bharti (1).pptx

7/29/2019 bharti (1).pptx

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Excerpt from quote by Manoj Kohli (Chief Executive and joint MD,

Bharti Airtel) in answer to the question of synergies between their

businesses

Our strategy is one of wallet share. Get the maximum wallet

We are also planning that we should do similar bundling with retail andinsurance, which are two big businesses with Bharti. This becomes OneBharti, where, if customers buy something from Easyday (Bharti Retailsconvenience stores..then they should get some benefit of telecom

That is our strategy on brandthat we have one brand.

Bharti Vision


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Bharti Airtel Ltd.

Shareholding

Promoter

Group

IndianPromoter

Group

Foreign

Non

Institutions

Institutions

Established July 07,1995, as a PublicLimited Company

Shares Outstanding:3,797,530,096 as atSeptember 30, 2010

Market Capitalization:122,166.54 (Rs CR)(Stock Price 321.7,BSE as on 6th March

2013


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Bharti Airtel Growth


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Telecom Market

Relatively large youth population - Telecom penetration c.73.3%(rural-39% urban- 163%)

Sub number should go upto 1 Billion by 2015

Broadband penetration 1.2% (14.9 mn)

Govt. target to reach 20 mn. Broadband subs by 2013


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Telecom Market


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Organisation Structure Bharti

Airtel


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Organisation Restructure:

Bharti Airtel India operations

The corporate restructure coincides with the appointment of GopalVittal as the new head of its India operations and will be applicablefrom March 1,2013

Instead of the current 3 regional hubs, the organization will now bedivided into 8 hub operations reporting to a newly created position

of Director - Market Operations Circle CEOs will report to a Hub CEO

Ajai Puri, Operations Director North & East, has been appointedas the Director - Market Operations for India and will report toGopal Vittal, Jt MD and CEO Designate for India

Raghunath Mandava, currently Operations Director for West &Distribution has been appointed Director - Customer Experience,reporting to Gopal Vittal

Najib Khan, CMO - Airtel Business, has been appointed as CEOHomes and Office. In this role, Najib will be responsible for the

Companys Telemedia business, the SMB vertical, LTE and Wi-Fi


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Portfolio and Business

Description

Product and Servicesportfolio

Mobile services,

Home phones, Broadband,

Calling cards,

DTH,

IPTV,

MPLS Services, Satellite services,

Data transport solutionsand conferencing services

Business Description

Provides GSM mobile servicesin all the 22 telecom circles in

India, Srilanka, Bangladeshand now in 16 countries ofAfrica.

Provides telemedia services(fixed line and broadbandservices through DSL) in 87

cities in India. Provides an integrated suite of

Enterprise solutions, inaddition to providing longdistance connectivity bothNationally and Internationally.


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BCG Matrix of Bharti Telecom

Star

SBU Enterprise Services(Carriers andCorporates)

Major contributor torevenue in just 4 yearsof coming

Question Mark

SBU Passive Infra

Good collaborations

like Indus tower/Untapped market)

Cash Cow

SBU Mobile services:

Legacy of Bharti

Dog

SBU Telemedia Services

Significant fall in ARPU/Other big players

existing in the market


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Bharti Airtel Focus


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Strategy On Current Focuses

Smart sourcing for cost effectiveness by retaining only customer satisfactionand marketing with themselves

Growth through acquisition

Acquired Zain to get foothold in developing markets of Africa to increase

revenue and customer base JV with Aditya Birla Telecom & Vodafone for Bharti Infratel (mobile tower

infra.)

Airtel money for m commerce to bring about new channels for earnings

Focus to increase rural penetration

Partnership with strong global partners


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Opportunities For Bharti Telecom

Upcoming 4g and Wimax technologies

Increasing call rates

Biddings for airwaves meeting with lukewarm response

M commerce a high growth area, can develop new applications

Applications which fuse the use of Airtel and Retail

Changing demographics of India


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2010

$435 bn

2015

$635 bn

2020$850 bn

Indian Retail Sector

0

5

10

15

% of GDP % of WorkForce AnnualGrowth Rate

Retail sector stats

% values

% of retail sectorOrganized-5%

Unorganized-95%


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Reasons For Growth In Organized Retail

Change in demographics (Median age of 24 years)

Increase in purchasing power of consumers

Availability and awareness about Brands

Want for quality products

Overall retail experience

Increase in working population, constrained for time

Development of mall culture


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Why did Bhartienter into retail

sector?

Entrepreneurial bent of Sunil Bharti Mittal

Bharti wanted 50% of revenue to come from non telecom sectors

Growth potential of the Retail sector

Easy to leverage the customer base and customer knowledge

derived from the telecom business

Declinig margins in telecom due to price war

Experience in the service sector


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Bharti Retail Structure(Modes of engagement)

BhartiEnterprise

Bharti RetailPvt. Ltd.

(Subsidiary)

Easy DayStore

(Neighborhoodstores)

Easy DayMarket

Easy Day Hyper(Hypermarkets)

Bharti-Walmart

(50-50 JV)

Best Price(Wholesale

cash andcarry format)

Field Fresh50-50 JV


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Why JVs?

Entered retail in 2008 (recession period), therefore JV allows lesser investment and

risk sharing

No prior experience in retailing

Walmart provides exceptional experience and capabilities in back end logistic

Bharti Retail Pvt. Ltd. has stores working on EDLP model, which Walmart has

mastered

JV with Del Monte (Phillipines) provides access in processed food industry, in terms

of operations and association with one of the top 10 brands in this product segment

Increase in product portfolio for retail stores


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Why Walmart chose Bharti ? Indian laws does not permit FDI in multi brand by non-domestic retailers. Thus,

this alliance will help Wal-Mart to enter fast growing retail sector.

Bharti served as a market leader in the telecom sector of India and also had an

experience of managing over 30,000 people.

Bharti had a long history of pitching in with foreign companies.

Wal-Marts failure in Korea and Germany and their hardships in Japan made them

realise the need of a local partner in order to understand the peoples choices.

Bharti had a huge market capitalization of worth more than US $ 25 billion.

Indian agricultural sourcing is highly disintegrated which requires understanding

of local market. WalMart could leverage on Bhartis experience in penetrating far

flung areas for their telecom markets.


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Competitors


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Bharti Retail hasapproximately only 0.1%market share by sales

Revenue of 236 crores

Therefore provides huge

potential for growth

Organized sector grew at25% in 2011

% Sales

Pantaloons

Retail

Vishal Stores

Trent

Shoppers Stop

Bharti Retail

Others


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RelianceInvestment of$6.7 bn with

expectedsales of $20bn

by 2010

Bharti GroupInvestment of$7bn to createhundereds of

stores andhyper malls

Expansion Plans

PantaloonRetail had aninvestmentportfolio of

$240 mn

Trent planned

to grow from 7star baars to 40

in 3 years in2010 with

investment ofRs 275 crore

Huge investment by each of the bigplayer indicates that there is hugepotential in the organized retailsector


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Future Opportunities


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Synergies Between Airtel & Retail

Leverage on their strong customer base and customer information of telecom to

grow in retail sector

Opportunities to increase retail footprint by giving talktime for their purchases

Both have partnership with strong foreign playersBoth make use of same brand i.e. Bharti

Both are service areas, and Bharti telecom can use its experience in customer

satisfaction to advantage in retail

Combining m commerce with retail

bharti (1).pptx

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