Description
Early telecommunication technologies included visual signals, such as beacons, smoke signals, semaphore telegraphs, signal flags, and optical heliographs.[7] Other examples of pre-modern telecommunications include audio messages such as coded drumbeats, lung-blown horns, and loud whistles.
A PROJECT REPORT ON Sectoral Research ON Telecommunication
(PGDM) 2010-12
Submitted by:
Roll No-1999/01010003 Sem.-IV
Submitted to the 1
SURYADATTA INSTITUTE OF MANAGEMENT AND MASS COMMUNICATION (SIMMC).
YEAR OF SUBMISSION: - 2012
DECLARATION
2
I do here by declare that this present project work entitled “A Project Report on Sectoral Research” being submitted by me for the partial fulfillment of the requirement for the award of (Post graduate Diploma In management) PGDM is a record of my own research work . I do also hereby declare that all the information collected for this project report is collected through my own efforts and is true to best of my belief .The report embodies the findings based on my study and observation and has not been submitted earlier for the award of any degree or diploma to any other institution or University.
I further declare that the project work is original genuine to the best of my knowledge and information.
ACKNOWLEDGEMENT
It is really a great pleasure to have this opportunity to describe the feeling of gratitude imprisoned in the core of my heart.
3
I convey my sincere gratitude to Prof. Dr. Sanjay Chordiya Sir, Chairman (Suryadatta Group of Institute) for giving me the opportunity to prepare my project work in Sectoral Reserach.
Sr.No
Contents
Pg.no
I expre
ss my sincere obligation and thanks to all the faculties of Suryadatta Institute for their valuable advice in guiding me at every stage in bringing out this report.
I am also thankful to my family for their kind co-operation which made my task easy.
TABLE OF CONTENTS
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1 2 3 4 5 6 7 9 10 11 12 13 14 15 16 17 18
Objective Introduction of sector Introduction of Sector In India
Airtel introduction
6 6-7 7-13 14-19 19-20 20-22 23-27 28 29 29 37-41 39-41 40-42 43-46 47-48 48-49 50
Company profile Awards Swot analysis
Reliance communication introduction
Vision&mission Content Financial data Swot analysis Aircel Introduction Services Marketing strategies Oppourtunity in the sector Learning experience
OBJECTIVES
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The present study includes insights of TELECOM INDUSTRY in India. In order to study about theTELECOM INDUSTRY I have conducted a study of 3 different companies. A comprehensive study is proposed with the following objectives.
? To know about Telecom Market in India. ? To know about THE TOP COMPITETORS in Telecom Industry. ? To know about the Customer base of the company.
? To know about the SERVICES Provided by the COMPANY.
Telecommunication Sector –Industry Profile
? Telecommunication is the transmission of messages over significant distances for the ? purpose of communication. In earlier times, telecommunications involved the use of visual signals, such as smoke, semaphore telegraphs, signal flags, and optical heliographs, or audio messages via coded drumbeats, lung-blown horns, or sent by loud whistles, for example. ? In the modern age of electricity and electronics, telecommunications has typically involved the use of electric means such as the telegraph, the telephone, and the teletype, the use of microwave communications, the use of fiber optics and their associated electronics, and/or the use of the Internet. The first breakthrough into modern electrical telecommunications came with the development of the telegraph during the 1830s and 1840s. The use of these electrical means of communications exploded into use on all of the continents of the world during the 19th century, and these also connected the continents via cables on the floors of the ocean. These three systems of communications all required the use of conducting metal wires. ? A revolution in wireless telecommunications began in the first decade of the 20th Century, with Guglielmo Marconi winning the Nobel Prize in Physics in 1909 for
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his pioneering developments in wireless radio communications. Other early inventors and developers in the field of electrical and electronic
telecommunications included Samuel F.B. Morse and Joseph Henry of the United States, Alexander Graham Bell of Canada, Lee de Forest of the U.S., who invented the amplifying vacuum tube called the triode, Edwin Armstrong of the U.S., John Logie Baird of England, and Nikola Tesla who's most important inventions were created in the United States. ? Telecommunications play an important role in the world economy and the worldwide telecommunication industry's revenue was estimated to be $3.85 trillion in 2008. The service revenue of the global telecommunications industry was estimated to be $1.7 trillion in 2008, and is expected to touch $2.7 trillion by 2013. ? Various searches made e.g. .Google search.
INTRODUCTION OF TELECOM SECTOR IN INDIA
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The Indian Telecommunications network is the third largest in the world and the second largest among the emerging economies of Asia. Today, it is the fastest growing market in the world. The telecommunication sector continued to register significant success during the year and has emerged as one of the key sectors responsible for India?s resurgent India?s economic growth This rapid growth has been possible due to various proactive and positive decisions of the Government and contribution of both by the public and the private sector. The rapid strides in the telecom sector have been facilitated by liberal policies of the Government that provide easy market access for telecom equipment and a fair regulatory framework for offering telecom services to the Indian consumers at affordable prices. It has also undergone a substantial change in terms of mobile versus fixed phones and public versus private participation. The preference for use of wireless phones has also been predominant in the sector. Participation of the private entities in the telecom sector is rapidly increasing rate there by presenting the enormous growth opportunities. There is a clear distinction between the Global Satellite Mobile Communication (GSM) and Code Division Multiple Access (CDMA) technologies used and the graph below shows the divide between the two. With increasing penetration of the wireless services, the wire line services in the country is becoming stagnant. On the other hand, Broadband demand has picked up and promises to stabilise fixed line growth. GSM Sector In terms of the Global System for Mobile Communication (GSM) subscriber base this now places India third after China and Russia.China had 401.7 million GSM subscribers
CDMA Services CDMA technology was introduced in India as a limited mobility solution. The introduction of CDMA services has created competition, lowered tariffs and offered many citizens access to communication services for the first time.
Internet Services
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Internet services were launched in India on August 15, 1995. In November 1998 the government opened up the sector to private operators. A liberal licensing regime was put in place to increase Internet penetration across the country. The growth of IP telephony or grey market is also a serious concern. Government loses revenue, while unlicensed operation by certain operators violates the law and depletes licensed operators market share. New services like IP-TV and IP-Telephony are becoming popular with the demand likely to increase in coming years. The scope of services under existing ISP license conditions are unclear.
The Telecom Regulatory Authority of India (TRAI)
The Telecom Regulatory Authority of India (TRAI) was set up in March 1997 as a regulator for Telecom sector. The TRAI?s functions are recommendatory, regulatory and tariff setting in telecom sector. Telecom Disputes Settlement and Appellate Tribunal (TDSAT) came into existence in May, 2000. TDSAT has been empowered to adjudicate any dispute – • between a licensor and a licensee • between two or more service providers • between a service provider and a group of consumers • hear and dispose of appeal against any direction, decision or order of TRAI
Tariffs for telecommunication services have evolved from a regime where tariffs were determined by Telecom Regulatory Authority of India to a regime where tariffs are largely under forbearance. TRAI intervenes by regulating the tariffs for only those services, the markets of which are not competitive. Universal Service Obligation Fund (USOF) exclusively for meeting the Universal Service Obligation was established in April, 2002. The Universal Service Levy is presently 5 per cent of the Adjusted Gross Revenue (AGR) of all telecom service providers except the pure value added service providers like Internet, Voice Mail, E-Mail service providers etc. Indian Telegraph Act has been amended in October?2006 to provide support for all telegraph
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services including mobile and broadband to bridge the digital divide. With the introduction of the Unified Access Licensing Regime, operators can offer telecom access services to consumers in a technology neutral manner, subject to fulfilling certain conditions. Introduction of this regime has also broken the legal/regulatory impasse between the cellular and basic service providers. Issuance of Intra-Circle Merger and Acquisition Guidelines provide investors an opportunity to take stakes in existing telecom operations.
The Government has taken the following main initiatives for the growth of the Telecom Sector: • All telecom services have been opened up for free competition for unprecedented growth • 217 (Information Technology Agreement) ITA-I items are at zero Customs Duty. Specified capital goods and all inputs required to manufacture ITA-I, items are at zero Customs Duty • Availability of low cost mobile handsets • The international Long Distance Services (ILDS) opened with effect from April 2002. Calling Party Pays (CPP) regime was implemented with effect from 1st May • Guidelines for Unified Access Service License regime were issued in November 2003, 27 licenses out of 31 Basic Service Licenses were converted to Unified Access Service Licenses • In April 2004, license fee for Unified Access Service Providers (UAS) was reduced by 2 per cent • License fee for infrastructure Provider-II reduced from 15 per cent to 6 per cent of the Adjusted Gross Revenue and spectrum charges between 2 to 4 per cent in June 2004 • Entry fee for NLD licenses was reduced to Rs. 2.5 Crore from Rs. 100 Crore. Entry fee for ILD reduced to Rs. 2.5 Crore from Rs. 25 Crore • Lease line charges have been reduced to make the bandwidth available at competitive prices to facilitate growth in IT enabled services • One India plan i.e. single tariff of Re. 1/-per minute to anywhere in India was introduced from 1st March 2006 by the Public Sector Undertakings. This tariff was emulated by most of the private service providers also. This scheme has led to death of
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distance in telecommunication and is going to be instrumental in promoting National Integration further • The robust telecom network has also facilitated the expansion of BPO industry that is having 500,000 employees now and adding 400 employees per day. • Annual license fee for National Long Distance (NLD), International Long Distance (ILD), Infrastructure Provider-II, VSAT commercial and Internet Service Provider (ISP) with internet telephony (restricted) licenses was reduced to 6 per cent of Adjusted Gross Revenue (AGR) with effort from Jan 2006. • The Government?s policy is neutral on use of technology by telecom service providers subject to availability of scarce resources such as spectrum etc. • Licence Fees 6-10 per cent of Adjusted Gross Revenue (AGR) Foreign Direct Investment (FDI) In Telecom sector Foreign Direct Investment (FDI) was permitted in the telecom sector beginning with the telecom manufacturing segment in 1991 - when India embarked on economic liberalisation. FDI is defined as investment made by non-residents in the equity capital of a company. For the telecom sector, FDI includes investment made by Non-Resident Indians (NRIs), Overseas Corporate Bodies (OCBs), foreign entities, Foreign Institutional Investors (FIIs), American Depository Receipts (ADRs)/Global Depository Receipts (GDRs) etc. Present FDI Policy for the Telecom sector: • In Basic, Cellular Mobile, National Long Distance, International Long Distance, Value Added Services and Global Mobile Personal Communications by Satellite, FDI is limited to 49 per cent (under automatic route) subject to grant of licence from the Department of
Telecommunications and adherence by the companies (who are investing and the companies in which investment is being made) to the licence conditions for foreign equity cap and lock-in period for transfer and addition of equity and other license provisions. • Foreign Direct Investment up to 74 per cent permitted, subject to licensing and security requirements for the following: - Internet Service (with gateways) - Infrastructure Providers (Category II) - Radio Paging Service
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• FDI up to 100 per cent permitted in respect to the following telecom services: - ISPs not providing gateways (Both for satellite and submarine cables) - Infrastructure Providers providing dark fibre (IP Category I) - Electronic Mail - Voice Mail The above is subject to the following conditions: - FDI up to 100 per cent is allowed subject to the condition that such companies would divest 26 per cent of their equity in favour of Indian public within 5 years, if these companies are listed in other parts of the world. - The above services would be subject to licensing and security requirements, wherever required. - Proposals for FDI beyond 49 per cent shall be considered by Foreign Investment Promotion Board (FIPB) on a case-to-case basis. • In the manufacturing sector 100 per cent FDI is permitted under the automatic route. • In Basic, Cellular Mobile, paging and Value Added service, and Global Mobile Personal Communications by Satellite, FDI is permitted up to 49 per cent (under automatic route) subject to grant of license from Department of Telecommunications • Foreign direct investment up to 74 per cent permitted, subject to licensing and security requirements for the Internet Service (with gateways), Infrastructure Providers (category-II), Radio Paging Service • FDI up to 100 per cent permitted in respect of - ISPs not providing gateways (both for satellite and submarine cables), - Infrastructure Providers providing dark fibre (IP Category I); - Electronic Mail; and - Voice Mail • FDI up to 49 per cent is also permitted in an investment company, set up for making investment in the telecom companies licensed to operate telecom services. Investment by these investment companies in a telecom service company is treated as part of domestic equity and is not set of against the foreign equity cap.
