Bharti Airtel Case Study: Services, Financials, Shareholding Pattern, and SWOT Analysis

Bharti Airtel is one of India’s top multinational telecommunication companies, with more than 352 million users nationwide. This blog will provide an overview of Bharti Airtel’s business segments, performance segments, services, and other offerings. Let’s take a look at the company’s profile.

Overview

Bharti Airtel, commonly known as Airtel, was founded by Sunil Mittal in 1995. It currently serves users from 20 countries. The telecom giant provides 2G, 3G, 4G, and 5G networks, fixed-line broadband connections, and voice services based on the country of operation. 

Let’s have a look at the company profile:

Let’s move towards the essential market data related to the Bharti Airtel:

Services Offered

Bharti Airtel provides products and services for the end consumers and businesses. The company offers 2G, 3G, 4G, and 5G wireless services, mobile commerce, fixed line services, high-speed DSL broadband, IPTV, and Digital TV. 

• B2C – Services:

Here are some B2C services that the company provides to the consumers:

1. Telemedia Services
2. Digital TV Services
3. Mobile Services

• B2B – Services:

The following are a few B2B services that the company offers to businesses :

1. Digital Media services
2. Data center-based services
3. Data and Application Based
4. Cloud-based services
5. Network Services
6. Voice Services

Competitors

The major competitors of the company are:

• Jio
• BSNL
• MTNL
• Vodafone Idea (VI)

Financial Highlights

Income Statement

The Income statement highlights indicate strong development over the years in both top line and bottom-line figures. These indicate efficient management of resources. 

Cash Flow Statement

The Cash Flow Statement indicates positive and consistent growth for Operating activities, but the same cannot be said for investing and financing activities, which have witnessed major turbulence over the last four years. 

Profitability Ratios

The chart indicates that over the last 4 years, the company has shown massive growth and has returned double-digit growth across multiple metrics. 

Growth Ratios

After 2021, the company’s growth ratios indicate a steady increase in topline figures and net profit figures. 2020 was a major year for Bharti Airtel as they saw a major decline in net profit due to unprecedented competition from Jio. 

Stock Returns

The stock movement indicates consistent returns and has even beaten the indices in some years. 

Shareholding Pattern

The graph shows that the shareholding pattern has remained mainly consistent throughout the years with slight changes.

SWOT Analysis

Strengths 

1. Advertisements: Airtel has brand visibility in social media and television ads to attract audiences.
2. Customer support: Airtel provides spectacular customer services to its audiences or users. The company also has a solid customer base in countries like Sri Lanka, Bangladesh, Africa, and many more.
3. Marketing: Airtel invests a large amount of money to run its unique marketing campaigns for the public to grab their attention. The company did several campaigns that created a significant impact on its consumers. 
4. Quality network: The company relies heavily on its quality network that provides high internet speed, a top priority for consumers today. 
5. Rural market penetration: Airtel is entering rural market sections with a solid customer base. The company has achieved this through strategic investment in rural network infrastructure, making it one of the leading players in the segment.

Weaknesses

1. Price Sensitivity: The company is price-sensitive in the market. They have been through a massive problem in the past that hindered the company’s growth. 
2. Oligopoly market: Airtel is in an oligopolistic market, and the industry is home to aggressive pricing strategies, frequent price wars, and predatory practices that have resulted in lower earnings for all players.
3. Third-party vendors: For several aspects of its operations, the company mainly depends on several partners, from network infrastructure to marketing and distribution. Inadequate supply chain management may result in quality issues, delays, and other concerns.

Opportunities

1. 5G technology: With the exponential rise in the 5G network, the fast internet speed will be a game changer in the telecom business. According to a report by Nasscom and Arthur D Little analysis, 5G network technology is estimated to contribute around 2% of India’s GDP by 2030, equivalent to $180 billion, and Airtel’s early adoption and investment in 5G technology will position it as a market leader in the future.
2. Collaborations: Airtel can collaborate with more smartphone companies to provide its services. It has helped in the rise in network penetration.

Threats

1. Competitions: Airtel is facing problems in the market because of its competitors. Jio is taking over the market because of price, network, etc. The competitors have no option but to make their prices more budget-friendly, which impacts Airtel’s market position. 
2. Fast-changing technology: It is disadvantageous for Airtel since it can quickly turn its current offers obsolete and make competing harder. It must consistently develop and invest in new technology to keep up with changing users’ wants and stay updated and ahead of the competition.

Conclusion

Airtel is a brand that has maintained its legacy for more than 25 years. The company understands the market scenario and users’ tastes and preferences. The company has consistently delivered high-speed internet and exceptional network coverage, making it a popular choice for millions of customers. Only time will tell if the company will be able to keep its dominant position in the long run.

Frequently Asked Questions (FAQs)

1. Who is the founder of Bharti Airtel?

Ans. The founder of Bharti Airtel is Sunil Mittal.

2. What is the market capitalization of Airtel?

Ans. As of 18 March 2024, the market capitalization is ₹7,04,934 Cr.

3. What does the cash flow position of the company indicate?

Ans. The Cash Flow statement indicates positive and consistent growth for Operating activities, but the same cannot be said for investing and financing activities, which have witnessed significant turbulence over the last four years.  

4. Who is Bharti Airtel’s CEO?

Ans. Gopal Vittal is the CEO of Airtel.

5. Has there been any major change in the company’s shareholding pattern?

Ans. As of 18th March 2024, the company has not witnessed any major changes in the shareholding pattern.

Disclaimer: The securities, funds, and strategies mentioned in this blog are purely for informational purposes and are not recommendations.