Connect with us


Bharti Airtel

Bharti Airtel is one of the world’s leading providers of telecommunication services with significant presence in 16 countries, representing India, Sri Lanka, and 14 countries in Africa.

The company’s diversified service range includes mobile, voice, and data solutions, using 2G, 3G, and 4G technologies.

It provides telecom services under wireless and fixed line technology, national and international long distance connectivity, and digital TV; and complete integrated telecom solutions to our enterprise customers. All these services are rendered under a unified brand Airtel either directly or through subsidiary companies.

The company also deploys and manages passive infrastructure pertaining to telecom operations through its subsidiary, Bharti Infratel Limited, which also owns 42 percent of Indus Towers Limited. Together, Bharti Infratel and Indus Towers are the largest passive infrastructure service providers in India.

Financial review

The company’s consolidated revenues stood at Rs 83,687.9 crore for the year ended March 31, 2018, as compared to Rs 95,468.3 crore in the previous year, decrease of 12.3 percent (decrease of 9.8 per after normalizing for impact of IUC rate cut in India, divested operating units of Africa/Bangladesh and acquisition of Tigo, Rwanda). The revenues for India and South Asia (Rs 64,421.7 crore for the year ended March 31, 2018) represented a de-growth of 13.5 percent compared to that of the previous year (de-growth of 11.6 percent after normalizing for impact of IUC rate cut and impact of Bangladesh divestment). The revenues across 14 countries of Africa, in constant currency terms, grew by 4.9 percent (growth of 4.6 percent adjusting for the impact of divestment of tower assets and acquisition of Tigo, Rwanda).

The company incurred operating expenditure (excluding access charges, cost of goods sold, license fees, and CSR costs) of Rs 35,888.8 crore representing a decrease of 9.2 percent over the previous year. Consolidated EBITDA at Rs 30,447.9 crore decreased by 14.5 percent (decrease of 13.3 percent after normalizing for impact of IUC rate cut in India, divested operating units of Africa/Bangladesh and acquisition of Tigo, Rwanda) over the previous year. The company’s EBITDA margin decreased during the year to 36.4 percent as compared to 37.3 percent in the previous year.

Depreciation and amortization costs for the year were lower by 2.7 percent to Rs 19,243 crore. Consequently, EBIT for the year at Rs 11,084.5 crore decreased by 29.3 percent (decrease of 31.1 percent after normalizing for impact of IUC in India and impact of divestments) resulting in margin of 13.2 percent vis-à-vis 16.4 percent in the previous year. The cash profits from operations (before derivative and exchange fluctuations) for year ended March 31, 2018 were Rs 22,716.9 crore vis-à-vis Rs 28,366.6 crore in the previous year.

Net finance costs at Rs 8071.2 crore were higher by Rs 373.7 crore, compared to the previous year, mainly due to lower investment income by Rs 348.8 crore. The increase on account of spectrum related debt in India was partially off-set by lower forex losses in the current year compared to the previous year. Consequently, the consolidated profit before taxes and exceptional items was at Rs 4060.1 crore compared to Rs 8893 crore for the previous year.

The consolidated income tax expense (before the impact on exceptional items) for the full year ending March 31, 2018 was Rs 1491.8 crore, compared to Rs 4423 crore for the previous year. The decline is primarily led by drop in profits in India. After adjusting for certain losses where no DTA was created, the underlying effective tax rate in India for the year ended March 31, 2018 was at 26.5 percent versus 29.4 percent in the previous year. The tax charge in Africa for the full year (excluding divested units) was at USD 159 million versus USD 148 million in the previous year on account of change in profit mix of the countries.

Net income before exceptional items for the full year came in at Rs 1396 crore as compared to Rs 3813.4 crore in the previous year. Exceptional items during the year accounted for net impact of Rs 297 crore. These included impact of gains/losses on divestment of subsidiaries, translation impact in Nigeria due to transition to market-based exchange rate, litigation related assessments, operating costs on network re-farming and upgradation programs and assessment of tax provisions. After accounting for exceptional items, the resultant consolidated net income for the year ended March 31, 2018 came in at Rs 1099 crore as compared to Rs 3799.8 crore in the previous year.

