Mar 03, 2010, 06.04 PM IST | Source: CNBC-TV18

Bharti Airtel sees room for growth in rural India

In an interview with CNBC-TV18, Sanjay Kapoor, CEO, Bharti Airtel, speaks about the latest happenings in his company and sector.

Sanjay Kapoor, CEO, Bharti Airtel
In an interview with CNBC-TV18, Sanjay Kapoor, CEO, Bharti Airtel , speaks about the latest happenings in his company and sector.

Here is a verbatim transcript of the exclusive interview with Sanjay Kapoor on CNBC-TV18. Also watch the accompanying video.

Q: Quantify in terms of customer growth, is it going to be 10-20% and perhaps if you could tell us per customer whether the revenues go up or down as you go further?

A: Given the Indian scenario which is overly heated with 14 competitors and overcapacity, I would not look at customer numbers in isolation. I would always view customer numbers along with revenue numbers or revenue growth to make some sense out of that because you have a lot of multiplicity and duplicity of sims in the market place and what is truly getting reported today is probably multiple sims and not unique customers. So I would say if you have that in mind, I would easily out of the numbers that are getting reported probably discount about 50% and the balance 50% are probably real numbers. So the industry is still growing very fast even if you were to discount to that extent.

I would say given Indias position today globally, even if you were to discount those reported numbers by 50% and you look at the growth on minutes of use quarter on quarter, I think this is one of the fastest growing markets in the world even today and that makes it very uniquely poised. Also, the fact that although the metros and big cities are close to 100% or above penetrated, I think rural India which probably accounts for more than 60% of the new customers is still under 20% penetrated and that truly makes the Indian story very compelling.

Q: The other big project thats looming large are the 3G auctions, what are the initial numbers you are looking? What is the kind of amount, what kind of kitty is Bharti preparing itself with?

A: You are asking me very strategic sensitive information which I cannot give away, its competitive in nature. All I can say is that Bharti has been sticking on the statement that we will be interested and bid for 3G. I cannot reveal more than that. All I can say from a consumer perspective is that Indian consumer is waiting to be served on broadband. In a country like India, which is so vast, with a very dismal penetration of fix line broadband, I think wireless is the only solution. Like for most Indians the first call, the voice call was on a wireless device, similarly for most Indians the first access to internet will be also through a wireless device. Keeping that in mind, I think to delay 3G any further would be depriving the customers of what is in store for them on broadband.

Q: Coming to the competition that you were speaking about, are you seeing any signs of the competition easing after all, all of you have the same problems of capacity and undercutting? How is this quarter looking or maybe how is next quarter looking to you compared to the quarter that just went by?

A: As a policy we do not give any guidance for future. All I can reiterate is that the current scenario on either tariffing or what is reflective in the market in terms of customer offerings is not either sustainable or based on rational economics. I think this is a euphoria that it is spelling out overcapacity and its a matter of time where it will begin to crystallise and consolidation will take shape in some form or the other.

Bharti Airtel stock price

On April 23, 2014, Bharti Airtel closed at Rs 339.10, up Rs 3.80, or 1.13 percent. The 52-week high of the share was Rs 373.50 and the 52-week low was Rs 274.50.


The company's trailing 12-month (TTM) EPS was at Rs 14.07 per share as per the quarter ended December 2013. The stock's price-to-earnings (P/E) ratio was 24.1. The latest book value of the company is Rs 135.70 per share. At current value, the price-to-book value of the company is 2.50.

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