EQUITY RESEARCH REPORT - AIRTEL

About the Company

Founded in 1995, Bharti Airtel Limited is an integrated telecommunications
company with operations in 20 countries across Asia and Africa. Headquartered
in New Delhi, India, the Company ranks amongst the top 5 mobile service
providers globally in terms of subscribers.
In India, the Companys product offerings include 2G, 3G and 4G services, fixed
line, high speed broadband through DTH, enterprise services including national &
international long distance services to carriers. In the rest of the geographies, it
offers 2G, 3G mobile services. All these services are rendered under a unified
brand airtel. The Company also manages passive infrastructure pertaining to
telecom operations through its subsidiary and joint venture entity.
Bharti Airtel had over 262 million customers across its operations at the end of
March 2014. The operations of Bharti Airtel in India and South Asia are divided
into two distinct customer business units with clear focus on B2C and B2B
segments. B2C services includes mobile services; telemedia services; and digital
TV services. B2B services includes airtel business; and passive infrastructure
services.
Key Ratios

Mar 2016

Mar 2015

Mar 2014

Mar 2013

Mar 2012

Debt-Equity Ratio

2.25

1.60

1.25

1.26

1.22

Long Term Debt-Equity Ratio

1.84

1.17

0.98

0.99

0.98

Current Ratio

0.28

0.30

0.41

0.40

0.38

0.43

0.46

0.44

0.43

0.44

666.25

696.13

678.49

636.71

414.89

18.23

16.78

13.18

11.70

12.05

1.84

3.37

2.34

2.06

2.60

PBIDTM (%)

37.07

36.26

34.23

31.34

33.52

PBITM (%)

15.90

15.59

16.01

12.09

14.83

PBDTM (%)

28.44

31.63

27.39

25.47

27.81

CPM (%)

25.42

25.92

21.74

22.20

24.65

APATM (%)

4.25

5.26

3.52

2.95

5.95

ROCE (%)

11.47

11.07

10.29

7.38

8.83

Turnover Ratios
Fixed Assets
Inventory
Debtors
Interest Cover Ratio

EQUITY RESEARCH REPORT - AIRTEL

RONW (%)

10.45

10.15

5.29

4.21

8.11

Bharti Airtels average current ratio over the last 5 financial years has been 0.28
times which indicates that the Company has been facing liquidity problems to
meet its short term obligations. Bharti Airtels average long term debt to equity
ratio over the last 5 financial years has been 0.98 times which indicates that the
Company is comfortably placed to meet its obligations. Bharti Airtels average
interest coverage ratio over the last 5 financial years has been 6.61 times which
indicates that the company has been generating enough for the shareholders
after servicing its debt obligations.

Ownership pattern
In its latest stock exchange filing dated 31 March 2016, Bharti Airtel reported a
promoter holding of 66.74 %. Large promoter holding indicates conviction and
sincerity of the promoters. We believe that a greater than 35 % promoter holding
offers safety to the retail investors.
At the same time, institutional holding in the Company stood at 25.60 %
(FII+DII). Large institutional holding indicates the confidence of seasoned
investors. At the same time, it can also lead to high volatility in the stock price as
institutions buy and sell larger stakes than retail participants