The capital expenditure for the full year was Rs 26,817.6 crore (USD 4.2 billion) as compared to Rs 19,874.5 crore in the previous year (an increase of 34.9 percent). Consolidated operating free cash flow for the year was at Rs 3630.3 crore as compared to Rs 15,746.1 crore in the previous year. Higher investments and continued pricing pressure in India have resulted in decline of Return on Capital Employed (ROCE) to 4.6 percent from 6.5 percent in the previous year.

Liquidity and funding

As on March 31, 2018, the company had cash and cash equivalents of Rs 4788.6 crore and short-term investments of Rs 6897.8 crore. During the year ended March 31, 2018, the company generated operating free cash flow of Rs 3630.3 crore. The company’s consolidated net debt as on March 31, 2018 increased by USD 517 million to USD 14,611 million as compared to USD 14,094 million last year, mainly on account of increased capital expenditure. The Net Debt–EBITDA ratio (USD terms LTM) as on March 31, 2018 stood at 3.13 times as compared to 2.63 times in the previous year, mainly on account of increased borrowings and reduced EBITDA. The net debt–equity ratio stood at 1.37 times as on March 31, 2018, compared to 1.35 times in the previous year.

During the year, the company undertook several initiatives to meet its liquidity and funding requirements. The company completed the secondary sale of its subsidiary Bharti Infratel Limited (Bharti Infratel) to global fund managers and global tower company investors for a consideration of approx. Rs 2570 crore and Rs 3325 crore in 2Q18 and 3Q18 respectively, thereby reducing its equity stake to 53.51 percent in Bharti Infratel. These proceeds were primarily used by the company to reduce its debt. The company also made its maiden unsecured listed.

NCD issuance of Rs 3000 crore in 4Q18. The company continues to maintain its credit ratings and has access to both domestic and international debt capital markets.

Segment-wise performance

B2C services

Airtel entered into several M&A transactions to harness operational synergies and scale benefits from consolidation. During the year, the acquisition of Telenor India has also been approved by the Department of Telecommunications (DoT). The company also completed the acquisition of Tikona Digital Networks. The company also entered into agreements with Tata Teleservices Ltd. (TTSL) and Tata Teleservices (Maharashtra) Ltd. (TTML) to merge their consumer mobile business (CMB). The deal is currently under regulatory approvals. The above acquisitions further strengthened the company’s spectrum portfolio.

The company crossed the milestone of 300 million customers in India; the latest 100 million customers have joined the Airtel family in less than 2 years. As on March 31, 2018, the company had 304.2 million GSM customers. During the year, total minutes on network increased by 45.3 percent to 1946.3 billion. The churn decreased to 3.5 percent for the current year, compared to 3.7 percent during the previous year. The company had 86.1 million data customers at the end of March 31, 2018, of which 76.6 million were mobile broadband customers. The total MBs on the network for the full year has increased by 432.2 percent to 3901.8 billion MBs. The company has also expanded its reach within the digital space. Wynk music remains the number 1 music app in the country and Airtel TV is now ranked number 3 amongst comparable video OTT apps. It offers more than 350 live channels, 8000+ movies, and is available in 14 languages.

During the year, revenues decreased by 18.2 percent to Rs 46,263.9 crore as compared to Rs 56,551.1 crore in the previous year. The segment witnessed decline in the EBITDA margin to 32.6 percent during the year, compared to 40.3 percent in the last year. EBIT margin for the year declined to 4.5 percent, compared to 18.7 percent in the last year.

The company expanded its project leap initiative announced last year and continued to invest in building data capabilities and provide a world class network to customers who are on a journey of digital transformation. The CapEx investment, its highest ever, was almost entirely targeted to this end. These investments resulted in the company being named as the fastest mobile network in India by the global leader in internet speed test – Ookla for three consecutive times in a row.

The company had 165,748 network towers, compared to 162,046 network towers in the last year. Mobile broadband (MBB) base stations stood at 298,014 at the end of the year, compared to 190,860 at the end of last year.

Airtel announced a strategic partnership with SK Telecom, Korea’s largest telecommunications company to leverage the latter’s expertise to build the most advanced telecom network in India.