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• Manufacturing - 100 per cent FDI is permitted under automatic route. • FDI is subject to the following conditions • FDI up to 100 per cent is allowed subject to the conditions that such companies would divest 26 per cent of their equity in favour of Indian public in 5 years, if these companies are listed in other parts of the world. • The above services would be subject to licensing and security requirements, Wherever required. • Proposals for FDI beyond 49 per cent shall be considered by FIPB on case to case Basis
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Telecom industry
Type
Public BSE: 532454
Industry Founded Founder(s) Headquarters Key people Products
Telecommunications
July 07, 1995
Sunil Bharti Mittal New Delhi, India Sunil Mittal (Chairman) &MD SanjayKapoor (CEO)
Wireless Telephone Internet Satellite television
Revenue Operating income Net income Total assets Owner(s)
596.01 billion (US$11.89 billion)(2011) US$ 2.043 billion (2009) US$ 1.662 billion (2009)
1,007.85 billion (US$20.11 billion)(2011
Bharti Enterprises SingTel (32.15%) Vodafone (4.4%)(as on 2011)
(63.45%)
Employees Website
20,675 (Dec. 2011)
Bharti.com Airtel.in
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Company Profile
We are one of Asia?s leading providers of telecommunication services with presence in all the 22 licensed jurisdictions (also known as Telecom Circles) in India, and in Srilanka. We served an aggregate of 121,852,576 customers as of December 31, 2009, in India; of whom 118,864,031 subscribe to our GSM services and 2,988,545 use our Telemedia Services either for voice and/or broadband access delivered through DSL. We are the largest wireless service provider in the country, based on the number of customers as of December 31, 2009. We offer an integrated suite of telecom solutions to our enterprise customers, in addition to providing long distance connectivity both nationally and internationally. We also offer DTH and IPTV Services. All these services are rendered under a unified brand “Airtel”. The company also deploys, owns and manages passive infrastructure pertaining to telecom operations under its subsidiary Bharti Infratel Limited. Bharti Infratel owns 42% of Indus Towers Limited. Bharti Infratel and Indus Towers are the two top providers of passive infrastructure services in India. Partners Mobile Services Network Equipment Telemedia & Long Distance Nokia Siemens, Wipro, Cisco, Alcatel Lucent, Services Information Technology Call Centre Operations Equity Partner {Strategic} ECI, Tellabs IBM IBM Daksh, Hinduja TMT, Teleperformance, Mphasis, Firstsource & Aegis Singtel Nokia Siemens, Ericsson, Huawei
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Name
Business Description
Bharti Airtel Limited.
Provides GSM mobile services in all the 22 telecom circles in India, and was the first private operator to have an all India presence. Provides telemedia services (fixed line and broadband services through DSL) in 95 cities in India.
Established Proportionate Revenue
July 07, 1995, as a Public Limited Company Rs. 369,615 million (year ended March 31, 2009-Audited) Rs. 270,250 million (year ended March 31, 2008 Audited)
As per US GAAP Accounts Proportionate EBITDA Rs. 199,664 million (year ended March 31, 2011 Audited)
Rs. 167,633 million (year ended March 31, 2010- Audited As per US GAAP Accounts Shares in Issue Listings 3,796,951,980 as at Dec 31, 2009 The Stock Exchange, Mumbai (BSE)
The National Stock Exchange of India Limited (NSE) Market Capitalisation Customer Base Stock quote: BSE: INR 304.35 211,919,000 GSM mobile and
3,296,000Telemedia Customers (status as on Dec 31, 2011) Operational Network Provides GSM mobile services in all the
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telecom circles in India, and was the first private operator to have an all India presence.Provides telemedia services (fixed line) in more than 95 cities in India. Registered Office Bharti Airtel Limited (A Bharti Enterprise) Bharti Crescent, 1 Nelson Mandela Road, Vasant Kunj Phase II New Delhi - 110 070 Tel. No.: +91 11 4666 6100
Fax No.: +91 11 4666 6411
Future Prospect
Bharti Airtel company is planning to set up3000 more towers as part of enhancing their rural coverage and will now focus on rural and semi-urban areas.
As an outcome of a restructuring exercise conducted within the company; a new integrated organizational structure has emerged; with realigned roles, responsibilities and reporting relationships of Bharti?s key team players. With effect from March 01, 2006, this unified management structure of 'One Airtel' will enable continued improvement in the delivery of the Group?s strategic vision.
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3.1.
Organization Structure
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AWARDS For the Year 2008 – 2009
Voted India?s most innovative company – in a survey conducted by The Wall Street Journal in 2008 Winner of the “Gallup Great Workplace Award”- Gallup Consulting, 2008 “2nd Most Trusted Service Brand” - Annual Economic Times-Brand Equity, Most Trusted Brands survey 2008 „Best Content Service? Award for its Farmer Information Dissemination Platform for Bharti Airtel?s joint venture with IFFCO, IKSL (IFFCO Kisan Samachar) World Communications Awards 2008 Best Project Management? Award for its Gujarat e-GRAM project - World Communications Awards 2008 “Best Telecom Company” at the NDTV Profit Business Leadership Awards Best Carrier India for innovative products & services and efficient cost models and the Ovum Telco-Transformation award recognizing philosophy and execution of a successful outsourcing strategy at the Telecom Asia Awards 2008 Sunil Bharti Mittal was awarded the GSM Association Chairman?s Award 2008. The highest honour in global telecom sector, recognized his tremendous contribution to the development of India?s telecom sector Sunil Bharti Mittal adjudged the “Business Leader Transforming India, 2008 at
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NDTV Profit Business Leadership Awards.
Brands Airtel Airtel is a brand of telecommunication services in India, Bangladesh and in Sri Lanka owned and operated by Bharti Airtel. Bharti airtel limited is a leading global telecommunications company with operations in 19 countries across Asia and Africa. The company offers mobile voice & data services, fixed line, high speed broadband, IPTV, DTH, turnkey telecom solutions for enterprises and national & international long distance services to carriers. Bharti airtel has been ranked among the six best performing technology companies in the world by business week. bharti airtel had 200 million customers across its operations It is the largest cellular service provider in India in terms of number of subscribers. Services are offered under the brand name Airtel: Mobile Services (using GSM Technology), Broadband & Telephone Services (Fixed line, Internet Connectivity(DSL) and Leased Line), Long Distance Services and Enterprise Services (Telecommunications Consulting for corporates). It has presence in all 23 circles of the country and covers 71% of the current population (as of Financial Year 2007). Airtel has also launched 16Mb/s broadband plans in India, making it the first ISP to do so. Airtel is facing a lot of flack from its customers, as people have become dissatisfied with its customer care services. (www.consumercomplaints.in - Indian Consumer Complaints Forum) Airtel Sri Lanka In December 2008, Bharti Airtel rolled out third generation services in Sri Lanka in association with Singapore Telecommunications. SingTel is a major player in the 3G space in Asia. It operates third generation networks in several markets across Asia. Airtel's operation in Sri Lanka, known as Airtel Lanka, commenced operations on the 12th of January 2009.
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Airtel in Bangladesh In January 2010, it was announced that the Bangladesh Telecommuncations Regulatrory Commission (BTRC) of The People's Republic of Bangladesh had given Bharti Airtel the go ahead to acquire a 70% stake in the Bangladesh business of Abu Dhabi based Warid Telcom. The latter had till date invested a total of $600 million, with plans to bring their Bangladesh investments to the $1 billion mark. Airtel's 70% stake in the company is said to be at a cost of an initial $300 million. Touchtel Until September 18, 2004, Bharti provided fixed-line telephony and broadband services under the Touchtel brand. Bharti now provides all telecom services including fixed-line services under a common brand "Airtel". BlackBerry On 19 October 2004 Airtel announced the launch of a BlackBerry Wireless Solution in India. The launch is a result of a tie-up between Bharti Tele-Ventures Limited and Research In Motion (RIM). Digital TV Main article: Airtel Digital Tv On 9 October 2008, Airtel joined the DTH bandwagon in India with Airtel Digital TV, a Direct-to-Home Television service. iPhone 3G The Apple iPhone 3G was rolled out in India on 22 August 2008 via Airtel & Vodafone. Merger talks In May 2008, it emerged that Bharti Airtel was exploring the possibility of buying the MTN
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Group, a South Africa-based telecommunications company with coverage in 21 countries in Africa and the Middle East. The Financial Times reported that Bharti Airtel was considering offering US$45 billion for a 100% stake in MTN, which would be the largest overseas acquisition ever by an Indian firm. However, both sides emphasize the tentative nature of the talks, while The Economist magazine noted, "If anything, Bharti would be marrying up," as MTN has more subscribers, higher revenues and broader geographic coverage. However, the talks fell apart as MTN group tried to reverse the negotiations by making Bharti almost a subsidiary of the new company. In May 2009, Bharti Airtel again confirmed that it is in Talks with MTN and companies have now agreed discuss the potential transaction exclusively by July 31, 2009. Bharti Airtel said in a statement “Bharti Airtel Ltd is pleased to announce that it has renewed its effort for a significant partnership with MTN Group". Talks eventually ended without agreement, some sources stating that due to the South African government opposition. Acquisition Talks On 14, February 2010 a statement issued exclusively to the Ghana News Agency by Zain Ghana, said "the Board of Directors of Kuwait's Zain Group, after its meeting on February 14, 2010, issued a resolution to accept a proposal received from Bharti Airtel Limited (Bharti) to enter into exclusive discussions until 25 March 2010, regarding the sale of its African unit, Zain Africa BV." The offer was for $10.7 billion. “This potential transaction does not include Zain?s operations in Morocco and Sudan and remains subject to due diligence, customary regulatory approvals and signing of final transaction documentation,” Bharti said. The deal would provide Bharti access to 15 more countries in the region, adding around 40.1 million subscribers to its already 125 million-plus user base. With Bharti already having presence in five overseas markets,after the deal, it would increase its global presence across 20 regions. The combined revenue of the two entities would be around $12 billion.
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Recently a shareholder of Zain Nigeria, Broad Communications, secured an injunction against the company from managing its subsidiary in that country because Zain was destroying shareholder value. Experts have said the developments in Nigeria could have implications for the Bharti acquisition. Sponsorship Bharti Airtel signed a five-year deal with ESPN Star Sports to become the title sponsor of the Champions League Twenty20 cricket tournament. The tournament itself is named "Airtel Champions League Twenty20." Airtel 3G Airtel plans to launch the nationwide 3G services in India in the second quarter of 2010. Subscriber base The Airtel subscriber base according to COAI - Cellular Operators Association of India as of January 2010 was:
? ? ? ? ? ? ? ? ? ? ? ? ?
Chennai - 4,656,675 Delhi - 1,822,208 Mumbai - 3,003,201 Kolkata - 2,746,100 Madhya Pradesh - 6,212,992 Gujarat - 5,112,601 Andhra Pradesh - 12,425,791 Karnataka - 12,153,094 Tamil Nadu - 8,033,771 Kerala - 3,076,728 Punjab - 4,581,187 Maharashtra - 6,518,134 Uttar Pradesh - 3,653,016
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? ? ? ? ? ? ? ? ?
Uttar Pradesh East - 8,462,726 Rajasthan - 9,925,141 West Bengal & Andaman and Nicobar Islands - 5,070,213 Himachal Pradesh - 1,273,922 Bihar - 10,338,828 Orissa - 3,836,091 Assam - 2,194,310 North East. States - 1,357,383 Jammu and Kashmir - 1,804,047
The total is 131,714,243 or 32.86% of the total 404,349,733 GSM mobile connections in India till December 2009; and presently the Number 1 operator in India. On the 9th of May, 2009 Airtel signed a major deal with Manchester United Football Club. As a result of the deal, Airtel gets the rights to broadcast the matches played by the team to its customers. 3.2. Corporate Responsibility at Bharti Airtel At Bharti, CSR is a way of life. Each department and employee strives to be sensitive to the stakeholders and environment within their work context. Bharti encourages employees to take decisions and design business-linked processes that are sensitive to communities and environment. Corporate Social Responsibility (CSR) in Bharti encompasses much more than only social outreach programs. It is an integral part of the way Bharti conducts its business. The essence of Bharti?s commitment to Corporate Social Responsibility is embedded in the „Corporate Values?, which stem from its deepest held beliefs. These Values are: ? To be responsive to the needs of our customers ? To trust and respect our employees
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? To continuously improve our services – innovatively and expeditiously ? To be transparent and sensitive in our dealings with all stakeholders ? They encourage their employees to take decisions and design business processes, keeping in mind the following: ? Ethics, fairness and being correct ? Meeting and going beyond compliances and legal requirements ? Showing respect and sensitivity towards stakeholders and communities, and ? Nurturing the environment They practice their CSR beliefs and commitments through a three-pronged approach: ? Engaging with stakeholders ? Ensuring stakeholder sensitive policies and practices ? Undertaking programs for our employees, community and environment Bharti Airtel sensitizes its employees towards CSR issues at various forums. We feel that it is important that each employee should understand the importance of environmental, social and economical aspects while taking business decisions. At Bharti, each employee is sensitized towards CSR issues and thus operations at the ground level are influenced. Such sensitization exercises have resulted in many socially and environmentally sensitive decisions on the ground. Being a responsible corporate citizen is something very dear to Airtel. Our flagship initiative, the Bharti Foundation?s school education programme, grew from strength to strength during the year. The programme followed Airtel into Africa, where we adopted 19 schools in the 16 countries that we are present in. In India, the programme saw a year of consolidation. Over and above increasing the number of Satya Bharti schools to 242, reaching out to over 30,000 students, Bharti Foundation initiated up gradation of 50 primary schools to middle/elementary level during the coming years. Importantly, the Foundation?s flagship programme found traction amongst benefactors, with organisations and eminent individuals coming forth to support this ambitious, yet much-needed, endeavour.
