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Sunil Bharti Mittal could not have asked more for Bharti Tele-Ventures in the financial year 2004–05, except spectrum for the current as well as 3G services. Be it subscriber growth, pan-India coverage, performance on the stock market or expansion of network-everything seemed to be on track for the company. The Bharti scrip showed a remarkable jump from Rs 124 to Rs 241 in 52 weeks. Riding high, Mittal sold his entire personal stock, accounting for about 0.15 percent stake in the company, for a consideration of over Rs 60 crore in March 2005. Earlier, Warburg Pincus sold over six percent equity stake in Bharti Tele-Ventures for nearly Rs 2,500 crore, making almost four times profit on its investments.

Perhaps the biggest achievement of Bharti Tele-Ventures last year was the expansion of its services in all the 23 circles, making it the only private mobile operator to have on all-India presence with 10,000 base stations put up in the last 10 years. Bharti now plans to add another 10,000 base stations to fuel its expansion both in cities and rural areas this year.

The mobile subscriber base of the company, as on 31 March 2005, stood at 10,984,280, a growth of almost 69 percent year-on-year. This gave Bharti a market share of almost 21 percent in the wireless space. And among the GSM operators it occupied almost 27 percent of the pie. This year the firm has managed to bring down its prepaid customer base to 76 percent, as compared to79 percent in FY 2003–04. Though Bharti's officials skirt questions on falling ARPU and say that in a hyper-growth market subscriber growth matters more; the fact remains that for mobile services, its ARPU came down from Rs 532 in FY 2003–04 to Rs 504 in FY 2004–05. However, the good news was that average minutes of usage per user went up from 300 minutes to 357 minutes in the same period.

Bharti Tele-Ventures is on its way to becoming a $2 billion company. The consolidated revenue for FY 2004–05 was over Rs 8,034.6 crore, up 61 percent from Rs 5,002.5 crore in FY 2003–04. The mobile services contributed Rs 5,435.60 crore, broadband and telephone services Rs 1,127 crore, long distance 1,866.10 crore, and the enterprise business brought in Rs 538.10 crore.

In the FY 2004–05, Bharti consolidated its enterprise service portfolio with the acquisition of Comsat Max and C Max Infocom for Rs 33 crore. This gave Bharti a lead in the financial and banking segment, where Comsat had a strong VSAT presence.

With Reliance and BSNL pursuing aggressive plans in mobile and broadband businesses, and others also expanding their network, maintaining a strong growth rate would be an uphill task for Bharti, particularly when the next phase of expansion is in even lower ARPU areas. The financial year 2005-06 would see concrete plans for 3G being brought to the fore. The company has time and again made clear its desire for starting 3G services as soon as spectrum is released. This year, Bharti would strive to increase its non-voice revenue while pushing up its ARPU and minutes usage. And with 3G services, we might see an improvement in quality of voice services, and better data revenues.

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"ARPU has lost the kind of relevance it had earlier"

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