ON

FOR

Submitted in partial fulfillment of two year full time course in

MASTER OF BUSINESS ADMINISTRATION, 2009-2011,

Institute of Management Science,

SHEPA, VARANASI

UTTAR PRADESH TECHNICAL UNIVERSITY, LUCKNOW(U.P.)

Submitted To: Submitted by:

Prof. C. Lal Puneet Prakash Singh

Director-IMS,(SHEPA) MBA(Marketing)

Varanasi Roll No.-0918470040

Project Report“MARKETING RESEARCH AND CUSTOMER SATISFACTION”

PREFACE

Summer training is an integral part of the MBA course Curriculum. The main

objective of this training is to supplement the student’s theoretical

knowledge with a practical Exposure to the working environment of an

organization.

This program enhances the student’s capability to cope up with the

Uncertainties and challenges which are the part and parcel of every

organization.

The competition in the telecommunication sector

is highly volatile in nature. Over the decade only government undertaking

company was operating in India but with the opening up of the economy

several new players like private sector & multinational telecommunication

entered in Indian horizon.

In the giving project I made the impotence of Financial Advisor

in accelerative the service of the company. Advisors are playing a very

important role for making a bright future of Idea Cellular.

On the basis of filled questionnaire, coding sheet is formulated

& the conclusions are drawn with the help of graphs pie charts.

Date: Jitendra Pratap

Place:

I am thankful to management of IDEA CELLULER COMPANY LTD.FOR Granting the permission , cooperation and valuable information for completing this projecT No words are enough to thank Mr. Mo. Mustafa Ali (Area sales Manager) and Mr. Dipak Tiwari (),who not only inspired me to work on this project but also accepted to guide me

I also express my heart felt thanks to Mr.Atul Bhadoria (Zonal Branch Manager) Idea Celluler Company Ltd. Sigra Varanasi for his valuable guidance and continuous support in better understanding THE study with his excellent ideas throughout the project .

I spite of heavy responsibilities and busy schedules, they always managed time to provide proper guidance.

Last but not the least, I would like to say that my parents and friends for giving me their constant support and encouragement incompletion of my project

JITENDRA PRATAP

I hereby declare that this project repot is mainly based on the summer trating by me at IDEA CELLULER COMPANY LTD. This is my orignal work and no part therefore has been submitted anywhere else fodatr aaaaaany other academic purpose

Date-

Signature of student

CONTENT

CHAPTER 1…………………………………………

o Brief History of Organization.

o Vision, mission, objectives,strategy,etc.

o Organization structure and management.

o `SWOT analysis of organization.

CHAPTER 2

RESEARCH METHODOLOGY

Objective of project.

Scope of study.

Period of study.

Limitation of study.

CHAPTER 3…

ANALYSIS OF DATA

Preparation of table and interpretation.

Preparation of chart, diagram and interpretation.

CHAPTER 4……

o Findings and recommendations.

ANNEXURE- QUESTIONNAIRE

BIBLIOGRAPHY

COMPANY PROFILE

INTRODUCTION

CHAPTER-1

As India's leading GSM Mobile Services operator, IDEA Cellular has licenses to

operate in 11 circles. With a customer base of over 17 million, IDEA Cellular

has operations in Delhi, Maharashtra, Goa, Gujarat, Andhra Pradesh, Madhya

Pradesh, Chattisgarh, Uttaranchal, Haryana, UP-West, Himachal Pradesh and

Kerala. IDEA Cellular's footprint currently covers approximately 45% of India's

population and over 50% of the potential telecom-market.

As a leader in Value Added Services, Innovation is central to IDEA's VAS

Factory. It is the first cellular company to launch music messaging with

'Cellular Jockey', 'Background Tones', 'Group Talk', a voice portal with 'Say

IDEA' and a complete suite of Mobile Email Services.

Idea Cellular is a wireless telephony company operating in various states in

India. It initially started in 1995 as a join venture between the Tatas, Aditya

Birla Group and AT&T by merging Tata Cellular and Birla AT&T

Communications.

