Bharti Airtel Reasserts Market Leadership

Telecom stocks have been in focus since the start of the calendar year. Competition abated during the year and normalcy returned to the market, particularly in the second half of FY13. Many operators hanging up on subscribers has turned out to be a boon for the larger players like Bharti Airtel and Idea Cellular. It seems that the telecom operators are all set for a resurgence.

Bharti Airtel recently held its AGM for the year 2012-13. Here, we present to you snippets of the key points that the Chairman of the Board Sunil Bharti Mittal made in his speech.

Key Takeaways:

In the telecom sector, the anticipated big shift towards data services became increasingly visible during the year. With increasing penetration of smartphones and the increasing data managing capability, wireless data services grew by 66% in India. Widening reach and quality of 3G networks complemented the changing industry dynamics effectively.

With regard to Bharti Airtel, while voice still continues to be the mainstay of its business, the company has experienced equally powerful traction in the data space especially in the African markets.

The other is airtel Money, which currently available in 18 of the 20 markets the company is present in. Sunil Mittal says that this service is redefining banking and commerce in multiple ways. Here too, he said that airtel Money is making a huge impact on the unbanked population in the African markets. With more than a million customers in India, this offering is ready to scale new heights in the days to come.

On the regulatory front, however, the sector has encountered adverse developments on several issues - legality of 3G roaming agreements, one-time spectrum cost, re-farming of allotted spectrums in the 900 MHz band and currently litigating on the matter of spectrum allocation to leading operators in 2002.

As a market, Africa continues to be a great learning experience. Despite the success of initiatives like airtel Money and 3G services, significant headwinds in the shape of increased competitive intensity and challenging market conditions are being experienced. Airtel has consistently outpaced market growth and managed to marginally grow its revenue share in this market during the year.

The company moved past another key milestone during the year, when its subsidiary Bharti Infratel successfully completed its Initial Public Offer (IPO) in December 2012 and raised Rs 4172.8 crore.

Mittal concluded his address by saying that overall, 2012-13 turned out to be a year of consolidation in Africa, where the individual operations strengthened their relative market position despite multiple market and regulatory odds. In India too, it was a year of reassertion of the company's revenue market leadership. He sees further consolidation in its position in the days to come in the youth-oriented, data-hungry environments in these regions.