Market Analysis Project

Comparative study of Market Analysis of Airtel and Vodafone
EXECUTIVE SUMMARY
• From starting we came to know about the objective and need which we
have done in project.
• Then I have given some information of telecom industry in India with

literature review and Porter’s five forces and also SWOT analysis.
• As per market share I have given some background of all the companies
in Indian telecom industry.
• Then main project start that I have done comparative study of airtel and
Vodafone.
• Then I have done some research on telecom industry by forming the

questionnaire and then some information of research methodology and
then data is been analysis and interprets.
• After data analysis I have given some suggestions, recommendations

and conclusions for Airtel.
Page 1
Index
Sr. No. Contents Page No.
1 NEED OF THE STUDY 5
2 OBJECTIVE OF THE STUDY 6
3 OVERVIEW OF TELECOM INDUSTRY 7-14
4 LITERATURE REVIEW 15-20
5 PORTERS FIVE FORCES TOWARDS TELECOM 21-24

INDUSTRY
6 SWOT ANALYSIS OF TELECOM INDUSTRY 25-26
7 OVERVIEW OF ALL COMPANIES IN TELECOM 27-39

INDUSTRY AS PER MARKET SHARE.
8 COMPARATIVE STUDY OF AIRTEL AND 40-56

VODAFONE
9 RESEARCH METHODOLOGY 57-59
10 SCOPE OF STUDY 60
11 DATA ANALYSIS AND INTERPRETATION 61-67
12 SUGGESTIONS 68
13 RECOMMENDATIONS 69
14 CONCLUSION 70
15 QUESTIONNAIRE 71-72
16 BIBLIOGRAPHY 73
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NEED OF THE STUDY
1. To identify the difference between market performance of Airtel industry and

Vodafone.
2. To study the market of Airtel Industry and Vodafone on big scale

telecommunication sector.
3. To compare various parameters of marketing strategies, manufacturing process,

technology adopted production policy, advertising, collaboration, export
scenario, future prospect for the two companies and government policies.
4. To study the level of customer satisfaction in Airtel & Vodafone.
5. To study customer buying behavior and factors which influence the purchase
decision process.
6. To study consumer preferences.
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OBJECTIVE OF THE STUDY
Every organization has to achieve its organization goals. For this it is very essential
for an
organization to know about the view of consumers and their competitive products.
This survey
research may be also aimed as to estimate potential buyer for the product. The
objective of the
study is as under:-
1. To identify the difference between market performance of Airtel industry and

Vodafone.
2. To study the market of Airtel Industry and Vodafone on big scale
telecommunication sector.
3. To compare various parameters of marketing strategies, manufacturing process,
technology adopted production policy, advertising, collaboration, export scenario,
future prospect for the two companies and government policies.
4. To study customer buying behavior and factors which influence the purchase
decision process.
5. To know how the company has been successful in encountering the aggressive
marketing strategies of competitors.
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HISTORY OF TELECOMMUNICATION
INDUSTRY
The history of telecommunication industry started with the first public

demonstration of Morse’s electric telegraph, Baltimore to Washington in 1844. In
1876 Alexander Graham Bell filed his patent application and the first telephone
patent was issued to him on 7th of March.
In 1913, telegraph was popular way of communication. AT&T commits to dispose

its telegraph stocks and agreed to provide long distance connection to
independence telephone system.
In 1956, the final judgment limited the Bell System to Common Carrier
Communications and Government projects but preserving the long-standing
relationships between the manufacturing, researches and operating arms of the
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Bell System. In this judgment AT&T retained bell laboratories and Western Electric
Company. This final judgment brought to a close the justice departments seven –
year-old antitrust suit against AT&T and Western Electric which sought separation
of the Bell Systems Manufacturing from its operating and research functions. AT&T
was still controlling the telecommunication industry.
In 1982 , AT&T was requested to divestiture its stock ownership in Western

Electric; termination of exclusive relationship between AT&T and Western Electric;
divestiture by Western Electric of its fifty percent interest in Bell Telephone
Laboratories, AT&T ‘s telecommunication research and development facility, is a
jointly owned subsidiary in which AT&T and Western Electric each own 50% of the
stock; separation of telephone manufacturing from provision of telephone service
and the compulsory licensing of patents owned by AT&T on a non-discriminatory
basis.
It was telecommunication act of 1996 that true competition was allowed. The act
of 1996 opened the market to all competitors. AT&T being the first
telecommunication company paved the road for the telecommunication industry as
well as set the policy and standards for others to follow.
Beginning of telecommunication in India

• 1851 First operational land lines were laid by the government near Calcutta
• 1881Telephone services introduced in India
• 1883 Merger with postal system
• 1923 Formation of Indian radio Telegraph Company
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• 1932 Merger of ETC and IRT into Indian Radio and Cable Communication
Company
• 1947 Nationalization of all foreign telecommunication companies to form the

posts, telephone and telegraph, a monopoly run by the government’s
ministry of
communications
• 1985 Department of telecommunication established , an exclusive provider

of domestic and long-distance services that would be its own regulator
• 1986 Conversion of dot into two wholly government – owned companies the
VSNL for international telecommunication and MTNL for services in
metropolitan areas
• 1997 Telecom regulatory authority created Telecommunication is important

not only because of its role in bringing the benefits of communication to
every corner of India but also in serving the new policy objectives of
improving the global competitiveness of the Indian economy and stimulating
and attracting foreign direct investment.
Indian Telecom industry is one of the fastest growing telecom markets in the
world. In telecom industry, service providers are the main drivers; whereas
equipment manufacturers are witnessing growth and decline in successive
quarters as sales is dependent on order undertaken by the companies.
TELECOM INDUSTRY SCENARIO IN INDIA
The Indian telecommunications market has been displaying sustained high growth
rates. Riding on expectations of overall high economic growth and consequent
rising income levels, it offers an unprecedented opportunity for foreign investment.
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A combination of factors is driving growth in the telecom market, promising rich

returns on investments.
Over the past 10 years, India has registered the fastest growth among major
democracies, having grown at over 7 per cent in four years during the 1990s. It
represents the fourth largest economy in terms of Purchasing Power Parity.
According to a recent Goldman Sachs report, over the next fifty years, Brazil,
Russia, India and China - the BRIC economies- could become a much larger force in
the world economy. It reports, “India could emerge as the world’s third largest
economy and of these four countries; India has the potential to show the fastest
growth over the next 30 to 50 years”. The report also states that, “Rising incomes
may also see these economies move through the ‘sweet spot’ of growth for
different kinds of products, as local spending patterns change. This could be an
important determinant of demand and pricing patterns for a range of
commodities”. The share of the services sector as a percentage of total GDP is also
predicted to rise from the current 46 per cent to about 60 per cent by 2020. The
boom in the services sector is slated to come from India, emerging as a chosen
destination for software and other IT enabled services, tourism etc. According to a
Nasscom- McKinsey & Co. Study, by 2008, the Indian IT software and services
sector will account for US$ 70-80 billion in revenues; it’ll employ 4 million people,
and account for 7 per cent of India’s GDP and 30 per cent of India’s foreign
exchange inflows.
Population projections from the Planning Commission of India suggest that the
share of the working age population (15-64 years) in total population will grow
from the current 59 per cent to about 65 per cent, translating into 882 million by
year 2020.According to the Vision 2020 document for the Planning Commission of
India, the country will witness continued urbanization.
The urban population is expected to rise from 28 per cent to 40 per cent of total
population by 2020.Future growth is likely to be concentrated in and around 60 to
70 large cities, each having a population of one million or more. This profile of
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concentrated urban population will facilitate customized telecom offerings from

operators. Over the years, spending power has steadily increased in India.
Between 1995 and 2002, nearly 100 million people became part of the consuming
and rich classes. Over the next five years, 180 million people are expected to
move into the consuming and very rich classes.
SERVICES PROVIDED BY THE TELECOM INDUSTRY
Wire line Services
1 Wire line services subscriber base stood at 37.96 million in quarter ending March
2009 as compared to 37.90 million in quarter ending December 2008.
2 Rural Wire line Subscriber base stood at 10.58 million in quarter ending March
2009 as compared to 10.68 million in quarter ending December 2008.
3 Number of Village Public Telephones (VPTs) have increased from 5.39 lakhs in
quarter ending December 2008 to 5.61 lakhs in quarterly ending march 2009
4 Number of Public Call Offices (PCOs) have increased from 5.98 million in quarter
ending December 2008 to 6.20 million in quarter ending March 2009.
Wireless Services
1 The Wireless subscribers have reached 391.76 million as on 31st March 2009 as
against 346.89 million subscribers in the previous quarter. During this quarter
44.87 million wireless subscribers were added.
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2 Technology-wise Wireless Market Share There are 297.26 million GSM

subscribers (75.88%) and 94.50 million CDMA subscribers (24.12%) at the end of
March 2009.
GSM
The GSM subscriber base has reached 297.26 million in the quarter ending March
2009 as against 258.23 million at the end of the previous quarter.
CDMA
The CDMA subscriber base has reached 94.50 million in the quarter ending March
2009 as against 88.66 million at the end of the previous quarter
Internet Services (Including Broadband)
1) There are 13.54 million Internet subscribers at the end of March 2009 as
compared to 12.85 million Internet subscribers at the end of December 2008
registering a growth of 5.30%. This growth rate is higher as compared to the
growth rate of 5.01% at the end of December 2008.
2) Besides above, there are 117.82 million wireless data subscribers at the end of
March 2009 (capable of accessing data services including internet through
mobile handsets [GSM/ CDMA]).
3) Broadband Subscriber Growths - The number of Broadband subscribers (with a

download speed of 256 Kbps or more) was 6.22 million at the end of March
2009 as compared to 5.52 million at the end of December 2008. The growth
rate of broadband subscribers in this quarter is 12.68%.
ISP Providers In INDIA % Market Share
BSNL 54%
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MTNL 16%
Bharti Airtel 8%
Reliance 7%
Sify 2%
Hathway 2%
Tata 2%
Others 8%
Total 100%
4) Broadband Subscribers Share (Technology wise) – Out of total 6.22 million

broadband subscribers, 5.364 million are DSL based; 0.474 million Cable
Modem; 0.244 million Ethernet LAN; 0.042 million Fiber; 0.072 million Wireless,
0.020 million Leased Line and 0.002 million use other technologies.
TIMELINE - EVOLUTION OF INDIAN TELECOM
Mid 1980s Department of Telecommunications set up
Mar 1986 VSNL incorporated to provide international telecom services
Apr 1986 MTNL incorporated to provide fixed-line telephone services in Mumbai

and New Delhi
Dec 1991 DoT invites bids from Indian companies for cellular licenses in the four
metropolitan circles
May 1994 Government announces the National Telecom Policy, opening up the
basic service sector to private players
Sep 1994 Entry guidelines for basic services announced
Nov 1994 Licenses were issued to cellular operators in the four metros
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Mar 1995 Paging services by private operators commence
Oct 1996 Licenses for 20 cellular circles issued
Jan 1997 Telecom Regulatory Authority of India established by government
Nov 1998 ISP business opened up to operators other than DoT and VSNL
Mar 1999 Government announces NTP 1999
Jul 1999 DoT announces Migration Package for existing operators' licensing
costs, subject to compliance with certain conditions
Aug 2000 Government announces guidelines for opening up domestic long

distance telephony for carrying both inter-circle and intra- circle traffic,
with no restriction on the number of players TRAI issues the first tariff
order and cuts domestic and international long distance telephone
charges.
Jan 2001 The Department of Telecom opens up basic services to unlimited

