September 2011
3T
T
ALK
T
IME
Indian telecom monthly
19
20
20
T
ELE
Main Menu
SIM:
Special In the Month ......................................................
Bharti Airtel: CEO track takeaways from 7th Annual global investor conference
Idea Cellular: CEO track takeaways from 7th Annual global investor conference
2
Gallery
Industry wireless net additions (m)
15
Numbers:
Statistical Review (July) ...........................................
4
Buzz:
Monthly Updates ..........................................................
10
Indian Telecom: Jul-11 GSM net adds down 11% MoM at 7.6m; reflects rationality in
competition rather than broad-based slowdown; Buy Bharti, Idea
Investor meeting takeaways from 7th Annual global investor conference: Bharti
Airtel, Idea Cellular, Reliance Communications
Reliance Comm 1QFY12 results: Downgrading revenue/EBITDA by 3-9%; leverage
concerns remain; Neutral
Idea Cellular - The Corner Office: Recent tariff hikes to flow through in four
quarters; Revenue market share trend to decode the future
Indian Telecom: Vodafone India stake sale at EV of ~USD18b; implied EV/EBITDA at
~12x FY11 v/s ~11x for Bharti/Idea
13
11
7
July-11 subscriber market share (inner)
1QFY12 AGR market share (outer)
5 3
9
7
10
14
11
8
11
20
Absolute performance (%)
Bharti
Idea
RCOM
Bharti Airtel
7
20
32
RCo m
Vodafo ne
BSNL+M TNL
Messages:
Key Sector Developments (August)
................................ 19
Signals:
Sector Outlook & Valuation
........................................................ 21
17
17
8
Idea
Tata Tele
Aircel
New entrants
Speed Dial:
Monthly Summary
GSM subscriber net adds (ex RCOM and Tata DOCOMO) is 7.6m in Jul-11
v/s 8.6m in Jun-11, down 11% MoM and 34% YoY. All major operators
except BSNL & Uninor reported lower net additions on MoM basis with
decline of 26-29% recorded by Bharti, Idea and Vodafone.
Reliance Communications reported 1QFY12 PAT of INR1.57b, lower than
our estimate of INR2.09b due to lower EBITDA and higher minority interest.
Adjusted revenue declined 3.3% YoY and 7.3% QoQ to INR49.4b (10%
below est) mainly due to lower revenue in non-wireless business. Maintain
Neutral
with revised target price of INR83 (INR106 earlier).
Recently announced transaction involving 5.5% stake sale in Vodafone
Essar for a consideration of INR28.6b (USD640m) implies an EV of ~USD18b
and equity valuation of ~USD11.5b for Vodafone Essar. The deal values
Vodafone Essar at FY11 EV/EBITDA of ~12x, EV/sales of ~3x, and EV/sub
of ~USD130.
We reiterate
Buy
on Bharti/Idea and
Neutral
on RCom. We expect EBITDA
CAGR of 25% for Bharti and 42% for Idea over FY11-13E. Improving
competitive environment in the wireless sector should drive better revenue
growth as well as expansion in margins for Indian wireless companies.
Sensex
67
44
17
25 6
5
-2 -8-3
1W
1M
8
-9-9
3M
26
20
-6-8
6M
-8
-48
12M
41
Stock price performance v/s Sensex
Bharti rebased
Sensex rebased
160
130
100
70
40
RCom rebased
Idea rebased
Comparative valuations
CMP
(INR)
Rating
TP
Mcap
(INR) (USDb)
33.6
7.2
3.8
P/E (x)
FY11 FY12E
25.6
36.9
11.7
19.8
38.7
16.5
FY13E
13.3
14.8
9.6
EV/EBITDA (x)
FY11 FY12E FY13E
10.9
11.5
7.6
8.1
8.4
6.9
6.2
5.9
5.3
EV/Sales (x)
FY11 FY12E FY13E
3.8
2.8
2.4
3.0
2.3
2.2
2.5
1.8
1.8
Bharti *
409
Buy
530
Idea
100
Buy
140
RCom
85
Neutral
83
* Proportionate EV/EBITDA and EV/sales
Shobhit Khare
(Shobhit.Khare@MotilalOswal.com) +91 22 3982 5428

3T
T
ELE
T
ALK
T
IME
SIM
Special In The Month
Bharti Airtel: CEO track takeaways from 7th Annual
global investor conference
Indian telecom sector at a turning point; best in Africa business yet to come
Core essence
The Indian telecom sector is at a turning point, with increasing rationality in competition,
sustainable voice growth (led by the rural market), large data opportunity, and peak
investments already behind. The best in the Africa business is yet to come.
Industry insights
Increasing rationality in competitive activity as underscored by recent pricing actions,
focus on paying customers as well as sales and distribution cost management.
Real wireless subscribers in India are estimated at ~600m, with actual rural penetration
at just 20-22%.
Non-voice revenue at 13.5% for the industry has significant room for improvement.
However, the industry will need to work hard to achieve the full potential of data
opportunity.
Africa market penetration in Bharti's footprint is relatively low at ~30%.
Telecom operators are keenly looking at the New Telecom Policy 2011 (NTP 2011).
Bharti expects the policy to (1) be comprehensive, (2) provide exit opportunities to
unviable operators, and (3) provide a level-playing field.
Please refer to our 7th Annual
global investor conference dated
30 August 2011
Company vision and strategy
Bharti is best positioned to capture rural and data opportunities.
The company has demonstrated its leadership in the market, with initiatives like passive
infrastructure sharing and recent tariff corrections.
Relentless focus on efficiency improvement, as underscored by the recent organization
restructuring.
Focus on continued execution in the Africa business. The business delivery model has
been aligned similar to India. Bharti would be looking to expand the Africa footprint in
the long-term.
Key triggers/milestones/challenges
NTP 2011 would be a key event to watch for.
Bharti aims to bring down its net debt/EBITDA ratio to 2x over the next one year v/s 2.6x
currently.
September 2011
2

