros

A Cat.

B Cat.

C Cat.

Kol

Note: (1) Subscriber numbers and wireless penetration numbers as at March 31, 2009 as per TRAI. (2) Other indicators on the slide are based on QE Mar, 2009 Global Wireless Matrix released by Merrill Lynch, and reflective of Industry numbers.

12


Net Adds in Feb…15.6 MN, higher than 12 MN average net adds per month over last 6

monthsS-curve triggered

Rapidly Growing Wireless Market

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

1999 2001 2003 2005 2007 2009 2011 2013 2015 2017 2019

Note: (1) Actual Data as per Industry Association Releases and Industry Estimates.

fastest growing market in the world

-50

100150200250300350400450

Mar

-01

Sep-

01

Mar

-02

Sep-

02

Mar

-03

Sep-

03

Mar

-04

Sep-

04

Mar

-05

Sep-

05

Mar

-06

Sep-

06

Mar

-07

Sep-

07

Mar

-08

Sep-

08

Mar

-09

-1234567891011

Closing Customers (mn) Net Adds (mn)

13


Wireless Market Structure

72.67 68.7756.63

38.89 35.1225.76

31.9426.87 24.64

12.30 14.89 10.79 9.24

93.92

-10.0020.0030.0040.0050.0060.0070.0080.0090.00

100.00

Airt

el

Rel

ianc

e

Vod

afon

e

BSN

L+M

TNL

Idea

Tata

Oth

ers

(mn)

Mar-09 Mar-08 Net adds during the year

• Airtel continuously consolidating its market leadership position despite intense competition.• Airtel current monthly net adds at 2.81 million vs 2.25 million a year ago.• Airtel ranks 1& 2 in 18 circles in terms of number of subscribers.• 56% of net adds coming from B&C circles (rural India).

Continues to lead on revenue market share

Subscriber Trends

24.0%

18.5%

14.5%

9.0%

17.6%

9.9%

6.6% 6.3%

9.3%9.2%

17.0%16.9%17.5%

23.7%

5.0%

7.0%

9.0%

11.0%

13.0%

15.0%

17.0%

19.0%

21.0%

23.0%

25.0%

Airt

el

Rel

ianc

e

Vod

afon

e

BS

NL+

MTN

L

Idea

Tata

Oth

ers

CMS(Mar'09) CMS(Mar'08)

Customer Market Share – CMS (%)

14

Mobile Services Telemedia Services Enterprise Services14

Hello Tunes(Ring Back

Tones)

Portfolio Manager(Stock Tracker)

Blackberry

Airtel Live(Portal)

Life time validity product

Electronic Recharge /

Micro Prepaid

first mover advantage/ product innovations

focus on product innovations

Easy Music

Song Catcher

Call Home Service

Money Transfers

Music on Demand

Google search

M Commerce

iPhone

15


Performance Indicators

90.4% 91.0% 91.6% 92.3% 92.9% 93.5% 94.2%

100.8%

95.4%

85.0%

90.0%

95.0%

100.0%

105.0%

Q208 Q308 Q408 Q109 Q209 Q309 Q409

Prepaid Subs Prepaid Net Adds

7.0

6.06.46.5

6.97.0

7.2

1.21.31.21.3

1.41.5

1.5

5.0

5.5

6.0

6.5

7.0

7.5

Q208 Q308 Q408 Q109 Q209 Q309 Q4091.01.11.21.31.41.51.6

ARPU (US$) RPM (US Cents)

507

469 474

534 526 505 485130.7123.6

115.8105.289.173.864.4

300

350

400

450

500

550

Q208 Q308 Q408 Q109 Q209 Q309 Q4090.0

50.0

100.0

150.0

MOU / sub Total mins (bn)

Customers & Market Share Prepaid/Postpaid

MoU/Sub/Month & MONARPU & RPM

93.985.7

77.5

69.4

62.0

48.955.2 23.7%

24.2%

24.7%

24.0%

23.4%23.6%

24.6%

40.0

50.0

60.0

70.0

80.0

90.0

100.0

Q208 Q308 Q408 Q109 Q209 Q309 Q40923.0%

23.5%

24.0%

24.5%

25.0%

Customers (Mn) CMS (%)

16



9931,101

1,2601,357

1,4301,558

1,614

9001,0001,1001,2001,3001,4001,5001,6001,700

Q208 Q308 Q408 Q109 Q209 Q309 Q409

EBITDA (USD mn) & Margin (%)Revenues (USD mn)

407

508490

432449 447

416

400

450

500

550

Q208 Q308 Q408 Q109 Q209 Q309 Q409

41.0 40.8 35.5 30.7 30.2 31.4 31.5

17


Telemedia Services

18


A snapshot

Largest private operator having presence in the voice and data (broadband).

