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Bharti Infratel Ltd.

BSE: 534816 Sector: Infrastructure
NSE: INFRATEL ISIN Code: INE121J01017
BSE LIVE 15:40 | 02 Dec 386.00 -0.75
(-0.19%)
OPEN

385.00

HIGH

393.15

LOW

381.50

NSE LIVE 15:58 | 02 Dec 385.90 -0.65
(-0.17%)
OPEN

385.10

HIGH

393.00

LOW

381.40

OPEN 385.00
PREVIOUS CLOSE 386.75
VOLUME 87437
52-Week high
52-Week low
P/E 25.38
Mkt Cap.(Rs cr) 71394.95
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 385.00
CLOSE 386.75
VOLUME 87437
52-Week high
52-Week low
P/E 25.38
Mkt Cap.(Rs cr) 71394.95
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Bharti Infratel Ltd. (INFRATEL) - Chairman Speech

Company chairman speech

Dear Shareholders

As the fastest growing major economy in the world India turned out to be a rare brightspot during the year in the midst of a weak global environment. Aided by keymacro-economic factors like low global crude prices and moderate domestic inflation theeconomy managed to regain its lost momentum. Thanks to the pro-reform initiatives of theGovernment India emerged as the world’s most sought after FDI destination in 2015.

Backed by a robust economic performance an overall optimistic outlook and a keendesire to realise its full potential India has adopted the mission of ‘DigitalIndia’. In simple terms Digital India would represent a connected India where everycitizen would be connected to the Internet which would be transformational and open upsignificant opportunities for employment efficiencies and better governance and controls.

Telecommunication has a crucial role to play for Digital India by providing networksfor broadband connectivity across the length and breadth of the country to every town andvillage. The only way to do so is through wireless networks. Telecom networks alreadycover approximately 95% of the population and 90% geography of India for voice with over500000 towers and over a million base stations. However for mobile broadband thepenetration is still low with 3G networks on only 40-50% of towers. For 4G where rolloutstarted only last year it is significantly lower.

With investments of over 50 Bn USD by operators in spectrum over last six years theoperators are rapidly rolling out mobile broadband networks across the country. We expectthe

voice coverage to be replicated for 3G within the next few years. This means asignificant rollout in the coming years. In addition the operators have also now startedrolling out 4G networks which we expect over time to follow the same trend as 4Gecosystem grows. The rollouts by operators are also being complemented by rapidly growingpenetration of smartphones in India which as per an Ericsson estimate is likely to growfrom 13% in 2014 to 58% by 2020. According to IDC India is expected to overtake the US tobecome the second-largest smartphone market globally by 2017.

These developments augur very well for companies like us providing criticalinfrastructure support to telecom companies for network rollouts. Telecom industry is alsowitnessing consolidation which would result in spectrum becoming available to operatorswho have the resources to rollout networks. We accordingly expect further acceleration indata network rollouts by all operators in the coming years; and are fully prepared to meetthe demand.

Due to our superior network execution capabilities and strong relationship withoperators we have been continuously gaining market share. As per a Deloitte report inJune 2015 Indus Towers and Bharti Infratel combined has close to 41% tower market shareand close to 50% tenancy market share in India compared to 38% tower market share and 42%tenancy market share in December 2012 (Analysys Mason Report).

The Company’s financial and operational performance continues to be healthy. Ouraverage sharing ratio per tower for the year stood at 2.16; and we ended the year with aratio of 2.20 up from 2.12 at the beginning of the year. The Company’s financialperformance during the year was strong with a consolidated EBITDA of over '5400 Crores and net profit of nearly ' 2400 Crores an increase of around20% over previous year. The Board of Directors have proposed a dividend of '3.0 per equity share for the year ended March 31 2016. In addition the Board ofDirectors also approved a buyback of equity shares up to a maximum of '2000 Crores. Total cash outgo for the dividend and buyback for the full year inclusiveof tax on dividend would amount to ' 2685 Crores ~203% of the standalonePAT.

The investors reposed their faith in the robustness of the business model and theForeign Institutional ownership touched an all-time high of 25.73% on December 31 2015compared to 8.65% at the time of IPO in December 2012. The Company has been included inMSCI (Morgan Stanley Composite Index) India Index with effect from May 29 2015; and inthe list of stocks eligible for Futures & Options Trading Bharti Infratel also madeit to the flagship NIFTY 50 index with effect from April 012016.

People and Partners continued to be the key pillars of business excellence at BhartiInfratel. The Company has diligently built a cohesive and employee-friendly work culture.As a result of our sustained efforts through the year on people development Aon Hewittrecognised Bharti Infratel for the second time in a row as one of the ‘BestEmployer’ in FY 2015-16.

During the year we continued our efforts to drive our Green Towers P7 Programmerelentlessly and made further investments to enhance our green footprint. I am pleased toreport that as on March 31 2016 over 33750 towers (approximately 38% of totalportfolio) are green towers with zero-diesel consumption. We believe that ourenvironment-friendly initiatives will have long-term benefits to our customers and thesociety at large. Improvement in grid supply as promised by the Government will furtherhelp our initiatives.

Our commitment as a socially conscious and responsible corporate citizen has beenincreasing with every passing year. We are helping build an empowered society througheducation community development and environment sustainability. We have also reached outto young underprivileged girls and women living across several cities by providing themwith opportunities for skill-based training and dignified employment. Our initiativestarget disadvantaged and vulnerable sections of society. During last year collectivelythe Company has spent close to ' 20 Crores on various CSR initiatives.

The Company’s Board went through multiple changes during the year while VinodDhall and Rakesh Bharti Mittal departed after long association; R P Singh and Rajan BhartiMittal joined the Board. I take this opportunity to express my sincere gratitude to VinodDhall and Rakesh Bharti Mittal for their valuable services to the Board during theirassociation with the Company and welcome R P Singh and Rajan Bharti Mittal to the Board.

Overall 2015-16 proved to be yet another constructive and satisfying year. We believethe infrastructure requirement for telecom operators is set to undergo a transformation ofsorts as operators upgrade and expand their networks to cater to the aspirations of arapidly expanding economy. We believe that with strong relationship with all operators andour execution and management strengths we will be able to continue garnering a dominantshare of new business. In the current year we would also be closely watching developmentson potential new businesses like smart cities and transmission opportunities.

Akhil Gupta

Chairman

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