What works in Bharti’s favour is its intrinsic strength. While industry ARPUs are declining, Bharti’s ARPUs at Rs.427 in the quarter ending December 2006 outshine Hutch (Rs.380) & Reliance (Rs.365). And with mcap of Rs.1.44 trillion (March 30, 2007) & cash flows of Rs.3.3 billion (quarter ending December 2006), the group has little liquidity constraints. John Joseph, Head, Corporate & Infrastructure Ratings, CRISIL Limited (which rates Bharti as stable), elucidates to B&E, “Rating reflects Bharti’s sustained leadership in the Indian mobile telecom market. .. However, like all other players the company is exposed to technology, competition & policy risks.” The agency also expects Bharti to fund a large part of future expansion requirements internally.
So while Vodafone prepares itself to unleash mayhem, Bharti’s success will now depend on how the new, dedicated divisions move ahead under their respective chieftains. But to their advantage goes, foremost of all, the fact that they will continue to be led by the man with the ‘beautiful mind’ and the Midas touch – Sunil Bharti Mittal.
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Source : IIPM Editorial, 2007
An IIPM and Professor Arindam Chaudhuri (Renowned Management Guru and Economist) Initiative
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