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Investor Presentation
Bharti airtel limitedMay2012
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B2C Airtel Business
The Company...Bharti airtel An Integrated Operator
MobileServices
EnterpriseServices
PassiveInfrastructure
Services
TelemediaServices
Digital TVServices
Cellularmobileservicesacross20countries
Customerand
revenuemarket
Offersfixedtelephonyandbroadband
internet
(DSL
+
IPTV)
BhartiInfratelowns33,326towersacross11
circlesOwns42%stake
Servicestolargeenterprisesandcarriers
Servesas
single
pointofcontact
PanIndiaDTHoperations
7.23mn
customers
leaderinIndia
~241millionwirelesssubscribersglobally,asof
Customerbaseof3.3million;largebroadband&internet
inIndusTowers,amongstthelargestindependenttowercompanies
foralltelecomneeds
Globalinfrastructureofover225,000
609districts
Q4FY12 Servicesprovidedacross87cities
,109,114
towers
across15circles
Averagetenancyratioof~1.89
Rkmscovering
50countriesacross5continents
Fullyintegratedtelecomplayeroffering
endto
end
solutions
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The CompanyBharti airtel
No. of circles (India) Today Countries1 5 15 22 20
1996 2001 2003 2004 2012
Fully integrated telecom player offering end to end solutions and entering newgeographies
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Growth trajectory reflected in the numbers
1996 2012
operator
< 25k Customers ~ 252 mn
~ evenue ~ n
~ USD 2.5 mn EBITDA ~ USD 5 bn
~ USD 1.4 mn Cash Profit ~ USD 4 bn
~ USD 16 mn Market Capitalization ~ USD 25 bn
Continuing on our journey of Value Creation
Note:1)2012financialsareasperFY2012results.2)Exchangerate:Financialsasof31st Mar12:Rs51.16
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Financials & Positioning
Positioning in the world & in IndiaKey financial metrics
FY 12 (in Mn)
Customers 251.6
r n coun ryw re essopera or n e
world
(1)
LARGESTprivateINTEGRATEDtelecomcompanyin
Revenue $ 14,937
EBITDA $ 4,957
India
5thLARGESTMobiletelecomoperatorintheworld
,
Net Income $ 890
EBITDA Margin (%) 33.2
AmongstthelargestprovidersofPassive
infrastructure(bytowers)(2)
ROCE (%) 7.2
Note:FY11
numbers
are
as
per
IFRS
as
per
March12
quarterly
report.
Exchange
rate
for
Re
to
$conversion:
51.16.
(1)3rd largestwirelessoperatorintheworldreferstoincountry(singlecountry)operatorbasedonthenumberofsubscribers.5th largestmobileoperatoronbasisofnumberofsubscribers.(2)ThroughitssubsidiaryBhartiInfratel&IndusTowersinwhichBhartiInfratelowns42% stake.
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Latest Results 4Q12
Key operating and financial metrics Continued Strong Performance
Q4FY12* YonY
Customers 251.6mn
WirelessCMS 19.7%
WirelessRMS 29.7%
Revenue $3,723mn 15%
EBITDA $1,239mn 14%
,
eliminations 265bn
Balancesheet
strength:
CashProfit $1,065mn 10%
NetIncome $200mn 28%
Assets 30.7bn
Netdebt $12.7bn
NetdebttoEBITDA 2.6Times
EBITDAMargin 33.3%
ROCE 7.2%
(annualized)
ContinuestobeFCFpositiveonatSouthAsia
Level.
Includes
full
quarter
numbers
for
Africa (a)ClosingExchangerateasof31stMarch2012:51.16.(b)AverageExchangerateason31st March2012:50.30
**RMSasper Dec quarterreleasedbyTRAI
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Performance dashboard - 3 line graph
184,767187,294
69.9%71.2%
68.6%71.1%180,000
190,000
70%
80%
162,930 169,749
172,698
.