competition and allows basic operators to provide WLL services on a
restricted basis.
Aug 2001 Opening of National Long Distance Service to competition
Jan 2002 Bharti starts cellular to cellular long distance services with sharp cuts
in tariffs
Mar 2007 9 distinct operators had been allocated GSM spectrum. Out of these,
only Bharti has a pan-India presence.
Aug 2007 Subscriber thresholds were revised by TRAI as operators could support
more subscribers with lower spectrum as compared to WPC allocation
Jan 2008 Govt of India allocated start-up spectrum to all prior licensees awaiting
spectrum (does not include LOIs issued in January 2008). These include
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Aircel (14 circles), Idea (2 circles), RComm (14 circles) and Vodafone (6
circles).
Jun 2009 TRAI plans to introduce MNP (Mobile Number Portability) on a pan-India
basis.
Apr 2010 3G Spectrum Auction
LATEST DEVELOPMENT
A WIDE LOOK ON INDIA’S 3G AUCTIONS:
India’s auction for 3G GSM Service licence ended today with bids for pan-India
licence touching Rs 16,751 crore which ensures the Government of India a revenue
of Rs 67,719 crore.
The 3G auction had commenced on 9 April, 2010 and there were nine bidders in
the fray for the slots of 3G spectrum on the block. The government auctioned three
slots in 17 telecom service areas and four slots in the remaining five states of
Punjab, Bihar, Orissa, Jammu and Kashmir and Himachal Pradesh.
No single bidder bid for a pan-India 3G license so state operator BSNL would be
remain the biggest 3G operator in India. Delhi circle emerged the most valuable
circle at Rs.3317 crore, followed by Mumbai at Rs.3247 crore. Among the major
bidders, Idea cellular paid nearly Rs.5765 cr for 11 telecom circles, while India’s
largest 2G Mobile service operator Bharti Airtel paid Rs.12290 cr for 13 telecom
circles, Vodafone Essar will paid Rs. 11617 crore for 9 telecom circle while Reliance
Communication paid Rs 8583 crore for 13 telecom circles.
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LITERATURE REVIEW
Girija (1998), in its article “Socioeconomic Implications of Telecommunications

Liberalization: India in the International Context” says that Telecommunications
restructuring have evolved differently in Asia and Latin America. While Asian
governments have moved cautiously in bringing changes to the sector, Latin
American nations have implemented radical ownership and market
transformations. The Indian telecommunications reform falls in between these two
general regional trends. The choice of a high component of competition, increased
private participation, and no privatization of the national carrier set conditions that
will trigger unique socioeconomic effects. This article identifies and highlights the
likely implications of the Indian reform on key economic and social issues, such as
the cost of services, cross-subsidies, network interconnection, private investments,
universal services, employment, and the possible rise of an information-intensive
economy. It does so by comparing and contrasting the Indian experience with
dominant reform strategies elsewhere in the developing world.
T.H. Chowdary (1999) discusses how Telecom reform, or demonopolization, in

India has been bungled. Shaped by legislation dating back to the colonial era and
post Second World War socialist policies, by the mid-1980s India realized that its
poor telecommunications infrastructure and service needed reform. At the heart of
the problem lay the monopoly by the government’s Department of
Telecommunications (DOT) in equipment, networks and services. The National
Telecom Policy 1994 spelt out decent objectives for reform but tragically its
implementation was entrusted to the DOT. This
created an untenable situation in which the DOT became policymaker, licenser,
regulator, operator and also arbitrator in disputes between itself and licensed
competitors. He discusses the question: ‘Why did India get it so wrong? and What
India should do now?
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Anand (1999), in his article named “India's economic policy reforms” says that
India was embarked on economic reforms in July 1991, in the wake of a balance of
payments crisis. In this article, an attempt is made to review two books and a set
of World Bank reports concerning the progress of these reforms. Issues concerning
economic policy, impact of the reforms on poverty, sectoral issues relating to
agriculture, industry and infrastructure are briefly discussed. As reforms enter a
more difficult phase,
several challenges remain. Some of this fall under the “economic agenda'' of
measures needed to maintain economic growth; others can be termed the
“development agenda'' - of improving human development. Progress with regard
to the former is not sufficient to produce results concerning the latter.
Bhattacharya (2000) constructs a vision of the Indian telecommunication sector

for the year 2020. The paper aims at isolating agents of change based on
international experiences and situates India in the development continuum. The
agents of change have been broadly categorized into economic structure,
competition policy and technology.
Das (2000), in her paper described the Liberalisation of the Indian

telecommunications services which started in mid nineties with no change in the
existing public monopoly structure, entirely controlled by Department of
Telecommunications (DoT). In order to evaluate any proposed industry structure, it
is essential to analyse the production technology of DoT so as to determine the
rationale of liberalisation and sustainability of competition. Accordingly, the
researcher estimates a frontier multi-product cost function for DoT, where the cost
function has been duly modified to account for the production technology of a
public monopoly. The study finds that although DoT displays high allocation
inefficiency, it is still a natural monopoly with very high degree of sub additively of
cost of production. This study implies that the choice of any reform policy should
consider the trade-off between the loss of scale and scope economies and cost
saving from the reduction in inefficiency of the incumbent monopoly in the event
of competition.
Rao (2000), in her article named “Internet service providers in India”, provides a
broad view of the role of an Internet service provider (ISP) and the factors to be
considered before entering the ISP market. Describes the Internet/ISP scene within
India and discusses the configuration of local, regional and national level ISPs, and
the supporting infrastructure. She also identifies the various success factors. The
global Internet scenario is discussed regarding the phases of the Internet in India,
i.e. pre and post
commercialization. The main players are described: ERNET, NICNET, STPI, VSNL,
MTNL, Satyam Infoway and Bharti-BT. The financial and legal implications are
highlighted in the Indian context. Many companies entered the nascent ISP
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business in India due to deregulation. Building local content, foreknowledge of new

Internet technologies, connecting issues, competitiveness, etc. would help in their
sustainability. She concludes that though many companies entered the nascent ISP
businesses in India due to deregulation, many of them are unlikely to survive in the
longer term.
Vrmani (2000) estimates the contribution of telecommunication (or telecom)

services to aggregate economic growth in India. Estimated contribution is
distinguished between public and private sectors to highlight the impact of
telecom privatization on economic growth. Knowledge of policy determinants of
demand of telecom services is shown to be essential to enhance growth
contribution of telecom services. Using a recent sample survey data from
Karnataka State in South India, price and income determinants of demand for
telecom services are estimated by capacity of telephone exchanges Estimation
results offer evidence for significant negative own price elasticity and positive
income elasticity of demand for telecom services.
Narinder (2004), in his article “Enhancing Developmental Opportunities by

Promoting ICT Use: Vision for Rural India” talks about the foremost benefits of
Information and Communication Technologies (ICTs) in developing countries that
can be helpful in improving governance including public safety and eradication of
illiteracy. The benefits of ICTs have not reached the masses in India due to lack of
ICT infrastructure, particularly in rural areas, where two-third of the population of
the country lives. Even in cities and suburban areas, use of ICTs is not popular due
to lack of awareness to its use, computer illiteracy, and absence of practical
applications. India is the largest country in South Asia, with a population of over
one billion people and its telecom sector is presently experiencing fast growth
phases. However telephony penetration in villages is less than two percent of the
rural population and about 15 percent of the villages are still without any
telephony service. Universal access to ICTs in rural areas has been planned and is
being implemented through Public Tele Info Centers having voice data and video,
as majority of villagers in India cannot afford a separate home connection.
Illiteracy in rural areas is as high as 40 percent and in some tribal belts hardly
about 20 percent people are literate. There are 35 million children in age group of
6–11 years, who are out of school and one out of four drops out during primary
classes. Education and training, therefore, must be given the top priority if
advantages of ICTs are to be harnessed. Indian economy is agriculture based and
employs maximum workforce. Improvement in agriculture productivity can help in
reducing rural poverty. Adoption of ICT in agriculture will play an increasingly
important role in crop production and natural resource management. The other
critical factor is technological challenges for universal access to ICTs to bring down
the network access cost.
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Nikam, Ganesh, Tamizhchelvan (2004), analyses that changing face of India in

bridging the digital device. He reiterated - “India lives in villages” said the Father
of the Nation, Mahatma Gandhi. With 1,000 million people and 180 million
households, India is one of the biggest growing economies in the world. With the
advent of the Information, Communication and Technology (ICT) revolution, India
and its villages are slowly but steadily getting connected to the cities of the nation
and the world beyond. Owing to the late Rajiv Gandhi, India is now a powerful
knowledge economy, and though India may have been slow to start, it certainly
has caught up with the West and is ahead in important respects. The Government,
the corporate sector, NGOs and educational institutions have supported rural
development by encouraging digital libraries, e-business, e-learning and e-
governance. The aim of this paper is to touch upon and highlight some of the areas
where, by using ICT, the masses have been reached in this way. A follow-up paper
will outline collections of significant cultural material which, once national IT
strategies are fully achieved, could form part of a digitally preserved national
heritage collection.
Dey (2004), in her article talks about the discussions between the Federal
Communications Commission (FCC) and communications policy makers and
regulators in other countries and how they have gleaned several clusters of issues
where further research would directly benefit them. Recently, there have been two
notable shifts. First, as the acceptance of the competition model over the
monopoly model for telecommunications markets takes deep effect in regulators
all over the world, questions regarding process and procedure for regulation are
becoming ever more urgent. This paper discusses current questions regarding
decision making, enforcement, and understanding consumer issues that arise
often in the FCC's discussions with other regulators. Second, technological change
is potentially shifting market definitions. In the FCC's discussion with other
regulators over the last two years, the overlap of wire line telecom, wireless
telecom and cable television has become more pronounced.
Singh (2005), in his article “The role of technology in the emergence of the
information society in India” describes the role that information and
communication technologies are playing for Indian society to educate them
formally or informally which is ultimately helping India to emerge as an information
society. Though India has a huge population, the illiteracy rate is also huge in this
country. The paper has taken an approach to find the historical situation and
present the prevailing scenario as well as the change that are taking place with the
application of ICT to the advantage of the society in different areas including daily
life. India is making all out efforts to be counted among the developed nations of
the world. The article also describes the considerable attention India is taking for
application of technology, development of infrastructure and human resource for
meeting national needs. Basically India is building an information society.
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Technology has helped society to cut across the traditional boundaries for getting
converted into an emerging information society. The study concludes that The
Indian software and services industry has significantly helped to boost the Indian
economy. In IT-enabled services too, India has been clearly perceived to be the
dominant hub. The Indian software sector is being recognized as the single largest
contributor to incremental market capitalization in India but the sector is still small
in terms of contribution to GDP, especially when compared to other large sectors in
the economy like agriculture and manufacturing. Similarly, the telecommunication
sector has contributed a lot but still has a considerable way to go. The paper also
enforces that comparisons of India’s telecommunication statistics with those of
developed and other emerging economies show that the country is still far behind
its contemporaries.
Mr. Banka (2006) gives an overview of the mergers and acquisitions in the
telecommunication industry. According to him Governments decision to raise the
foreign investment limit to 74% is expected to spur fresh rounds of mergers and
takeovers in India. He foresees a sector that represents humongous opportunity
waiting to be tapped by Indian and foreign conglomerates.
Thomas (2007), in his article describes the contribution made by

telecommunications in India by the state and civil society to public service, this
article aims to identify the state’s initial reluctance to recognize
telecommunications provision as a basic need as against the robust tradition of
public service aligned to the postal services and finds hope in the renewal of public
service telecommunications via the Right to Information movement. The article
follows the methodology of studying the history of telecommunications approach
that is conversant with the political economy tradition. It uses archival sources,
personal correspondence, and published information as its research material. The
findings of the paper suggests that public service in telecommunication is a
relatively ‘‘new’’ concept in the annals of Indian telecommunications and that a
deregulated environment along with the Right to Information movement holds
significant hope for making public service telecommunications a real alternative.
The article provides a reflexive, critical account of public service
telecommunications in India and suggests that it can be strengthened by learning
gained from the continual renewal of public service ideals and action by the postal
services and a people-based demand model linked to the Right to Information
Movement. All studies done by the researcher suggests that the right to
information movement has contributed to the revitalization of participatory
democracy in India and to a strengthening of public service telecommunications.
Cygnus Business Consulting & Research Pvt. Ltd. (2008), in its “Quarterly
Performance Analysis of Companies (April-June 2008)” has analysed the Indian
telecom industry in the awake of recent global recession and its overall impact on
the Indian economy. The analysis is done in the background of wake of global
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recession and rising inflation. Cygnus estimates, the Indian telecom industry is
expected to maintain the growth trajectory in the next quarter as well. With almost
5-6m subscribers are being added every month, and the country is witnessing wild
momentum in the telecom industry.
Maheshwari (July-September 2008), in her report analysed the Indian telecom