Mergers and acquisitions. Airtel entered into several M&A transactions to harness operational synergies and scale benefits from consolidations.

Airtel’s proposed merger with the Indian unit of Norway’s Telenor was approved by DoT. The DoT transferred all licenses belonging to the Indian unit of Norway’s Telenor, along with its liabilities to Airtel.

> Airtel’s proposed merger with the consumer business unit of TTML) and TTSL is under regulatory approvals. Securities and Exchange Board of India (SEBI) has given approval for the TTML merger.

> Airtel has completed the proposed acquisition of shares of Tikona Digital Networks and Tikona has become a wholly owned subsidiary of Airtel.

> Airtel (through the subsidiary company) acquired a strategic stake in Juggernaut Books (Juggernaut), a popular digital platform to discover and read high-quality, affordable books and to submit amateur writing. This synergizes with Airtel’s endeavor to build an open content ecosystem and bring world class digital content to customers.

Successful divestment/funding. Airtel (through the subsidiary company) offloaded Rs 5895 crore stake in Bharti Infratel primarily to pare debt and issued Rs 3000 crore worth NCDs to refine existing debt.

Bharti Airtel Limited via its wholly owned subsidiary, Nettle Infrastructure Investments Limited, divested 150 million shares of its subsidiary Bharti Infratel Limited through secondary share sale in the stock market for a consideration of over Rs 5895 crore.

Airtel issued non-convertible debentures worth up to Rs 3000 crore on a private placement basis. The proceeds of the issue will be used for routine treasury activities such as refinancing of existing debt and spectrum liabilities.

Network expansion and transformation. Airtel took several initiatives to remain lean and agile and provide a world class network to customers who are on a journey of digital transformation.

Airtel signed an agreement with DoT and the Universal Service Obligation Fund (USOF) in December 2017 for provision of mobile services in identified uncovered villages and national highways in the North Eastern States of Assam, Manipur, Mizoram, Nagaland, Sikkim, Tripura, and Arunachal Pradesh. Under the agreement, Airtel will set up over 2000 mobile towers in more than 2100 villages over the next 18 months.

Airtel announced the launch of India’s first Telecom Infra Project (TIP) Community Lab. Airtel is among the early members of TIP – a global initiative founded by Facebook, Deutsche Telekom, Intel, Nokia, and SK Telecom to create a new approach for building and deploying telecom network infrastructure.

Airtel announced the deployment of massive multiple-input multiple-output (MIMO) in partnership with Huawei Telecommunication India. Part of Airtel’s ongoing network transformation program, Project Leap, this technology will expand existing network capacity and enhance user experience. The first round of deployment has started in Bangalore and Kolkata.

Airtel launched its VoLTE services in Mumbai, Madhya Pradesh, Andhra Pradesh, Gujarat, Karnataka, Chennai, Maharashtra, Goa, and Chhattisgarh. Customers can now enjoy HD quality voice calls and call any mobile, landline network using Airtel VoLTE, which works over 4G.

Airtel conducted India’s first 5G network trial in partnership with Huawei.

Homes services. The company provides fixed-line telephone and broadband (DSL) services for homes in 89 cities across India. The company expanded V-Fiber technology for its homes customers after it became the first operator to deploy Vectorization in India; this technology enables the customers to experience internet speeds of up to 100 Mbps. The homes business had 2.2 million customers as on March 31, 2018, representing a growth of 2.0 percent as compared to 2.1 million at the end of previous year. DSL customers now represent 94 percent of the total homes customers as compared to 92.3 percent in the previous year.

Revenues from homes services stood at Rs 2526.5 crore for the year ended March 31, 2018, as compared to Rs 2751.8 crore in the previous year, decrease of 8.2 percent. EBITDA margin has been slightly decreased during the year to 46.7 percent as compared to 47.2 percent in the previous year. During the year, data traffic increased by 55.6 percent to 1340.8 billion MBs.

Digital TV services. The company served a customer base of 14.2 million on its direct-to-home platform (Airtel digital TV), as on March 31, 2018, adding 1.4 million customers during the year.