170,000
enue(Rs.mn
60%
44.8% 44.6% 44.5% 45.4% 44.4%150,000
1 ,
TotalRe
40%
140,000
Q311 Q411 Q112 Q212 Q312
30%
Total Revenue (Rs. Mn) (LHS) Opex to Total Revenue (RHS) Capital Productivity (RHS)
ProductivityIndicators=growingrevenues+costefficiencies+capitalproductivity
TheabovechartisforAirtelConsolidatedincludingAfrica
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Wireless Services
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Indian Market
Overall Telecom Market Wireless Market
SubBase c.919.2mn
. Relativelylargeyouthpopulation
Telecompenetration c.78.5% WirelessPenetration c.75.9% Operationalmetricspermonth
(~951.3mntelecomsubs)Subnumbershouldgoupto1Billionby2015
Broadbandpenetration 1.1%(13.8mn)
Usageperuser 330min ARPU ~US$3.06 Rateperminute ~US$0.01
Govt.targettoreach20mn.Broadbandsubsby2012
VAS ~13.7%
Lotofopportunityahead.
Note: (1) Subscriber numbers and wireless penetration numbers as on March 31, 2012 are as per TRAI(2) Other indicators on the slide are based on Global Wireless Matrix 1Q12 dated 19th April12 by MerrillLynch, and reflective of Industry numbers.
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Rapidly Growing Indian Wireless Market
NetAddsinMar8.0Mnlessthanoverlast3 months
averagerunrateof8.9MnS-curve triggered
70%
80%
90%1,000 25
Clos ing Subs Net Adds
30%
40%
50%
60%
400
600
M
illions
10
15
0%
10%
20%
1999 20012003 2005 2007 2009 2011 2013 2015 2017 2019
-
200
b-06
n-06
ct-06
b-07
n-07
ct-07
b-08
n-08
ct-08
b-09
n-09
ct-09
b-10
n-10
ct-10
b-11
n-11
ct-11
b-12
-
5
F
eJu
OF
eJu
OF
eJu
OF
eJu
OF
eJu
OF
eJu
OF
e
Note:(1)ActualDataasperIndustryAssociationReleasesandIndustryEstimatesinIndia.
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Wireless Market Structure in India
us omer ar e are
181
153162
180
20019.7%
20.0%21%
23%
25%
104 113
82
136136 135
9790 89
103
60
80
100
120
140
(m
n)
11.3%
8.9%
16.7% 16.4%
12.3%
14.8%
16.7%16.6%
12.0%
11.0% 11.0%
12.7%
11%
13%
15%
17%
19%
19 17 167
2333
-
20
40
Airtel
eliance
dafon
e
+MT
NL
Idea
Ta
ta
Othe
rs
.
5%
7%
9%
A
irtel
Relia
nce
Vodafone
NL+M
TNL
Idea
Tata
Others
RVo
BSN
Mar-12 Mar-11 Net adds during the year
B
CMS(Mar' 12) CMS(Mar' 11)
rte cont nuous yconso at ng tsmar et ea ers ppos t on esp te ntensecompet t on
Airtelcurrentmonthlynetaddsat2.5millionvs.3.2millionayearago
Airtelranks1&2in16circlesintermsofnumberofsubscribers
Over65%ofnetaddscomingfromB&Ccircles(ruralIndia)
AirtelContinuestoleadonRevenueMarketShare
Note:BasedonsubscriberdataforIndiaason March312012asperTRAIpressrelease.
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AirtelPerformance Indicators (Operational)
Customers & Market Share Pre aid/Post aid
20.0% 19.9% 19.8% 19.8% 19.7%
150
20 0
18%
22 %
98.1% 97.3%
93.7%96.2%
95.8%
94%
98%
102%
162.2 169.2 172.8 175.7 181.3
50
100
10%
14%
96.3% 96.3% 96.3% 96.3% 96.3%
82%
86%
90%
ARPU & RPM MoU/Sub/Month & MON
0
Q411 Q112 Q212 Q312 Q412
6%
Cust omer s ( mn) CMS ( %)
78%
Q411 Q112 Q212 Q312 Q412
P repaid Subs P repaid Net A dds
194 190183 187
189
40
50
60
200
250
300 449 445 423 419 431
218,190228,331
242,683
227,115
238,779440
450
200,000
250,000
43.1342.76 43.18 44.56 43.83
10
20
30
50
100
150
410
420
50,000
100,000
,
-
Q411 Q112 Q212 Q312 Q412
RPM (Paise) ARPU (INR)
Q411 Q112 Q212 Q312 Q412
MoU/Sub (Min) Total m inutes on Network (Mn Min)
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Current positioning and way forward
Leadership Positioning Growth strategy and plans
Streams
Revenuesize
(>$12Bn)
RevenueMarketShare
Changingfaceofgrowth
throughMCom, M
entertainment&3G
Cost
Non financial Maximizing
Net Adds
Improvingcostefficiencies Drivenbyruralstrategy
vitals usage Brand
Distribution
Churnlowerthanindustry
owes cos ne wor
IncreasingtheusagethroughU&Rdrive
Walletshare
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Telemedia Services
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A Snapshot
Largestprivateoperatorhavingpresenceinthevoice,broadband,IPTVanddata.