industry and ascertain that Indian telecommunications has been zooming up the
growth curve at an mounting pace, and India is has surpassed US to become the
second largest wireless network in the world. This growing subscriber base is
basically created by tapping into rural India, which is an emerging market for the
industry. The estimate for the next five to ten years is that the rural market will
form 40 % of the subscriber base. The study has analysed the human resource
management process of the industry, and specially the latest trends of recruitment
of this massively growing industry.
Anderson (2008), in his single executive interview titled “Developing a route to

market strategy for mobile communications in rural India An interview with
Gurdeep Singh, Operations Director, Uttar Pradesh, Hutch India” suggests that
managers need to go beyond traditional approaches to serving the poor, and
innovate by taking into account the unique institutional context of developing
markets. His practical implication says that the experience of Hutchison Essar in
India provides some important lessons for mobile network operators (MNOs) and
other firms in other developing markets who are hoping to serve the rural poor:
Hutchison has recognized the value of corporate and non corporate partners. The
company has proactively established relationships with individual entrepreneurs,
and has provided has provided development support to other partners such as
distributors. The company has recognized the value of leveraging existing local
institutions, and has seen gaps in local infrastructure or missing services as
potential opportunities rather than barriers to growth. The company has seen the
rural market as an opportunity – not just an obligation to be served because of
universal service obligations. Also this article demonstrates that MNOs can deliver
availability and affordability to achieve increased individual or household
penetration through business model innovation.
Mani (2008) addresses a number of issues arising from the growth of telecom
services in India since the mid-1990s. It also discusses a number of spillover
effects for the rest of the economy and one of the more important effects is the
potential to develop a major manufacturing hub in the country for telecom
equipment and for downstream industries such as semiconductor devices. The
telecom industry in India could slowly become an example of the service sector
acting as a fillip to the growth of the manufacturing sector. A beginning towards
this has been made. The formation of a Telecom Equipment Export Forum and the
announcement of the Indian Semiconductor Policy 2007 are steps in this direction.
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Success crucially depends on the response of the private sector to these

incentives. Given the importance that a regulatory agency can play in this crafting,
no effort should be lost in strengthening the powers of the TRAI. The benefits to
the Indian economy from having both a strong services and manufacturing
segments in the telecom sector cannot be undermined.
Narayana (2008) estimates the contribution of telecommunication (or telecom)
services to aggregate economic growth in India. Estimated contribution is
distinguished between public and private sectors to highlight the impact of
telecom privatization on economic growth. Knowledge of policy determinants of
demand of telecom services is shown to be essential to enhance growth
contribution of telecom services. Using a recent sample survey data from
Karnataka State in South India, price and income determinants of demand for
telecom services are estimated by capacity of telephone exchanges. Estimation
results offer evidence for significant negative own price elasticity and positive
income elasticity of demand for telecom services.
Sharma (2009) deals with the major challenges faced by India’s telecom
equipment manufacturing sector, which lags behind telecom services. Only 35% of
the total demand for telecom equipment in the country is met by domestic
production. This is not favourable to long-term sustained growth of the telecom
sector. The country is also far behind in R&D spending when compared to other
leading countries. India needs to see an increase in R&D investment, industry-
academia-government partnership, better quality doctoral education and
incentives to entrepreneurs for start-ups in telecom equipment manufacturing. In
2006-07, 65% of the total consumption of equipment was met through imports.
This trend has far-reaching implications for the economy and should not be allowed
to continue for long. In a country like India which has a problem of massive
unemployment, the manufacturing sector should be promoted to create more
employment opportunities.
Shah (February, 2009), has analysed Indian telecom industry and studied the
sector keeping in mind three companies; namely Bharti, R.Comm and idea in the
background of recent global meltdown. The study suggests that though there is no
sign of slowdown in this sector, but surely a strong turmoil is going on in the
industry. The study states that the sector is fairly immune from the current
economic downturn & does provide a good defensive bet in medium term. With the
help of newer technologies, wireless penetration is expected to increase in the
near future, which is basically fuelling the growth of the sector. While the 3G /
Broadband adoption would ensure long term growth momentum, the article has
thoroughly investigated about the intense competitive scenario, pricing pressure,
high capital intensity & substantial regulatory uncertainties currently faced by the
industry. The article has also described the cause of being relatively safe of this
industry. The causes described by Shah are increasing rural coverage, rising
affordability, declining handset/subscription costs, substantially low tariffs &
Page 20
established brand/distribution. However, the study also cautions the telecom

industry that a steeper economic slowdown could start impacting the subscriber
usage patterns as well as operator capital investments & thereby could
substantially restrict revenue growth rates going forward.
PORTERS FIVE FORCES MODEL ON TELECOM SECTOR IN INDIA
Porter’s five forces model uses concepts developed by Industrial

Organisation economics to derive five forces that determine the
competitive intensity and therefore attractiveness of a market.
1. COMPETITIVE RIVALRY WITHIN AN THE INDUSTRY
This describes the intensity of competition between existing firms in an

industry. Highly competitive industries generally earn low returns because
the cost of competition is high. A highly competitive market might result
from:
i) Many players of about the same size; there is no dominant firm
ii) Little differentiation between competitors products and services
iii) A mature industry with very little growth; companies can only grow by
stealing customers away from competitors
There are majorly 3 types of players in the industry…

i) State owned players. (BSNL and MTNL)
ii) Private Indian players. (Reliance comm., Tata comm., Bharti Airtel)
iii) Foreign invested companies. (Vodafone, Idea cellular)
There has been a stiff competition in the telecom market over a period of time. Let
us talk about the current scenario.
Page 21
At present has a subscribers base of above 6,47,44,985 with a market share of

apron. 15%. BSNL has an edge over private players as it has already started with
3G spectrum services across India. BSNL is BSNL dedicatedly performing its work
as it drives India into the next league of telecom supremacy by providing
technologically advanced services to its discerning customers at an affordable cost
On the private side, there has been a tough competition between Bharti airtel and
Vodafone each having a market share of 30 % and 24% respectively.
Even the growth rate of both the companies for the month of April when compared
with March is around +/- 2.5% .
Both are again in the race to start with the 3G services and cater it all across India
and give a tough competition to BSNL who is already in the market.
Idea cellular, Reliance comm. and Aircel are also in the race as they lack in the
infrastructure when compared with Vodafone and Bharti Airtel
1. BARGAINING POWER OF CUSTOMERS.
This is how much pressure customers can place on a business. If one

customer has a large enough impact to affect a company's margins and
volumes, then the customer hold substantial power. Here are a few reasons
that customers might have power:
i) Small number of buyers
ii) Purchases large volumes
iii) Customers are price sensitive.
Indian telecom industry is one of the fastest growing or second largest in the
world. In this industry, service providers are the major drivers. The major booster is
the wireless mobile subscribers which have crossed 433 million. There has been a
major increase in subscribers in the month of April,2010 by a whopping 11 mn. It is
expected to grow more after the 3G services starting off from sep1,2010,
Page 22
1. BARGAINING POWER OF SUPPLIERS
This is how much pressure suppliers can place on a business. If one supplier
has a large enough impact to affect a company's margins and volumes,
then it holds substantial power. Here are a few reasons that suppliers might
have power:
i) There are very few suppliers of a particular product
a. There are no substitutes
ii) Switching to another (competitive) product is very costly
iii) The product is extremely important to buyers - can't do without it
iv) The supplying industry has a higher profitability than the buying
industry
As far as telecom industry is concerned there are very few suppliers in the
market. So the role of suppliers is almost negligible in the industry. We are
trying to analyze that minor role.
1. Mobile handset suppliers : There are many handset suppliers in the

market, some of them are Nokia, Samsung, Motorola, Sony Ericsson,
Reliance Classic, Tata Indicom, etc. Few of the new entrants are Spice,
Micromax, Karbon, etc.
2. Some other suppliers in the industry are the suppliers of Optical fibre and
Aluminium.
Other important parameter in this can be the software assistance, where suppliers
can have edge over. The major software providers are TCS, Infosys, Wipro, Satyam
etc. Again one thing is noticeable that big giants like Reliance and Tata have their
own software solution departments
Page 23
1. THREAT TO NEW ENTRANTS.
The easier it is for new companies to enter the industry, the more
cutthroat competition there will be. Factors that can limit the threat of
new entrants are known as barriers to entry. Some examples include:
i) Existing loyalty to major brands
ii) High fixed costs
iii) Scarcity of resources
iv) High costs of switching companies
v) Government restrictions or legislation
The Indian telecom sector offers unprecedented opportunities for foreign

companies in various areas such as 3G, Virtual Private Network, international long
distance calls, value added services, etc. The market is witnessing M&A like the
Bharti – Zain, which are leading to consolidations in the industry. This sector also
attracts FDI which has made it the third largest sector attracting FDI in the post
liberalization era.
1. SUBSTITUTE TO PRODUCT
What is the likelihood that someone will switch to a competitive product or

service? If the cost of switching is low, then this poses a serious threat. Here are a
few factors that can affect the threat of substitutes:
I) The main issue is the similarity of substitutes. For example, if the price of
coffee rises substantially, a coffee drinker may switch over to a beverage
like tea.
II) If substitutes are similar, it can be viewed in the same light as a new
entrant.
There is a cut throat competition and a price war for the tariffs of the service
provider. Today the difference in the price of the of two products is marginal. Also
with the availability of additional services like GPRS, internet, video conferencing
Page 24
etc, the option of substitutes for the consumer is never ending. In today’s scenario,
there are consumers who are ready to change their service providers for a
reduction in the tariffs, which poses a major threat to the companies..
SWOT ANALYSIS OF TELECOM SECTOR
STRENGTHS:
Strong mobile subscriber’s growth is continuing, with the market benefiting from
healthy degree of competition.
The mobile market plays host to a large number of strategic investors including
Singapore’s SingTel, Vodafone from U.K, Telecom Malaysia, Etisalat from UAE,
Japan’s NTT DoCoMo and Russia’s Sistema.
Demand for mobile Value Added Services is strong and expected to grow.
WEAKNESS:
Mobile market is still inclined towards prepaid users.
The dominance of prepaid services has contributed to declining mobile average

revenue per user (ARPU) levels.
Disagreement between the regulator TRAI and government ministries has led to
delayed policy implementation in a number of areas, most notably 3G licensing.
OPPURTUNITIES:
Page 25
The government is currently considering recommendations made by TRAI to allow

the operations of MVNO’s (Mobile Virtual Network Operator) in the mobile market.
The government will cut license fees upto 33% for those operators whose service
covers 95% of the residential area in a calling circle.
There is an opportunity to cover the vast untapped rural market.
THREATS:
Government plans to increase spectrum usage charges for telecom companies.
Network capacity, particularly in the mobile market, could struggle to keep up with
demand.
Stiff competition in the market will make service providers difficult to retain
customers.
Page 26
Overview of Telecom Operators in India as

per Market share:-
Page 27
1. Bharti Airtel Ltd.