Initially having a very limited footprint in the GSM arena, the acquisition of

Escotel in 2004 gave Idea a truly pan-India presence covering Maharashtra

(excluding Mumbai), Goa, Gujarat, Andhra Pradesh, Madhya Pradesh,

Chattisgarh, Uttar Pradesh (East and West), Haryana, Kerala, Rajasthan and

Delhi (inclusive of NCR).

The company has its retail outlets under the "Idea n' U" banner. The company

has also been the first to offer flexible tariff plans for prepaid customers. It

also offers GPRS services in urban areas.

IDEA Cellular is a publicly listed company, having listed on the

Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE) in

March2007.

IIDEA Cellular is a leading GSM mobile service operator with pan India

licenses. With a customer base of over 44 million in 17 service areas,

operations are soon expected to start in Chennai Metro; Kolkata & West

Bengal, North East & Assam, and J&K.

A frontrunner in introducing revolutionary tariff plans, IDEA Cellular has the

distinction of offering the most customer friendly and competitive Pre Paid

offerings, for the first time in India, in an increasingly segmented market.

From basic voice & Short Message Service (SMS) services to high-end value

added services such as Mobile TV, Games etc - IDEA is seen as an innovative,

customerfocusedbrand.

IDEA 'Women's Card' caters to the special needs of

women on the move, and 'Youth Card' covers the emerging youth segment.

IDEA 'My Gang' - the widely popular community user group product recently

bagged the prestigious 'Golden Peacock Award 2008' under the Most

Innovative Product category at the "19th World Congress on Total Quality".

A brand known for many firsts, IDEA was the first to launch GPRS and EDGE

in India. IDEA has partnered with Research in Motion (RIM) to offer

Blackberry services on its network. IDEA 'Net Setter'- Plug & Play, EDGE

enabled USB Data Card offers affordable data connectivity with faster speed

and consistency.

IDEA offers seamless coverage to roaming customers

traveling to any part of the country, as well as to international traveling

customers across over 200 countries. IDEA Cellular has partnership with

over 400 operators worldwide to ensure that customers are always

connected while on the move, across the globe.

IDEA has received several national and international recognitions for its

path-breaking innovations in mobile telephony products & services. It won

the GSM Association Award for "Best Billing and Customer Care Solution" for

2 consecutive years. It was awarded "Mobile Operator of the Year Award -

India" for 2007 and 2008 at the Annual Asian Mobile News Awards.

BRIEF HISTORY OF THE ORGANISATION:

The chronology of key events of the Company from incorporation is set out below:

Calendar year Events

2009Subscriber base as on December 31, 2009: 57,611,872Idea becomes a pan-India operatorEmerging Company of the Year - fastest growing mobile operator in the world’s fastest growing telecom market

2008Subscriber base as on December 31, 2008: 40,016,153

Idea acquired 9 licences for Punjab, Karnataka, Tamil Nadu & Chennai, West Bengal, Orissa, Kolkata, Assam, North East and Jammu & KashmirAcquired Spice Communications with the

 

Becomes pan-India operator in 2009

Acquired Escotel, incumbent cellular service provider in Haryana, UP(W) & Kerala and new licensee in HP

Brand IDEA launched Delhi operations commence (Nov)

operating circles of Punjab and KarnatakaLaunched services in Mumbai metro in the largest single metro city launch, everLaunched services in Bihar

2007Subscriber base as on December 31, 2007: 21,054,027

Won an award for the "CARE" service in the "Best Billing or Customer Care Solution" at the GSM Association Awards in Barcelona, Spain Initial Public Offering aggregating to Rs. 28,187 million and Listing of Equity Shares on the Bombay Stock Exchange and the National Stock ExchangeMerger of seven subsidiaries with Idea Cellular LimitedReached the twenty million subscriber mark