FocusonSMBsegment&BroadbandatHomes
KeyPerformance
Indicators
1. Voice(wireline)andData(DSL)Presencein87topcitiesofIndia.
2. TargetSegment:RetailandSmallandMediumEnterprises.
3. Customerbase:3.3million(endMarch 2012)
4. Broadband(DSLwithspeeds>256kbps)penetrationat42.4%ofcustomerbase.
5. AverageARPUforQuarterended Dec11$18.6permonth.
6. Segmentcontributingto7% ofoverallrevenuesofthecompany.
. marg no over . .
BroadbandrevolutiontofollowwirelessrevolutioninIndia
SMBopportunityacrossICTstream
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Digital Services
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A Snapshot
LaunchedAirtelDigitalTVserviceinOctober2008asfifth
operatorprovidingDirecttoHome(DTH)servicesinIndia
urren su scr er aseo ~ . m oncus omers
Adding1outofevery4newcustomersjoiningtheDTHplatform
and7interactiveservices
Presentacross
609
districts
,partnering
with
local
service
partners
to
AlsoofferHighDefinition(HD)SetTopBoxesandDigitalTVRecorders
with3Dcapabilitiesdeliveringsuperiorcustomerexperience
KeyPerformance
Indicators
(Q412)
Revenue: Rs.3,565Million(3%SegmentContributionShare)
EBITDA: Rs. 209 Million 5.9% EBITDA Mar in
AverageARPUof$3.3permonthforquarterendedMar12___________________________Source:CompanyFilings
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nterpr se erv ces
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A Snapshot
EnterpriseServicesprovidesabroadportfolioofservicestolargeEnterpriseandCarriercustomers
Corporates:SinglepointofcontactforalltelecommunicationneedsforTop2500corporatecustomers,
providingfullsuiteofvoice,data,andmanagedcommunicationssolutions
Carriers:
Wholesale
voice
and
data
services
to
over
130
domestic
and
450
international
telecommunicationscarriers,aswellasILDandNLDcarriageforAirtelsowncustomers
xtens venat ona an nternat ona n rastructure
PanIndianetworkwith157,886Routekmsofopticalfiber,over4,150MPLSandSDHPOPs
Accessnetwork
(terrestrial)
in
87
cities,
Wimax
network
in
143
cities,
and
over
1,500
local
POIs
Internationalnetworkwith225,000RouteKms,connectingover50countriesand5Continents.
KeyPerformanceIndicators (Q412)
NLD
Minutes
Carried:
21.6
Billion
;
ILD
Minutes
Carried:
3.5
Billion
Revenue: Rs.11,209Million(8%SegmentContributionShare)
EBITDA: Rs.1 631Million 14.5%EBITAMar in
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Passive Infra
r ca
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Financial Performance Passive Infra
EBITDA
183
192
182180
186
200
37.0 37.7 37.5 37.3 38.6
493
509
486482 481
510
140
160
180
450
480
100
120
Q411 Q112 Q212 Q312 Q412
390
420
Q411 Q112 Q212 Q312 Q412
FocusontenancyenhancementdrivingRevenue&Profitability
TheabovenosforRevenue&EBITDAareinIFRSasperQuarterlyReport&includesproportionate
share(42%)inIndus .