2. Reliance Communications Ltd.
3. Vodafone Essar Ltd.
4. BSNL
5. Idea Cellular + Spice
Page 28
BHARTI AIRTEL LTD.
Telecom giant Bharti Airtel is the flagship company of Bharti Enterprises. The
Bharti Group has a diverse business portfolio and has created global brands in the
telecommunication sector. Airtel comes from Bharti Airtel Limited, India’s largest
integrated and the first private telecom services provider with a footprint in all the
23 telecom circles. Bharti Airtel since its inception has been at the forefront of
technology and has steered the course of the telecom sector in the country with its
world class products and services. The businesses at Bharti Airtel have been
structured into three
individual strategic business units (SBU’s) - Mobile Services, Airtel Telemedia
Services & Enterprise Services. The mobile business provides mobile & fixed
wireless services using GSM technology across 23 telecom circles while the Airtel
Telemedia Services business offers broadband & telephone services in 95 cities
and has recently launched India's best Direct-to-Home (DTH) service, Airtel digital
TV. The Enterprise services provide end-to-end telecom solutions to corporate
customers and national & international long distance services to carriers. All these
services are provided under the Airtel brand.
The company served an aggregate of 88,270,194 customers as of December 31,

2008; of whom 85,650,733 subscribed to GSM services and 2,619,461 use the
Telemedia Services either for voice and/or broadband access delivered through
DSL. Bharti Airtel is the largest wireless service provider in the country, based on
the number of subscribers as of December 31, 2008. They also offer an integrated
suite of telecom solutions to their enterprise customers, in addition to providing
long distance connectivity both nationally and internationally. They have recently
forayed into media by launching their DTH and IPTV Services. All these services are
rendered under a unified brand "Airtel".
Page 29
The company also deploys, owns and manages passive infrastructure pertaining to
telecom operations under its subsidiary Bharti Infratel Limited. Bharti Infratel owns
42% of Indus Towers Limited. Bharti Infratel and Indus Towers are the two top
providers of passive infrastructure services in India.
Company shares are listed on The Stock Exchange, Mumbai (BSE) and The National
Stock Exchange of India Limited (NSE).
RELIANCE COMMUNICATIONS LTD.
Page 30
Reliance Communications is the flagship company of the Anil Dhirubhai Ambani

Group (ADAG) of companies. Listed on the National Stock Exchange and the
Bombay Stock Exchange, it is India’s leading integrated telecommunication
company with over 71million customers.
Their business encompasses a complete range of telecom services covering mobile

and fixed line telephony. It includes broadband, national and international long
distance services and data services along with an exhaustive range of value-added
services and applications. Our constant endeavour is to achieve customer delight
by enhancing the productivity of the enterprises and individuals we serve.
Reliance Mobile (formerly Reliance India Mobile), launched on 28 December 2002,

coinciding with the joyous occasion of the late Dhirubhai Ambani’s 70th birthday,
was among the initial initiatives of Reliance Communications. It marked the
auspicious beginning of Dhirubhai’s dream of ushering in a digital revolution in
India. Today, the company can proudly claim that they were instrumental in
harnessing the true power of information and communication, by bestowing it in
the hands of the common man at affordable rates. They endeavour to further
extend their efforts beyond the traditional value chain by developing and
deploying complete telecom solutions for the entire spectrum of society.
It was established in the year 2004 as Reliance Infrastructure Developers Private

Limited,Reliance Communications started laying 60,000 route kilometers of a pan-
India fibre optic backbone with high capacity, integrated (wireless and wireline),
convergent (voice, data and video) digital network and to offer services spanning
the entire infocomm value chain. It is capable of delivering a range of services
spanning the entire infocomm (information and communication) value chain,
including infrastructure and services for
enterprises as well as individuals, applications, and consulting.
Page 31
VODAFONE ESSAR LTD.
Vodafone Essar in India is a subsidiary of Vodafone Group Plc and commenced

operations in 1994 when its predecessor Hutchison Telecom acquired the cellular
license for Mumbai. Vodafone Essar now has operations in 22 circles with over
65.92 million customers**. The company is a joint venture of Essar Communication
Holdings Ltd and the UK-based Vodafone Group. Vodafone has partnered with the
Essar Group as their principal joint venture partner for the Indian market. They are
in the business of cellular telephony. Over the years, Vodafone Essar, under the
Hutch brand, has been named the ‘Most Respected Telecom Company’, the ‘Best
Mobile Service in the country’ and the‘Most Creative and Most Effective Advertiser
of the Year’.
Vodafone is the world’s leading international mobile communications company. It

currently has equity interests in 27 countries across 5 continents and 40 partner
networks with over 289 million proportionate customers worldwide. Vodafone has
partnered with the Essar Group as its principal joint venture partner for the Indian
market.
Essar Global Limited (EGL) is a diversified business group spanning the

manufacturing and services sectors of Steel, Energy, Power, Communications,
Shipping & Logistics, and Projects. The group has operations and investments in
India, Canada, USA, Africa, the Middle East, the Caribbean and South East Asia and
employs 30,000 people worldwide.
Vodafone Essar Ltd provides services like 2G, which are based on 1800 Mhz and
900Mhz GSM digital technology. They offers voice and data services. In addition,
they offers postpaid connections activation, prepaid SIM cards and recharge
coupons sale, service activation/deactivation, postpaid tariff plan change,
customer query resolution, prepaid/postpaid SIM card replacement and
Page 32
upgradation, mobile number change, and information on and subscription of value

added services through stores.
BHARAT SANCHAR NIGAM LTD.
Bharat Sanchar Nigam Ltd. formed in October, 2000, is World's 7th largest
Telecommunications Company providing comprehensive range of telecom services
in India: Wireline, CDMA mobile, GSM Mobile, Internet, Broadband, Carrier service,
MPLS-VPN, VSAT, VoIP services, IN Services etc. Within a span of five years it has
become one of the largest public sector unit in India.
It has about 47.3 million line basic telephone capacity, 4 million WLL capacity, 20.1
Million GSM Capacity, more than 37382 fixed exchanges, 18000 BTS, 287 Satellite
Stations, 480196 Rkm of OFC Cable, 63730 Rkm of Microwave Network connecting
602 Districts, 7330 cities/towns and 5.5 Lakhs villages.
BSNL is the only service provider, making focused efforts and planned initiatives to
bridge the Rural-Urban Digital Divide ICT sector. In fact there is no telecom
operator in the country to beat its reach with its wide network giving services in
every nook & corner of country and operates across India except Delhi & Mumbai.
BSNL is numero uno operator of India in all services in its license area. The
company offers vide ranging & most transparent tariff schemes designed to suite
every customer.
BSNL cellular service, CellOne, has more than 17.8 million cellular customers,
garnering 24 percent of all mobile users as its subscribers. That means that almost
every fourth mobile user in the country has a BSNL connection. In basic services,
BSNL is miles ahead of its rivals, with 35.1 million Basic Phone subscribers i.e.
85 per cent share of the subscriber base and 92 percent share in revenue terms.
BSNL has more than 2.5 million WLL subscribers and 2.5 million Internet
Customers who access Internet through various modes viz. Dial-up, Leased Line,
Page 33
DIAS, Account Less Internet (CLI). BSNL has been adjudged as the NUMBER ONE
ISP in the country.
BSNL has set up a world class multi-gigabit, multi-protocol convergent IP

infrastructure that provides convergent services like voice, data and video through
the same Backbone and Broadband Access Network. At present there are 0.6
million DataOne broadband custome
IDEA CELLULAR LTD. + SPICE
IDEA Cellular is a publicly listed company, having listed on the Bombay Stock
Exchange (BSE and the National Stock Exchange (NSE) in March 2007. Idea
Cellular Ltd. is India's leading GSM mobile services operator. It has licenses to
operate in 11 circles.
The company has a customer base of over 17 million. It is the first cellular
company to launch music messaging with Cellular Jockey, Background Tones,
Group Talk, a voiceportal with Say IDEA and a complete suite of mobile email
Services.A brand known for many firsts, Idea was the first to launch GPRS and
EDGE in the country. Idea has received international recognition for its path-
breaking innovations when it won the GSM Association Award for "Best Billing and
Customer Care Solution" for 2 consecutive years.
IDEA Cellular is part of the Aditya Birla Group, India's first truly
multinationalcorporation. The group operates in 25 countries, and is anchored by
over 1,25,000 employees belonging to 25 nationalities.
The combined holding of the Aditya Birla Group companies in Idea stands at 98.3
percent. Mr. Kumar Mangalam Birla has been named the Chairman of the
company.
Page 34
The Indian telecommunications market for mobile services is divided into 22

"Service Areas" classified into "Metro", Category "A", Category "B" and Category
"C" service areas by the Government of India. These classifications are based
principally on a Service Area's revenue generating potential
Customer Service and Innovation are the drivers of this Cellular Brand. A brand
known for their many firsts, IDEA is the only operator to launch General Packet
Radio Service (GPRS) and EDGE in the country. IDEA has seen phenomenal growth
since its inception, the company's footprint idea is to first achieve critical mass,
then drill deep instead of spreading thin, however, does not increasing geographic
footprint only, it also drills deep and successfully attempts to provide excellent
network coverage in all its circles of operation
BOTTOM FIVE COMPANIES
1. Aircel Cellular Ltd. + Dishnet

2. Mahanagar Telephone Nigam Ltd. (MTNL)
3. BPL Mobile Communications Ltd.
4. HFCL Infotel Ltd.
5. Shyam Telecom Ltd.
AIRCEL + DISHNET
The Aircel Group is a joint venture between Maxis Communications Berhad of

Malaysia and Apollo Hospital Enterprise Ltd of India, with Maxis Communications
holding a majority stake of 74%.
Aircel commenced operations in 1999 and became the leading mobile operator in
Tamil Nadu within 18 months. In December 2003, it launched commercially in
Chennai and quickly established itself as a market leader – a position it has held
since. Aircel began its outward expansion in 2005 and met with unprecedented
Page 35
success in the Eastern frontier circles. It emerged a market leader in Assam and in
the North Eastern provinces within 18 months of operations. Till today, the
company gained a foothold in 14 circles including Chennai, Tamil Nadu, Assam,
North East, Orissa, Bihar, Jammu &
Kashmir, Himachal Pradesh, West Bengal, Kolkata, Kerala, Andhra Pradesh,
Karnataka and Delhi.
The Company has currently gained a momentum in the space of telecom in India
post the allocation of additional spectrum by the Department of Telecom, Govt. of
India for 13 new circles across India. These include Delhi (Metro), Mumbai (Metro),
Andhra Pradesh, Gujarat, Haryana, Karnataka, Kerala, Madhya Pradesh,
Maharashtra & Goa, Rajasthan, Punjab, UP (West) and UP (East).
Aircel has won many awards and recognitions. Voice and Data gave Aircel the
highest rating for overall customer satisfaction and network quality in 2006. Aircel
emerged as the top mid-size utility company in Business world’s ‘List of Best Mid-
Size Companies’in 2007. Additionally, Tele.net recognized Aircel as the best
regional operator in 2008.
With over 16 million customers in the country, Aircel, the fastest growing telecom
company in India, has revved up plans to become a full-fledged national operator
by end of 2009.
MTNL
Mahanagar Telephone Nigam Limited (MTNL) was set up in 1st April of the year
1986 by the Government of India to upgrade the quality of telecom services,
expand the telecom network, introduce new services and to raise revenue for
telecom development needs of India's key metros, Delhi (the political capital) and
Page 36
Mumbai (the business capital of India). The company has also been in the forefront
of technology induction by converting 100% of its telephone exchange network
into the state-of-the-art digital mode.
MTNL as a company, over last nineteen years, grew rapidly by modernizing the
network, incorporating the State-of-the-art technologies and a customer friendly
approach. The Company providing various types of telecommunication services
including Telephone, telex, wireless, data communication, telematic and other like
forms of communication (Internet).
First digital exchange world technology brought to India by the company during
the year 1986. Phone Plus services was offered by the company in the year 1988,
it gives multiplied benefits to telephone users. During the year 1992, the company
introduced Voice Mail Service. MTNL had introduced the Integrated Services Digital
Network (ISDN) services in the period of 1996. Apart from this IVRS (Interactive
Voice Response System) like local assistance changed number information, and
fault booking system ensuring round the clock service, a CD-ROM version of the
telephone directory and an on-line directory enquiry through PC was introduced
during the year 1997. To facilitate the clientele, MTNL launched the country's first
toll-free service in Delhi in the period of
1998. During the year 1999, MTNL brought in the most widely using service called
Internet (Network of Networks), the extreme level of information exchange.
During the year 2001, the company launched GSM Cellular Mobile service under
the brand name Dolphin and in the same year MTNL also launched Wireless in
Local Loop (WLL) Mobile services under the brand name Garuda.
The Company established Wi-Fi & digital certification services in the identical year.
MTNL bagged the award for excellence in cost reduction in the year 2004. State of
the art training centre of the company 'CETTM' was commissioned in the year of
2004. The Company introduced the broadband services under the brand name of
'TRI BAND' during the year 2005. MTNL-STPI IT Services Ltd is a 50:50 Joint Venture
between Software Technology Parks of India (STPI) and the company. The
Page 37
Company has restructured Millennium Telecom Ltd (MTL) as a Joint Venture