3T
T
ELE
T
ALK
T
IME
Idea Cellular: CEO track takeaways from 7th Annual
global investor conference
Significant opportunity available in the Indian voice as well as data markets over
the medium term
Core essence
Significant opportunity available in the Indian voice as well as data markets over the medium
term. Current focus only on tariff hikes, tower deals, etc could be misplaced.
Industry insights
Penetration of voice services in India is still relatively low at ~50% v/s the 80-90%
benchmark.
Virtual consolidation in the industry is evident from increase in revenue market share of
top-three operators from ~55% to ~65% in the last 3-4 years despite hyper-competition.
Wireless is a heterogeneous sector, with different operators having leadership in different
circles.
The share of non-voice services in revenue is set to increase, as most subscribers will
upgrade their handsets over the next few years and eco-system for 3G is being developed.
While incremental operating cost for 3G is only a fraction of the current operating costs,
amortization and finance costs related to 3G spectrum will negatively impact the bottomline
of all operators.
Please refer to our 7th Annual
global investor conference dated
30 August 2011
Company vision and strategy
Idea has a strategy of over-investing in its established circles, which drives its leadership
in these operations.
Idea is focused on deepening its coverage and driving rural growth. 67% of net subscriber
additions for Idea come from rural markets.
Focus is on building scale, with 1.2b minutes/day. Idea is the eighth-largest operator
globally in terms of traffic.
Enhancing revenue market share, driven by (1) focus on quality of subscribers, (2) cash
profits to sustain investments, and (3) higher-than-industry traffic growth.
Idea is expanding its 3G reach and is rolling-out 3G services in 10 towns/day, as significant
growth is expected from wireless broadband on the handsets.
Key triggers/milestones/challenges
NTP 2011 would be a key event to watch for.
Continued overcapacity in the industry remains a challenge.
Potential exit of unviable operators could be an important milestone for the industry.
Increase in smart-phone penetration to drive data revenue.
September 2011
3

3T
T
ELE
T
ALK
T
IME
NUMBERS
Statistical Review
Monthly trend analysis
July 2011
Pan India trend of wireless subscriber base, net adds (m)
Pan India - Wireless Subscriber Base (m)
Pan India - Wireless Net Adds (m)
Industry net adds declined
to 7m in July-11 after
recording ~20m in 2HFY11
12
14 15
15
17
18
19 20 19
21
17
16
18 17 18 17
19
23 23
19 20 20
15
13
11
7
Operator-wise wireless net adds (m)
Bharti
Vodafone
BSNL
IDEA (incl. Spice)
Aircel
MTNL
Reliance Comm
Tata Tele
Sistema
HFCL
Loop Mobile
Uninor
S Tel
Etisalat DB
Videocon
Total
Jan-11
3.3
3.1
2.2
2.5
1.7
0.0
3.2
1.8
0.7
(0.3)
0.0
1.8
0.2
0.2
(1.3)
19.1
Feb-11
3.2
3.6
1.5
2.5
1.7
0.0
3.3
1.6
0.5
0.1
0.0
1.3
0.2
0.2
0.6
20.2
Mar-11
3.2
3.6
1.4
2.7
1.3
0.0
3.5
1.5
0.4
0.1
0.0
1.2
0.1
0.3
0.5
20.0
Apr-11
2.4
2.4
0.7
2.5
1.1
0.0
2.9
1.2
0.6
0.0
0.0
1.5
0.2
0.2
0.1
15.9
May-11
2.5
2.4
0.5
1.8
1.1
0.0
2.5
0.4
0.6
(0.0)
0.0
1.1
0.2
0.1
(0.2)
13.0
Jun-11
2.1
2.1
0.8
1.4
0.9
0.0
2.1
0.2
0.5
0.0
0.0
0.9
0.2
0.1
0.1
11.4
Jul-11
1.5
1.5
1.8
1.0
0.6
0.0
1.5
(2.7)
0.5
0.0
0.0
1.1
0.2
0.1
(0.1)
7.0
MoM (%)
(29)
(29)
110
(26)
(34)
1,715
(28)
(1,329)
8
-
(36)
12
21
11
(226)
(12)
Wireless net adds (m) trend of leading operators (m)
Bharti
Tata Tele
4
3
Idea
BSNL+MTNL
RC om
Aircel
Vodafone
Net adds for majors
are tapering-off;
Tata Teleservices reported
negative netadds of
2.7m in July-11
2
1
0
-1
-2
-3
1.8
1. 5
1. 0
0. 6
-2. 7
Source:TRAI
September 2011
4

3T
T
ELE
T
ALK
T
IME
Wireless net adds (m) trend of new entrants
2. 8
1. 5
Uninor
Sistema Shyam
Etisalat
Videocon
S Tel
New entrants net adds fairly
stable; Videocon reported
negative net adds
-1. 0
-2. 3
0. 2
1.1
0.5
0. 2
-0.1
Aggregate adjusted gross revenue (AGR) of telecom operators (INR b)
Aggregate industry AGR in
1QFY12 increased 5% QoQ
driven by lower decline in
RPM (<1.5% QoQ) and
growth in traffic
(4-7% QoQ)
4
154
160
171
7
QoQ AGR growth (%)
Adjusted Gross Revenue (INR b)
185
8
184
184
200
205
205
204
195
206
215
213
221
225
236
9
5.8
0
0
2
0.0
-0.4
-4.6
-0.7
4.3
3.6
2.1
4.9
Adjusted gross revenue (INR b)
1Q
FY10
Bharti (incl. wireline)
Vodafone
Idea/Spice
BSNL/MTNL
RCOM (incl. wireline)
Tata Tele (incl. wireline)
Aircel
Others
All India
QoQ (%)
69.3
42.3
25.7
21.6
22.9
14.2
7.3
1.7
205.0
0.0
2Q
FY10
68.2
40.8
25.2
22.7
22.0
15.5
8.0
1.7
204.1
-0.4
3Q
FY10
64.6
40.0
25.9
19.8
21.2
14.5
7.1
1.7
194.7
-4.6
4Q
FY10
67.8
42.7
26.3
19.7
18.8
18.5
9.6
2.4
205.9
5.8
1Q
FY11
71.5
44.1
27.9
18.6
21.3
18.1
10.5
2.6
214.7
4.3
2Q
FY11
68.7
43.8
27.4
18.6
21.3
18.7
11.0
3.6
213.2
-0.7
3Q
FY11
70.7
45.9
29.7
19.2
19.5
20.0
10.8
5.1
220.8
3.6
4Q
FY11
70.2
47.7
31.2
19.9
18.4
21.1
10.9
6.0
225.4
2.1
1Q
FY12
75.6
48.4
33.5
19.1
18.6
22.0
11.2
7.9
236.4
4.9
Source: TRAI
YoY
%
6
10
20
3
-13
22
6
200
10
QoQ
%
8
2
7
-4
1
4
3
30
5
AGR share (%)
1Q
FY10
Bharti (incl. wireline)
Vodafone
Idea/Spice
BSNL/MTNL
RCOM (incl. wireline)
Tata Tele (incl. wireline)
Aircel
Others
All India
33.8
20.6
12.5
10.5
11.2
6.9
3.6
0.8
100.0
2Q
FY10
33.4
20.0
12.4
11.1
10.8
7.6
3.9
0.8
100.0
3Q
FY10
33.2
20.5
13.3
10.2
10.9
7.4
3.6
0.9
100.0
4Q
FY10
32.9
20.7
12.8
9.6
9.1
9.0
4.7
1.2
100.0
1Q
FY11
33.3
20.5
13.0
8.6
9.9
8.4
4.9
1.2
100.0
2Q
FY11
32.2
20.6
12.9
8.7
10.0
8.8
5.1
1.7
100.0
3Q
FY11
32.0
20.8
13.4
8.7
8.8
9.1
4.9
2.3
100.0
4Q
FY11
31.1
21.2
13.9
8.8
8.2
9.4
4.8
2.7
100.0
1Q
FY12
32.0
20.5
14.2
8.1
7.9
9.3
4.7
3.3
YoY
-134
-5
117
-55
-205
88
-17
211
QoQ
84
-68
33
-72
-29
-5
-9
65
(BP) (BP)
Source: TRAI
September 2011
5

