The game is to be in the top two, who will constitute 45% of the market. We will surely be one of them.”
“I like the airline business and the media business, but Naresh Goyal (Jet) and Subhash Chandra (Zee) started at the same time as us and built these businesses. Today they are entrenched, and it doesn't make sense for us to enter there.”
“We try to work ahead of the policy that the government has led out. Sometimes we are dealt a good hand and most of the times we are dealt a bad one. The idea is to be very nimble and flexible to the changing environment.”
Vital Statistics
Name Sunil Bharti Mittal
Age in 2005 47 years
Education Graduated from Punjab University, Management Program from Harvard Business School in 1999
Mission/ Vision “To capitalize on the growth opportunities available in the Indian telecommunications market and consolidate its position”
Company Bharti Tele-Ventures
Designation Chairman & Group Managing Director
Tenure in current position 7 July 1995 to today
Tenure in company 10 years: since 7 July 1995
Experience Set up a unit to manufacture bicycle components in 1979. Then partnered with Seimens to produce telephone equipment. Used his understanding of the industry to build one of India's largest telecom services provider's from scratch
World class competency Ability to plan and manage sustained growth
Salary Rs3,048,000 (from BTVL only)
Google hits 637
Number of employees 5,189
Company Performance FY02 - FY04
Revenues Rs29.88bn RONW -0.58%
Net profit Rs3.7mn Growth rate 39% CAGR
Net profit margin -1362.31% ROCE -0.08%
Smart Achievements
Built Airtel into the largest mobile service in India, covering 21 of the 23 licensed areas where 58% of potential customers are covered. Grew customer base from 1,300,000 to 3,100,000 within a period of twelve months in 2002. Became the first GSM operator in India to cross the 10mn customer mark
Organic growth: launched mobile services in Gujarat, Haryana, Kerala, Madhya Pradesh, Maharashtra, Mumbai, Punjab, Tamil Nadu, Uttar Pradesh (West), West Bengal, Orissa, Jammu and Kashmir, Bihar and Jharkhand, within three years
Became the first private telecommunications services company to offer fixed line services as well as international long distance services in India, offered Internet access over DSL in five circles, built submarine cable connecting Chennai and Singapore
Raised Rs8,340mn through IPO that was oversubscribed 2.2 times, mobilized $315mn long term foreign currency borrowings for expansion of cellular operations
Began second phase of expansion investing Rs1,500mn in Uttar Pradesh, signed IT outsourcing deal with IBM for a ten year period, signed deal to share its national long distance (STD) network with VSNL
Slashed prices by reducing out going SMS price to 30p, reduced STD and ISD rates for more than 10bn mobile customers to further drive penetration of mobile telephony
Successfully rolled out sixteen new projects: audio-conferencing service, MMS, pan-India GPRS, voice portal services, SMS cricket updates, prepaid cards via ATMs, dial a hot spot service, Wi-Fi service in eight hot spots in Mumbai, ring back tone serviceThe telecom sector is not for the faint of heart. High investments, long gestation periods, tricky government regulations and cranky customers are just some of the problems that assault telecom companies on a regular basis. Not to mention persistent threat from international competition in the form of Hutch that has global expertise at its disposal and experienced domestic players like MTNL that have a readymade infrastructure and customer base to source from. Even companies like Reliance are finding it mildly hard to sustain in this industry in spite of their deep pockets. It would seem virtually impossible for a company to make good in such conditions. Nevertheless Sunil Bharti Mittal is proving everyone wrong in spectacular style.
Within a mere ten years he has built Bharti Tele-Ventures Limited (BTVL) into one of the largest private telecom services group with a network that covers all 23 mobile circles in the country. The company's current customer base exceeds 12.26mn of which 11.39mn are mobile customers (Figures as on 30 April 2005). Mittal can expect to have 25mn customers by 2007 if he retains his market share.
To drive the institutionalization process forward, Mittal has put a robust business management structure in place. The structure is also designed to bring the company closer to the customers and to consistently deliver business results.
In telecom, as in any industry, matching market growth, with a quick parallel improvement in technology, infrastructure and capacity is critical to maintain profit margins. For Mittal there have been infinite options available for upgradation and capacity enhancement. But he has opted for large capital expenditure at exactly the right time in the growth cycle of the company and then executed it speedily, thus ensuring best returns for his investment.
Mittal's strategic objective has always been to capitalize on the growth opportunities that the available in the Indian telecommunications market and consolidate position to be the leading integrated telecommunications services provider.
In 2004 in his bid to maximize its strengths and leverage the scale of operations of BTVL, Mittal also decided to unify all his brands under the flagship Airtel. He outlined new brand architecture for the various services that the company offered. The restructuring divided BTVL into four categories: Airtel mobile services; Airtel telephone and broadband services; Airtel long distance services; Airtel enterprise services - single window telecom solutions for large corporates.
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