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Growth Strategies By Airtel: Bharti Airtel is structured as four strategic business units - Mobile, Telemedia, Enterprise and Digital TV. The mobile business offers services in India, Sri Lanka and Bangladesh. The Telemedia business provides broadband, IPTV and telephone services in 94 Indian cities. The Enterprise business provides end-to-end telecom solutions to corporate customers and national and international long distance services to carriers. The Digital TV business provides DTH services across India. All these services are provided under the Airtel brand. Airtel?s national high-speed optic fiber network currently spans over 118,337 Rkms across India. Bharti Airtel selects Infosys as its technology partner for 'airtel money' Now use airtel money to make payments and transfer money across India
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3.3. SWOT ANALYSIS Following is the SWOT Analysis for AIRTEL
Competition Airtel is facing strong competition from Reliance, TATA Indicom, MTNL and BSNL in spite of the fact they are far away from Airtel technologically but these two have an inside rich in rural and urban area and have low tariff rates. Brand Ambassador Airtel have strong brand ambassador, Sachin Tendulcar, Shahrukh Khan, Kareena Kapoor, Saif
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Ali Khan and A . R. rehman to promote their product and services. Faces that Airtel choose to represent itself are the icon of Indian youth. So in some way Indian customer link them selves to these brand ambassador and thus to the Bharti Airtel as a brand they trust.
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Type
Public NSE:RCOM , BSE: 532712
Industry Founded Founder(s) Key people
Telecommunications 2004 Shri. Dhirubhai Hirachand Ambani Anil Ambani(Chairman) Satish Seth [Group Managing Director]
Products
Wireless Telephone Internet Television DataCards RechargeVouchers VC
Revenue Operating income Net income
Rs. 22,766 cr (US$4.54 billion)(2011) Rs 9,305 cr (2009) Rs. 6,045 cr(2009)
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Total assets Total Employees Total equity Owner(s)
Rs. 80,395 cr (2011) 28,065(2010) Rs. 1032 crore Promoters(67.58 %) Non promoters(32.42%)
Website
www.rcom.co.in
Reliance Communications, formerly known as Reliance Infocomm, along with Reliance Telecom and Flag Telecom, is part of Reliance Communications Ventures (RCoVL).Reliance Communications Limited (BSE: 532712) founded by the late Shri Dhirubhai H Ambani (19322002) is the flagship company of the Reliance Anil Dhirubhai Ambani Group. The Reliance Anil Dhirubhai Ambani Group currently has a net worth in excess of Rs. 64,000 crore (US$ 13.6 billion), cash flows of Rs. 13,000 crore (US$ 2.8 billion), net profit of Rs. 8,400 crore (US$ 1.8 billion).The Equity Shares of RCOM are listed on Bombay Stock Exchange Limited and National Stock Exchange Limited. The Global Depository Receipts and Foreign Currency Convertible Bonds are listed on Luxembourg Stock Exchange and Singapore Stock Exchange respectively. VISION By 2015, be amongst the top 3 most valued Indian companies,providing Information, Communication & Entertainment services, and being the industry benchmark in Customer Experience, Employee Centricity and Innovation Mission We will create world-class benchmarks by:
? ? ?
Meeting and exceeding Customer expectations with a segmented approach Establishing, reengineering and automating Processes to make them customer centric, efficient and effective Incessant offering of Products and Services that are value for money and excite customers Providing a Network experience that is best in the industry Building Reliance into an iconic Brand which is benchmarked by others and leads industry in Intention to Purchase and
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Loyalty Developing a professional Leadership team that inspires, nurtures talent and propagates RCOM Values by personal example.
Contents
? ?
1 Company Overview 2 Main Subsidiaries
o o o o o o
2.1 Reliance Telecom 2.2 Reliance Telecom 2.2 Reliance Globalcom 2.3 Reliance Communications Infrastructure Limited (RCIL) 2.4 Reliance Big TV Limited 2.5 Reliance Infratel Limited(RITL)
? ? ? ?
3 Offices 4 Products & Services 5 Subscriber Base 6 Notable awards
Company Overview
Reliance Communications is India's truly integrated telecommunications service provider. The Company has a customer base of 1050 million including over 2.5 million individual overseas retail customers. It ranks among the Top 5 Telecom companies in the world by number of customers in a single country. Reliance Communications corporate clientele includes 2,100 Indian and multinational corporations, and over 800 global, regional and domestic carriers. A pan-India, next generation, integrated (wireless and wireline), convergent (voice, data and video) digital network that is capable of supporting best-of-class services spanning the entire communications value chain,covering over 24,000 towns and 600,000 villages has been established by Reliance Communications. Reliance Communications owns and operates the next generation IP enabled connectivity infrastructure, comprising over 190,000 kilometers of fiber
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optic cable systems in India, USA, Europe, Middle East and the Asia Pacific region.
Main Subsidiaries
Reliance Telecom In July 2007, the company announced it is buying US-based managed ethernet and application delivery services company Yipes Enterprise Services for a cash amount of Rs. 1200 crore rupees (equivalent of USD 300 million). The deal was announced of the overseas acquisition, the Reliance group has amalgamated the United States-based Flag Telecom for $ 210 million [roughly Rs 950 crore (Rs 9.50 billion)]. RTL operates in Madhya Pradesh, West Bengal, Himachal Pradesh, Orissa, Bihar, Assam, Kolkata and Northeast offering GSM and CDMA services. Reliance Globalcom RGL owns the worlds largest private undersea cable system spanning 65,000 kms seamlessly integrated with Reliance Communications over 110,000 kms of domestic optic fiber provides a robust Global Service Delivery Platform connecting 40 key business markets in India, the Middle East, Asia, Europe, and the U.S. Reliance Communications Infrastructure Limited (RCIL) RCILe provide Internet Data Centre (IDC) services located in Mumbai and Bangalore. RCIL currently have IDC capacity of 304,000 sq ft with the market share close to 60%.
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Reliance Big TV Limited Reliance Big Tv launched in August 2008 and thereafter acquired 1 million subscribers within 90 days of launch, the fastest ramp-up ever achieved by any DTH operator in the world. Reliance Big TV offers its 1.7 million customers DVD quality pictures across a bouquet of over 200 channels using the latest, state-of-the-art MPEG 4 technology. Reliance Infratel Limited(RITL) RITL?s business is to build, own and operate telecommunication towers, optic fiber cable assets and related assets at designated sites and to provide these passive telecommunication infrastructure assets on a shared basis to wireless service providers and other communications service providers under long-term contracts. Offices Reliance Communications Limited has its offices in Ahmedabad, Bangalore, Bhopal, Chandigarh, Chennai, Hyderabad, Jaipur, Kochi, Lucknow, Mumbai, New Delhi , Patna & Pune. Products & Services Products & Services promoted by the Group are Prepaid Mobile, Postpaid Mobile, Handsets, Blackberry, R World, Internet, Home Phone, Global Calling, Data Card, DTH.
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Subscriber Base The Reliance Communication subscriber base according to COAI - Cellular Operators Association of India is over 105:
GSM Circle Name Andhra Pradesh Delhi Gujarat Kerala Karnataka Maharashtra & Goa Mumbai Punjab,Haryana & Himachal Pradesh Rajasthan Tamil Nadu & Andaman Not Defined Uttar Pradesh West Bengal RCOM GSM - Total sub base Post Paid 6182 19172 19414 8049 18572 25288 24884 18630 6631 25704 136636 9093 8765 29262215 Prepaid 1890923 2054393 2480642 901829 2168131 3301389 2083175 2717375 2628940 1909641 345658 6430945 22154
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Broadband:
Circle Name Andhra Pradesh Delhi Gujarat Kerala Karnataka Maharashtra & Goa Mumbai
Data 6182 19172 19414 8049 18572 25288 24884
Voice 1890923 2054393 2480642 901829 2168131 3301389 2083175 2717375 2628940 1909641 345658 6430945 22154
Punjab,Haryana & Himachal Pradesh 18630 Rajasthan Tamil Nadu & Andaman Not Defined Uttar Pradesh West Bengal RCOM GSM - Total sub base 6631 25704 136636 9093 8765 29262215
DTH Circle Name Andhra Pradesh Bihar Chattisgarh Delhi Gujarat Maharashtra & Goa Total 209118 41245 28965 73148 109013 25288
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Haryana Himachal Pradesh Jammu & Kashmir Jharkhand Karnataka Kerala Maharashtra & Goa Madhya Pradesh North East Orissa Rajasthan Tamilnadu Uttar Pradesh (W) Uttar Pradesh (E) Maharashtra & Goa West Bengal Maharashtra & Goa
65358 25822 28643 21060 309007 171179 258365 96609 28518 79011 177667 208692 124430 115058 258365 44280 258365
DTH - Total sub base 233496
CDMA Circle Name Andhra Pradesh Delhi Gujarat Kerala
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Post Paid Prepaid Prepaid PCO 250597 505724 288480 200796 4454341 476990 3211875 114702 2992165 115298 2054601 125214
Karnataka Maharashtra & Goa Madhya Pradesh & Orissa Mumbai
236288 295534 187860 555120
3024954 253848 3457329 275002 4495163 139575 3223211 166858 2569998 92611 2284651 96704 3854839 374900 7976083 265494 6606050 203919
Punjab,Haryana & Himachal Pradesh 198497 Rajasthan Tamil Nadu & Andaman Uttar Pradesh West Bengal,Bihar & Jharkhand RCOM CDMA - Total sub base 151260 304861 270627 240946 56592965
RTL Circle Name Assam Bihar & Jharkhand Calcutta Himachal Pradesh Madhya Pradesh & Chhattisgarh North-East Orissa West Bengal Post Paid 114942 7482 5524 2344 55911 21454 12684 2481 20064568 RCOM RTL - Total sub base Prepaid 1749992 4152577 2076028 999493 4913590 520513 2217043 3212510
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Balance sheet
Mar ' 09 Mar ' 08 Mar ' 07 Dec ' 05 Mar ' 05
Sources of funds
Owner's fund Equity share capital Share application money Preference share capital Reserves & surplus Loan funds Secured loans Unsecured loans Total 3,000.00 950.00 5,113.57 1,032.01 1,032.01 1,022.31 0.05 611.57 0.01 -
50,658.31 23,808.02 19,503.23 14,783.43 -
27,903.61 19,336.43 9,454.27 -
82,593.93 45,126.46 35,093.38 15,395.04 0.01
Uses of funds
Fixed assets Gross block Less : revaluation reserve Less : accumulated depreciation Net block Capital work-in-progress 37,941.15 21,576.32 20,625.82 198.09 -
6,533.38 4,688.69 2,527.37 31.85 31,407.77 16,887.63 18,098.45 166.24 3,643.86 7,117.56 2,185.60 -
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Mar ' 09
Mar ' 08
Mar ' 07
Dec ' 05
Mar ' 05
Investments
31,364.75 13,844.14 5,434.43 12,074.10 -
Net current assets
Current assets, loans & advances Less : current liabilities & provisions Total net current assets Miscellaneous expenses not written Total 25,543.01 18,515.29 20,107.04 3,158.96 0.01 9,365.46 11,238.16 10,732.14 4.25 -
16,177.55 7,277.13 9,374.90 3,154.70 0.01 -
82,593.93 45,126.46 35,093.38 15,395.04 0.01
Notes:
Book value of unquoted investments Market value of quoted investments Contingent liabilities 31,364.63 13,844.14 5,434.43 12,074.10 0.12 0.10
6,555.82 4,392.73 3,781.30 -
Number of equity sharesoutstanding (Lacs) 20640.27 20640.27 20446.15 1.00
Annual results in brief
Mar ' 09 Sales 13,610.58 Mar ' 08 13,416.19 4,882.46 445.17 Mar ' 07 11,725.26 4,476.60 232.38 Dec ' 06 8,584.97 3,276.94 162.84 Dec ' 05 -6.79
Operating profit 4,337.16 Interest 85.58
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Mar ' 09 Gross profit EPS (Rs) 4,335.67 11.40
Mar ' 08 4,447.75 12.53
Mar ' 07 4,280.87 11.78
Dec ' 06 3,149.84 8.42
Dec ' 05 11.59 565.00
Annual results in details
Mar ' 09 Other income Stock adjustment Raw material Power and fuel Employee expenses Excise Admin and selling expenses 84.09 759.35 Mar ' 08 10.46 858.65 7,675.08 1,843.66 17.64 2,586.45 1,032.01 6992.16 33.88 Mar ' 07 36.65 684.40 2,119.44 4,444.82 1,836.12 12.00 2,408.85 -23.90 1,022.31 6798.04 33.25 Dec ' 06 35.74 492.04 Dec ' 05 6.47 1.11 -
1,544.81 0.56 -
Research and development expenses Expenses capitalized Other expenses Provisions made Depreciation Taxation Net profit / loss Extra ordinary item Prior year adjustments Equity capital Equity dividend rate Agg.of non-prom. shares (Lacs) Agg.of non promotoHolding (%) 8,514.07 2,366.90 12.40 2,352.93 396.56 1,032.01 6741.66 32.66
3,271.18 -
1,364.39 2.74 18.35 3.20
1,722.10 5.65 -45.00 -
1,022.31 0.05 6797.94 33.25 -
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Mar ' 09 OPM (%) GPM (%) NPM (%) 31.87 31.66 17.18
Mar ' 08 36.39 33.13 19.26
Mar ' 07 38.18 36.40 20.48
Dec ' 06 38.17 36.54 19.98
Dec ' 05 -
Notable awards
? ?
