SOME FACTS ABOUT BHARTI AIRTEL
Bharti Airtel was formed in 1995 and was formerly known as Bharti Tele-Ventures Limited (BTVL). Indias largest cellular service provider. Largest Private Integrated Telecom Company in India. 5th Largest Wireless Operator in the World. Largest & Fastest Growing Wireless Operator in India. Largest Telecom Company listed on Indian Stock Exchange.
Our Vision & Promise
By 2015 Airtel will be the most loved brand, enriching the lives of millions.
" Enriching lives means putting the customer at the heart of everything we do. We will meet their needs based on our deep understanding of their ambitions, wherever they are. By having this focus we will enrich our own lives and those of our other key stakeholders. Only then will we be thought of as exciting, innovation, on their side and a truly world class company."
Market Capitalisation
M Cap (Rs in Mn)
Bharti Airtel Idea Cellular R Com
Tata Comm
Source: Company data, Bloomberg,
350
300 250 221 281 246
314
200
128 150 100
Bharti Africa
Bharti (Ex-Africa)
50
0 FY 10 FY 11 FY 12 FY 13 FY 14
Strengths
Post acquisition, Bharti Airtel has become 5th largest service provider in terms of the number of subscribers. The deal has given Bharti 42million subscribers in 17 African countries, which have a combined estimated annual revenue of $3.6billion Strategic Alliance with other stake holders, including Nokia, SingTel & SonyEricson Bharti, largest telecom player in India, can replicate the success of India in Africa
Weakness
Improper Customer Service Customer complaint rates are high according to TRAI Improper implementation of re-branding Strategy
Opportunities
Africa is too good an opportunity for Bharti Airtel to experiment the model that it has mastered in India, particularly its rural strategy Telecom penetration in African countries varies from 37 per cent to 65 per cent. There are few markets with penetration less than 40 percent The African market is homologous to Indian market in term of its structural similarities.
Threats
Introduction of Mobile Number Portability (MNP) Price competition from Vodafone and Idea
14 Subscribers IN Subscribers OUT 50 36 Net Additions
Company Analysis Marketing Myopia
Competitor
Customer Analysis Positioning
Analysis
Segmentation
Marketing Orientation Branding
Marketing Strategy
Product
Price
Pricing process Pricing and innovation
Promotion Place
people
Process
Physical Evidence
Market
Product
Airtel Pre-paid . Airtel Post-paid. Blackberry Wireless Handheld. Value Added Services (VAS). Hello Tunes and Ring Tones Three main products i.e 3G, GPRS and money transfer through video
Price
Customer bases pricing strategies Flexible pricing mechanism Controlled by TRAI
Skimming pricing : High price then reduce at some range. Competition pricing : same as docomo 1p/sec Product Line pricing : can make call with 50p/min or 1p/sec or 1p/2sec. Cost based pricing : If a firm operates in a very volatile industry, where costs are changing regularly. Cost plus pricing : cost + profit
Place
It has wide and extensive presence even in the remotest areas. Airtel customer touch points. Distributor like Ex: Paan Shops, Grocery Stores, Chemist Outlets etc
Promotions
Large scale print and video advertising. Big celebrities like SRK and Sachin roped into endorse the product because it.
Airtel uses different media advertising of all types like: Television Radio Billboards Internet
Total advertising budget of Airtel is 150 Cr for the year 2011
People
Total employees is more than 60,000. Dedicated and passionate workforce One of the best customer support Have won 2nd best employer award in 2004
Process
Process for services is very easy and customer can avail it very easily. 121 is the customer support number which can be dial from anywhere in India.
Physical Evidence
Maximum Complaints
Bharti Airtel expands service agreement with Ericsson Telecom major Bharti Airtel expanded for five years its managed services agreement for India operations with Swedish telecom equipment provider Ericsson.
Brand Logo
The new logo represents a dynamic force of unparalleled energy that brings us and our customers closer.
Brand Tune
In 2002 Airtel got Signature tune from A. R Rehman. This signature tune is the most downladed tune in India
Bharti Airtel has donated Rs 1 Crore to the Prime Ministers Relief Fund for the Tsunami Victims Airtel Has tied up with various Blood Banks for organising Blood Donation Drives in the Rural Areas
Rural penetration remains low; Bharti leads in coverage While the urban penetration in India has crossed 100%, rural penetration still remains low at <25%. Bharti has a strong market share of rural subscribers and would be a key beneficiary of potential increase in rural wireless penetration given its advantage of superior distribution and coverage.
120
100 80 60 40 20 0 0 2 4 6 8 10
Urban
Rural
Bharti is going strong Bharti reached its peak subscriber and AGR market share (~25% and 34% respectively) in 3QFY09. In the six subsequent quarters, while Bharti's subscriber share has declined ~350bp to ~22% largely due to multi-SIM usage/subscriber duplication, its AGR market share has remained almost steady at 33%+.
Bharti hikes wireless tariffs: Bharti has increased on net
(Airtel-to-Airtel calls) tariffs by 20% in 6/22 circles from INR0.01/second (~INR0.5/minute) to INR0.012/second (~INR0.6/minute). These circles represent ~40% of Bharti's revenue; once fully absorbed (likely over the next 2-3 quarters), we estimate that the tariff hike will increase Bharti's blended India mobile RPM by ~2%.
Also taking other profitability enhancement measures: Other measures that operators are taking to improve profitability include a 0.50.8% cut in recharge commissions (typically 2.5-4%) and INR20-25 cut in commissions per customer added in the prepaid segment (typically INR160170/gross-add). The operators are clearly trying to gain some value back from channel and customers, which they had lost due to increase in competitive intensity.
Important parameter of Financial analysis:It was analysed by Business Line, Money Control & The Economics Times Stocks with the large Promoter Holding (50%-80%) clearly out-performed
Shareholding Pattern(%)
9 17 23
6
45
Indian Promoter Foreign Promoter FII's Indian Institutions Others
Bharti Airtel has maintained its market share in telecom industry both in the rural as well as in the urban areas they still they are No. 1. Bharti Airtel has successfully introduced 3G through its wide distribution network and attractive prices
Most successful brand in India with largest market share.
Higher re-branding cost has brought Bharti Airtels net down by 41% The re-branding strategy was not as effective as it has to be, as customers are not getting familiar with the logo. Maximum customer complaints has resulted a loss of 3.2 lakhs customers