2006Subscriber base as on December 31, 2006: 12,442,450

Became part of the Aditya Birla Group subsequent to the TATA Group transferring

Acquired RPG Cellcom, service provider in Madhya Pradesh (Feb) Awarded

MoU for merger between Birla AT&T and Tata Cellular Limited Andhra Pradesh signed (Jan)

Birla AT&T commence

its entire shareholding in the Company to the Aditya Birla GroupAcquired Escorts Telecommunications Limited (subsequently renamed as Idea Telecommunications Limited)Restructuring of debtLaunch of the New CirclesReached the 10 million subscriber markReceived Letter of Intent from the DoT for a new UAS License for the Mumbai Circle.Received Letter of Intent from the DoT for a new UAS License for the Bihar Circle through Aditya Birla Telecom Limited. ABNL, the parent of Aditya Birla Telecom Limited, pursuant to a letter dated November 22, 2006, agreed to transfer its entire shareholding in Aditya Birla Telecom Limited to the Company for the consideration of Rs. 100 million.

2005Subscriber base as on December 31, 2005: 6,473,962

Reached the five million subscriber mark

Cellular operations Maharashtra & Gujarat

Turned Profit Positive

Won an Award for the "Bill Flash" service at GSM Association Awards in Barcelona, Spain

Sponsored the International Indian Film Academy Awards

2004Completed debt restructuring for the then existing debt facilities and additional funding for the Delhi Circle.Acquired Escotel Mobile Communications Limited (subsequently renamed as Idea Mobile Communications Limited)Reached the four million subscriber markFirst operator in India to commercially launch EDGE services 2005

2003Reached the two million subscriber mark

2002

Changed name to Idea Cellular Limited and launched "Idea" brand nameCommenced commercial operations in Delhi CircleReached the one million subscriber mark

2001Acquired RPG Cellular Limited and consequently the license for the Madhya Pradesh (including Chattisgarh) CircleChanged name to Birla Tata AT&T LimitedObtained license for providing GSM-based services in the Delhi Circle following the fourth operator GSM license bidding process

2000Merged with Tata Cellular Limited, thereby acquiring original license for the Andhra Pradesh Circle

1999Migrated to revenues share license fee regime under

New Telecommunications Policy ("NTP")

1997Commenced operations in the Gujarat and Maharashtra Circles

1996Changed name to Birla AT&T Communications Limited following joint venture between Grasim Industries and AT&T Corporation

1995Incorporated as Birla Communications Limited Obtained licenses for providing GSM-based services in the Gujarat and Maharashtra Circles following the original GSM license bidding process.

It goes without saying that the brand vision of idea mirrors the company’s

vision. The brand mission statement is...... To be the most customer-focused

mobile service brand, continuously innovating to help liberate our customers

from the shackles of time & space.

The india foot print idea Anywhere connectivity bringing India closer.The technology advantage Idea Tomorrow's technology to enrich to day.The customer focus idea make a single interactional a sting relationship. The employee focus idea nuture the roots that nurture our ideas.

OBJECTIVES OF THE PROJECT:

To find out the perception of the general people towards the land line &

Mobile phone.

1. To find out the telecom market share of different companies in

Varanasi.

2. To find out the consumer satisfaction towards the different plans

offered by the company.

3. Managing the distribution channel of idea cellular.

STRATETEGY FOR IDEA CELLULAR:

The Idea Cellular Limited falls in the “question mark” quadrant of BCG

matrix and in the High attractive and Strong Competitive strength category as

per the GE Matrix. Thus they need to formulate some strategies to try

capturing some market share, growing and building their brand image as well

as brand value.