The company currently offers both standard and high definition (HD) digital TV services with 3D capabilities and Dolby surround sound. The company currently offer a total of 649 channels including 75 HD channels, 5 international channels, and 4 interactive services. Revenues for the year stood at Rs 3757 crore for the year ended March 31, 2018, as compared to Rs 3430.6 crore in the previous year, increase of 9.5 percent. Affordability of HD set-top boxes, demand for HD channels, and upselling efforts led to ARPU flat at Rs 231.

Operating free cash flow on a full year basis at Rs 394.9 crore compared to cash flow of Rs 361.1 crore during the previous year.

Key highlights

Divestment.  Airtel announced that an affiliate of Warbug Pincus will acquire an equity stake of up to 20 percent in Bharti Telemedia Limited – its DTH arm. After this transaction, Airtel will own 80 percent equity stake in Bharti Telemedia Limited.

B2B services

Airtel business. An ICT services provider, its diverse portfolio of services includes voice, data, video, network integration, data center, managed services, enterprise mobility applications, and digital media. Airtel Business consistently delivers integrated solutions, customer service, and reach to global markets, to enterprises, governments, carriers, and small and medium businesses.

Revenues in this segment comprise: (a) Enterprise and corporates fixed line, data and voice businesses; and (b) Global business, which includes wholesale voice and data. Revenue as per point (a) Above, together with Enterprise Mobile revenues (included in India Mobile) is at Rs 9589.4 crore in this year, this is now 15 percent of the total India revenues.

Global business, the international arm of Airtel business, offers an integrated suite of global and local connectivity solutions, spanning voice and data to the carriers, telcos, OTTs, large multinationals, and content owners globally.

Airtel’s international infrastructure includes the ownership of i2i submarine cable system, connecting Chennai to Singapore and consortium ownership of submarine cable systems like South East Asia – Middle east – Western Europe – 4 (SWM4), Asia America Gateway (AAG), India – Middle East – Western Europe (IMEWE), Unity, Europe India Gateway (EIG), and East Africa Submarine System (EASSy). Along with these seven owned subsea cables, Airtel Business has a capacity on 22 other cables across various geographies.

Its global network runs across 250,000 Rkm with over 1200 customers, covering 50 countries and five continents and 65 global PoPs (point of presence). This is further interconnected to its domestic network in India and direct terrestrial cables to SAARC countries, Myanmar, and China helping accelerate India’s emergence as a preferred transit hub.

Leveraging the direct presence of Airtel Mobile operations in 16 countries across Asia and Africa, global business also offers mobile solutions (ITFS, signaling hubs, messaging), along with managed services and SatCom solutions. Global business is also providing advanced consumers solutions like IoT to global customers.

Key highlights

Digital transformation and expansion. Airtel rolled out a first-of-its-kind dedicated digital platform for B2B customers (including SMEs and startups) to serve their growing connectivity, communication and collaboration requirements. With Airtel’s new digital platform on small businesses can buy new communication and collaboration products to enable faster time to market and enhance ease of doing business.

Airtel has acquired the Indian leg of Gulf Bridge International (GBI) India – Middle East – Europe submarine cable with an aim to consolidate its global network leadership and serve the exploding data demand in emerging markets like India, Gulf, and Africa.

Strategic alliances

Airtel entered into a strategic alliance with Symantec Corp. to serve the growing cyber security requirements of businesses in India, providing protection and prevention of online threats. As part of the agreement, Airtel will be the exclusive Cybers security Services partner for Symantec in India, and will distribute Symantec’s enterprise security software.

Passive tower infrastructure

A subsidiary of the company, Bharti Infratel Ltd. (Infratel), is India’s leading provider of tower and related infrastructure and it deploys, owns, and manages telecom towers and communication structures, for various mobile operators. It holds 42 percent equity interest in Indus towers, a joint venture with Vodafone India and Aditya Birla Telecom who hold42 percent and 16 percent respectively. The company’s  consolidated portfolio of 91,451 telecom towers, which includes 39,523 of its own towers and the balance from its 42 percent equity interest in Indus Towers, makes it one of the largest tower infrastructure providers in the country with presence in all 22 telecom circles. The company has been the industry pioneer in adopting green energy initiatives for its operations. Infratel is listed on the Indian stock exchanges, NSE and BSE.