Anil Ambani – The Telecom Person of the Year 2008 by Light Reading Most Promising Service Provider of 2003 (Asia Pacific) Award instituted by Asia Pacific Technology from Frost & Sullivan RCOM adjudged the World?s Top CDMA Operator at the Global CDMA Industry Achievement Awards Reliance Mobile amongst the "Top 10 Most Trusted Brands“ & rated as "India's Most Trusted Service Brand 2009“ by "The Economic Times“
?
?
?
Reliance Mobile" voted as No.8th in "India's Most Admired Marketers“. The youngest Indian brand amongst the "Top 10" and ahead of P&G, Hero Honda, Samsung, LG, Colgate and Cadbury's.
? ?
Reliance Mobile, India's Top 25 Marketers Awards 2009, Pitch, November 09 Mobile Marketing Award(Los Angeles) at Global level for cross-media integration on digital and mobile medium of Reliance GSM
launch campaign (Go For It!).
?
Best Advert game award conferred by World Brand Congress for digital advertising game hosted on Zapak.com
? ? ?
CMOs Council Brand Leadership Award to Reliance Communications, November'2009 World Brand Congress, Chair for Yr.2009-10 granted to RCOM, November'2009 Business Today along with TAM rated Simply Reliance TVC as the most watched Ad in the month of October 2009.
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?
Total Network TVC s Kedarnath & Highway rated as No.1 campaign in India for the month of Aug 08 & Sept 08
?
Most awarded single brand for Creative Excellence ABBY Awards 2007(Advertising Agency Association of India) Fair &Lovely Scholarship on Reliance Mobile wins at MMA Awards, USA.
RELIANCE COMMUNICATION LIMITED
SWOT ANALYSIS
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Strength ? ? ? ? ? ? Low Entry Cost Commission Structure Fast Activation Process Network Connectivity Data GPRS
Weakness ? Branding Image ? Distribution problem ? Limited product portfolioOnly Mobile ? Lack of Competitive Strength ? Limited Budget Threat ? ? ? ? ? Political destabilization. New Entrants IT Development Market Demand Seasonality, Weather Effects
Opportunity ? Preference of GSM over CDMA ? New Specialist Application ? Rural Telephony ? New Market, Vertical, Horizontal ? Competitors` Vulnerabilities
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AIRCEL
Type
Joint Venture
Industry
Telecommunications
Founded
1999
Headquarters
Chennai, Tamil Nadu, India
Key people
Sandip Das, CEO Gurdeep Singh, COO Pragas Pathy
Products
Mobile telephony, Wireless broadband services
Parent
Maxis Communications (74%)[1]
Website
aircel.com
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SERVICEIt provides wireless voice, messaging and data services in India and operates in 13 circles in india.
AIRCEL
Maxis? expansion into Indonesia and India is another milestone in our aspiration to be the regional communications leader of choice. The acquisition of a 51% stake in PT Natrindo Telepon Seluler (NTS), Indonesia and a 74% equity interest in Aircel, India provides new growth opportunities for Maxis. These acquisitions give Maxis a strong foothold in two of the world?s most attractive high-growth, low-penetration markets Maxis in INDONESIA
On 29th April 2005, Maxis acquired 51% of PT Natrindo Telepon Seluler. Maxis is currently in the middle of rolling out a Java wide network to establish the company as a national operator. Th initial launch phase encompasses 1,300 BTS, providing both 2G and 3G services. NTS expects to have up to 480 employees by launch date and to increase significantly upon launching. Maxis in India Maxis completed the acquisition of a 74% stake in Aircel on March 21,2006. Currently, Aircel has operations in 9 of the 23-telecom circles of India - Chennai, Tamil Nadu, West Bengal, Orissa, Assam, North East, Jammu and Kashmir, Himachal Pradesh and Bihar. Aircel launched its services in Bihar and Himachal Pradesh in December 2006 and also recently
45
received the licenses to operate in the remaining 14- telecom circles of India giving it the ability to become a pan-India player. Maxis? expansion into Indonesia and India is another milestone in our aspiration to be the regional communications leader of choice. The acquisition of a 51% stake in PT Natrindo Telepon Seluler (NTS), Indonesia and a 74% equity interest in Aircel, India provides new growth opportunities for Maxis. These acquisitions give Maxis a strong foothold in two of the world?s most attractive high-growth, low-penetration markets. This marks the beginning of the new world of Maxis – a world beyond voice, and beyond borders. MAP Maxis in Indonesia On 29th April 2005, Maxis acquired 51% of PT Natrindo Telepo Seluler. Maxis is currently in the middle of rolling out a Java wide network to establish the company as a national operator. The initial launch phase encompasses 1,300 BTS, providing both 2G and 3G services. NTS expects to have up to 480 employees by launch date and to increase significantly upon launching. Maxis in India Maxis completed the acquisition of a 74% stake in Aircel on March 21, 2006. Currently, Aircel has operations in 9 of the 23 telecom circles of India - Chennai, Tamil Nadu, West Bengal, Orissa, Assam,North East, Jammu and Kashmir, Himachal Pradesh and Bihar. Aircel launched its services in Bihar and Himachal Pradesh in December 2006 and also recently received the licenses to operate in the remaining 14 telecom circles of India giving it the ability to become a pan-India player. Aircel expects to aggressively grow its subscriber base in India and is developing a broad range of new propositions for its customers - from branding, to increased network coverage, to innovative product and service offerings, to refreshing customer experience. As of 31st December 2006, Aircel serves more than 4.5 million subscribers with a network comprising of almost 4,000 BTS. Aircel continues to be the market leader in Tamil Nadu and Chennai circle. Aircel?s network provides 2G and GPRS services, and is EDGE capable. Aircel is also currently in the process of conducting 3G Trials across different cities in India. In addition, Aircel is the first cellular operator in India to launch wireless Internet services using WiMAX technology. It aims to immediately extend its WiMax coverage to over 20 cities to serve enterprise broadband customers. Over the next few quarters, India is expected to add new subscribers at the rate of 5 to 6 million per month. India offers huge opportunities for Aircel given the current low mobile.
MISSION STATEMENT
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We are conditionally committed to exceeding our customer’s expectations. we will provide network and services that are innovative and reliable, allowing our customers any time anywhere communications. we will attract, develop and retain an exceptional team of people. We are committed to enhancing the quality of real life in the community in which we operate. Wewill meet the financial expectation of our shareholders . OUR GOALS AND VALUES CUSTOMERS
ur customers are our most valued assets. we will strive to exceed their expectations at all time by providing them with superior services that embody value, innovation, quality and care. PEOPLE : our people are our greatest resources. we will attract, train and retain the best.we will challenge them to develop their full potential in the context of our company goals. INTEGRITY : We will maintain and strive for the highest levels of personal and professional integrity and honesty in all ours dealings. We will keep our promises. RESPECT : We will treat with respect & dignity all people we deal with. EXCELLENCE : We are committed to excellence in all what we do.there will
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OPPORTUNITIES
The telecom sector has been one of the fastest growing sectors in the Indian economy in the past 4 years. This has been witnessed due to strong competition that has brought down tariffs as well as simplification of policy environment that has promoted healthy competition among various players.. The mobile sector alone has been growing rapidly and has emerged as the fastest growing market in the whole worlds. Currently of a size nearing 70 million (GSM and CDMA), this sector is expected to reach a size of nearly 200 million subscribers by financial year 2008 and growing very fast. The government has eased the rules regarding inter circle and intra circle mergers. This has led to a slew of mergers and acquisitions in the recent past. Also as the sector is moving closer to maturity, further consolidation is a reality and this will lead to the survival of more profitable players in this segment In order to further promote the use of Internet in the country the government is taking proactive steps to develop this sector with the help of the various players in this segment. For this purpose, the use of broadband technology is being mooted and this will go a long way in improving the productivity of the Indian economy as well as turn out to be the next big opportunity for telecom companies after the mobile communications segment Non-voice services and VAS are the gold mines. The big takeoff is expected with the rollout of 3G services in early 2007, once the spectrum issues are sorted out. Internet users base fast reaching near the English speaking population base. Local language and content required for further growth Infrastructure equipment cost is down to a fraction of what prevailed just a few years ago. Operators can plan better expansion plan now Increased viability for the operators to expand to semi-urban and rural markets, hence, accelerate growth further It?s not without reason that India is tipped to be the world?s third-larges economy by 2050! No wonder if it happens much earlier Investors can look to capture the gains of the Indian telecom boom and diversify their operations outside developed economies that are marked by saturated telecom markets and lower GDP growth rates.
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At a time when global telecom majors are struggling to cope with their losses and the rollout of 3G networks, which has been a non-starter for close to a year now; India, with its telecom success story, represents an attractive and lucrative SECTORAL ANALYSIS Telecommunication sector is one of the sectors with high growth rate. The customer base of telecom sector is huge unlike other sectors. The sector is dependent upon the Government to provide infrastructure, For example, Government is providing 1MHZ spectrum for 3G technology. The telecom companies have to share the spectrum provided. The room for error is very less in service sector as after sales is nonexistent. A service once provided cannot be renewed or be modified. Thus with a huge customer base and room for no error, the service providers follow near fool proof system.
Learning Experience
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1. It teaches about how the company functions effectively, how the higher management plans out various targets and they are achieved by the means of lower management.
2. Managing the various resources like money, manpower, time, raw material etc.
3. Since finance is the lifeline of any organization, this project would help me in understanding the vitality of finance and utilizing it in the most suitable way.
4. Every company has its own unique policy, structure, and the way of functioning.
5. One can learn from other companies and try to develop its own way of working.
6. Expanding the presence across the globe and exploit the opportunities that exist in the neighboring region.
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BIBLIOGRAPHY
MAGAZINEs India Today Economic Times Times of India Business India Bharti Airtel, Annual Report -2011 Reliance communication annual report 2011
WEBILOGRAPHY
www.airtel.in airtel-broadband.com www.trai.gov.in www.hindustantimes.comhttp://www.moneycontrol.com/financials/bhartiairtel/ratios/BA08http://www.moneycontrol.com/annual-report/bhartiairtel/directors-report/BA08http://coai.in/statistics.php www.rcom.in www.scribd.com www.slideshare.com
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52
doc_765571885.docx
Early telecommunication technologies included visual signals, such as beacons, smoke signals, semaphore telegraphs, signal flags, and optical heliographs.[7] Other examples of pre-modern telecommunications include audio messages such as coded drumbeats, lung-blown horns, and loud whistles.