Market penetration

The company enters where the products and the market already exists. IDEA

being a question mark that means it is competing in a high growth market but

with a relatively low share compare to its competitors. Market penetration can

be done by attracting competitor’s customers that implies increase in market

share. The strategy that IDEA can adapt under market penetration is to attract

non-users and convince to use their product more often. They are different

market penetration strategies like cutting price, increase in promotion, and

creating innovative distribution tactics. The target should be in such a way that

IDEA sales volume relative to its competitors should be high as expressed in

percentage. IDEA’s present market share is about 12%, and competitors like

airtel, Vodafone, and bsnl have a market share of about 31, 23, and 19 percent

respectively. Though telecom industry is growing rapidly every year, there is

always a little increment in the percentage of sales for IDEA. To overcome

this problem and to occupy the competitor’s position we recommend

following strategies.

Increasing the mobile circles which are at present are only 11, so there

is always a need to expand its services.

Target the rural segment in India which is expected to grow by 15%

every year

Launch different types of packages as per the requirements for different

segments of the customers

Provide more high end services like GPRS, mobile internet services

Collaboration with different service providers on global basis to provide

better facility to customers on roaming.

Tracing out the search patterns which are left untapped by the

competitors to reveal new markets.

Backward Integration – In July 2008 Swedish equipment supplier entered

into a contract to provide technology “Ericsson Mobile organizer” to Idea

cellular enabling its subscribers to serve email facility on its cell phones.

Forward Integration – Company operate approximately 589 Idea” n “U and

other showrooms which supplement the distribution channels and provide

customer service.

Horizontal Integration: Idea acquired the Modi family’s stake of 40.8% in

spice which ultimately in a way increased the market share of Idea. This can

be seen as horizontal integration

Strategic Alliance:

1) Product alliance

Idea should form product alliance with a company that has a strong

brand image and carry a promotion for one another. E.g. Acer in

collaboration with Ferrari launched Acer Ferrari laptops which are

catering to high end niche segment having high specifications and high

price.

2) Promotional Alliance:

Idea should form promotional alliances in collaboration with big movie

houses or big retail brands to promote their products. Recently SONY

Viao had a promotional alliance with “James Bond” latest movie

“Casino Royale”.

Board of Directors -

Mr.KumarMangalamBirla(Chairman)

Smt. Rajashree Birla

Mr.SanjeevAga(ManagingDirector)

Mr. Arun Thiagarajan

Ms. Tarjani Vakil

Mr. Mohan Gyani

Mr. Gian Prakash Gupta

Mr. R.C. Bhargava

Mr. P. Murari

Mr.BiswajitA.Subramanian

Dr.RakeshJain

Mr. Juan Villalonga Navarro

Dr. Hansa Wijayasuriya (Alternate to Mr. Juan Villalonga Navarro)

 

ManagementTeamCorporateLeadershipTeam

Mr.SanjeevAga,ManagingDirector

Mr.AkshayaMoondra,ChiefFinancialOfficer

Mr.AnilK.Tandan,ChiefTechnologyOfficer

Mr.PrakashK.Paranjape,ChiefInformationOfficer

Mr.PradeepShrivastava,ChiefMarketingOfficer

Mr.NavanitNarayan,ChiefServiceDeliveryOfficer

Mr.VinayK.Razdan,ChiefHumanResourceOfficer

Mr.RajatK.Mukarji,ChiefCorporateAffairsOfficer

Mr. Rajesh K. Srivastava, Chief Materials & Procurement Officer

Mr.AmbrishJain,Director-Operations

Mr. Himanshu Kapania, Director - Operations

Circle Heads

Mr. Iyer SubbaramanS., Chief Operating Officer, Andhra Pradesh

Mr. Rajendra Chourasia, Chief Operating Officer, Madhya Pradesh & Chattisgarh

Mr. Virad Kaul, Chief Operating Officer, Uttar Pradesh (West), Delhi & Haryana

Mr.T.G.B.Ramakrishna, Chief Operating Officer, Kerala

Mr. Sashi Shankar, Chief Operating Officer, Mumbai

Mr. P.Lakshminarayana, Chief Operating Officer, Maharashtra & Goa

Mr. Naozer Firoze Aibara, Chief Operating Officer, Uttar Pradesh (East)