Investment plans

The company had announced that it plans to invest Rs 25,000 crore pan-India in mobile network sites, capacities, fiber roll-out, and digitalization among others.

Airtel is expanding its broadband network footprint to stay abreast with competition and fulfilling customers’ expectation. As a part of expansion program, the company will deploy additional LTE sites with fiber/ backhaul readiness and will expand its coverage by strengthening its LTE FDD footprint in order to provide seamless connectivity. The surge in volume will necessitate enhancement of the LTE TDD layer to support additional traffic in select places of high throughput.

With the explosion in data, Airtel will significantly step-up backhaul readiness on its site along with increased fiberization and rapidly expand its transmission backbone and aggregation capacity to cater to the additional data load.

With the exponential increase in voice minutes, the company has recently launched VoLTE services offering HD quality calls along with faster call set up time which once scaled up will give a significantly better experience to the customers.

Technology has been rapidly evolving in the telecom sector. In the next few years wide scale commercial deployment of 5G is expected to start. In such a scenario, the company is making its investments future proof and starting to be ready for 5G network deployment.


During the quarter, Bharti Airtel acquired Telenor’s operations in India. Financial and operational parameters of the combined entity are part of India results. The consolidated revenues for 1Q’19 at Rs 20,080 crore de-grew 2.3 percent YoY (reported drop of 8.6 percent) on an underlying basis (viz. adjusted for India domestic and international termination rate reduction and divested operating units). Consolidated mobile data traffic at 2236 billion MBs in the quarter has registered a robust YoY growth of 328 percent.

India revenues for 1Q’19 at Rs 14,930 crore have declined by 7.0 percent YoY (declined 13.5 percent on reported) on an underlying basis. Mobile segment continues to be impacted by aggressive industry pricing and has witnessed YoY de-growth of 11.0 percent. Other businesses in India have witnessed healthy YoY growth for example, 10.6 percent in digital TV and 11.8 percent in Airtel Business on an underlying basis. Mobile data traffic has quadrupled to 2151 billion MBs in the quarter as compared to 472 billion MBs in the corresponding quarter last year. Mobile broadband customers increased by 75.2 percent to 85.7 million from 48.9 million in the corresponding quarter last year.

In constant currency March 1, 18 terms, Africa revenues grew by 13.9 percent YoY led by strong growth in data and Airtel money transaction value. Mobile data traffic has grown by 75 percent to 78 billion MBs in the quarter as compared to 44 billion MBs in the same quarter last year. Data customers increased by 45.2 percent to 26.4 million from 18.2 million in the corresponding quarter last year. Active Airtel Money customer base increased to 11.8 million, boosting the total transaction value on Airtel Money platform by 43 percent to USD 6.1 billion. Our continuous cost control initiatives have resulted in improvement of EBITDA margin by 7.8 percent YoY and stands at 36.4 percent.

Consolidated EBITDA at Rs 6837 crore declined 12.6 percent YoY. Consolidated EBITDA margin decreased by 1.6 percent to 34.0 percent in the quarter as compared to 35.6 percent in the corresponding quarter last year. Consolidated EBIT dropped by 43.8 percent YoY to Rs 1680 crore. The consolidated net income after exceptional items for the quarter stands at Rs 97 crore (4Q’18: Rs 83 crore) compared to Rs 367 crore in the corresponding quarter last year.


With convergence of mobility services, entertainment, banking, education, the role of a smartphone has expanded enormously. Airtel is the only player with an integrated product portfolio, and wide geographical presence. Bharti Airtel’s Network leadership and excellent customer experience delivery will continue to stimulate company’s growth against its competitors.

“Telecom markets across emerging economies are in transition. While life cycles of 2G and 3G are getting truncated, 4G is taking rapid strides. Market structures are getting reshaped with fewer players to facilitate these investments. With our strong balance sheet and robust spectrum portfolio across markets, we are well positioned to make the best of this transition to come out stronger.”

Sunil Bharti Mittal
Bharti Airtel

Click to comment

You must be logged in to post a comment Login

Leave a Reply