3T
T
ELE
T
ALK
T
IME
July2011: Wireless subscriber market share
Others (new
entrants),
6%
Aircel,
7%
Tata Tele
10%
Reliance
Comm
17%
July2011: Wireless net adds market share
BSNL+MTNL
7%
Bharti
21%
Reliance
Comm
22%
Bharti ,
20%
Others (new
entrants),
15%
IDEA,
12%
Aircel,
8%
Vodafone,
17%
Idea
11%
Vodafone,
18%
BSNL+MTNL
11%
Tata Tele
-38%
Bharti remains the market leader with ~20%
wireless subscriber market share followed by
RCom/ Vodafone (~17%); new entrants together
constitute only ~6% of the market
Bharti, RCom and Vodafone together constitute
~61% of the net add market share
July 2011: Circle-wise subscriber mix
July 2011: Circle-wise net adds mix
Metro
-1%
'C' Circle,
13%
Metro,
14%
'C' Circle
19%
'A' Circle
48%
'B' Circle,
39%
'A' Circle,
34%
'B' Circle
34%
Metro and 'A' Circle categories together
constitute ~48% of the wireless subscriber base
'A' Circle contributes the highest share (~48%)
in wireless subscriber net adds. Metro Circle
witnessed a negative net adds mix
September 2011
6

3T
T
ELE
T
ALK
T
IME
Quarterly trends
1QFY12: Gross revenue (GR) market share
Others
4%
Tata Tele
9%
1QFY12: Adjusted gross revenue (AGR) market share
Aircel
5%
Others
3%
Bharti
32%
Aircel,
5%
BSNL+MTNL
8%
Bharti,
31%
Tata Tele
9%
RCom
9%
Vodafone
21%
RCom
8%
BSNL+MTNL
8%
Idea
14%
Idea
14%
Vodafone
20%
Bharti continues to be the market leader with ~31% revenue
market share followed by Vodafone (~21%); new entrants
together garner only ~4% of revenue market share
1QFY12: Circle-wise GR mix
'C' Circle
12%
Metro
18%
1QFY12: Circle-wise AGR mix
'C' Circle
12%
Metro
15%
'B' Circle
34%
'B' Circle
34%
'A' Circle
37%
'A' Circle
38%
Metro and 'A' Circle categories together constitute
~55% of the aggregate revenues
September 2011
7

3T
T
ELE
T
ALK
T
IME
Revenue per minute (INR/min)*
0.72
Bharti (India)
0.64
Idea
Vodafone
RCom
While Bharti/Vodafone's RPM
declined ~1% QoQ, Idea's
RPM increased 1% QoQ.
RCom's RPM continued to
remain stable for the sixth
consecutive quarter
0.40
0.48
0.44
0.43
0.41
0.56
Average revenue per user (INR/month)
400
Bharti (India)
325
Idea
Vodafone
RCom
Bharti (India) Mobile ARPU
declined 1.8% QoQ to
INR190 (v/s estimate
of INR192)
175
100
190
169
160
103
250
Wireless traffic (billion mins) *
225
Idea
175
RCom
Vodafone
Bharti (India)
Bharti/Idea/Vodafone's
traffic was up 4-7% QoQ
125
75
25
Source: Company/MOSL
* Vodafone RPM and traffic adjusted for on-net traffic to make it comparable with reporting
of other operators. Vodafone counts on-net minutes once while other operators report it as
2 minutes.
September 2011
8

3T
T
ELE
T
ALK
T
IME
Rural and urban subscriber mix
Rural subscribers (% of total)
71%
73%
72%
71%
70%
Urban subscribers (% of total)
69%
67%
67%
67%
67%
66%
66%
Rural subscriber mix remains
stable in 1QFY12 at 34%
29%
27%
28%
29%
30%
31%
33%
33%
33%
33%
34%
34%
GSM and CDMA subscriber mix
CDMA subscribers (% of total)
GSM subscribers (% of total)
82%
83%
84%
85%
86%
GSM subscriber mix (~86%
in 4QFY11) has been
increasing over the past
nine quarters
74%
74%
76%
77%
79%
80%
26%
26%
24%
23%
21%
20%
18%
17%
16%
15%
14%
Source: TRAI
September 2011
9