A PROJECT REPORT ON Sectoral Research ON Telecommunication
(PGDM) 2010-12
Submitted by:
Roll No-1999/01010003 Sem.-IV
Submitted to the 1
SURYADATTA INSTITUTE OF MANAGEMENT AND MASS COMMUNICATION (SIMMC).
YEAR OF SUBMISSION: - 2012
DECLARATION
2
I do here by declare that this present project work entitled “A Project Report on Sectoral Research” being submitted by me for the partial fulfillment of the requirement for the award of (Post graduate Diploma In management) PGDM is a record of my own research work . I do also hereby declare that all the information collected for this project report is collected through my own efforts and is true to best of my belief .The report embodies the findings based on my study and observation and has not been submitted earlier for the award of any degree or diploma to any other institution or University.
I further declare that the project work is original genuine to the best of my knowledge and information.
ACKNOWLEDGEMENT
It is really a great pleasure to have this opportunity to describe the feeling of gratitude imprisoned in the core of my heart.
3
I convey my sincere gratitude to Prof. Dr. Sanjay Chordiya Sir, Chairman (Suryadatta Group of Institute) for giving me the opportunity to prepare my project work in Sectoral Reserach.
Sr.No
Contents
Pg.no
I expre
ss my sincere obligation and thanks to all the faculties of Suryadatta Institute for their valuable advice in guiding me at every stage in bringing out this report.
I am also thankful to my family for their kind co-operation which made my task easy.
TABLE OF CONTENTS
4
1 2 3 4 5 6 7 9 10 11 12 13 14 15 16 17 18
Objective Introduction of sector Introduction of Sector In India
Airtel introduction
6 6-7 7-13 14-19 19-20 20-22 23-27 28 29 29 37-41 39-41 40-42 43-46 47-48 48-49 50
Company profile Awards Swot analysis
Reliance communication introduction
Vision&mission Content Financial data Swot analysis Aircel Introduction Services Marketing strategies Oppourtunity in the sector Learning experience
OBJECTIVES
5
The present study includes insights of TELECOM INDUSTRY in India. In order to study about theTELECOM INDUSTRY I have conducted a study of 3 different companies. A comprehensive study is proposed with the following objectives.
? To know about Telecom Market in India. ? To know about THE TOP COMPITETORS in Telecom Industry. ? To know about the Customer base of the company.
? To know about the SERVICES Provided by the COMPANY.
Telecommunication Sector –Industry Profile
? Telecommunication is the transmission of messages over significant distances for the ? purpose of communication. In earlier times, telecommunications involved the use of visual signals, such as smoke, semaphore telegraphs, signal flags, and optical heliographs, or audio messages via coded drumbeats, lung-blown horns, or sent by loud whistles, for example. ? In the modern age of electricity and electronics, telecommunications has typically involved the use of electric means such as the telegraph, the telephone, and the teletype, the use of microwave communications, the use of fiber optics and their associated electronics, and/or the use of the Internet. The first breakthrough into modern electrical telecommunications came with the development of the telegraph during the 1830s and 1840s. The use of these electrical means of communications exploded into use on all of the continents of the world during the 19th century, and these also connected the continents via cables on the floors of the ocean. These three systems of communications all required the use of conducting metal wires. ? A revolution in wireless telecommunications began in the first decade of the 20th Century, with Guglielmo Marconi winning the Nobel Prize in Physics in 1909 for
6
his pioneering developments in wireless radio communications. Other early inventors and developers in the field of electrical and electronic
telecommunications included Samuel F.B. Morse and Joseph Henry of the United States, Alexander Graham Bell of Canada, Lee de Forest of the U.S., who invented the amplifying vacuum tube called the triode, Edwin Armstrong of the U.S., John Logie Baird of England, and Nikola Tesla who's most important inventions were created in the United States. ? Telecommunications play an important role in the world economy and the worldwide telecommunication industry's revenue was estimated to be $3.85 trillion in 2008. The service revenue of the global telecommunications industry was estimated to be $1.7 trillion in 2008, and is expected to touch $2.7 trillion by 2013. ? Various searches made e.g. .Google search.
INTRODUCTION OF TELECOM SECTOR IN INDIA
7
The Indian Telecommunications network is the third largest in the world and the second largest among the emerging economies of Asia. Today, it is the fastest growing market in the world. The telecommunication sector continued to register significant success during the year and has emerged as one of the key sectors responsible for India?s resurgent India?s economic growth This rapid growth has been possible due to various proactive and positive decisions of the Government and contribution of both by the public and the private sector. The rapid strides in the telecom sector have been facilitated by liberal policies of the Government that provide easy market access for telecom equipment and a fair regulatory framework for offering telecom services to the Indian consumers at affordable prices. It has also undergone a substantial change in terms of mobile versus fixed phones and public versus private participation. The preference for use of wireless phones has also been predominant in the sector. Participation of the private entities in the telecom sector is rapidly increasing rate there by presenting the enormous growth opportunities. There is a clear distinction between the Global Satellite Mobile Communication (GSM) and Code Division Multiple Access (CDMA) technologies used and the graph below shows the divide between the two. With increasing penetration of the wireless services, the wire line services in the country is becoming stagnant. On the other hand, Broadband demand has picked up and promises to stabilise fixed line growth. GSM Sector In terms of the Global System for Mobile Communication (GSM) subscriber base this now places India third after China and Russia.China had 401.7 million GSM subscribers
CDMA Services CDMA technology was introduced in India as a limited mobility solution. The introduction of CDMA services has created competition, lowered tariffs and offered many citizens access to communication services for the first time.
Internet Services
8
Internet services were launched in India on August 15, 1995. In November 1998 the government opened up the sector to private operators. A liberal licensing regime was put in place to increase Internet penetration across the country. The growth of IP telephony or grey market is also a serious concern. Government loses revenue, while unlicensed operation by certain operators violates the law and depletes licensed operators market share. New services like IP-TV and IP-Telephony are becoming popular with the demand likely to increase in coming years. The scope of services under existing ISP license conditions are unclear.
The Telecom Regulatory Authority of India (TRAI)
The Telecom Regulatory Authority of India (TRAI) was set up in March 1997 as a regulator for Telecom sector. The TRAI?s functions are recommendatory, regulatory and tariff setting in telecom sector. Telecom Disputes Settlement and Appellate Tribunal (TDSAT) came into existence in May, 2000. TDSAT has been empowered to adjudicate any dispute – • between a licensor and a licensee • between two or more service providers • between a service provider and a group of consumers • hear and dispose of appeal against any direction, decision or order of TRAI
Tariffs for telecommunication services have evolved from a regime where tariffs were determined by Telecom Regulatory Authority of India to a regime where tariffs are largely under forbearance. TRAI intervenes by regulating the tariffs for only those services, the markets of which are not competitive. Universal Service Obligation Fund (USOF) exclusively for meeting the Universal Service Obligation was established in April, 2002. The Universal Service Levy is presently 5 per cent of the Adjusted Gross Revenue (AGR) of all telecom service providers except the pure value added service providers like Internet, Voice Mail, E-Mail service providers etc. Indian Telegraph Act has been amended in October?2006 to provide support for all telegraph
9
services including mobile and broadband to bridge the digital divide. With the introduction of the Unified Access Licensing Regime, operators can offer telecom access services to consumers in a technology neutral manner, subject to fulfilling certain conditions. Introduction of this regime has also broken the legal/regulatory impasse between the cellular and basic service providers. Issuance of Intra-Circle Merger and Acquisition Guidelines provide investors an opportunity to take stakes in existing telecom operations.
The Government has taken the following main initiatives for the growth of the Telecom Sector: • All telecom services have been opened up for free competition for unprecedented growth • 217 (Information Technology Agreement) ITA-I items are at zero Customs Duty. Specified capital goods and all inputs required to manufacture ITA-I, items are at zero Customs Duty • Availability of low cost mobile handsets • The international Long Distance Services (ILDS) opened with effect from April 2002. Calling Party Pays (CPP) regime was implemented with effect from 1st May • Guidelines for Unified Access Service License regime were issued in November 2003, 27 licenses out of 31 Basic Service Licenses were converted to Unified Access Service Licenses • In April 2004, license fee for Unified Access Service Providers (UAS) was reduced by 2 per cent • License fee for infrastructure Provider-II reduced from 15 per cent to 6 per cent of the Adjusted Gross Revenue and spectrum charges between 2 to 4 per cent in June 2004 • Entry fee for NLD licenses was reduced to Rs. 2.5 Crore from Rs. 100 Crore. Entry fee for ILD reduced to Rs. 2.5 Crore from Rs. 25 Crore • Lease line charges have been reduced to make the bandwidth available at competitive prices to facilitate growth in IT enabled services • One India plan i.e. single tariff of Re. 1/-per minute to anywhere in India was introduced from 1st March 2006 by the Public Sector Undertakings. This tariff was emulated by most of the private service providers also. This scheme has led to death of
10
distance in telecommunication and is going to be instrumental in promoting National Integration further • The robust telecom network has also facilitated the expansion of BPO industry that is having 500,000 employees now and adding 400 employees per day. • Annual license fee for National Long Distance (NLD), International Long Distance (ILD), Infrastructure Provider-II, VSAT commercial and Internet Service Provider (ISP) with internet telephony (restricted) licenses was reduced to 6 per cent of Adjusted Gross Revenue (AGR) with effort from Jan 2006. • The Government?s policy is neutral on use of technology by telecom service providers subject to availability of scarce resources such as spectrum etc. • Licence Fees 6-10 per cent of Adjusted Gross Revenue (AGR) Foreign Direct Investment (FDI) In Telecom sector Foreign Direct Investment (FDI) was permitted in the telecom sector beginning with the telecom manufacturing segment in 1991 - when India embarked on economic liberalisation. FDI is defined as investment made by non-residents in the equity capital of a company. For the telecom sector, FDI includes investment made by Non-Resident Indians (NRIs), Overseas Corporate Bodies (OCBs), foreign entities, Foreign Institutional Investors (FIIs), American Depository Receipts (ADRs)/Global Depository Receipts (GDRs) etc. Present FDI Policy for the Telecom sector: • In Basic, Cellular Mobile, National Long Distance, International Long Distance, Value Added Services and Global Mobile Personal Communications by Satellite, FDI is limited to 49 per cent (under automatic route) subject to grant of licence from the Department of
Telecommunications and adherence by the companies (who are investing and the companies in which investment is being made) to the licence conditions for foreign equity cap and lock-in period for transfer and addition of equity and other license provisions. • Foreign Direct Investment up to 74 per cent permitted, subject to licensing and security requirements for the following: - Internet Service (with gateways) - Infrastructure Providers (Category II) - Radio Paging Service
11
• FDI up to 100 per cent permitted in respect to the following telecom services: - ISPs not providing gateways (Both for satellite and submarine cables) - Infrastructure Providers providing dark fibre (IP Category I) - Electronic Mail - Voice Mail The above is subject to the following conditions: - FDI up to 100 per cent is allowed subject to the condition that such companies would divest 26 per cent of their equity in favour of Indian public within 5 years, if these companies are listed in other parts of the world. - The above services would be subject to licensing and security requirements, wherever required. - Proposals for FDI beyond 49 per cent shall be considered by Foreign Investment Promotion Board (FIPB) on a case-to-case basis. • In the manufacturing sector 100 per cent FDI is permitted under the automatic route. • In Basic, Cellular Mobile, paging and Value Added service, and Global Mobile Personal Communications by Satellite, FDI is permitted up to 49 per cent (under automatic route) subject to grant of license from Department of Telecommunications • Foreign direct investment up to 74 per cent permitted, subject to licensing and security requirements for the Internet Service (with gateways), Infrastructure Providers (category-II), Radio Paging Service • FDI up to 100 per cent permitted in respect of - ISPs not providing gateways (both for satellite and submarine cables), - Infrastructure Providers providing dark fibre (IP Category I); - Electronic Mail; and - Voice Mail • FDI up to 49 per cent is also permitted in an investment company, set up for making investment in the telecom companies licensed to operate telecom services. Investment by these investment companies in a telecom service company is treated as part of domestic equity and is not set of against the foreign equity cap.