Mr. Sunil Kataria, Senior Vice President - Operations, Rajasthan

Mr. Arul Bright, Senior Vice President - Operations, Gujarat

Mr. M. D. Prasad, Senior Vice President - Operations, Bihar

Mr. M. Srinivas, Senior Vice President - Operations, Tamil NaduChennaiMr. Siva Ganapathi, Chief Operating Officer, Karnataka

Mr. Anish Roy, Chief Operating Officer, Punjab, J&K and Himachal

Pradesh

Mr. Aloke Malik, Chief Operating Officer, East (Kolkata, Rest of

Bengal, Orissa & NESA)

Idea Cellular Limited

An Aditya Birla Group Company

Quarterly Report

Fourth Quarter ended March 31, 2009

A D I T Y A B I R L A G R O U P

istered Office: Suman Tower, Plot No. 18, Sector 11, Gandhinagar 382011, India the Corporate Office: 5 Floor, Windsor, Off C.S.T. Road, Near Vidya Nagari, Kalina Santacruz (East), Mumbai 400 098, India Supplemental Disclosures

Unless stated otherwise, the financial data in this report is derived from our unaudited / audited consolidated financial statements prepared in accordance with Indian GAAP. Our financial year ends on March 31 of each year, so all references to a particular financial year are to the twelve months ending March 31 of that year. In this report, any discrepancies in any table between the total and the sums of the amounts listed are due to rounding-off. There are significant differences between Indian GAAP, IFRS, and U.S. GAAP; accordingly, the degree to which the Indian GAAP financial statements will provide meaningful information is dependent on the reader’s level of familiarity with Indian accounting practices. Any reliance by persons not familiar with Indian accounting

practices on the financial information presented in this report should accordingly be limited. We have not attempted to explain those differences or quantify their impact on the financial data included herein.

Unless stated otherwise, industry data used throughout this report has been obtained from industry publications. Industry publications generally state that the information contained in those publications has been obtained from sources believed to be reliable but that their accuracy and completeness are not guaranteed and their reliability cannot be assured. Although we believe that industry data used in this report is reliable, it has not been independently verified. Actual results may differ materially from those suggested by the forward-looking statements due to risks or uncertainties associated with our expectations with respect to, but not limited to, our ability to successfully implement our strategy, our growth and expansion, technological changes, our exposure to market risks, general economic and political conditions in India which have an impact on our business activities or investments, the monetary and interest policies of India, inflation, deflation, unanticipated turbulence in interest rates, foreign exchange rates, equity prices or other rates or prices, the performance of the financial markets in India and globally, changes in domestic and foreign laws, regulations and taxes and changes in competition in the industry

2. Company Overview

Idea Cellular Limited (“Idea”) is a leading mobile services operator in India, with ~ 39 mn subscribers as on March‘09. Idea has a subscriber market share of 19.5% in its 8 established service areas, and 14.5% in its 13 operating service areas. After inclusion of Spice Communications, Brand !dea has 43.02 mn subscribers, corresponding to a 11.0% national market share.

A. Promoter Group

Idea is part of the Aditya Birla Group, India's first truly multinational group. The Group has businesses in sectors ranging from metals, garments, cement, fertilisers, life insurance and financial services among others. Over 50% of the Group’s revenues are derived from overseas operations. The group operates in 25 countries, and is anchored by an extraordinary force of over 125,000 employees belonging to 25 nationalities. The current Group holding of 49.13% in Idea is made up of; Aditya Birla Nuvo Ltd. 27.02%