3T
T
ELE
T
ALK
T
IME
BUZZ
Monthly Updates
INDIAN TELECOM: Jul-11 GSM net adds down 11% MoM at 7.6m;
reflects rationality in competition rather than broad-based slowdown;
Buy Bharti, Idea
GSM subscriber net adds (ex RCOM and Tata DOCOMO) is 7.6m in Jul-11 v/s 8.6m in
Jun-11, down 11% MoM and 34% YoY. All major operators except BSNL & Uninor reported
lower net additions on MoM basis with decline of 26-29% recorded by Bharti, Idea and
Vodafone.
Total GSM subscriber base as reported by COAI (excl RCOM in 14 circles and TATA
DOCOMO) is up 1.3% MoM to 606m. We expect subscriber additions to remain at lower
levels given already significant wireless penetration (~70% reported penetration; ~50%
real penetration) as well as decline in competitive activity. We believe voice RPM, EBITDA
margin and data revenue growth would be key drivers for earnings of telcos rather than
subscriber additions.
Our FY12 subscriber estimates incorporate net adds at 1.9m for Bharti and 2m for Idea.
We do not see any material impact of net adds assumptions on earnings given low
incremental traffic/revenue contribution from marginal subscribers. On the contrary,
selling and distribution costs for most companies could decline due to lower gross
additions, thus supporting margins.
Reiterate
Buy
on Bharti (trades at 7.9x FY12 and 6.1x FY13 proportionate EV/EBITDA)
and Idea (trades at 8.3x FY12 and 5.8x FY13 EV/EBITDA).
Company-wise additions
Bharti's net adds declined 29% MoM and 42% YoY to 1.51m. Bharti's subscriber base is
up 23% YoY and 0.9% MoM to 171m.
Vodafone Essar recorded net adds of 1.49m, down 29% MoM and 38% YoY. Vodafone's
subscriber base is up 28% YoY and 1.1% MoM to 143m.
Idea's net adds declined 26% MoM and 46% YoY to 1.0m; Idea's subscriber base reached
96m; up 36% YoY and 1.1% MoM.
BSNL net adds increased 110% MoM and 50% YoY. This is the second consecutive
month of growth in net adds for BSNL. BSNL's subscriber base is up 33% YoY and 2%
MoM to 90m.
Aircel's net adds declined 34% MoM and 62% YoY to 0.6m; Aircel's subscriber base is
up 35% YoY and 1% MoM to 58.6m.
Uninor recorded net adds of 1.06m in Jul-11 (v/s 0.94m in Jun-11) taking its subscriber
base to 27m; After three consecutive months of decline in net adds, Uninor's net adds
have increased. Videocon reported negative net adds of 0.09m in Jul-11. Videocon has
a subscriber base of 7m.
S-Tel net adds increased 21% MoM and 90% YoY to 0.15m taking its subscriber base to
3.5m.
Etisalat's subscribers increased 5% MoM to 1.4m.
September 2011
10

3T
T
ELE
T
ALK
T
IME
GSM subscriber additions (Excl RCOM AND TATA DOCOMO) (M)
Jan-11 Feb-11 Mar-11 Apr-11 May-11
Bharti
Vodafone
Idea
BSNL
Aircel
Uninor
MTNL
Loop
Videocon
S Tel
Etisalat DB
Total of above
3.30
3.11
2.51
2.20
1.66
1.80
0.04
0.02
-1.31
0.20
0.19
13.7
3.20
3.56
2.51
1.51
1.67
1.27
0.03
0.02
0.55
0.18
0.20
14.7
3.20
3.65
2.70
1.36
1.34
1.21
0.02
0.01
0.54
0.13
0.32
14.5
2.41
2.41
2.45
0.69
1.11
1.45
0.01
0.02
0.13
0.18
0.24
11.1
2.45
2.45
1.80
0.47
1.11
1.14
0.02
0.02
-0.19
0.16
0.09
9.5
Jun-11
2.12
2.09
1.35
0.84
0.92
0.94
0.00
0.02
0.08
0.15
0.06
8.6
Jul-11
1.51
1.49
1.00
1.77
0.61
1.06
0.03
0.01
-0.10
0.18
0.07
7.6
MoM
(%)
-29
-29
-26
110
-34
12
1715
-36
-226
21
11
-11
YoY
(%)
-42
-38
-46
50
-62
25
-36
-38
-111
90
458
-34
Subs
(m)
171
143
96
90
59
27
5
3
7
4
1
Past 12 months
net adds (m)
31
32
25
22
15
21
0
0
4
2
1
606
155
Source: Company/MOSL
September 2011
11

3T
T
ELE
T
ALK
T
IME
BUZZ
Bharti Airtel: Investor meeting takeaways from 7th Annual global
investor conference
Recent tariff hikes to get reflected in four quarters
Recent tariff hikes have largely been driven by increasing costs and required investments
in 3G and rural networks.
The hikes will flow-through over four quarters.
Tariffs would be reviewed to assess the impact on market share and volumes.
The recent hike in some 2G data plans are mainly to benchmark them with the recently
introduced 3G data plans.
Expect upcoming policy to provide level-playing field
License renewal and excess spectrum are the two major regulatory issues.
While NTP 2011 is keenly awaited for long-term regulatory visibility, it is also expected
to provide a level-playing field for all operators.
Revenue market share: Company has managed well despite hyper competition
Bharti has lost ~2% revenue market share over the last 2 years.
This is mainly a function of large players like Vodafone & Idea entering new markets.
Huge potential opportunity in 3G
Voice penetration currently stands at ~50% and could increase largely driven by rural
(currently at ~30%).
Potential 3G user penetration is a large subset of voice penetration. The potential for
data usage is very large given that there are no fixed lines and the broadband penetration
is less than 2%. However this would require an application ecosystem, rollouts and 3G
enabled handsets at affordable prices.
Non-3G handsets are likely to be driven out of the market over the next two years.
Africa: Cost reduction a key focus area
Primary focus for Bharti in Africa is to reduce cost per minute.
Regulatory and competitive environment is favorable in Africa.
Bharti is keen to invest and expand its business in Africa at a fast pace but has faced
some logistical challenges which will keep FY12 capex at US$1.2b.
Valuation & View
The stock trades at proportionate EV/EBITDA of 7.7x FY12E and 5.9x FY13E. Maintain
Buy
with a target price of INR530.
Please refer to our 7th Annual
global investor conference dated
30 August 2011
September 2011
12