Foraying into the media space - IPTV & DTH (Direct-To-Home) services.

Key Performance Indicators 1. Voice (wire-line) and Data (DSL) Presence in 95 top cities of India.

2. Target Segment : Retail and Small and Medium Enterprises.

3. Customer base: 2.7 million (end March,2009)

4. Broadband (DSL with speeds>256 kbps) penetration at 38% of customer base.

5. Average ARPU for Quarter ended March’09 $ 21.0 per month.

6. Segment contributing to 9% of overall revenues of the company.

7. EBITDA margin of over 42.1%.

Broadband revolution to follow wireless revolution in India

19


Telemedia Services

Business Units Media SMBs Homes

Products • DTH• IPTV

• Voice• Data• Mobile Services

• Broadband• Voice

Goal

A Pan-India DTH Businesses; and a targeted IPTV Presence in top metros

One-Stop Shop for All Airtel Services and Solutions to SMBs

Dominant Broadband & Fixed Voice share of the affluent in targeted 95 cities

Strategies

• Best-in-class technology:

• World-class Installation & Customer Service

• Interactive VAS to Drive ARPU enhancement

• One Airtel Synergies for Distribution, Brand & IT

• Data Products: Internet, MPLS etc

• Integrated Solutions to Drive Share of wallet

• Strategic Alliances• Indirect Channel to

Drive Penetration

• Deeper & Not Wider: 95 Cities

• Vertical & Not Horizontal: Hi-Rise

• Network Enhancement to Deliver 8+ MBPS

• New Products & VAS to drive Flat, Combo Plans

20


Product Portfolio

Our Media Play

http://airtel.in/wps/wcm/connect/Airtel.in/airtel.in/home/foryou/home+phones/fixed+line/pg_fy_hp_fl

http://airtel.in/wps/wcm/connect/Airtel.in/airtel.in/home/foryou/broadband+internet/speed+on+demand/pg_fy_bi_sod

21



2,7262,619

2,1782,283 2,394

2,509

2,075

9921,072

922853795751705

1,250

1,500

1,750

2,000

2,250

2,500

2,750

Q208 Q308 Q408 Q109 Q209 Q309 Q4090

200

400

600

800

1,000

1,200

B&T Customers ('000) DSL Customers ('000)

143

150

157

167 166 168

140

150

160

170

180

190

Q208 Q308 Q408 Q109 Q209 Q309 Q409

716973

666662

55

40.045.050.055.060.065.070.075.080.0

Q208 Q308 Q408 Q109 Q209 Q309 Q409

39.7 43.4 43.8 42.2 43.6 41.7 42.1

Customers (overall & DSL) ARPU (USD)

Revenues (USD mn) EBITDA (USD mn) & Margin (%)

22.6 22.4 22.3 22.3 22.5 21.6 21.0

0.0

4.0

8.0

12.0

16.0

20.0

24.0

28.0

Q208 Q308 Q408 Q109 Q209 Q309 Q409

22


Enterprise Services

23


A snapshotCarrier: - one of the largest carriers of voice and data, both domestic and international.

Corporate: - providing end to end telecom solutions to large corporate and Small & Medium Businesses.

Present Competition: National Long Distance: BSNL; Reliance; VSNL; Vodafone; Tata

International Long Distance: VSNL, Bharti, Reliance, BSNL

24


Enterprise Services – Carriers NLD

LegendExisting OFC RouteUnder Execution

Kolkata

Mumbai

Chennai

Hyderabad

Bangalore

Jaipur

Ahmedabad Bhopal

Chandigarh

Delhi

Nagpur

Lucknow

Jalandhar

ErnakulamCoimbatore

Kolkata

Mumbai

Chennai

Hyderabad

Bangalore

Jaipur

Ahmedabad Bhopal

Chandigarh

Delhi

Nagpur

Lucknow

Jalandhar

ErnakulamCoimbatore

Voice Network

captive traffic (group traffic) ~ 90 %NLD minutes carried (Q4FY09) 11.7 Bn Minoptic fibre capacity (Q4FY09) 101,337 km

25


Enterprise Services – Carriers ILD

Legendi-2-iSEA-ME-WE-4Other Int’l ConnectivityInt’l Gateways Connectivity

SEA-ME-WE-4 Connectivity to Westi-2-i Connectivity to EastILD minutes carried (Q4FY09) 2.8 Bn MinILD gateways 4landing stations 2