Birla TMT Holdings Pvt. Ltd. 9.15%

Hindalco Industries Ltd. 7.37%

Grasim Industries Ltd. 5.52%

IGH Holdings Pvt. Ltd. 0.08%

Total 49.13%

B. Key Shareholders

AXIATA Group Berhad, previously TM International Berhad, through its affiliates has 14.99% shareholding in Idea Cellular, and a 49.0% holding in Spice Communications. With the proposed merger of Spice Communications into Idea Cellular, the Axiata Group holding in Idea Cellular would increase to around 20%. The Group, is one of the largest Asian telecommunication companies, focused in high growth low penetration emerging markets. AXIATA has a controlling interest in Malaysia, Indonesia, Sri Lanka, Bangladesh and Cambodia with significant strategic stakes in India and Singapore. India and Indonesia are some of the fastest growing markets in the world. In addition, the Malaysian grown holding company has assets in telecommunication operations in Thailand, Pakistan and Iran. As of December 2008, the Group, including its subsidiaries and associates, has close to 90 million mobile subscribers in Asia. The Group provides employment to over 25,000 people across Asia. Upon its de-merger from Telekom Malaysia in April 2008, AXIATA became an independent entity and simultaneously listed on the Malaysian stock exchange.

Providence Equity Partners, through its affiliates has a 10.6% shareholding in Idea, and has also invested Rs. 20982 mn in ABTL through Compulsorily Convertible Preference Shares.

C. Corporate Structure

Idea Cellular Limited (Idea)

100% -- Idea Cellular Infrastructure Services Limited (ICISL) 100% -- Idea Cellular Services Limited (ICSL) 100% -- Swinder Singh Satara & Co Limited (SSSL) 41.1% -- Spice Communications Limited (Spice) 100% -- Aditya Birla Telecom Limited (ABTL)

100% -- Idea Cellular Tower Infrastructure Limited (ICTIL) 16% -- Indus Towers Limited (Indus)

IICCIISSLL – tower company owning towers in Bihar and Orissa service area. IICCSSLL – provides manpower services to operating entities i.e. Idea & ABTL. SSSSSSLL – holds MSC real estate in the Delhi service area.

SSppiiccee – provides GSM based mobile services in Punjab and Karnataka service areas. AABBTTLL – provides GSM based mobile services in Bihar service area, and has 16% shareholding in Indus. IICCTTIILL – holds towers de-merged from Idea, which will subsequently merge in Indus. IInndduuss

– a joint venture between Bharti Infratel, Vodafone Essar and Idea (through ABTL), to provide passive infrastructure services in 15 service areas.

Attractive existing footprint–The subscriber base under brand Idea, increased from 24 million as of end March 2008 to 43.02 million as of end March 2009, a growth of around 79%, taking its national market share to 11%.

Original licensee in seven of the Established Circles, providing incumbency advantages-The established service areas are Delhi, Andhra Pradesh, Gujarat, Maharashtra, Haryana, Kerala, Madhya Pradesh and Uttar Pradesh (West). The New Service Areas are Uttar Pradesh (East), Rajasthan, Himachal Pradesh, Bihar, Mumbai, Karnataka, Punjab, Orissa, Chennai & Tamil Nadu, Jammu & Kashmir, Kolkata & West Bengal, and Assam &

STRENTH

North East.Market leader in two of, and established positions in the remainder of, the Established Circles.

Strong distribution channels.

High quality network structure.

Innovation –always comes out with new products.IDEA is the winner of ‘The Emerging Company of the Year Award' at The Economic Times Corporate Excellence Awards 2008-09. The company has received several other national and international recognitions for its path-breaking innovations inmobile telephony products & services. It won the GSM Association Award for “Best Billing and Customer Care Solution” for 2 consecutive years. It was awarded “Mobile Operator of the Year Award -India” for 2007 and 2008 at the Annual Asian Mobile News Awards.

A national brandHuman Resources -The Company through its participative work environment, skill development activities, and by championing the values of commitment, integrity, passion, seamlessness and speed, promotes strong bonding with its employees. During the year, it has again undertaken sharing of value creation by granting another tranche of employee stock options to the eligible employees. The findings of OrganizationHealth Study (OHS) have been analyzed, which are very encouraging, and concern areas are being suitably addressed. The employee strength onrolls stood at 6,481 as on March 31, 2009.