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• Manufacturing - 100 per cent FDI is permitted under automatic route. • FDI is subject to the following conditions • FDI up to 100 per cent is allowed subject to the conditions that such companies would divest 26 per cent of their equity in favour of Indian public in 5 years, if these companies are listed in other parts of the world. • The above services would be subject to licensing and security requirements, Wherever required. • Proposals for FDI beyond 49 per cent shall be considered by FIPB on case to case Basis
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Telecom industry
Type
Public BSE: 532454
Industry Founded Founder(s) Headquarters Key people Products
Telecommunications
July 07, 1995
Sunil Bharti Mittal New Delhi, India Sunil Mittal (Chairman) &MD SanjayKapoor (CEO)
Wireless Telephone Internet Satellite television
Revenue Operating income Net income Total assets Owner(s)
596.01 billion (US$11.89 billion)(2011) US$ 2.043 billion (2009) US$ 1.662 billion (2009)
1,007.85 billion (US$20.11 billion)(2011
Bharti Enterprises SingTel (32.15%) Vodafone (4.4%)(as on 2011)
(63.45%)
Employees Website
20,675 (Dec. 2011)
Bharti.com Airtel.in
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Company Profile
We are one of Asia?s leading providers of telecommunication services with presence in all the 22 licensed jurisdictions (also known as Telecom Circles) in India, and in Srilanka. We served an aggregate of 121,852,576 customers as of December 31, 2009, in India; of whom 118,864,031 subscribe to our GSM services and 2,988,545 use our Telemedia Services either for voice and/or broadband access delivered through DSL. We are the largest wireless service provider in the country, based on the number of customers as of December 31, 2009. We offer an integrated suite of telecom solutions to our enterprise customers, in addition to providing long distance connectivity both nationally and internationally. We also offer DTH and IPTV Services. All these services are rendered under a unified brand “Airtel”. The company also deploys, owns and manages passive infrastructure pertaining to telecom operations under its subsidiary Bharti Infratel Limited. Bharti Infratel owns 42% of Indus Towers Limited. Bharti Infratel and Indus Towers are the two top providers of passive infrastructure services in India. Partners Mobile Services Network Equipment Telemedia & Long Distance Nokia Siemens, Wipro, Cisco, Alcatel Lucent, Services Information Technology Call Centre Operations Equity Partner {Strategic} ECI, Tellabs IBM IBM Daksh, Hinduja TMT, Teleperformance, Mphasis, Firstsource & Aegis Singtel Nokia Siemens, Ericsson, Huawei
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Name
Business Description
Bharti Airtel Limited.
Provides GSM mobile services in all the 22 telecom circles in India, and was the first private operator to have an all India presence. Provides telemedia services (fixed line and broadband services through DSL) in 95 cities in India.
Established Proportionate Revenue
July 07, 1995, as a Public Limited Company Rs. 369,615 million (year ended March 31, 2009-Audited) Rs. 270,250 million (year ended March 31, 2008 Audited)
As per US GAAP Accounts Proportionate EBITDA Rs. 199,664 million (year ended March 31, 2011 Audited)
Rs. 167,633 million (year ended March 31, 2010- Audited As per US GAAP Accounts Shares in Issue Listings 3,796,951,980 as at Dec 31, 2009 The Stock Exchange, Mumbai (BSE)
The National Stock Exchange of India Limited (NSE) Market Capitalisation Customer Base Stock quote: BSE: INR 304.35 211,919,000 GSM mobile and
3,296,000Telemedia Customers (status as on Dec 31, 2011) Operational Network Provides GSM mobile services in all the
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telecom circles in India, and was the first private operator to have an all India presence.Provides telemedia services (fixed line) in more than 95 cities in India. Registered Office Bharti Airtel Limited (A Bharti Enterprise) Bharti Crescent, 1 Nelson Mandela Road, Vasant Kunj Phase II New Delhi - 110 070 Tel. No.: +91 11 4666 6100
Fax No.: +91 11 4666 6411
Future Prospect
Bharti Airtel company is planning to set up3000 more towers as part of enhancing their rural coverage and will now focus on rural and semi-urban areas.
As an outcome of a restructuring exercise conducted within the company; a new integrated organizational structure has emerged; with realigned roles, responsibilities and reporting relationships of Bharti?s key team players. With effect from March 01, 2006, this unified management structure of 'One Airtel' will enable continued improvement in the delivery of the Group?s strategic vision.
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3.1.
Organization Structure
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AWARDS For the Year 2008 – 2009
Voted India?s most innovative company – in a survey conducted by The Wall Street Journal in 2008 Winner of the “Gallup Great Workplace Award”- Gallup Consulting, 2008 “2nd Most Trusted Service Brand” - Annual Economic Times-Brand Equity, Most Trusted Brands survey 2008 „Best Content Service? Award for its Farmer Information Dissemination Platform for Bharti Airtel?s joint venture with IFFCO, IKSL (IFFCO Kisan Samachar) World Communications Awards 2008 Best Project Management? Award for its Gujarat e-GRAM project - World Communications Awards 2008 “Best Telecom Company” at the NDTV Profit Business Leadership Awards Best Carrier India for innovative products & services and efficient cost models and the Ovum Telco-Transformation award recognizing philosophy and execution of a successful outsourcing strategy at the Telecom Asia Awards 2008 Sunil Bharti Mittal was awarded the GSM Association Chairman?s Award 2008. The highest honour in global telecom sector, recognized his tremendous contribution to the development of India?s telecom sector Sunil Bharti Mittal adjudged the “Business Leader Transforming India, 2008 at
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NDTV Profit Business Leadership Awards.
Brands Airtel Airtel is a brand of telecommunication services in India, Bangladesh and in Sri Lanka owned and operated by Bharti Airtel. Bharti airtel limited is a leading global telecommunications company with operations in 19 countries across Asia and Africa. The company offers mobile voice & data services, fixed line, high speed broadband, IPTV, DTH, turnkey telecom solutions for enterprises and national & international long distance services to carriers. Bharti airtel has been ranked among the six best performing technology companies in the world by business week. bharti airtel had 200 million customers across its operations It is the largest cellular service provider in India in terms of number of subscribers. Services are offered under the brand name Airtel: Mobile Services (using GSM Technology), Broadband & Telephone Services (Fixed line, Internet Connectivity(DSL) and Leased Line), Long Distance Services and Enterprise Services (Telecommunications Consulting for corporates). It has presence in all 23 circles of the country and covers 71% of the current population (as of Financial Year 2007). Airtel has also launched 16Mb/s broadband plans in India, making it the first ISP to do so. Airtel is facing a lot of flack from its customers, as people have become dissatisfied with its customer care services. (www.consumercomplaints.in - Indian Consumer Complaints Forum) Airtel Sri Lanka In December 2008, Bharti Airtel rolled out third generation services in Sri Lanka in association with Singapore Telecommunications. SingTel is a major player in the 3G space in Asia. It operates third generation networks in several markets across Asia. Airtel's operation in Sri Lanka, known as Airtel Lanka, commenced operations on the 12th of January 2009.
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Airtel in Bangladesh In January 2010, it was announced that the Bangladesh Telecommuncations Regulatrory Commission (BTRC) of The People's Republic of Bangladesh had given Bharti Airtel the go ahead to acquire a 70% stake in the Bangladesh business of Abu Dhabi based Warid Telcom. The latter had till date invested a total of $600 million, with plans to bring their Bangladesh investments to the $1 billion mark. Airtel's 70% stake in the company is said to be at a cost of an initial $300 million. Touchtel Until September 18, 2004, Bharti provided fixed-line telephony and broadband services under the Touchtel brand. Bharti now provides all telecom services including fixed-line services under a common brand "Airtel". BlackBerry On 19 October 2004 Airtel announced the launch of a BlackBerry Wireless Solution in India. The launch is a result of a tie-up between Bharti Tele-Ventures Limited and Research In Motion (RIM). Digital TV Main article: Airtel Digital Tv On 9 October 2008, Airtel joined the DTH bandwagon in India with Airtel Digital TV, a Direct-to-Home Television service. iPhone 3G The Apple iPhone 3G was rolled out in India on 22 August 2008 via Airtel & Vodafone. Merger talks In May 2008, it emerged that Bharti Airtel was exploring the possibility of buying the MTN
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Group, a South Africa-based telecommunications company with coverage in 21 countries in Africa and the Middle East. The Financial Times reported that Bharti Airtel was considering offering US$45 billion for a 100% stake in MTN, which would be the largest overseas acquisition ever by an Indian firm. However, both sides emphasize the tentative nature of the talks, while The Economist magazine noted, "If anything, Bharti would be marrying up," as MTN has more subscribers, higher revenues and broader geographic coverage. However, the talks fell apart as MTN group tried to reverse the negotiations by making Bharti almost a subsidiary of the new company. In May 2009, Bharti Airtel again confirmed that it is in Talks with MTN and companies have now agreed discuss the potential transaction exclusively by July 31, 2009. Bharti Airtel said in a statement “Bharti Airtel Ltd is pleased to announce that it has renewed its effort for a significant partnership with MTN Group". Talks eventually ended without agreement, some sources stating that due to the South African government opposition. Acquisition Talks On 14, February 2010 a statement issued exclusively to the Ghana News Agency by Zain Ghana, said "the Board of Directors of Kuwait's Zain Group, after its meeting on February 14, 2010, issued a resolution to accept a proposal received from Bharti Airtel Limited (Bharti) to enter into exclusive discussions until 25 March 2010, regarding the sale of its African unit, Zain Africa BV." The offer was for $10.7 billion. “This potential transaction does not include Zain?s operations in Morocco and Sudan and remains subject to due diligence, customary regulatory approvals and signing of final transaction documentation,” Bharti said. The deal would provide Bharti access to 15 more countries in the region, adding around 40.1 million subscribers to its already 125 million-plus user base. With Bharti already having presence in five overseas markets,after the deal, it would increase its global presence across 20 regions. The combined revenue of the two entities would be around $12 billion.
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Recently a shareholder of Zain Nigeria, Broad Communications, secured an injunction against the company from managing its subsidiary in that country because Zain was destroying shareholder value. Experts have said the developments in Nigeria could have implications for the Bharti acquisition. Sponsorship Bharti Airtel signed a five-year deal with ESPN Star Sports to become the title sponsor of the Champions League Twenty20 cricket tournament. The tournament itself is named "Airtel Champions League Twenty20." Airtel 3G Airtel plans to launch the nationwide 3G services in India in the second quarter of 2010. Subscriber base The Airtel subscriber base according to COAI - Cellular Operators Association of India as of January 2010 was:
? ? ? ? ? ? ? ? ? ? ? ? ?
Chennai - 4,656,675 Delhi - 1,822,208 Mumbai - 3,003,201 Kolkata - 2,746,100 Madhya Pradesh - 6,212,992 Gujarat - 5,112,601 Andhra Pradesh - 12,425,791 Karnataka - 12,153,094 Tamil Nadu - 8,033,771 Kerala - 3,076,728 Punjab - 4,581,187 Maharashtra - 6,518,134 Uttar Pradesh - 3,653,016
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? ? ? ? ? ? ? ? ?
Uttar Pradesh East - 8,462,726 Rajasthan - 9,925,141 West Bengal & Andaman and Nicobar Islands - 5,070,213 Himachal Pradesh - 1,273,922 Bihar - 10,338,828 Orissa - 3,836,091 Assam - 2,194,310 North East. States - 1,357,383 Jammu and Kashmir - 1,804,047
The total is 131,714,243 or 32.86% of the total 404,349,733 GSM mobile connections in India till December 2009; and presently the Number 1 operator in India. On the 9th of May, 2009 Airtel signed a major deal with Manchester United Football Club. As a result of the deal, Airtel gets the rights to broadcast the matches played by the team to its customers. 3.2. Corporate Responsibility at Bharti Airtel At Bharti, CSR is a way of life. Each department and employee strives to be sensitive to the stakeholders and environment within their work context. Bharti encourages employees to take decisions and design business-linked processes that are sensitive to communities and environment. Corporate Social Responsibility (CSR) in Bharti encompasses much more than only social outreach programs. It is an integral part of the way Bharti conducts its business. The essence of Bharti?s commitment to Corporate Social Responsibility is embedded in the „Corporate Values?, which stem from its deepest held beliefs. These Values are: ? To be responsive to the needs of our customers ? To trust and respect our employees
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? To continuously improve our services – innovatively and expeditiously ? To be transparent and sensitive in our dealings with all stakeholders ? They encourage their employees to take decisions and design business processes, keeping in mind the following: ? Ethics, fairness and being correct ? Meeting and going beyond compliances and legal requirements ? Showing respect and sensitivity towards stakeholders and communities, and ? Nurturing the environment They practice their CSR beliefs and commitments through a three-pronged approach: ? Engaging with stakeholders ? Ensuring stakeholder sensitive policies and practices ? Undertaking programs for our employees, community and environment Bharti Airtel sensitizes its employees towards CSR issues at various forums. We feel that it is important that each employee should understand the importance of environmental, social and economical aspects while taking business decisions. At Bharti, each employee is sensitized towards CSR issues and thus operations at the ground level are influenced. Such sensitization exercises have resulted in many socially and environmentally sensitive decisions on the ground. Being a responsible corporate citizen is something very dear to Airtel. Our flagship initiative, the Bharti Foundation?s school education programme, grew from strength to strength during the year. The programme followed Airtel into Africa, where we adopted 19 schools in the 16 countries that we are present in. In India, the programme saw a year of consolidation. Over and above increasing the number of Satya Bharti schools to 242, reaching out to over 30,000 students, Bharti Foundation initiated up gradation of 50 primary schools to middle/elementary level during the coming years. Importantly, the Foundation?s flagship programme found traction amongst benefactors, with organisations and eminent individuals coming forth to support this ambitious, yet much-needed, endeavour.
