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In Focus: Hello India

Bharti Airtel is in a position to dial in 30 per cent market share in GSM segment

India is fast on its way to break into the top three mobile markets in the world. India will have close to 35 crore subscribers by 2010. Availability of cheaper handsets, wide area coverage and cheap value-added services will drive the mobile penetration in India. These factors will push Bharti Airtel (Idirect Code: bhate) into high growth trajectory. The company is in a position to corner 30 per cent market share in the GSM segment in three years. Bharti looks better placed than its competitors since it enjoys highest average revenue per user (ARPU) in the industry and has been able to sustain high ARPUs. Bharti's wide area coverage, good signal quality and falling prices of handsets will stand in good stead for the company.

The company is taking very seriously to control its costs and has been successful too. As part of cost controlling measures, the company was able to lower its subscriber acquisition and interconnect costs. Bharti is also increasing its share of value added services as a percentage of total revenue year after year. From around 3 per cent in 2004, the current financial year is expected to end with a mobile penetration of 14 per cent. Most of this growth is now coming from non-metro cities and rural areas. Since Bharti has wide coverage, it is reaping the benefits of economies of scale. The company's EBITDA margins have improved on the back of rising intra-network traffic. The company's strong management team is working hard to make the company one of the most efficient telcos in the world.