3T
T
ELE
T
ALK
T
IME
BUZZ
Idea Cellular: Investor meeting takeaways from 7th Annual global
investor conference
Significant growth opportunity in voice as well as data
Penetration of voice services in India is still relatively low at ~50% vs 80-90% global
benchmark.
Data opportunity could be as large as voice over the next few years.
Share of non-voice services in the revenue is set to increase as most subscribers will
upgrade their handsets over the next few years and eco-system for 3G is being developed.
Most global companies derive 30-50% of revenue from data vs ~3% for India.
Key industry trends
Virtual consolidation in the industry evident from increase in revenue market share of
top-three operators from ~55% to ~65% in the last 3-4 years despite hyper-competition.
Wireless is a heterogeneous sector with different operators having leadership in different
circles.
While incremental operating cost for 3G is only a fraction of current operating costs;
amortization and finance costs related to 3G spectrum will negatively impact bottom-
line of all operators
Overinvestment strategy in established circles
Idea has a strategy of over-investing in its established circles which drives its leadership
in these operations.
Idea is focused on deepening its coverage and driving rural growth. 67% of net subscriber
additions for Idea come from rural markets.
Focus on building scale; with 1.2b min/day, Idea is the eight largest operator globally in
terms of traffic.
Enhancing revenue market share driven by 1) focus on quality of subscribers, 2) cash
profits to sustain investments, and 3) higher-than-industry traffic growth.
Idea is expanding its 3G reach and is rolling-out 3G services in 10 towns/day as significant
growth is expected from wireless broadband on the handsets.
New circle losses likely to continue at current levels
During FY11 Idea had incurred an EBITDA loss of Rs5.4b in its 9 new circles.
The loss is likely to remain at similar levels in the near-term as the company would
keep investing more as economics in these circles improves.
Regulatory issues
NTP 2011 would be a key event to watch out.
Continued overcapacity in the industry remains a challenge.
Potential exit of unviable operators could be an important milestone for the industry.
Valuation & View
The stock trades at EV/EBITDA of 7.9x FY12E and 5.5x FY13E. Maintain
Buy
with a
target price of INR140.
Please refer to our 7th Annual
global investor conference dated
30 August 2011
September 2011
13

3T
T
ELE
T
ALK
T
IME
BUZZ
Reliance Communications: Investor meeting takeaways from 7th Annual
global investor conference
Competitive environment improving
The worst of the competitive intensity is behind the sector.
With tariff hikes taken by operators controlling 80-90% of the revenue market, the
pricing environment has improved.
Voice RPM improvement will be driven by recent tariff hikes flowing through to more
subscriptions as they come up for renewal.
Advanced due diligence for tower company sale underway
The tower company transaction is in an advanced due diligence stage and could be
completed over the next 2-3 months. Media reports indicated a potential valuation of
USD5b for the tower assets.
The sale will involve the transfer of Reliance Communications' (RCom) tower assets.
Optic fiber assets will not be a part of the proposed transaction.
Leverage high
RCom has net debt of ~INR320b and the blended cost of debt is less than 5%.
The only major debt re-payment required over the next one year is related to the
outstanding FCCB (~USD1.1b due in May 2011).
RCom has drawn down ~USD1.3b from China Development Bank to re-finance shortterm
rupee loans related to 3G license fees. A further limit of ~USD0.6b is available.
Beside external capital raising, operating FCF should be healthy given expected FY12
EBITDA of ~INR68b and limited capex requirement of ~INR15b.
Huge untapped data opportunity
With a large disparity between voice penetration (60-65%) and broadband penetration
(1-2%), there is significant opportunity in the data business yet to be tapped.
The 3G customer base is ~2m. RCom has launched a tablet (priced INR12,999,
manufactured by ZTE). As the prices fall, data penetration should reach a threshold
level.
Valuation and view
RCom trades at EV/EBITDA of 6.7x FY12E and 5.1x FY13E. We have a
Neutral
rating
with a target price of INR83.
Please refer to our 7th Annual
global investor conference dated
30 August 2011
September 2011
14

3T
T
ELE
T
ALK
T
IME
BUZZ
Reliance Comm 1QFY12: Downgrading revenue/EBITDA by 3-9%;
leverage concerns remain; Neutral
Please refer to our detailed report
dated 16 August 2011
Reliance Communications (RCOM) reported 1QFY12 PAT of INR1.57b, lower than our
estimate of INR2.09b due to lower EBITDA and higher minority interests.
Adjusted revenue fell 3.3% YoY and 7.3% QoQ to INR49.4b (10% below our estimate)
mainly due to lower revenue in the non-wireless business. Adjusted EBITDA declined
1.8% YoY but was flat QoQ at INR16b (5% below our estimate). EBITDA margin improved
~50bp YoY and ~250bp QoQ to 32.4%.
Wireless revenue grew 3.1% QoQ to INR43.3b driven by ~3% traffic growth and stable
RPM at 44p. This is the fifth consecutive quarter of stable RPM for RCOM.
Wireless EBITDA grew 2% QoQ to INR11.7b. Wireless EBITDA margin remained largely
flat QoQ at 27%.
While trends in wireless revenue growth are encouraging (3% QoQ traffic growth for
the second consecutive quarter and stable RPM), global and broadband (now combined
into one segment - GEBU) business remains under pressure as indicated by 7-13% QoQ
revenue and EBITDA decline on an adjusted basis.
Other concerns include (1) increase in debtor days to ~75 v/s ~67 in 2HFY11 and ~57
in 1HFY11, (2) alarming leverage levels with net debt of INR320b (net debt/annualized
EBITDA of ~5x), and (3) costs related to capitalization of 3G spectrum fee and related
capex yet to hit the P&L pending vendor testing certification.
The RCOM management confirmed a tariff increase in 18-19 circles, which would be
RPM accretive by ~1p and take about two quarters to reflect in the numbers. Our
wireless RPM estimates remain largely unchanged at 45p (up 2% YoY) for FY12E and
49p (up 8% YoY) for FY13E.
RCom expects stake sale in the tower subsidiary Reliance Infratel to close shortly.
FY12 capex guidance remains unchanged at INR15b (INR3.6b in 1QFY12).
We are downgrading our revenue estimates by 9% and EBITDA by 3% for FY12 and
FY13. Maintain
Neutral
with a revised target price of INR83 (INR106 earlier) based on
5x FY13E EV/EBITDA plus INR1.5m/tower incremental upside for the tower business.
September 2011
15