company of MTNL and BSNL with 51% and 49% equity participation respectively.
To remain market leader in providing world class Telecom and IT related services
at affordable prices, the company partaking its all efforts in the same business
area and MTNL wants to become a global player, also find a place in the Fortune
500' companies.
BPL MOBILE COMMUNICATIONS LTD.
BPL Mobile Communications Limited popularly known as BPL Mobile is an India-

based telecommunication service providing company. BPL Mobile Communications
Limited is an offshoot of the legendary business conglomerate ESSAR group. BPL
Mobile Communications Limited was established in the year 1995 and it is
presently operating in only in the city of Mumbai. BPL Mobile Communications
Limited has revolutionized the Indian mobile telecommunication industry. Within a
short span of time the subscriber base of BPL Mobile Communications Limited has
reached the 1 million mark. This gigantic mobile telecommunication company of
India has grown in leaps and bounds and it offers seamless service to its customers
spread across Mumbai. Further, BPL Mobile has gained tremendous popularity due
to its competitive pricing of tariffs. BPL Mobile offers high-class mobile service to
its wide pool of Mumbai subscribers.
Further, it ranks very high on parameters like, customer satisfaction, billing

performance, voice quality etc and was thus ranked first in the category of Global
System for Mobile Communications (GSM) and Code Division Multiple Access
(CDMA) of mobile service providers, operating in Mumbai. Superior coverage and
optimum sound clarity are the strengths of BPL Mobile. BPL Mobile
Page 38
Communications Limited provides its customers with world class mobile services,
through the use of state-of-the-art technology and network and this includes use of
unique network design, the Qualnet, Camel Phase 2 Intelligent Network (IN)
platform and GPRS facilitating ultra modern services like Multimedia Messaging
Services (MMS), mobile browsing and Java based mobile phone games. Mr. S.
Subramaniam, CEO of the company, heads this leading telecommunication
company of India.
The products and services offered by BPL Mobile Communications Limited are as
follows -
· Prepaid Connections
· Postpaid Connections
· Prepaid Recharge Coupons
· Bill Payments
· Value Added Services (VAS)
· Service Inquiries
· SIM Replacements
· Handset Sales
HFCL INFOTEL LTD.
Incorporated on 2 Aug.'46, The Investment Trust of India (ITI) is managed by

chairman and managing director B K Kothari. During 2002-03 the name of the
Company changed to HFCL Infotel Ltd, as part of Company's diversification and
restructuring programme, HFCL Infotel Ltd ('transferor Company') a
telecommunication Company operating in the Punjab Circle merged with the
Page 39
Company through a Scheme of Amalgamation and decided to hive off the business
of Hire Purchase, Finance, Leasing and Securities Trading by way of an outright
sale with effect from 1st September 2002 to its wholly owned subsidiary 'Rajam
Finance & Investments Company (India) Ltd' now renamed as 'The Investment
Trust of India Ltd' Other group companies are Kothari Sugars and Chemicals and
Madras Safe Deposit. In Sep.'94, it came out with a rights issue of 21.79 lac shares
(premium: Rs 30) aggregating Rs 8.72 cr, to augment long-term working capital.
The company is mainly engaged in hire purchase, lease financing and investments.
Its clients include individuals, firms as well as corporate bodies. ITI's business
activities include sugar, petrochemicals, industrial alcohol, etc. It has two
subsidiaries -- ITI Pioneer AMC and ITI Capital Markets. ITI Pioneer AMC has
promoted Kothari Pioneer Mutual Fund. ITI has invested 55% of its capital in ITI
Pioneer AMC and the remaining 45% has been subscribed to by Pioneering
Management Corporation, US. During 1995-96, ITI Pioneer AMC Limited ceased to
be a subsidiary of the company. During 1997-98, The Company’s holding in ITI
Capital Market Ltd was sold to Kothari Pioneer AMC Ltd.
During 2003-04, The Company launched its Prepaid Mobile product and a complete
range of innovative value Added Services and Data products were launched in May
2004, by the introduction of DSL-high speed Internet product. The company
became the first service provider to have launched DSL services in the state of
Punjab and Chandigarh.
During 2004-05, The Company expanded its services to 125 cities/towns with 2.47
lacs subscribers in Punjab. The company is planning a venture into Video and
Cable TV Services and making triple play services by an expansion into the
neighbouring states of Punjab. A wholly owned subsidiary, Connect Broadband
Services Limited was formed on July 2004, for the above purpose.The Company's
services namely, Fixed Line Telephoney, Mobile Telephoney, Broadband Internet
Access and Data Networking Access are offered under the brand name 'CONNECT'.
Page 40
SHYAM TELECOM LTD.
Incorporated in 1992, Shyam Telecom Limited, a leading manufacturer of Telecom

Equipment in India is the flagship company of the Shyam Group of India. The
expanding horizon of the telecom sector in India has given Shyam new vistas and
avenues for growth and expansion. To concentrate mainly on its core activities i.e.
investment in Telecom activities, the company restructured its business and a
result it has de-merged its manufacturing business to a wholly owned subsidiary
viz. Shyam Telecom Manufacturing Ltd (formerly known as Shyam Telecom
Infrastructure Projects Ltd). Subsequently the company will be an investor in
Shyam Telecom Manufacturing Limited (developer of wireless product for GSM &
CDMA) and Shyam Telelink Ltd (basic telephony services in Rajasthan).
Shyam Telecom also took a strategic decision by de-subsidiarise Shyam

International Ltd by which Shyam ACeS also got de-subsidiarised. It has also
acquired the entire capital of Shyam Telecom Manufacturing Ltd & Shyam Tel
Singapore Pvt. Ltd. Shyam's R&D which is fully recognized by the Department of
Science and Technology has been able to design new products. Shyam's R&D wing
is well-equipped with the latest and sophisticated testing instruments, CAD/CAM
for design and assembly work besides having highly qualified engineers. The
company currently manufactures Wireless in Local Loop, Fiber in local loop, Digital
Loop Carriers (DLC), Digital Radios, Spread Spectrum Radios, Digital Subscriber
Line (DSL) for Internet Access, Remote Energy Meeting Systems (REMS) &
Supervisory control & data accusation systems (SCADA). The company has an
international presence in 27 countries spread over America, Europe, Africa, Indian
sub-continent and Asia-Pacific.
The company has extended its basic telephony service to Jaipur and Jodhpur. The
company's service covered all the three technologies in basic telephony - wireline,
CDMA and CorDect.
Page 41
Comparative Study
of
Airtel and Vodafone
in
Telecom industry
Page 42
Airtel
Company profile
Telecom giant Bharti Airtel is the flagship company of Bharti Enterprises. The
Bharti Group has a diverse business portfolio and has created global brands in the
telecommunication sector. Airtel comes from Bharti Airtel Limited, India’s largest
integrated and the first private telecom services provider with a footprint in all the
23 telecom circles. Bharti Airtel since its inception has been at the forefront of
technology and has steered the course of the telecom sector in the country with its
world class products and services. The businesses at Bharti Airtel have been
structured into three individual strategic business units (SBU’s) - Mobile Services,
Airtel Telemedia Services & Enterprise Services. The mobile business provides
mobile & fixed wireless services using GSM technology across 23 telecom circles
while the Airtel Telemedia Services business offers broadband & telephone
services in 95 cities and has recently launched India's best Direct-to-Home (DTH)
service, Airtel digital TV. The Enterprise services provide end-to-end telecom
solutions to corporate customers and national & international long distance
services to carriers. All these services are provided under the Airtel brand. The
company served an aggregate of 88,270,194 customers as of December 31, 2008;
of whom 85,650,733 subscribed to GSM services and 2,619,461 use the Telemedia
Services either for voice and/or broadband access delivered through DSL. Bharti
Airtel is the largest wireless service provider in the country, based on the number
of subscribers as of December 31, 2008. They also offer an integrated suite of
telecom solutions to their enterprise customers, in addition to providing long
distance connectivity both nationally and internationally. They have recently
forayed into media by launching their DTH and IPTV Services. All these services are
rendered under a unified brand "Airtel". The company also deploys, owns and
manages passive infrastructure pertaining to telecom operations under its
subsidiary Bharti Infratel Limited. Bharti Infratel owns 42% of Indus Towers Limited.
Bharti Infratel and Indus Towers are the two top providers of passive infrastructure
services in India.
Company shares are listed on The Stock Exchange, Mumbai (BSE) and The National
Stock Exchange of India Limited (NSE).
Page 43
Our vision & promise

By 2015 airtel will be the most loved brand, enriching the lives of millions.
" Enriching lives means putting the customer at the heart of everything we do. We will meet their needs based on our deep
understanding of their ambitions, wherever they are. By having this focus we will enrich our own lives and those of our other
key stakeholders. Only then will we be thought of as exciting, innovation, on their side and a truly world class company."
Mission
We will meet the mobile communication needs of our customers through :
 Error-free service delivery.
 Innovative products and services.
 Cost efficiency.
Values
We will always put our customers first. We will always trust and respect each other. We will respect our associates as we
respect each other. We will work together through a process of continuous improvement .
Page 44
THE KEY PRODUCTS/SERVICES OFFERED BY BHARTI AIRTEL :-

1. TELE SERVICES
2. WIRELESS INTERNET
3. DTH SERVICES
4. ENTERPRISE SERVICES
1. TELE SERVICES :
Bharti Airtel provides Prepaid and postpaid services for both mobile phones and fixed land lines users
The company charges Nominal tariff rates to its users in all the circles where it provides service
Bharti Airtel also provides gprs services to the gprs unabled handsets
Airtel also provides Wireless solution in blackberry and iphone
As far as advertising is concerned, the company has Shah rukh khan the brand ambassador
2. WIRELESS INTERNET :
Bharti Airtel has an easy to access Airtel usb modem for an instant internet connection
It provides with a wide range of prepaid and postpaid plans available as per customer needs
The company has most widespread network in the country
Data card is available from Rs.49 to Rs.999/month (installation cost Rs.2999)
3. DTH SERVICES :
Airtel digital TV is a satellite television service
It offers additional benefit like TV recorder
Page 45
Tariffs from Rs.145 to Rs.345/month (Installation Rs.1490 – Rs.4290)
Kareena Kapoor and Saif Ali Khan are the brand ambassadors which has helped a lot to the company to generate
sales and have a competitive stand in the DTH market
4. ENTERPRISE SERVICES :
1st ISP (Internet service provider) in India
It provides end to end telecom solutions to corporate customers
National and international long distance services to ‘’carriers’’
(A company authorized by regulatory agencies to operate a telecommunication system)
Page 46
SWOT ANALYSIS OF BHARTI AIRTEL