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Growth Strategies By Airtel: Bharti Airtel is structured as four strategic business units - Mobile, Telemedia, Enterprise and Digital TV. The mobile business offers services in India, Sri Lanka and Bangladesh. The Telemedia business provides broadband, IPTV and telephone services in 94 Indian cities. The Enterprise business provides end-to-end telecom solutions to corporate customers and national and international long distance services to carriers. The Digital TV business provides DTH services across India. All these services are provided under the Airtel brand. Airtel?s national high-speed optic fiber network currently spans over 118,337 Rkms across India. Bharti Airtel selects Infosys as its technology partner for 'airtel money' Now use airtel money to make payments and transfer money across India
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3.3. SWOT ANALYSIS Following is the SWOT Analysis for AIRTEL
Competition Airtel is facing strong competition from Reliance, TATA Indicom, MTNL and BSNL in spite of the fact they are far away from Airtel technologically but these two have an inside rich in rural and urban area and have low tariff rates. Brand Ambassador Airtel have strong brand ambassador, Sachin Tendulcar, Shahrukh Khan, Kareena Kapoor, Saif
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Ali Khan and A . R. rehman to promote their product and services. Faces that Airtel choose to represent itself are the icon of Indian youth. So in some way Indian customer link them selves to these brand ambassador and thus to the Bharti Airtel as a brand they trust.
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Type
Public NSE:RCOM , BSE: 532712
Industry Founded Founder(s) Key people
Telecommunications 2004 Shri. Dhirubhai Hirachand Ambani Anil Ambani(Chairman) Satish Seth [Group Managing Director]
Products
Wireless Telephone Internet Television DataCards RechargeVouchers VC
Revenue Operating income Net income
Rs. 22,766 cr (US$4.54 billion)(2011) Rs 9,305 cr (2009) Rs. 6,045 cr(2009)
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Total assets Total Employees Total equity Owner(s)
Rs. 80,395 cr (2011) 28,065(2010) Rs. 1032 crore Promoters(67.58 %) Non promoters(32.42%)
Website
www.rcom.co.in
Reliance Communications, formerly known as Reliance Infocomm, along with Reliance Telecom and Flag Telecom, is part of Reliance Communications Ventures (RCoVL).Reliance Communications Limited (BSE: 532712) founded by the late Shri Dhirubhai H Ambani (19322002) is the flagship company of the Reliance Anil Dhirubhai Ambani Group. The Reliance Anil Dhirubhai Ambani Group currently has a net worth in excess of Rs. 64,000 crore (US$ 13.6 billion), cash flows of Rs. 13,000 crore (US$ 2.8 billion), net profit of Rs. 8,400 crore (US$ 1.8 billion).The Equity Shares of RCOM are listed on Bombay Stock Exchange Limited and National Stock Exchange Limited. The Global Depository Receipts and Foreign Currency Convertible Bonds are listed on Luxembourg Stock Exchange and Singapore Stock Exchange respectively. VISION By 2015, be amongst the top 3 most valued Indian companies,providing Information, Communication & Entertainment services, and being the industry benchmark in Customer Experience, Employee Centricity and Innovation Mission We will create world-class benchmarks by:
? ? ?
Meeting and exceeding Customer expectations with a segmented approach Establishing, reengineering and automating Processes to make them customer centric, efficient and effective Incessant offering of Products and Services that are value for money and excite customers Providing a Network experience that is best in the industry Building Reliance into an iconic Brand which is benchmarked by others and leads industry in Intention to Purchase and
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Loyalty Developing a professional Leadership team that inspires, nurtures talent and propagates RCOM Values by personal example.
Contents
? ?
1 Company Overview 2 Main Subsidiaries
o o o o o o
2.1 Reliance Telecom 2.2 Reliance Telecom 2.2 Reliance Globalcom 2.3 Reliance Communications Infrastructure Limited (RCIL) 2.4 Reliance Big TV Limited 2.5 Reliance Infratel Limited(RITL)
? ? ? ?
3 Offices 4 Products & Services 5 Subscriber Base 6 Notable awards
Company Overview
Reliance Communications is India's truly integrated telecommunications service provider. The Company has a customer base of 1050 million including over 2.5 million individual overseas retail customers. It ranks among the Top 5 Telecom companies in the world by number of customers in a single country. Reliance Communications corporate clientele includes 2,100 Indian and multinational corporations, and over 800 global, regional and domestic carriers. A pan-India, next generation, integrated (wireless and wireline), convergent (voice, data and video) digital network that is capable of supporting best-of-class services spanning the entire communications value chain,covering over 24,000 towns and 600,000 villages has been established by Reliance Communications. Reliance Communications owns and operates the next generation IP enabled connectivity infrastructure, comprising over 190,000 kilometers of fiber
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optic cable systems in India, USA, Europe, Middle East and the Asia Pacific region.
Main Subsidiaries
Reliance Telecom In July 2007, the company announced it is buying US-based managed ethernet and application delivery services company Yipes Enterprise Services for a cash amount of Rs. 1200 crore rupees (equivalent of USD 300 million). The deal was announced of the overseas acquisition, the Reliance group has amalgamated the United States-based Flag Telecom for $ 210 million [roughly Rs 950 crore (Rs 9.50 billion)]. RTL operates in Madhya Pradesh, West Bengal, Himachal Pradesh, Orissa, Bihar, Assam, Kolkata and Northeast offering GSM and CDMA services. Reliance Globalcom RGL owns the worlds largest private undersea cable system spanning 65,000 kms seamlessly integrated with Reliance Communications over 110,000 kms of domestic optic fiber provides a robust Global Service Delivery Platform connecting 40 key business markets in India, the Middle East, Asia, Europe, and the U.S. Reliance Communications Infrastructure Limited (RCIL) RCILe provide Internet Data Centre (IDC) services located in Mumbai and Bangalore. RCIL currently have IDC capacity of 304,000 sq ft with the market share close to 60%.
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Reliance Big TV Limited Reliance Big Tv launched in August 2008 and thereafter acquired 1 million subscribers within 90 days of launch, the fastest ramp-up ever achieved by any DTH operator in the world. Reliance Big TV offers its 1.7 million customers DVD quality pictures across a bouquet of over 200 channels using the latest, state-of-the-art MPEG 4 technology. Reliance Infratel Limited(RITL) RITL?s business is to build, own and operate telecommunication towers, optic fiber cable assets and related assets at designated sites and to provide these passive telecommunication infrastructure assets on a shared basis to wireless service providers and other communications service providers under long-term contracts. Offices Reliance Communications Limited has its offices in Ahmedabad, Bangalore, Bhopal, Chandigarh, Chennai, Hyderabad, Jaipur, Kochi, Lucknow, Mumbai, New Delhi , Patna & Pune. Products & Services Products & Services promoted by the Group are Prepaid Mobile, Postpaid Mobile, Handsets, Blackberry, R World, Internet, Home Phone, Global Calling, Data Card, DTH.
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Subscriber Base The Reliance Communication subscriber base according to COAI - Cellular Operators Association of India is over 105:
GSM Circle Name Andhra Pradesh Delhi Gujarat Kerala Karnataka Maharashtra & Goa Mumbai Punjab,Haryana & Himachal Pradesh Rajasthan Tamil Nadu & Andaman Not Defined Uttar Pradesh West Bengal RCOM GSM - Total sub base Post Paid 6182 19172 19414 8049 18572 25288 24884 18630 6631 25704 136636 9093 8765 29262215 Prepaid 1890923 2054393 2480642 901829 2168131 3301389 2083175 2717375 2628940 1909641 345658 6430945 22154
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Broadband:
Circle Name Andhra Pradesh Delhi Gujarat Kerala Karnataka Maharashtra & Goa Mumbai
Data 6182 19172 19414 8049 18572 25288 24884
Voice 1890923 2054393 2480642 901829 2168131 3301389 2083175 2717375 2628940 1909641 345658 6430945 22154
Punjab,Haryana & Himachal Pradesh 18630 Rajasthan Tamil Nadu & Andaman Not Defined Uttar Pradesh West Bengal RCOM GSM - Total sub base 6631 25704 136636 9093 8765 29262215
DTH Circle Name Andhra Pradesh Bihar Chattisgarh Delhi Gujarat Maharashtra & Goa Total 209118 41245 28965 73148 109013 25288
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Haryana Himachal Pradesh Jammu & Kashmir Jharkhand Karnataka Kerala Maharashtra & Goa Madhya Pradesh North East Orissa Rajasthan Tamilnadu Uttar Pradesh (W) Uttar Pradesh (E) Maharashtra & Goa West Bengal Maharashtra & Goa
65358 25822 28643 21060 309007 171179 258365 96609 28518 79011 177667 208692 124430 115058 258365 44280 258365
DTH - Total sub base 233496
CDMA Circle Name Andhra Pradesh Delhi Gujarat Kerala
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Post Paid Prepaid Prepaid PCO 250597 505724 288480 200796 4454341 476990 3211875 114702 2992165 115298 2054601 125214
Karnataka Maharashtra & Goa Madhya Pradesh & Orissa Mumbai
236288 295534 187860 555120
3024954 253848 3457329 275002 4495163 139575 3223211 166858 2569998 92611 2284651 96704 3854839 374900 7976083 265494 6606050 203919
Punjab,Haryana & Himachal Pradesh 198497 Rajasthan Tamil Nadu & Andaman Uttar Pradesh West Bengal,Bihar & Jharkhand RCOM CDMA - Total sub base 151260 304861 270627 240946 56592965
RTL Circle Name Assam Bihar & Jharkhand Calcutta Himachal Pradesh Madhya Pradesh & Chhattisgarh North-East Orissa West Bengal Post Paid 114942 7482 5524 2344 55911 21454 12684 2481 20064568 RCOM RTL - Total sub base Prepaid 1749992 4152577 2076028 999493 4913590 520513 2217043 3212510
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Balance sheet
Mar ' 09 Mar ' 08 Mar ' 07 Dec ' 05 Mar ' 05
Sources of funds
Owner's fund Equity share capital Share application money Preference share capital Reserves & surplus Loan funds Secured loans Unsecured loans Total 3,000.00 950.00 5,113.57 1,032.01 1,032.01 1,022.31 0.05 611.57 0.01 -
50,658.31 23,808.02 19,503.23 14,783.43 -
27,903.61 19,336.43 9,454.27 -
82,593.93 45,126.46 35,093.38 15,395.04 0.01
Uses of funds
Fixed assets Gross block Less : revaluation reserve Less : accumulated depreciation Net block Capital work-in-progress 37,941.15 21,576.32 20,625.82 198.09 -
6,533.38 4,688.69 2,527.37 31.85 31,407.77 16,887.63 18,098.45 166.24 3,643.86 7,117.56 2,185.60 -
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Mar ' 09
Mar ' 08
Mar ' 07
Dec ' 05
Mar ' 05
Investments
31,364.75 13,844.14 5,434.43 12,074.10 -
Net current assets
Current assets, loans & advances Less : current liabilities & provisions Total net current assets Miscellaneous expenses not written Total 25,543.01 18,515.29 20,107.04 3,158.96 0.01 9,365.46 11,238.16 10,732.14 4.25 -
16,177.55 7,277.13 9,374.90 3,154.70 0.01 -
82,593.93 45,126.46 35,093.38 15,395.04 0.01
Notes:
Book value of unquoted investments Market value of quoted investments Contingent liabilities 31,364.63 13,844.14 5,434.43 12,074.10 0.12 0.10
6,555.82 4,392.73 3,781.30 -
Number of equity sharesoutstanding (Lacs) 20640.27 20640.27 20446.15 1.00
Annual results in brief
Mar ' 09 Sales 13,610.58 Mar ' 08 13,416.19 4,882.46 445.17 Mar ' 07 11,725.26 4,476.60 232.38 Dec ' 06 8,584.97 3,276.94 162.84 Dec ' 05 -6.79
Operating profit 4,337.16 Interest 85.58
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Mar ' 09 Gross profit EPS (Rs) 4,335.67 11.40
Mar ' 08 4,447.75 12.53
Mar ' 07 4,280.87 11.78
Dec ' 06 3,149.84 8.42
Dec ' 05 11.59 565.00
Annual results in details
Mar ' 09 Other income Stock adjustment Raw material Power and fuel Employee expenses Excise Admin and selling expenses 84.09 759.35 Mar ' 08 10.46 858.65 7,675.08 1,843.66 17.64 2,586.45 1,032.01 6992.16 33.88 Mar ' 07 36.65 684.40 2,119.44 4,444.82 1,836.12 12.00 2,408.85 -23.90 1,022.31 6798.04 33.25 Dec ' 06 35.74 492.04 Dec ' 05 6.47 1.11 -
1,544.81 0.56 -
Research and development expenses Expenses capitalized Other expenses Provisions made Depreciation Taxation Net profit / loss Extra ordinary item Prior year adjustments Equity capital Equity dividend rate Agg.of non-prom. shares (Lacs) Agg.of non promotoHolding (%) 8,514.07 2,366.90 12.40 2,352.93 396.56 1,032.01 6741.66 32.66
3,271.18 -
1,364.39 2.74 18.35 3.20
1,722.10 5.65 -45.00 -
1,022.31 0.05 6797.94 33.25 -
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Mar ' 09 OPM (%) GPM (%) NPM (%) 31.87 31.66 17.18
Mar ' 08 36.39 33.13 19.26
Mar ' 07 38.18 36.40 20.48
Dec ' 06 38.17 36.54 19.98
Dec ' 05 -
Notable awards
? ?