26


Performance Indicators - carriers

6,7747,898

9,39810,322

11,349 11,609 11,690

2,7722,6032,2842,0481,8501,5911,345

0

2,000

4,000

6,000

8,000

10,000

12,000

Q208 Q308 Q408 Q109 Q209 Q309 Q409

NLD Minutes (mn) ILD Minutes (mn)

197223

247

308334

348 344

160.0

200.0

240.0

280.0

320.0

360.0

400.0

Q208 Q308 Q408 Q109 Q209 Q309 Q409

Voice Minutes on Network Revenues (USD mn)

EBITDA (USD mn) & Margin (%)

68 72 79

135 144158 155

0.020.040.060.080.0

100.0120.0140.0160.0

Q208 Q308 Q408 Q109 Q209 Q309 Q409

34.5 32.2 32.0 43.9 43.2 45.4 45.1

27


Enterprise Services - Corporates

Voice services

Satellite services Managed data & Internet services

Managed e -business services

Managed customized integrated solutions

Mobile services

competition limitedsegment one stop telecom solutiontarget 2,000 top large corporatesleveraging integrated play

28


Performance Indicators - corporates

28 27

4235

4034

40

0.0

20.0

40.0

60.0

Q208 Q308 Q408 Q109 Q209 Q309 Q409

41.9 41.9 57.0 45.7 41.4 42.9 49.3

Revenues (USD mn) EBITDA (USD mn) & Margin (%)

67 65

74 76

96

80 81

60.0

80.0

100.0

120.0

Q208 Q308 Q408 Q109 Q209 Q309 Q409

29


Passive Infrastructure Services

30


A snapshotBharti Infratel operates in 11 circles.

Indus Tower operates in 16 circles.

Standard Master Services Agreement with competitive rates already in place.

Key focus areas:

To increase sharing factor (tenancy) from current levels of 1.34.

Provide energy optimization solutions and other network management services.

Evaluate other revenue streams.

Key performance Indicators:Sharing Factor: 1.34

Sharing Revenue per sharing operator per month at Rs. 33,586.

EBITDA margin: 40.1%

Aim to be the preferred choice of vendor for all existing and new operators

31


To conclude

32


Key Strategic Objectives

Sustain revenue share in mobile profitably

Achieve deeper penetration in home and SMB

Product & vertical focus to gain client Revenue Market Share (cRMS) in Enterprise business

Become a benchmark in customer experience through service quality & innovation

Build a robust leadership pipeline to support growth

Benchmark in cost efficiency & productivity

DisclaimerThe 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 has been taken care off in the presentation and neither we undertake any obligation as to the regular updating of the information as a result of new information, future events or otherwise. We will accept no liability whatsoever for any loss arising directly or indirectly from the use of, reliance of any information contained in this presentation or for any omission of the information. The information shall not be distributed or used by any person or entity in any jurisdiction or countries were such distribution or use would be contrary to the applicable laws or Regulations. It is advised that prior to acting upon this presentation independent consultation / advise may be obtained and necessary due diligence, investigation etc may be done at your end. You may also contact us directly for any questions or clarifications at our end.

This presentation contain certain statements of future expectations and other forward-looking statements, including those relating to our general business plans and strategy, our future financial condition and growth prospects, and future developments in our industry and our competitive and regulatory environment. In addition to statements which are forward looking by reason of context, the words ‘may, will, should, expects, plans, intends, anticipates, believes, estimates, predicts, potential or continue’ and similar expressions identify forward looking statements.

Actual results, performances or events may differ materially from these forward-looking statements including the plans, objectives, expectations, estimates and intentions expressed in forward looking statements due to a number of factors, including without limitation future changes or developments in our business, our competitive environment, telecommunications technology and application, and political, economic, legal and social conditions in India. It is cautioned that the foregoing list is not exhaustive

This presentation is not being used in connection with any invitation of an offer or an offer of securities and should not be used as a basis for any investment decision.

Investor Relations :- http://www.bhartiairtel.inFor any queries, write to: [email protected]

“The information contained herein does not constitute an offer of securities for sale in the United States. Securities may not be sold in the United States absent registration or an exemption from registration under the U.S. Securities Act of 1933, as amended. Any public offering of securities to be made in the United States will be made by means of a prospectus and will contain detailed information about the Company and its management, as well as financial statements. No money, securities or other consideration is being solicited, and, if sent in response to the information contained herein, will not be accepted.”

Documents

Investor Presentation - Amazon Simple Storage Service · Investor Presentation ... Sunil Bharti Mittal, Chairman & Group CEO ... Other indicators on the slide are based on QE Mar,