airtellogoFor the quarter ending September 2009, top telecommunications provider Bharti Airtel has reported a net profit of Rs. 23,210 million, up 13.42% from the same quarter last year but 7.78% lower compared to the Rs. 25, 167 million reported in the previous quarter, belying a weak quarter for the company. The telco added a total of 8,244 customers during the quarter (additions are down 4% QoQ) and has 113.44 million customers, of which 110.51 million are mobile connections. This is also the third consecutive quarter that Airtel’s mobile post-paid subscriber base has been declining.



A sequential decline of 0.97%  in revenues and 7.78% in profit from Airtel is quite surprising. However, consolidated revenues were up 9.15% year-on-year, to Rs. 98,455 million. In the previous quarter, Airtel had reported revenues of Rs. 99, 416 million. Operating expenses grew by 16% compared to the quarter
ended September 30, 2008 due to expansion of operations.

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Consolidated EBITDA margins increased further during the quarter to 42%, compared to 41% in the period ended September 08 and 41.8% in the previous quarter ended June 09. EBITDA is at Rs. 41,420 million, which has experienced a 12% increase on a year on year basis. Airtel’s total employee base has fallen 22% to 18,598 people.


With competition in pricing hotting up, Airtel had to play the tariff reduction game leading to a further fall in its ARPU to Rs. 252 in the second quarter of the fiscal, a year on year fall of 23.87%. Last quarter, the ARPU was Rs 278. Average minutes of use also declined to 450 in the quarter. Total minutes on network carried in the quarter was 164 billion, up from 160 billion in the previous quarter.

Post-paid customers form 4.8% of its overall customer base.


Non-voice revenues (includes SMS, voice mail, call management and other value added services like Hello Tunes, Music on Demand and Airtel Live) now contributes to 9.8% of mobile revenues while SMS revenues shoulder 4.9%.


Average monthly churn in the prepaid segment has increased to 4.6% from 3.5% in the previous quarter. In postpaid customers, the company divides churn on the basis of it is was a voluntary effort by the customer or a company-initiated one. We are not aware under which category would a disconnection due to disuse comes and if this figure is updated monthly for Airtel. Voluntary churn has reduced to 0.9% from 1.2% in the June 09 quarter, as has company-initiated churn, which is now 1%. Total postpaid churn is 2%.

Telemedia Services (DTH, Broadband and IPTV)


Revenue from the Telemedia segment, which runs DTH service Airtel Digital TV, broadband service and IPTV, rose marginally (0.06%) to Rs. 8555 million on a QoQ basis. ARPU for the segment has fallen 4% to Rs. 989 with the addition of 100 customers during the quarter. The segment incurred a capital expenditure of Rs. 1,790 million in the quarter.

The optic fibre network runs through 113, 326 kilometers, a year-on-year growth of  29,937 kms. Approximately 1.19 million customers subscribe to broadband (DSL) services.

Outsourcing Reduces Telemedia Workforce

The Telemedia segment now has only half the workforce it had in the quarter ended June 09. It appears that this reduction is a result of migration of employees to Alcatel Lucent Management Services India and other outsourcing initiatives by the telco. Now, Airtel has a total of 18,598
employees: 7,322 in Mobile services, 4,705 in Telemedia service, 3,191 in Enterprise services, 2,604 in Others and 776 in Passive Infrastructure services.

Bharti Infratel & Indus Towers

The telco’s own passive infrastructure division now owns 29,112 towers, indicating a 51% drop year on year. Sharing revenue per operator per month has increased marginally to Rs. 36,696 and the sharing factor is 1.49.

Indus towers, an independent entity in which Bharti Infratel owns 42%, showed a 3% growth in the quarter to 100,728 towers with a sharing factor of 1.61.

Key Corporate Developments

July 21 – Airtel launches NetPC with Nivio
August – Crossed 100 million customers in single country
August 3 – Talks with MTN extended to August 31
August 6 – Launched Gamesclub and Airtel Hosted Mail, a corporate mailing solution powered by Microsoft Exchange Server 2007 for SMBs
August 20 – Set up a joint venture with French communications firm Alcatel Lucent to manage Airtel’s pan India wireline broadband and telephone services and support its transition to next generation networks.
August 25 – Partnered NetworkPlay for CPM advertising on DTH
September 14 – Launched pre-paid Internet cards
September 27 –Increased Broadband speed  for its IPTV service, digital TV interactive, availble in Delhi, Gurgaon and Noida
September 30 – Talks with MTN broken off

Bharti Airtel inked an MoU with the Bhutan government for extending its terrestrial cable network to the country.

Subsidiary Bharti Airtel Lanka crossed 1 million customers in Sri Lanka.


Q1-10: Airtel Net Profit Up At Rs 25,167M; APRU Slide Continues