3T
T
ELE
T
ALK
T
IME
BUZZ
The Corner Office: Idea Cellular — The fastest growing major; Recent
tariff hikes to flow through in four quarters; Revenue market share
trend to decode the future
We met Mr Himanshu Kapania, Managing Director of Idea Cellular for views on 1) competitive
intensity and pricing scenario, 2) long-term industry structure, and 3) regulatory environment
and outlook. While Mr Kapania cited near-term market uncertainty, the meeting re-affirmed
our view that 1) current pricing is unviable for majority of the industry and hence should
correct upwards, and 2) there are visible signs of rationality returning in the competitive
activity. Idea remains our preferred pick to play "improvement in competitive dynamics"
given its highest exposure to Indian wireless and higher sensitivity to potential margin
improvement. Maintain
Buy
with a target price INR140.
Recent tariff hikes to flow-through in four quarters:
Idea has been tweaking tariffs
over the last few months, especially in its leadership circles. While the hikes are effective
immediately for new subscribers, existing subscribers would gradually migrate to new plans
over a period of four quarters. We maintain our estimates of flat RPM in FY12 and 8%
increase in FY13.
Are the hikes sustainable? Revenue market share trends to decode the future:
While it is too early to comment on sustenance of tariff hikes given the competitive dynamics,
we get comfort from the fact that despite not being aggressive on pricing, combined revenue
market share of Bharti, Vodafone, and Idea has remained at ~65% over past several quarters;
these operators have been net gainers in MNP as well. We believe other operators should
logically follow suit by taking price increases but also note that they would need to do a
balancing-act given sub-scale operations. Idea is solely focused on revenue market share
and would re-think the strategy (of raising tariffs) if there is pressure on that metric.
Industry adds down due to focus on quality and operational issues:
Lower industry
net adds have been driven by clear shift in focus to "quality of subscribers" and operational
issues like lower availability of number series etc.
Policy clarity for M&A, spectrum pricing would be crucial:
Telecom, like other
infrastructure, is a business where one can get in, but getting out is difficult. Current
government policies do not provide exit route or M&A opportunities to the unviable operators.
Also, spectrum pricing remains a key issue and current trends actually point towards likely
surplus of spectrum which, along with stretched balance sheets, should lead to lower valuation
for spectrum if a market mechanism is applied. Ultimately, one strategy for unviable operators
could be to shrink their operations.
Significant data potential yet to be unleashed:
Data opportunity is potentially bigger
than voice (voice is ~ Rs750b per annum market currently) and should take 2-4 years to
start showing traction. Global experience clearly shows that data is going to be a big wave
but timing is not certain. We estimate data and VAS to contribute 17-18% to wireless
revenue in FY13 vs 12-13% currently.
42% EBITDA CAGR; Buy:
Idea trades at an EV/EBITDA of 7.9x FY12E and 5.6x FY13E.
Reiterate
Buy
with a price target of INR140.
Please refer to our detailed report
dated 10 August 2011
September 2011
16

3T
T
ELE
T
ALK
T
IME
BUZZ
Indian Telecom: Vodafone India stake sale at EV of ~USD18b; implied
EV/EBITDA at ~12x FY11 v/s ~11x for Bharti/Idea
Recently announced transaction involving 5.5% stake sale in Vodafone Essar for a
consideration of INR28.6b (USD640m) implies an EV of ~USD18b and equity valuation
of ~USD11.5b for Vodafone Essar. The deal values Vodafone Essar at FY11 EV/EBITDA
of ~12x, EV/sales of ~3x, and EV/sub of ~USD130.
Bharti and Idea currently trade at ~11x EV/EBITDA and 2.7-3.7x EV/Sales on FY11 basis
while RCom trades at 7.5x EV/EBITDA and 2.4x EV/Sales.
Valuation benchmark for the deal is at a moderate premium vs current valuations of
listed majors. Reiterate
Buy
on
Bharti/Idea
and
Neutral
on
RCom.
Vodafone India equity valuation at USD11.5b
Vodafone Group and Piramal Healthcare announced that Piramal has agreed to purchase
approximately 5.5% stake in Vodafone Essar from ETHL Communications Holdings Limited
("Essar") for cash consideration of approximately US$640 million.
The transaction follows the settlement between Vodafone and Essar over the sale of
Essar's approximately 33% stake in Vodafone Essar, announced in July 2011. Essar has
used its put option to sell the 33% stake in Vodafone Essar for a consideration of
~US$5b.
The transaction contemplates various exit mechanisms for Piramal, including both
participation in a potential initial public offering of Vodafone Essar and a sale of its stake
to Vodafone.
While equity valuation for Vodafone Essar comes to ~INR520b, net debt is estimated at
~INR300b implying EV of ~INR820b. Vodafone Essar reported an EBITDA of ~Rs70b in
FY11.
Benchmark multiple calculation for the deal
Consideration for 5.5% stake (INRb)
Equity valuation of Vodafone Essar (INRb)
Estimated net debt (INRb)
Estimated EV (INRb)
FY11 EBITDA (INRb)
FY11 Revenue (INRb)
FY11 EV/EBITDA (x)
FY11 EV/Sales (x)
28.6
519
300
819
70
274
11.7
3.0
First major deal since Nov-08; fair possibility of Vodafone India IPO
We highlight this is the first major deal in the Indian wireless space since November
2008 when NTT DOCOMO bought a 26% stake in Tata Teleservices for a consideration
of USD2.7b.
At 12x trailing EV/EBITDA, we believe that valuations reflect strong growth outlook for
the sector coming from a slump over last 2-3 years due to hypercompetition.
We believe there is a fair possibility of a potential IPO by Vodafone India given 1) highly
leveraged capital structure (net debt/EBITDA of more than 4.5x) and 2) potential
settlement of the ownership structure through an IPO.
September 2011
17

3T
T
ELE
T
ALK
T
IME
September 2011
18

3T
T
ELE
T
ALK
T
IME
MESSAGES
Key sector developments
Mobile telephony yet to reach over 37k villages: Milind Deora
Over 37,000 villages in India were still waiting to get connected with the rest of the country
through mobile telephony as of March this year, despite the government'''s efforts to facilitate
expansion of networks to rural areas by offering a subsidy. Over 37,000 villages in the
county were yet to be connected with mobile telephony services as of March, 2011, Minister
of State for Communications and IT Milind Deora informed Parliament recently.
Source: TelecomTiger.com
Data to comprise 30 pc share of telcos rev by 2016: Qualcomm
With the rising popularity of smartphones and tablets, data services would contribute about
30 per cent of the revenues of telecom operators in India by 2016, mobile chipset maker
Qualcomm said today. "Data in terms of overall revenue is still less, 15 per cent, but this
would grow to 30 per cent in 2016. He said challenges like upgrading of networks, increasing
efficiencies and improving customer experience would hold the key to this growth. Other
industry players at the event also said that data services would be the next phase of growth
of telecom players, especially with the availability of 3G and BWA spectrum.
Source: Financial Express
Reliance Communications puts tower unit Reliance Infratel on the block for $5
billion: Sources
Billionaire Anil Ambani's Reliance Communications has hired UBS to sell its 95-percent
stake in tower unit Reliance Infratel and has reached out to several strategic and private-
equity firms, including Blackstone and UAE's Etisalat, asking for $5 billion for the stake,
three sources with direct knowledge said. Potential bidders have said Reliance's valuation
of the stake is at least a billion dollars too high, two of the sources said, adding that the
process was still in a very early stage.
Source: Economic Times
Centre working on exit policy for telecom firms
The Telecom Commission, India's apex policy-making body in the sector, has directed the
department of telecom ( DoT) to prepare an exit policy for operators. This will come as
welcome relief to several players combating the dual threats of market viability and licence
cancellation following the 2G spectrum scam. In 2003, the government had allowed telcos
to migrate from limited mobility to full mobility. The new decision, which could prove just as
significant, will be the sector's first ever exit policy and set a precedent for future exits from
any government concession agreement-based businesses.
Source: TelecomTiger.com
September 2011
19