STRENGTHS
More than 130mn customers base
Business has access to knowledge and technology as it holds strategic alliance with Sony-Ericsson, Nokia and Sing Tel
Pan India presence
Strong financials with increase in NP by 22%+ and Sales by 4.5%+ for FY Mar, 2010
WEAKNESS
Outsourcing of telecom and IT networks, IT infrastructure, last mile connectivity of broadband operations, BPO services,
Inter – city optic fibre cables
Risk associated with Zain acquisition like lower profitability, political and regulatory risks
OPPURTUNITIES
Bharti infratel can cut down cost in vast untapped rural and semi urban areas
Current tale - density is 52%, still low as compared to developed economies
Increase in subscribers base and global wide spread with Bharti – Zain acquisition
THREATS
Bharti Airtel is India – centric
Intense competition among Indian markets
Changing pace of global telecommunication industry which impacted the decision of purchase of MTN indirectly opening
doors for the rivals (Reliance comm.)
Financial Analysis of Bharti Airtel
Page 47
Balance Sheet of Bharti Airtel ------------------- in Rs. Cr. -------------------
Mar '06 Mar '07 Mar '08 Mar '09 Mar '10
12 mths 12 mths 12 mths 12 mths 12 mths
Sources Of Funds
Total Share Capital 1,893.88 1,895.93 1,897.91 1,898.24 1,898.77
Equity Share Capital 1,893.88 1,895.93 1,897.91 1,898.24 1,898.77
Share Application Money 12.13 30.00 57.63 116.22 186.09
Preference Share Capital 0.00 0.00 0.00 0.00 0.00
Reserves 5,437.42 9,515.21 18,283.82 25,627.38 34,650.19
Revaluation Reserves 2.13 2.13 2.13 2.13 2.13
Networth 7,345.56 11,443.27 20,241.49 27,643.97 36,737.18
Secured Loans 2,863.37 266.45 52.42 51.73 39.43
Unsecured Loans 1,932.92 5,044.36 6,517.92 7,661.92 4,999.49
Total Debt 4,796.29 5,310.81 6,570.34 7,713.65 5,038.92
12,141.8
Total Liabilities 16,754.08 26,811.83 35,357.62 41,776.10
5
Application Of Funds
17,951.7
Gross Block 26,509.93 28,115.65 37,266.70 44,212.53
4
Less: Accum. Depreciation 4,944.86 7,204.30 9,085.00 12,253.34 16,187.56
13,006.8
Net Block 19,305.63 19,030.65 25,013.36 28,024.97
8
Capital Work in Progress 2,341.25 2,375.82 2,751.08 2,566.67 1,594.74
Investments 719.70 705.82 10,952.85 11,777.76 15,773.32
Inventories 17.74 47.81 56.86 62.15 27.24
Sundry Debtors 1,076.17 1,418.52 2,776.46 2,550.05 2,104.98
Cash and Bank Balance 201.81 239.11 200.86 153.44 54.89
Total Current Assets 1,295.72 1,705.44 3,034.18 2,765.64 2,187.11
Loans and Advances 1,937.54 3,160.02 5,103.13 5,602.83 6,276.12
Fixed Deposits 105.61 541.35 302.08 2,098.16 761.86
Total CA, Loans & Advances 3,338.87 5,406.81 8,439.39 10,466.63 9,225.09
Deffered Credit 0.00 0.00 0.00 0.00 0.00
Current Liabilities 6,735.36 9,809.83 12,400.38 13,832.49 12,183.25
Provisions 537.44 1,232.84 1,961.95 634.40 658.75
Total CL & Provisions 7,272.80 11,042.67 14,362.33 14,466.89 12,842.00
Net Current Assets -3,933.93 -5,635.86 -5,922.94 -4,000.26 -3,616.91
Page 48
Miscellaneous Expenses 7.94 2.66 0.20 0.09 0.00
12,141.8
Total Assets 16,754.07 26,811.84 35,357.62 41,776.12
4
Contingent Liabilities 4,740.34 7,615.04 7,140.59 4,104.25 3,921.50

Book Value (Rs) 38.71 60.19 106.34 145.01 96.24
Profit & Loss account of Bharti Airtel ------------------- in Rs. Cr. -------------------
Income
11,259.1
Sales Turnover 17,851.61 25,761.11 34,048.32 35,609.54
2
Excise Duty 0.00 0.00 0.00 0.00 0.00
11,259.1
Net Sales 17,851.61 25,761.11 34,048.32 35,609.54
2
Other Income 26.94 105.62 104.04 -1,261.75 1,118.46
Stock Adjustments -13.84 30.07 9.05 5.29 -34.91
11,272.2
Total Income 17,987.30 25,874.20 32,791.86 36,693.09
2
Expenditure
Raw Materials 53.56 52.16 42.90 286.94 278.72
Power & Fuel Cost 0.00 0.00 0.00 0.00 0.00
Employee Cost 734.20 1,076.95 1,297.88 1,397.54 1,401.66
Other Manufacturing Expenses 3,299.73 5,017.27 7,339.01 8,627.13 11,882.41
Selling and Admin Expenses 2,804.85 4,030.48 5,892.50 9,385.68 6,856.42
Miscellaneous Expenses 314.37 444.28 535.46 1,409.89 1,482.39
Preoperative Exp Capitalised 0.00 0.00 0.00 -269.25 -293.31
Total Expenses 7,206.71 10,621.14 15,107.75 20,837.93 21,608.29
Operating Profit 4,038.57 7,260.54 10,662.41 13,215.68 13,966.34

PBDIT 4,065.51 7,366.16 10,766.45 11,953.93 15,084.80
Interest 236.81 282.07 393.43 434.16 283.35
PBDT 3,828.70 7,084.09 10,373.02 11,519.77 14,801.45
Depreciation 1,432.34 2,353.30 3,166.58 3,206.28 3,890.08
Other Written Off 127.39 137.80 266.07 178.82 207.84
Profit Before Tax 2,268.97 4,592.99 6,940.37 8,134.67 10,703.53
Extra-ordinary items 17.64 9.92 -60.67 -46.15 -50.78
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PBT (Post Extra-ord Items) 2,286.61 4,602.91 6,879.70 8,088.52 10,652.75
Tax 273.68 566.79 632.43 321.78 1,177.87
Reported Net Profit 2,012.08 4,033.23 6,244.19 7,743.84 9,426.15
Total Value Addition 7,153.15 10,568.98 15,064.84 20,551.00 21,329.56
Preference Dividend 0.00 0.00 0.00 0.00 0.00
Equity Dividend 0.00 0.00 0.00 379.65 379.79
Corporate Dividend Tax 0.00 0.00 0.00 64.52 64.55
Per share data (annualised)
18,938.7
Shares in issue (lakhs) 18,959.34 18,979.07 18,982.40 37,975.30
9
Earning Per Share (Rs) 10.62 21.27 32.90 40.79 24.82
Equity Dividend (%) 0.00 0.00 0.00 20.00 20.00
Book Value (Rs) 38.71 60.19 106.34 145.01 96.24
Cash Flow of Bharti Airtel ------------------- in Rs. Cr. -------------------
Net Profit Before Tax 2285.80 4601.37 6972.54 8161.54 10699.25

Net Cash From Operating Activities 4547.20 8107.95 10459.85 11853.15 12692.63
Net Cash (used in)/from
-5000.26 -7975.05 -11648.41 -10894.38 -10601.66
Investing Activities
Net Cash (used in)/from Financing Activities 376.35 340.13 898.03 -672.00 -2539.32
Net (decrease)/increase In Cash and Cash
-76.71 473.03 -290.53 286.77 -448.35
Equivalents
Opening Cash & Cash Equivalents 384.14 307.43 793.47 503.31 789.88
Closing Cash & Cash Equivalents 307.43 780.46 502.94 790.08 341.53
Key Financial Ratios of Bharti Airtel ------------------- in Rs. Cr. -------------------
Mar
Mar '07 Mar '08 Mar '09 Mar '10
'06
Investment Valuation Ratios

Face Value 10.00 10.00 10.00 10.00 5.00
Dividend Per Share -- -- -- 2.00 1.00
Operating Profit Per Share (Rs) 21.32 38.28 56.16 69.50 36.65
Page 50
Net Operating Profit Per Share (Rs) 59.45 94.16 135.73 179.37 93.77
Free Reserves Per Share (Rs) 28.11 49.88 83.18 121.78 84.64
Bonus in Equity Capital 82.70 82.61 82.53 82.51 82.49
Profitability Ratios
Operating Profit Margin(%) 35.86 40.65 41.37 38.74 39.08
Profit Before Interest And Tax Margin(%) 23.05 27.31 28.78 29.12 28.04
Gross Profit Margin(%) 23.14 27.47 29.08 29.33 28.15
Cash Profit Margin(%) 31.57 36.26 38.03 36.96 35.25
Adjusted Cash Margin(%) 31.57 36.26 38.03 36.96 35.25
Net Profit Margin(%) 17.80 22.46 23.99 22.58 26.36
Adjusted Net Profit Margin(%) 17.80 22.46 23.99 22.58 26.36
Return On Capital Employed(%) 20.74 29.06 27.95 28.40 23.86
Return On Net Worth(%) 27.47 35.35 30.94 28.13 25.79
Adjusted Return on Net Worth(%) 27.42 35.23 32.04 33.74 23.27
Return on Assets Excluding Revaluations 10.36 60.17 106.34 145.01 96.24
Return on Assets Including Revaluations 10.36 60.18 106.35 145.02 96.25
Return on Long Term Funds(%) 21.28 29.83 28.52 29.01 24.36
Liquidity And Solvency Ratios
Current Ratio 0.44 0.47 0.57 0.69 0.68
Quick Ratio 0.45 0.47 0.55 0.65 0.72
Debt Equity Ratio 0.65 0.47 0.33 0.28 0.14
Long Term Debt Equity Ratio 0.61 0.43 0.30 0.26 0.12
Debt Coverage Ratios
Interest Cover 12.76 23.45 34.38 46.28 85.82
Total Debt to Owners Fund 0.65 0.47 0.33 0.28 0.14
Financial Charges Coverage Ratio 17.22 26.09 27.77 30.93 49.64
Financial Charges Coverage Ratio Post Tax 16.08 24.13 25.60 26.63 48.73
Management Efficiency Ratios
Inventory Turnover Ratio 634.52 373.35 453.06 547.83 1,307.05
Debtors Turnover Ratio 12.57 14.31 12.28 12.78 15.30
Investments Turnover Ratio 634.52 373.35 453.06 547.83 1,307.05
Fixed Assets Turnover Ratio 0.72 0.75 1.03 1.00 0.88
Total Assets Turnover Ratio 1.15 1.27 1.09 1.06 0.93
Asset Turnover Ratio 0.72 0.75 1.03 1.00 0.88
Average Raw Material Holding -- -- -- -- --

Average Finished Goods Held 0.74 1.36 1.18 0.98 0.41
-
Number of Days In Working Capital -113.65 -82.77 -42.30 -36.57
125.78
Profit & Loss Account Ratios
Material Cost Composition 0.47 0.29 0.16 0.84 0.78
Imported Composition of Raw Materials
-- -- -- -- --
Consumed
Selling Distribution Cost Composition 7.14 6.30 7.15 6.49 6.75
Expenses as Composition of Total Sales 11.33 8.82 6.00 5.31 5.03
Cash Flow Indicator Ratios
Page 51
Dividend Payout Ratio Net Profit -- -- -- 5.73 4.71
Dividend Payout Ratio Cash Profit -- -- -- 3.99 3.28
Earning Retention Ratio 100.00 100.00 100.00 95.22 94.78
Cash Earning Retention Ratio 100.00 100.00 100.00 96.50 96.48
AdjustedCash Flow Times 1.34 0.82 0.66 0.61 0.40
Mar
Mar '07 Mar '08 Mar '09 Mar '10
'06
Earnings Per Share 10.62 21.27 32.90 40.79 24.82