Anil Ambani – The Telecom Person of the Year 2008 by Light Reading Most Promising Service Provider of 2003 (Asia Pacific) Award instituted by Asia Pacific Technology from Frost & Sullivan RCOM adjudged the World?s Top CDMA Operator at the Global CDMA Industry Achievement Awards Reliance Mobile amongst the "Top 10 Most Trusted Brands“ & rated as "India's Most Trusted Service Brand 2009“ by "The Economic Times“
?
?
?
Reliance Mobile" voted as No.8th in "India's Most Admired Marketers“. The youngest Indian brand amongst the "Top 10" and ahead of P&G, Hero Honda, Samsung, LG, Colgate and Cadbury's.
? ?
Reliance Mobile, India's Top 25 Marketers Awards 2009, Pitch, November 09 Mobile Marketing Award(Los Angeles) at Global level for cross-media integration on digital and mobile medium of Reliance GSM
launch campaign (Go For It!).
?
Best Advert game award conferred by World Brand Congress for digital advertising game hosted on Zapak.com
? ? ?
CMOs Council Brand Leadership Award to Reliance Communications, November'2009 World Brand Congress, Chair for Yr.2009-10 granted to RCOM, November'2009 Business Today along with TAM rated Simply Reliance TVC as the most watched Ad in the month of October 2009.
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?
Total Network TVC s Kedarnath & Highway rated as No.1 campaign in India for the month of Aug 08 & Sept 08
?
Most awarded single brand for Creative Excellence ABBY Awards 2007(Advertising Agency Association of India) Fair &Lovely Scholarship on Reliance Mobile wins at MMA Awards, USA.
RELIANCE COMMUNICATION LIMITED
SWOT ANALYSIS
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Strength ? ? ? ? ? ? Low Entry Cost Commission Structure Fast Activation Process Network Connectivity Data GPRS
Weakness ? Branding Image ? Distribution problem ? Limited product portfolioOnly Mobile ? Lack of Competitive Strength ? Limited Budget Threat ? ? ? ? ? Political destabilization. New Entrants IT Development Market Demand Seasonality, Weather Effects
Opportunity ? Preference of GSM over CDMA ? New Specialist Application ? Rural Telephony ? New Market, Vertical, Horizontal ? Competitors` Vulnerabilities
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AIRCEL
Type
Joint Venture
Industry
Telecommunications
Founded
1999
Headquarters
Chennai, Tamil Nadu, India
Key people
Sandip Das, CEO Gurdeep Singh, COO Pragas Pathy
Products
Mobile telephony, Wireless broadband services
Parent
Maxis Communications (74%)[1]
Website
aircel.com
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SERVICEIt provides wireless voice, messaging and data services in India and operates in 13 circles in india.
AIRCEL
Maxis? expansion into Indonesia and India is another milestone in our aspiration to be the regional communications leader of choice. The acquisition of a 51% stake in PT Natrindo Telepon Seluler (NTS), Indonesia and a 74% equity interest in Aircel, India provides new growth opportunities for Maxis. These acquisitions give Maxis a strong foothold in two of the world?s most attractive high-growth, low-penetration markets Maxis in INDONESIA
On 29th April 2005, Maxis acquired 51% of PT Natrindo Telepon Seluler. Maxis is currently in the middle of rolling out a Java wide network to establish the company as a national operator. Th initial launch phase encompasses 1,300 BTS, providing both 2G and 3G services. NTS expects to have up to 480 employees by launch date and to increase significantly upon launching. Maxis in India Maxis completed the acquisition of a 74% stake in Aircel on March 21,2006. Currently, Aircel has operations in 9 of the 23-telecom circles of India - Chennai, Tamil Nadu, West Bengal, Orissa, Assam, North East, Jammu and Kashmir, Himachal Pradesh and Bihar. Aircel launched its services in Bihar and Himachal Pradesh in December 2006 and also recently
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received the licenses to operate in the remaining 14- telecom circles of India giving it the ability to become a pan-India player. Maxis? expansion into Indonesia and India is another milestone in our aspiration to be the regional communications leader of choice. The acquisition of a 51% stake in PT Natrindo Telepon Seluler (NTS), Indonesia and a 74% equity interest in Aircel, India provides new growth opportunities for Maxis. These acquisitions give Maxis a strong foothold in two of the world?s most attractive high-growth, low-penetration markets. This marks the beginning of the new world of Maxis – a world beyond voice, and beyond borders. MAP Maxis in Indonesia On 29th April 2005, Maxis acquired 51% of PT Natrindo Telepo Seluler. Maxis is currently in the middle of rolling out a Java wide network to establish the company as a national operator. The initial launch phase encompasses 1,300 BTS, providing both 2G and 3G services. NTS expects to have up to 480 employees by launch date and to increase significantly upon launching. Maxis in India Maxis completed the acquisition of a 74% stake in Aircel on March 21, 2006. Currently, Aircel has operations in 9 of the 23 telecom circles of India - Chennai, Tamil Nadu, West Bengal, Orissa, Assam,North East, Jammu and Kashmir, Himachal Pradesh and Bihar. Aircel launched its services in Bihar and Himachal Pradesh in December 2006 and also recently received the licenses to operate in the remaining 14 telecom circles of India giving it the ability to become a pan-India player. Aircel expects to aggressively grow its subscriber base in India and is developing a broad range of new propositions for its customers - from branding, to increased network coverage, to innovative product and service offerings, to refreshing customer experience. As of 31st December 2006, Aircel serves more than 4.5 million subscribers with a network comprising of almost 4,000 BTS. Aircel continues to be the market leader in Tamil Nadu and Chennai circle. Aircel?s network provides 2G and GPRS services, and is EDGE capable. Aircel is also currently in the process of conducting 3G Trials across different cities in India. In addition, Aircel is the first cellular operator in India to launch wireless Internet services using WiMAX technology. It aims to immediately extend its WiMax coverage to over 20 cities to serve enterprise broadband customers. Over the next few quarters, India is expected to add new subscribers at the rate of 5 to 6 million per month. India offers huge opportunities for Aircel given the current low mobile.
MISSION STATEMENT
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We are conditionally committed to exceeding our customer’s expectations. we will provide network and services that are innovative and reliable, allowing our customers any time anywhere communications. we will attract, develop and retain an exceptional team of people. We are committed to enhancing the quality of real life in the community in which we operate. Wewill meet the financial expectation of our shareholders . OUR GOALS AND VALUES CUSTOMERS
ur customers are our most valued assets. we will strive to exceed their expectations at all time by providing them with superior services that embody value, innovation, quality and care. PEOPLE : our people are our greatest resources. we will attract, train and retain the best.we will challenge them to develop their full potential in the context of our company goals. INTEGRITY : We will maintain and strive for the highest levels of personal and professional integrity and honesty in all ours dealings. We will keep our promises. RESPECT : We will treat with respect & dignity all people we deal with. EXCELLENCE : We are committed to excellence in all what we do.there will47
OPPORTUNITIES
The telecom sector has been one of the fastest growing sectors in the Indian economy in the past 4 years. This has been witnessed due to strong competition that has brought down tariffs as well as simplification of policy environment that has promoted healthy competition among various players.. The mobile sector alone has been growing rapidly and has emerged as the fastest growing market in the whole worlds. Currently of a size nearing 70 million (GSM and CDMA), this sector is expected to reach a size of nearly 200 million subscribers by financial year 2008 and growing very fast. The government has eased the rules regarding inter circle and intra circle mergers. This has led to a slew of mergers and acquisitions in the recent past. Also as the sector is moving closer to maturity, further consolidation is a reality and this will lead to the survival of more profitable players in this segment In order to further promote the use of Internet in the country the government is taking proactive steps to develop this sector with the help of the various players in this segment. For this purpose, the use of broadband technology is being mooted and this will go a long way in improving the productivity of the Indian economy as well as turn out to be the next big opportunity for telecom companies after the mobile communications segment Non-voice services and VAS are the gold mines. The big takeoff is expected with the rollout of 3G services in early 2007, once the spectrum issues are sorted out. Internet users base fast reaching near the English speaking population base. Local language and content required for further growth Infrastructure equipment cost is down to a fraction of what prevailed just a few years ago. Operators can plan better expansion plan now Increased viability for the operators to expand to semi-urban and rural markets, hence, accelerate growth further It?s not without reason that India is tipped to be the world?s third-larges economy by 2050! No wonder if it happens much earlier Investors can look to capture the gains of the Indian telecom boom and diversify their operations outside developed economies that are marked by saturated telecom markets and lower GDP growth rates.
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At a time when global telecom majors are struggling to cope with their losses and the rollout of 3G networks, which has been a non-starter for close to a year now; India, with its telecom success story, represents an attractive and lucrative SECTORAL ANALYSIS Telecommunication sector is one of the sectors with high growth rate. The customer base of telecom sector is huge unlike other sectors. The sector is dependent upon the Government to provide infrastructure, For example, Government is providing 1MHZ spectrum for 3G technology. The telecom companies have to share the spectrum provided. The room for error is very less in service sector as after sales is nonexistent. A service once provided cannot be renewed or be modified. Thus with a huge customer base and room for no error, the service providers follow near fool proof system.
Learning Experience
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1. It teaches about how the company functions effectively, how the higher management plans out various targets and they are achieved by the means of lower management.
2. Managing the various resources like money, manpower, time, raw material etc.
3. Since finance is the lifeline of any organization, this project would help me in understanding the vitality of finance and utilizing it in the most suitable way.
4. Every company has its own unique policy, structure, and the way of functioning.
5. One can learn from other companies and try to develop its own way of working.
6. Expanding the presence across the globe and exploit the opportunities that exist in the neighboring region.
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BIBLIOGRAPHY
MAGAZINEs India Today Economic Times Times of India Business India Bharti Airtel, Annual Report -2011 Reliance communication annual report 2011
WEBILOGRAPHY
www.airtel.in airtel-broadband.com www.trai.gov.in www.hindustantimes.comhttp://www.moneycontrol.com/financials/bhartiairtel/ratios/BA08http://www.moneycontrol.com/annual-report/bhartiairtel/directors-report/BA08http://coai.in/statistics.php www.rcom.in www.scribd.com www.slideshare.com
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