3T
T
ELE
T
ALK
T
IME
Smartphone industry to grow 55 percent globally in 2011-Report
Based on IDC's Worldwide Quarterly Mobile Phone Tracker, the global smartphone industry
is expected to grow 55 percent by the end of 2011 as more consumers embrace the new
technology. According to the report, smartphone vendors will ship a total of 472 million
smartphones in 2011 compared to approximately 305 million units shipped in 2010. With
IDC forecasting total shipments of smartphones to touch one billion by 2015, an annual
average growth of 20.6 percent, smartphones usage will continue to grow more prominent
globally as consumers embrace the new technology.
Source: TelecomTiger.com
Telecom Commission picks loop-holes in TRAI's mergers & acquisitions proposals,
seeks review
The Telecom Commission, the highest decision-making wing of the communications ministry,
has picked holes in sector regulator TRAI's proposals linked to mergers & acquisitions and
advocated an early review in the run-up to the new telecoms policy due out in October. It
has just dismissed TRAI's key suggestion that the surrender mechanism of excess airwaves
following the merger of two mobile phone companies should be left to the discretion of the
merged entity. Instead, the apex body feels the government should be the final authority in
formalising such surrender of excess airwaves in a post-merger situation.
Source: Economic Times
Government collects over Rs 2.15 lakh cr as spectrum, licence fees
The government on Wednesday said it has received over Rs 2.15 lakh crore so far from
telecom operators as spectrum fee and licence fee. Up to June 2011, the government has
received Rs 1,27,775.47 crore as spectrum charges and Rs 88,095.38 crore as licence fee
from operators, total amounting to Rs 2,15,870.85 crore, Minister of State for Communications
and IT Milind Deora said in a written reply to the Lok Sabha.
Source: Economic Times
DoT group wants 100% preference for Indian equip in government projects
A Working Group constituted by the Department of Telecom to prepare a roadmap for the
telecom sector in the 12th Five-Year Plan has proposed giving 100 per cent preference to
domestically manufactured telecom products in government-funded projects. "100 per cent
preference for India products in government procurement and projects funded by government
and USOF (Universal Service Obligation fund) should be given," the Working Group said in
a presentation to the DoT
Source: Economic Times
September 2011
20

3T
T
ELE
T
ALK
T
IME
SIGNALS
Sector outlook & valuation
GSM subscriber net adds (ex RCOM and Tata DOCOMO) is 7.6m in Jul-11 v/s 8.6m in
Jun-11, down 11% MoM and 34% YoY. All major operators except BSNL & Uninor reported
lower net additions on MoM basis with decline of 26-29% recorded by Bharti, Idea and
Vodafone.
Reliance Communications reported 1QFY12 PAT of INR1.57b, lower than our estimate
of INR2.09b due to lower EBITDA and higher minority interest. Adjusted revenue declined
3.3% YoY and 7.3% QoQ to INR49.4b (10% below est) mainly due to lower revenue in
non-wireless business. Maintain Neutral with revised target price of INR83 (INR106
earlier) based on 5x FY13 EV/EBITDA plus INR1.5m/tower incremental upside for tower
business.
Recently announced transaction involving 5.5% stake sale in Vodafone Essar for a
consideration of INR28.6b (USD640m) implies an EV of ~USD18b and equity valuation
of ~USD11.5b for Vodafone Essar. The deal values Vodafone Essar at FY11 EV/EBITDA
of ~12x, EV/sales of ~3x, and EV/sub of ~USD130.
We reiterate
Buy
on
Bharti/Idea
and
Neutral
on
RCom.
We expect EBITDA CAGR of
25% for Bharti and 42% for Idea over FY11-13E. Improving competitive environment in
the wireless sector should drive better revenue growth as well as expansion in margins
for Indian wireless companies.
Comparative valuations
CMP
(INR)
Bharti *
409
Rating
Buy
TP
Mcap
(INR) (USDb)
530
33.6
7.2
3.8
P/E (x)
FY11 FY12E
25.6
36.9
11.7
19.8
38.7
16.5
FY13E
13.3
14.8
9.6
EV/EBITDA (x)
FY11 FY12E FY13E
10.9
11.5
7.6
8.1
8.4
6.9
6.2
5.9
5.3
EV/Sales (x)
FY11 FY12E FY13E
3.8
2.8
2.4
3.0
2.3
2.2
2.5
1.8
1.8
Idea
100
Buy
140
RCom
85
Neutral
83
* Proportionate EV/EBITDA and EV/sales
RoIC (%)
FY11 FY12E FY13E
Bharti
Idea
RCom
9.8
6.1
4.0
9.2
6.5
3.9
12.8
11.2
5.3
RoE (%)
FY11 FY12E FY13E
12.6
7.6
3.9
14.1
6.7
2.9
18.0
15.7
4.8
EBITDA Margin (%)
FY11 FY12E FY13E
33.6
24.5
31.9
35.9
27.7
32.8
38.9
31.3
35.0
Net Debt/EBITDA (x) Net Debt/Equity (x)
FY11 FY12E FY13E FY11 FY12E FY13E
3.0
2.8
4.9
2.6
2.4
5.0
EPS (INR)
FY12E FY13E
20.6
2.6
5.1
30.6
6.8
8.8
2.5
2.4
4.8
1.2
0.9
0.9
0.9
1.0
0.8
0.6
0.8
0.7
Capex/Sales (%)
FY11
Bharti
Idea
RCom
24.2
57.0
62.6
FY12E FY13E
25.6
22.6
7.2
18.1
14.3
9.8
Sales Growth (%)
FY11
42.1
24.5
-7.6
FY12E FY13E
21.9
28.2
0.3
12.9
22.6
12.3
EBITDA Growth (%)
FY11
19.1
11.3
-16.9
FY12E FY13E
30.3
45.0
3.1
22.4
38.6
20.0
FY11
15.9
2.7
7.2
EPS Growth (%)
FY11
-32.6
-11.6
-69.4
FY12E FY13E
29.6
-4.7
-29.0
48.4
162.0
71.9
September 2011
21