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Operational Performance Passive Infra
Infratel Indus
Towers(nos)&SharingFactor Towers(nos)&SharingFactor1.83 1.87 1.89 1.91 1.94112,000 2.00
1.81
34,000 1.90
108,586 108,922 108,998 109,101 109,114
102,000
107,000
1.40
1.60
1.80
33,32633,203
33,05632,942
32,792
..1.79
1.77
1.73
33,000
1.50
1.60
1.70
1.80
SharingRevenue
per
Sharing
Operator
per
Month
(Rs) Sharing
Revenue
per
Sharing
Operator
per
Month
(Rs)
97,000
Q411 Q112 Q212 Q312 Q412
1.20
No of t ower s S har ing Fac t or
32,000
Q411 Q112 Q212 Q312 Q412
1.40
No of t ower s S har ing Fac t or
36,599 3620337,117 37,623
38,400
33,000
37,000
41,00032,56332,272
3111231963
30,501
25,000
30,000
35,000
25,000
29,000
Q411 Q112 Q212 Q312 Q412
Sharing Revenue per Sharing Operat or per month
15,000
20,000
Q411 Q112 Q212 Q312 Q412
Sharing Revenue per Sharing Operator per mont h
imstoenhancethetenancyratio&bethepreferredchoiceofvendorforallexisting
andnewoperators
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Transaction Rationale
Shareholding andManagementControl
100% Cash Transaction
Focus on CoreGlobal
Clean /certaintyof transaction
OperatorsStature
Emerging MarketCharacteristics
ManageableDeal Size
rong a ormfor FutureExpansion
Low CompetitiveIntensity
Diversification ofIndia Risk
Speed inTransaction
Repayment of
SignificantSynergies
ThetransactionmeetstheobjectivesofAirtelwithlongtermstrategicbenefits
andcreatestremendousshareholdervalue
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Differences between the two markets
MobilePenetration 46%76%
India Africa(1)
AverageNumber
of
Competitors351012
BusinessModel
Minutes of Usa e
Lowusage,highpricingmodel
~122
Highusage,lowpricingmodel
~431
ARPU(US$) ~$6.8~$3.8
ARPM(UScents) 5.60.9
n ere ore ugeoppor un yspace
Source: Global Insight, annual / quarterly reports.1. Data pertaining to the 17African countries where Zain Africa has operations.
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Another Growth Engine - Africa
Customer Base:53.1Mn
PerformanceIndicators(CY2012):
Revenue:$4,137Mn
EBITDA:$1,097Mn
PrepaidBase:99.3%
world
Usagepersubpermonth:122Minutes
oneo thelowest
ARPU:~US$6.8
Rateperminute:~US5.6
oneof
the
highest
VAS:~8.6%
Oneofthelowest
Note:AbovenumbersbasedonQuarterlyreportended31Mar,2012.
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Recent Honors
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Bharti airtel Leadership in business Recent Honours
Sunil Bharti Mittal,Chairman & Group CEO
GlobalGamechangerat
EconomicTimesTelecomAwards
2011.
Telecom Center of Excellence
(TCOE) Award for Service Provider
with customer focus for best delivery
of Network Services - for the year
2011.
Placed among the top 200 brands
globally in the annual survey
undertaken by Brand Finance, an
international agency
Rajan Bharti Mittal,
GlobalTelecomLeader Voice&
DatamagazineWon in 4 Categories : Best National
Mobile Operator, Best VAS Provider,Best Enterprise Services Provider ,
Best Ad Campaign by an Operator at
the Telecom Operator Awards 2012.
Ranked first in Indias Buzziest
Brands, a survey conducted by
agency faqs, a media communication
portal
ce a rman
CABusinessAchieverAwardby
InstituteofChartered
AccountantsofIndia
'The Most Impactful HR Practise
Award for the 'use of mobile
technologies for employee services'
at the recently concluded National
Airtel money won the Best
Innovation awards at the Telecom
Operator Awards 2012Akhil Gu ta
on erence y e n
Bangalore..
Won the Golden Peacock
National Quality Award for the
Deputy Group CEO & MD
CABusinessAchieverAwardin
2009
CFOIndiaHallofFamebyCFO
Conferred the prestigious NDTV
Profit Business Leadership Awards
Manoj Kohli,CEO (International) & Joint MD
TelecomManoftheyearby
Tele.netinApr10
year 2011
2011 in the Teleocm Sector
category
Product of the year 2012, by AC Nielsen, an
international research firm.
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