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Change Change %
-6.75 -1.26%

Updated:14 Aug, 2020, 16:01 PM IST

Change Change %
-6.75 -1.26%

Updated:14 Aug, 2020, 16:01 PM IST


Dear Shareholders,

The global economy encountered multiple challenges during the past one year. Even as the US exhibited signs of recovery, the Eurozone remained saddled with an unprecedented debt crisis and its attendant slowdown with several of its members slipping into outright recession. Emerging markets like India and China too experienced slowdown in the momentum of growth in the midst of a decelerating global economy. India in particular struggled to find its bearings in a high inflationary situation and ended up with one of its lowest growth rates in recent years. Overall, macroeconomic indicators in Africa remained largely moderate, though, as an economic region, the Francophone countries continued to be adversely impacted because of their strong linkages with the Eurozone.

In telecom, the anticipated big shift towards data services became increasingly visible during the year. Though, voice still continued to be the mainstay of our business, we certainly had a clear glimpse of the massive change underway in the mobile eco–system and the pattern of consumption. Riding high on rapidly increasing smartphone penetration and the increasing data managing capability of new generation feature phones, wireless data services grew by 66% in India. We experienced equally powerful traction in the data space in African markets. Widening reach and quality of our 3G networks complemented the changing industry dynamics effectively, helping trigger a powerful mobile internet revolution in these markets.

Airtel money, currently available in 18 of the 20 markets we are present in, is redefining banking and commerce in multiple ways. The service is making a huge impact on the unbanked population in the African markets, particularly in remote rural regions with negligible or no banking infrastructure. Inspired by this service's encouraging take off, we aspire to be one of the largest mobile banks in these markets in the years to come. With more than one million customers in India, airtel money is ready to scale new heights in the days to come.

In India, competition did abate during the year and normalcy returned to the market, particularly in the second half. We seem ready for a balanced take–off on this score in the coming year. On the regulatory front, however, we encountered adverse developments on several issues –legality of 3G roaming agreements, one–time spectrum cost, refarming of allotted spectrum in the 900 MHz band and are currently litigating on the matter of spectrum allocation to leading operators in 2002. We firmly believe that the Company is in compliance on all these issues and appropriate actions, including legal challenges, have been initiated by the Company.

As a market, Africa continues to be a great learning experience for us. Despite the success of new initiatives like airtel money and 3G services, we experienced significant headwinds in the shape of increased competitive intensity and challenging market conditions. While political disturbance and accompanying security concerns did affect our business operations in two of our biggest markets, – Nigeria and Democratic Republic of Congo (DRC) –regulatory challenges in the form of demands of additional taxes and levies from several regulators also created some unforeseen financial stress. Notwithstanding these challenges, I am pleased to inform you that we consistently outpaced market growth and managed to marginally grow our revenue share in these markets during the year.

The Company moved past another key milestone during the year, when our subsidiary Bharti Infratel successfully completed its Initial Public Offer (IPO) in December 2012 raising Rs. 41,728 Mn. Enthusiastic participation by institutional investors reaffirmed market confidence in the Company's strong balance sheet and future cash flows. Listed on the two Indian bourses – NSE India and BSE India –the Bharti Infratel stock is today included in the FTSE global equity indices as well.

Our people agenda continued to be focused on productivity improvement through organisational restructuring, enhancement in people engagement and employee value proposition. The Dubai Leadership Conclave in March 2013 constituted a landmark event that helped us define our strategic roadmap in the changing technology and regulatory landscape. Having established a solid platform for 'winning smartly' and 'executing brilliantly', people are poised to become a strategic driver of the business agenda in the coming days.

The year witnessed some key leadership changes at the top. While Manoj Kohli moved into the enhanced role of Managing Director & CEO (International) with the added responsibility of Bangladesh and Sri Lanka, Gopal Vittal took over as the Joint Managing Director & CEO (India).

Over the years, sustainability has not only been intrinsic, but invariably complementary to our business agenda. The business continued to put in place innovative ways to reduce the carbon footprint of our operations. During the year, we released our first Sustainability Report, which highlights the different dimensions of our engagements with society and environment. The year also witnessed the strengthening of our social initiatives in India and Africa. Our efforts at the Group's philanthropic arm, the Bharti Foundation, were largely focused on consolidation of our operations covering 254 schools – 187 primary, 62 elementary and five senior secondary – reaching out to over 39,000 children across six states in India. In Africa too, we extended the 'Our School' Programme to 38 schools across different markets catering to over 18,000 underprivileged children.

The Board of Directors, which has been the pivotal guiding force for us over the years, went through some significant restructuring during the year. Six members – N. Kumar, Rakesh Bharti Mittal, Akhil Kumar Gupta, H.E. Dr. Salim Ahmed Salim, Lord Evan Mervyn Davies and Hui Weng Cheong – exited after long years of meaningful association. My sincere gratitude to them for their sterling contribution to the Board over the years. I also take this opportunity to welcome on Board Manish Kejriwal, Obiageli Ezekwesili and Gopal Vittal, who joined the Board during the year.

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 our revenue market leadership. I see further consolidation in our position in the days to come in the youth–oriented, data–hungry environments in these regions. 

Sunil Bharti Mittal 

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