Book Value 38.71 60.19 106.34 145.01 96.24
Vodafone
Company profile
Vodafone is a world leader in providing a wide range of communications services, including voice calls, internet
access, text, picture and video messaging, and other data services. It has significant presence in Europe, the Middle East,
Africa, Asia Pacific and the United States through the Company's subsidiary undertakings, joint ventures, associated
undertakings & investment.
“The name Vodafone comes from Voice data one, chosen by the company to "reflect the provision of voice
and data services over mobile phones.”
In the year 2007, the world's largest telecom company in terms of revenue, Vodafone Plc (Vodafone) made a major foray into
the Indian telecom market by acquiring a 67 percent stake in the Indian telecom company, Hutchison Essar Ltd, through a
deal with the Hong Kong-based Hutchison Telecommunication International Ltd. It was the biggest deal in the Indian
Page 52
telecom market. Vodafone's main motive of going in for the deal was its strategy of expanding into emerging and high
growth markets like India. In 2007, India had emerged as the fastest growing telecom market in the world outpacing China.
But it still had low penetration rates, making it the most lucrative market for global telecom companies.
The current CEO of Vodafone is Mr. Vitoria Colao.
Vodafone Essar is the Indian subsidiary of Vodafone Group 67% and Essar Group33%. It is the second largest mobile
phone operator in terms of revenue behind Bharti Airtel and third largest in terms of customers. The company now has
operations across the country with over 113.77 million customers.
Vision: Our Vision is to be the world’s mobile communication leader – enriching customers’ lives, helping
individuals, businesses and communities be more connected in a mobile world.
Mission: “The Vodafone mission is to be the communications leader in an increasingly connected world – enriching
customers’ lives, helping individuals, businesses and communities is more connected by delivering their total communication
needs.”
PRODUCTS AND SERVICES

PRODUCTS
• Post-paid Services
• Pre-paid Services
• Magic Box Handsets
• World Calling Cards
World Calling Card from Vodafone is a Pre-paid long distance calling card that one can use with their Vodafone Prepaid and
Post-paid mobile phones to make ISD & STD calls.
• Home Calling Cards
Vodafone Home Calling Card is a Pre-paid calling card that allows one to make calls from landlines, PCOs & mobile phones
from over 100 countries. And helps save up to 90% as compared to International Roaming charges. So talk more, spend less
and always stay connected.
• Handy phone
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Vodafone Handy phone is a landline that’s loaded with all the features of a cell phone - including low call rates. And
Vodafone Handy phone isn’t that expensive either. One can make it theirs for Rs 1999.
SERVICES
• Tunes & downloads

• Entertainment
• Devotional
• Sports
• News & Updates
• Call Management Services
• Astrology
• Finance
• Travel
• Mail, messaging & more
• Dial in Services
• Bill Info
• RE-BRANDING STRATEGIES – Hutch to Vodafone
• mobile services with GSM technology
Page 54
• fixed-line telephone services
• Universal Internetworking
• VoIP (Voice over Internet Protocol)
• Interactive Television
• Visual Communication
• Broadband Portal
• Telecommunity
SWOT ANALYSIS
Strengths
• Strong international presence and brand recognition

• Well-defined cost reduction initiatives, managed outsourcing
• Stable operating profit
• The India operations is backed by its huge expertise and diversified geographical portfolio.
• Sharing of network infrastructure
• Leading presence in India
• Brand value built by delivering a superior, consistent and differentiated customer experience.
• Vodafone’s customer strategy endeavors to ensure that customers’ needs are at the core of all products and services.
Weakness
• Benefits of investment in technology are not realized
• Little penetration in rural market
• Have not entered broadband services, smart phones segment
• Advertising campaigns do not have the emotional connect to the lower income classes and rural customers
Page 55
• Perception of customers in lower segment that Vodafone is a costly brand
Opportunities
• Focus on capturing rural sector through cost reductions improving returns
• Research and development of new mobile technologies
• Mobile Broadband
• Improve accessibility to wide range of customers
• Vodafone can offer voice, messaging, data and fixed broadband services through multiple solutions and supporting
technologies to deliver on its total communications strategy.
• The advancements in 3G networks and download speeds, handset capabilities and the mobilisation of internet
services, could contribute to an acceleration of data services usage growth.
Threats
• Existing competitive market
• Entry of many new players in immediate future
• Government regulations
• Change in technology
• Change in consumer preference
• Adverse macroeconomic conditions like recession and economic slow down
Page 56
Financial Analysis of Vodafone
Profit & Loss

Year Ended 31 March 2010 2009 2008 2007 2006
£ millions
Turnover 44472.0 41017.0 35478.0 31104.0 29350.0
Operating Profit 4738.0 1766.0 7171.0 -4292.0 -16512.0
Net Interest -796.0 -1624.0 -1300.0 -823.0 -767.0
Profit Before Tax 8674.0 4189.0 9001.0 -2383.0 -14853.0
Profit After Tax 8618.0 3080.0 6756.0 -4806.0 -17233.0
Total Dividend n/a n/a n/a n/a n/a
Retained Profit / Loss n/a n/a n/a n/a n/a
Balance Sheet
Year Ended 31 March 2010 2009 2008 2007 2006
£ millions
Intangible Assets 74258.0 74938.0 70331.0 56272.0 69118.0
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Tangible Assets 20642.0 19250.0 16735.0 13444.0 13660.0
Fixed Investments 43968.0 41775.0 29912.0 26102.0 25316.0
Total Fixed Assets 142766.0 139670.0 118546.0 96804.0 108614.0
Stocks 433.0 412.0 417.0 288.0 297.0
Debtors n/a n/a n/a n/a n/a
Cash at Bank and in Hand 4423.0 4878.0 1699.0 7481.0 4630.0
Total Assets 156985.0 152699.0 127270.0 109617.0 126738.0
Creditors Amount Within 1 year 31535.0 31721.0 29403.0 22903.0 19541.0
Creditors Amount After 1 year 1053.0 1051.0 749.0 658.0 686.0
Total Liabilities 66175.0 67922.0 50799.0 42324.0 41426.0
Net Assets 90810.0 84777.0 76471.0 67293.0 85312.0
Net Current Assets n/a n/a n/a n/a n/a
Called Up Share Capital 4153.0 4153.0 4182.0 4172.0 4165.0
Share Premium Account n/a n/a 42934.0 43572.0 52444.0
Other Reserves 165883.0 165829.0 112907.0 104576.0 96172.0
Profit and Loss Account -79655.0 -83820.0 -81980.0 -85253.0 -67356.0
Shareholders Funds 90381.0 86162.0 78043.0 67067.0 85425.0
Minority Interests 429.0 -1385.0 -1572.0 226.0 -113.0
Key Figures
Year Ended 31 March 2010 2009 2008 2007 2006
Earings Per Share Basic (p) 16.44 5.84 12.56 -8.94 -27.66
Earings Per Share Diluted (p) 16.36 5.81 12.50 -8.94 -27.66
Earings Per Share Adjusted (p) 16.11 17.17 12.56 11.26 10.11
Earnings Per Share Growth (%) -6 37 12 11 13
Total Dividend (p) 8.31 7.77 7.51 6.76 6.07
Operating Margin (%) 11 3 21 -14 -56
ROCE (%) 16 10 28 -2 -32
Dividend Cover 1.94 2.21 1.67 1.67 1.67
Dividend Yield 5.50 6.30 5.00 5.00 5.00
Price / Earnings Ratio 9.40 7.10 12.00 12.00 11.90
Dividend Per Share Growth (%) 7 3 11 11 49
Page 58
RESEARCH METHODOLOGY
Achieving accuracy in any research requires a deep study regarding the subject.
The prime objective of the project is to compare Airtel with the existing competitor
(Vodafone) in the market and the impact of WLL on Airtel. The research
methodology adopted is basically based on primary data via which the most recent
and accurate piece of first hand information could be collected. Secondary data
has been used to support primary data wherever needed.
Type of Research Methodology
EXPLORATORY:
TYPE OF RESEARCH CARRIED OUT WAS EXPLORATORY IN NATURE; THE OBJECTIVE

OF SUCH RESEARCH IS TO DETERMINE THE APPROXIMATE AREA WHERE THE
DRAWBACK OF THE COMPANY LIES AND ALSO TO IDENTIFY THE COURSE OF
Page 59
ACTION TO SOLVE IT. FOR THIS PURPOSE THE INFORMATION PROVED USEFUL FOR
GIVING RIGHT SUGGESTION TO THE COMPANY.
DATA COLLECTION METHOD
THERE TWO TYPE OF METHOD OF DATA COLLECTION.
PRIMARY DATA
SECONDARY DATA
Primary data was collected using the following techniques
Questionnaire Method
Direct Interview Method and
Observation Method
The main tool used was, the questionnaire method. Further direct interview
method, where a face-to- face formal interview was taken. Lastly observation
method has been continuous with the questionnaire method, as one continuously
observes the surrounding environment he works in.
DATA USED FOR THE RESEARCH WORK WAS PRIMARY IN NATURE.

PRIMARY DATA:
PRIMARY DATA IS THAT WHICH IS THE COLLECTED FOR THE FIRST TIME AND THUS
HAPPEN TO BE ORIGINATED IN CHARACTER.
QUESTIONNAIRE SURVEY:
IN THE STUDIES A QUESTIONNAIRE IS PREPARED. THE QUESTIONNAIRE CONSISTS

OF 10 QUESTIONS.
SECONDARY DATA:
SECONDARY DATA REFER TO THE DATA THAT HAS BEEN ALREADY COLLECTED
.THE SECONDARY DATA, WHICH HAS BEEN USED TO CARRY OUT THIS STUDY, ARE
AS FOLLOW:
BOOKS, JOURNALS, MAGAZINES, NEWSPAPERS, INDUSTRY REPORTS, COMPANY’S

INTERNET SITE, SOME OTHER RELEVANT STUDY MATERIAL AND WEBSITES..
Page 60
SAMPLE UNIT: - Mumbai.
THE RESEARCH PROCESS WAS DONE BY INTERACTING WITH NUMBER OF

CUSTOMERS DURING THE ACTIVITIES PERFORMED, WHICH INCLUDED, MARKETS,
COLD CALLING, CANOPIES, ETC. SAMPLE DESIGN CONSISTS OF RANDOM
SAMPLING.
SAMPLE SIZE: - 103 PEOPLE
METHOD OF COLLECTION: -
FIELD PROCEDURE FOR GATHERING PRIMARY DATA INCLUDED OBSERVATION IN

WHICH THE QUESTIONNAIRES WERE FILED BY THE INTERVIEWER. PERSONAL
INTERVIEW THROUGH SELF ADMINISTERED SURVEY WAS DONE TO COLLECT THE
DATA, MARKET RESEARCH WAS UNDERTAKEN, THAT WAS ACCOMPLISHED BY
PERFORMING VARIOUS ACTIVITIES DESIGNED.
RESEARCH INSTRUMENT:
QUESTIONNAIRE:- THE QUESTIONNAIRE WAS FORMULATED BY KEEP IN MIND THE

FOLLOWING
POINTS: -
• GIVING THE RESPONDENTS. CLEAR COMPREHENSION OF THE QUESTION.
• INDUCING THE RESPONDENTS TO CO-OPERATE.
• GIVING INSTRUCTIONS AS TO WHAT IS NEEDED.
• IDENTIFYING THE NEEDS TO BE KNOWN.
Advantages of questionnaire method:-

 Quick and easy to administer.
 Can get a large amount of information in a short time.
 Allows for employee participation.
 Does not require trained interviewer.
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 Relatively less expensive.
Disadvantages of questionnaire method:-