3T
T
ELE
T
ALK
T
IME
One-year forward EV/EBITDA
Bharti
Bh ti
Idea
Id
RCom
RC
Average
A
20
16
12
10.3
8
4
Global valuations
Market
Cap (USDB)
China Mobile
AT&T
Vodafone Group
Telefonica
America Movil
Verizon
NTT DOCOMO
France Telecom
China Unicom
MTN Group
Zain
Mobile telesystems
Partner Comm
Average
201
166
132
89
96
101
79
46
48
38
15
17
2
Revenue gr. (%)
CY10
CY11
13
1
3
8
54
-2
0
-10
12
8
-39
36
10
7
11
1
14
10
13
5
14
4
27
1
0
14
13
10
EBITDA gr. (%)
CY10
CY11
11
2
-3
18
65
-2
0
-8
2
10
-35
30
16
8
7
1
10
-9
2
5
13
2
14
7
2
8
-9
4
EV/EBITDA (x)
CY10
CY11
4.2
5.4
8.5
4.9
5.8
5.8
4.4
4.5
6.5
6.1
6.8
4.8
3.0
3.9
5.3
7.7
5.4
5.7
5.6
3.9
4.5
5.7
5.7
6.7
4.5
3.3
5.4
5.2
Source: Bloomberg
September 2011
22

Motilal Oswal
Product Gallery
weekly
Motilal Oswal
Sector
Periodicals
power utilities monthly

Disclosures
This report is for personal information of the authorized recipient and does not construe to be any investment, legal or taxation advice to you. This research report does not constitute an offer, invitation or inducement
to invest in securities or other investments and Motilal Oswal Securities Limited (hereinafter referred as MOSt) is not soliciting any action based upon it. This report is not for public distribution and has been
furnished to you solely for your information and should not be reproduced or redistributed to any other person in any form.
Unauthorized disclosure, use, dissemination or copying (either whole or partial) of this information, is prohibited. The person accessing this information specifically agrees to exempt MOSt or any of its affiliates
or employees from, any and all responsibility/liability arising from such misuse and agrees not to hold MOSt or any of its affiliates or employees responsible for any such misuse and further agrees to hold MOSt
or any of its affiliates or employees free and harmless from all losses, costs, damages, expenses that may be suffered by the person accessing this information due to any errors and delays.
The information contained herein is based on publicly available data or other sources believed to be reliable. While we would endeavour to update the information herein on reasonable basis, MOSt and/or its
affiliates are under no obligation to update the information. Also there may be regulatory, compliance, or other reasons that may prevent MOSt and/or its affiliates from doing so. MOSt or any of its affiliates or
employees shall not be in any way responsible and liable for any loss or damage that may arise to any person from any inadvertent error in the information contained in this report . MOSt or any of its affiliates
or employees do not provide, at any time, any express or implied warranty of any kind, regarding any matter pertaining to this report, including without limitation the implied warranties of merchantability, fitness
for a particular purpose, and non-infringement. The recipients of this report should rely on their own investigations.
This report is intended for distribution to institutional investors. Recipients who are not institutional investors should seek advice of their independent financial advisor prior to taking any investment decision
based on this report or for any necessary explanation of its contents.
MOSt and/or its affiliates and/or employees may have interests/positions, financial or otherwise in the securities mentioned in this report. To enhance transparency, MOSt has incorporated a Disclosure of Interest
Statement in this document. This should, however, not be treated as endorsement of the views expressed in the report.
Disclosure of Interest Statement
1. Analyst ownership of the stock
2. Group/Directors ownership of the stock
3. Broking relationship with company covered
4. Investment Banking relationship with company covered
Companies where there is interest
None
Bharti Airtel
None
None
Analyst Certification
The views expressed in this research report accurately reflect the personal views of the analyst(s) about the subject securities or issues, and no part of the compensation of the research analyst(s) was, is, or
will be directly or indirectly related to the specific recommendations and views expressed by research analyst(s) in this report. The research analysts, strategists, or research associates principally responsible
for preparation of MOSt research receive compensation based upon various factors, including quality of research, investor client feedback, stock picking, competitive factors and firm revenues.
Regional Disclosures (outside India)
This report is not directed or intended for distribution to or use by any person or entity resident in a state, country or any jurisdiction, where such distribution, publication, availability or use would be contrary to
law, regulation or which would subject MOSt & its group companies to registration or licensing requirements within such jurisdictions.
For U.K.
This report is intended for distribution only to persons having professional experience in matters relating to investments as described in Article 19 of the Financial Services and Markets Act 2000 (Financial
Promotion) Order 2005 (referred to as "investment professionals"). This document must not be acted on or relied on by persons who are not investment professionals. Any investment or investment activity to
which this document relates is only available to investment professionals and will be engaged in only with such persons.
For U.S.
MOSt is not a registered broker-dealer in the United States (U.S.) and, therefore, is not subject to U.S. rules. In reliance on the exemption from registration provided by Rule 15a-6 of the U.S. Securities Exchange
Act of 1934, as amended (the "Exchange Act") and interpretations thereof by the U.S. Securities and Exchange Commission ("SEC") in order to conduct business with Institutional Investors based in the U.S.,
Motilal Oswal has entered into a chaperoning agreement with a U.S. registered broker-dealer, Marco Polo Securities Inc. ("Marco Polo").
This report is intended for distribution only to "Major Institutional Investors" as defined by Rule 15a-6(b)(4) of the Exchange Act and interpretations thereof by SEC (henceforth referred to as "major institutional
investors"). This document must not be acted on or relied on by persons who are not major institutional investors. Any investment or investment activity to which this document relates is only available to major
institutional investors and will be engaged in only with major institutional investors.
The Research Analysts contributing to the report may not be registered /qualified as research analyst with FINRA. Such research analyst may not be associated persons of the U.S. registered broker-dealer, Marco
Polo and therefore, may not be subject to NASD rule 2711 and NYSE Rule 472 restrictions on communication with a subject company, public appearances and trading securities held by a research analyst account.
Motilal Oswal Securities Ltd
3rd Floor, Hoechst House, Nariman Point, Mumbai 400 021
Phone: (91-22) 39825500 Fax: (91-22) 22885038. E-mail: reports@motilaloswal.com