 Quality of information related to the quality of the questionnaire.
 Often needs follow-up interview or observation.
 May be difficult to construct.
 May have low response rate.
 Responses may be incomplete.
Scope of the study

To conduct this research the target population was the mobile users of Airtel and
Vodafone, who are using GSM Technology.
• Targeted geographic area of Mumbai. Sample size of 103 persons was taken.
• To these 103 people a questionnaire was given, the questionnaire was a
combination of both open ended and closed ended questions.
• Finally the collected data and information was analyzed and compiled to
arrive at the conclusion and recommendations given.
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Data Analysis And Interpretation

1. In which age group do you fall?
As above diagram show you that the maximum numbers of mobile is used
by students, employee who has aged between 17-25 yrs and having 54%.
2. Educational qualification:-
3. Occupation:-
As above diagram show you that the maximum number of mobile as per their
Occupation, the Employee hold 50% means employee who are graduate and
post graduate and they also have market information about their operators. And
second is students who hold 33% in diagram.
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4. Which telecom services do you posses?
As we can see that maximum numbers of customers are using Vodafone as per
my survey and 2nd is others means users of MTNL and BSNL. And bahrti airtel
hold the 3rd position in diagram.
5. Your monthly expenses on mobile?
The maximum customers spent only Rs.150-350 on their mobile per month. And
Rs.350-700 holds 27% & they hold 2nd position in diagram.
6. Which services is more helpful to you while using

telecom service?
As we can see in diagram that the numbers of customers look for low call rates
from their service operator and that why call rates services hold the 49% in the
services providing operator. And low call rates means as now all operator are
providing 1paise/second then 10paise/minutes. And also 1paise/sms.
7. How long you have been using the services of

current telecom operator?
Customers who are spending more time on mobile is more than two years. And
then 1-2yrs hold the position in diagram. Means customers are very much clear
about their needs and company also satisfying their needs as they used
particular operator more than 2 yrs.
8. If you are asked to select among the following as

first preference which would you choose?
As we can see in diagram that Airtel is lacking to satisfy the customers
and Vodafone holds the maximum of first preference from customers as
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they satisfy the needs of them and also providing their services nearby
their place.
9. Who are the persons that influenced you to buy a

particular telecom operator?
The maximum numbers of people are influenced by friends 51% rather

than parents, sales person and others.
10. What factors influences your choice?
The customers looks for offers from operators as diagram show. But as
per my survey I came to know that reliance user are influenced by Brand
Image.
Customer satisfaction with service dimensions

In your opinion, how does the service quality of your network meet your expectation in
terms of the following dimensions?
Dimensions
Reliability and responsiveness Poor neutral good
R1 Delivery of sms, mms, voice

messages and other services
R2 Customer care and handling

compliant
Technical qualities
T1 Network coverage
Economy(how economical is the

used of your telecom service in
terms of)
E1 Recharge voucher
E2 Call charge per minute or second.
Page 65
Reliability and responsiveness Dimensions

R1:- Delivery of sms, mms, voice messages and other services
Operators Poor Neutral Good
Airtel 5 12
Vodafone 4 15
Aircel 1 2
Tata Docomo 1 2 2
Reliance 2 5 5
Loop 9 13
Idea 1 3 3
Others(Bsnl and 1 7 10
Mtnl)
R2:- Customer care and handling compliant.

Airtel 1 8 8
Vodafone 9 12
Aircel 2 1
Tata Docomo 2 1 2
Reliance 2 4 6
Loop 1 5 6
Idea 1 4 9
Others(Bsnl And 4 8 7
Mtnl)
Technical Dimensions
T1:- Network coverage
Airtel 1 12 7
Vodafone 1 4 18
Aircel 2 1
Tata Docomo 2 2 1
Reliance 2 1 9
Loop 1 6 7
Idea 4 3
Others (Bsnl And 3 6 10
mtnl)
Economic dimensions
Page 66
E1:- Recharge voucher

Airtel 1 5 15
Vodafone 1 7 15
Aircel 1 2
Tata Docomo 2 3 1
Reliance 2 5 5
Loop 2 2 10
Idea 4 3
Others (Bsnl and 2 7 8
Mtnl)
E2:- Call charge per minute or second.

Airtel 9 10
Vodafone 1 7 16
Aircel 2 1
Tata Docomo 1 4
Reliance 2 2 8
Loop 5 9
Idea 7
Other(Bsnl and Mtnl) 2 4 13
Suggestions
Modification and innovative things must be brought in AIRTEL, in terms of quality.

Its demand should be increased.
Company must undertake extensive promotional activities like advertisements

must be released in different Medias to create brand awareness.
Free samples should be distributed among the prospects. Sales promotion tools
like gifts, contests and coupons must be given to retailers as well as customers
and prospects as Vodafone was Giving offers for post-paid users before like Bags,
watches etc. to attract users.
Catalogues should be distributed among customers.
Price should be as competitive as other company maintains as loop has introduced

‘Dus kaa gang’ And hello tunes packages.
Page 67
Distribution of new connection should be in reach of customer pocket.
Recommendations
• The company should make its marketing strategy flexible enough in order
to face competition.
• The company rate policy must be flexible enough to catch new customers
because if company offers lower price to a new customer then he may
continue buy the goods and can be a permanent customer for the company.
• The company should offers such rate in the market so that it may able to
catch a bigger market share and it should be able to compete with the local
traders and commission agents while having a brand name.
Page 68
Conclusion
• After analyzing the findings of the research, I can conclude that Airtel lagged
behind its competitors as far as customer service and availability is
concerned and also network. The maximum no. of people who use the
mobile is in the age group of 17 to 25.
• As they are the market leader in particular industry Airtel should used some
new strategy with new products and services and should also market their
products at every retailers shops. So it can easily available to customers.
• The network of Airtel is very consents areas for them as the users of Airtel
say that Network is not proper sometimes there is connection error.
• From the comparison and deep analysis of every aspect of business of both
the companies we can conclude that bharti Airtel has to more work in every
field of communication business. It is the time not only to survive but to
sustain in the market for a long time.
Page 69
• For this Airtel has to work on its all marketing strategies, marketing,
promotion, brand image.etc.
• Airtel has to take Vodafone. Very seriously and update its own strategies
from time to time and
when the need arises.
.
Questionnaire
Name:-
Gender:- Male O female O
Contact No:-
_____________________________________________________________________________________
1. In which age group do you fall?
(a) Below 17 years O (b) 17-25 yrs O (c)25-40 yrs O (d) above 40 yrs O
2. Educational qualification:-
(a) Upto 12th O (b) graduation O (c) post-graduation O (d) others O
Page 70
3. Occupation:-
(a)Student O (b) Business O (c) Professional O (d) Employee O (e)

Others O
4. Which telecom services do you posses?
(a) Airtel O (b) Aircel O (c) Tata Docomo O (d) Reliance O (e)Bpl
O
(f)Idea O (g) Vodafone O ( h)Others O
5. Your monthly expenses on mobile?
(a)Less than Rs.150 O (b) Rs.150-350 O (c) Rs.350-700 O (d) Above

Rs.700 O
6. Which services is more helpful to you while using telecom service?
(a)Call rates O (b) Sms service O (c) Value added service O (d) Network
O
7. How long you have been using the services of current telecom operator?
(a) Less than 2 month O (b) 6-8 month O (c) 1-2 yrs O (d) more than 2
yrs O.
8. If you are asked to select among the following as first preference which would you
choose?
(a)Airtel O (b)Tata Docomo O (c)Aircel O (d)Reliance O (e)Bpl

O
(f) Vodafone O (g)Idea O (h) Others O
9. Who are the persons that influenced you to buy a particular telecom operator?
Page 71
(a) Parents O (b) Friends O (c) Sales Person O (d) You O (e)
Others O
10. What factors influences your choice?
(a) Brand image O (b) Offers O (c) Value added services O

(d)Advertisement O
Customer satisfaction with service dimensions
In your opinion, how does the service quality of your network meet your expectation in
terms of the following dimensions?
Dimensions
Reliability and responsiveness Poor neutral good
R1 Delivery of sms, mms, voice

messages and other services
R2 Customer care and handling

compliant
Technical qualities
T1 Network coverage
Economy(how economical is the

used of your telecom service in
terms of)
E1 Recharge voucher
E2 Call charge per minute or second.
Bibliography
www.vodafone.com
Page 72
www.money.control.com
www.indianindustry.com
www.airtel.in
www.wikipedheia.com
Page 73

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Comparative study of Market Analysis of Airtel and Vodafone

• Then I have given some information of telecom industry in India with

• Then I have done some research on telecom industry by forming the

• After data analysis I have given some suggestions, recommendations

Sr. No. Contents Page No.

1 NEED OF THE STUDY 5

2 OBJECTIVE OF THE STUDY 6

3 OVERVIEW OF TELECOM INDUSTRY 7-14

4 LITERATURE REVIEW 15-20

5 PORTERS FIVE FORCES TOWARDS TELECOM 21-24

6 SWOT ANALYSIS OF TELECOM INDUSTRY 25-26

7 OVERVIEW OF ALL COMPANIES IN TELECOM 27-39

8 COMPARATIVE STUDY OF AIRTEL AND 40-56

9 RESEARCH METHODOLOGY 57-59

11 DATA ANALYSIS AND INTERPRETATION 61-67

NEED OF THE STUDY

1. To identify the difference between market performance of Airtel industry and

2. To study the market of Airtel Industry and Vodafone on big scale

3. To compare various parameters of marketing strategies, manufacturing process,

4. To study the level of customer satisfaction in Airtel & Vodafone.

6. To study consumer preferences.

OBJECTIVE OF THE STUDY

1. To identify the difference between market performance of Airtel industry and

The history of telecommunication industry started with the first public

In 1913, telegraph was popular way of communication. AT&T commits to dispose

In 1982 , AT&T was requested to divestiture its stock ownership in Western

Beginning of telecommunication in India

• 1881Telephone services introduced in India

• 1883 Merger with postal system

• 1923 Formation of Indian radio Telegraph Company

• 1947 Nationalization of all foreign telecommunication companies to form the

• 1985 Department of telecommunication established , an exclusive provider

• 1997 Telecom regulatory authority created Telecommunication is important

TELECOM INDUSTRY SCENARIO IN INDIA

A combination of factors is driving growth in the telecom market, promising rich

concentrated urban population will facilitate customized telecom offerings from

SERVICES PROVIDED BY THE TELECOM INDUSTRY

Wire line Services

2 Technology-wise Wireless Market Share There are 297.26 million GSM

Internet Services (Including Broadband)

3) Broadband Subscriber Growths - The number of Broadband subscribers (with a

ISP Providers In INDIA % Market Share

4) Broadband Subscribers Share (Technology wise) – Out of total 6.22 million

TIMELINE - EVOLUTION OF INDIAN TELECOM

Mid 1980s Department of Telecommunications set up

Mar 1986 VSNL incorporated to provide international telecom services

Apr 1986 MTNL incorporated to provide fixed-line telephone services in Mumbai

Sep 1994 Entry guidelines for basic services announced

Mar 1995 Paging services by private operators commence

Oct 1996 Licenses for 20 cellular circles issued

Jan 1997 Telecom Regulatory Authority of India established by government

Mar 1999 Government announces NTP 1999

Aug 2000 Government announces guidelines for opening up domestic long

Jan 2001 The Department of Telecom opens up basic services to unlimited

Aug 2001 Opening of National Long Distance Service to competition

Apr 2010 3G Spectrum Auction

A WIDE LOOK ON INDIA’S 3G AUCTIONS:

Girija (1998), in its article “Socioeconomic Implications of Telecommunications

T.H. Chowdary (1999) discusses how Telecom reform, or demonopolization, in

Bhattacharya (2000) constructs a vision of the Indian telecommunication sector

Das (2000), in her paper described the Liberalisation of the Indian

business in India due to deregulation. Building local content, foreknowledge of new