Attractive growth –From 11.8 million subscribers in 2006 to 24 millionin 2008 ,then to 43 million by end of March 2009 and to 51 by end of 2009 is really a great performance from Idea.

Part of the Aditya Birla Group-IDEA Cellular is an Aditya Birla Group Company, India's first truly multinational corporation. The group operates in 25 countries, and is anchored by over 1, 30,000employees belonging to 30 nationalities. The Group has been adjudged the ‘6th Top Company for Leaders in Asia Pacific Region' in 2009, in a survey conducted by Hewitt Associates, in partnership with The RBL Group, and Fortune. The Group has also been rated ‘The Best Employer in India and among the Top 20 in Asia' by the Hewitt-Economic Times and Wall Street Journal Study 2007.Their promoters-1. Aditya Birla Nuvo Limited2. Grasim Industries Limited

3. Hindalco Industries Limited

WEAKNESS

Birla TMT HoldingsPrivate LimitedWeaknessesHigh Debt-Equity Ratio: The Company's Debt-Equity ratio is high as compared to its peers. Moreover, the Company needs the approval of the lenders under its financing arrangements before undertaking certain significant corporate actions.Concentration: The Company revenues are derived solely from providing mobile services and it is dependent on four of the Established Circles for a significant proportion of its revenues.

The Company had accumulated losses amounting to Rs. 19.23 billion and Rs. 17.23 billion for financial years 2005 and 2006 respectively. The Company may not be in a position to pay dividends until it clears its accumulated losses.

The Indian telecommunication industry is expected to continue to enjoygrowth due to its low teledensity and increasing affordability of mobile telephone and services. The strong growth in the sector continues, mainly due to expansion of telecom networks to rural India, the reduced cost of entry and the reduced cost of handsets. Low penetration, more particularly in rural India, provides opportunity for further growth, and your company, an incumbent GSM player with 900 MHz spectrum in about half of India, is well positioned to tap this opportunity.

The contribution of service sector to the GDP has improved significantly from 29% in 1950 to 54% in 2005. This is primarily due to growth of information-technology and information technology enables services. This will further stimulate the demand for mobile telecommunication services.The regulatory environment is improving and there is greater clarity in existing rules and procedures. This would enable operators in improving network quality. Also raising of funds will become easier due to greater predictability of operational environment.Competition from new technologies is an inherent threat. While the planned 2100 MHz spectrum auction for 3G services will lead to additional cash outflow, it will also open new revenue streams. The Company’s strong

balance sheet and market standing, positions it to participate effectively in such auction.

There is intense competitionin the Indian telecommunication industry. Idea Cellular faces significant competition from private companies that have a pan-India footprint such as Bharti Airtel, Tata Teleservices and Reliance Communication Ventures. Also it faces competition from government owned companies such as BSNL and MTNL.Alternative technology is evolving very rapidly in the telecommunications industry. For instance, “Wi-Fi”and “Wi-Max”which allows for voice data transfer have been tested and handsets with such technology maysoon be available in the Indian market. Moreover, satellite communication voice data transport medium like “Skype”may become a serious competitor in the long distance voice data transfer business.Porter’s five forces -Analysis the external environment1.Competitive rivalry within the Industrya.Principal competitors-Major competition comes from the industry leader Bharti Airtel. Bharti Airtelhas 24.3% customer market share and 33.8% revenue market

share.Vodafone India has 18.8% customer market share and 20.7% revenue market share.

Idea Cellular has 11.2% subscribers market share and 12.1% revenue market share BSNL has subscriber share of 12.7% and mere 10.2% of revenue share Reliance Communications is the worst performerwith 18.9% customer market share and pathetic 11.5% revenue market share.

(Data mentioned are by end of August 2009)b.Salient strengths -BSNL has taken full advantage of its wide network and fixed line subscriber base, and has established itself as the provider with maximum coverage over the country.

While Bharti Airtel has dominated the scene with wide reach, innovative packages, catchy ads, and has emerged the leader of the pack. Reliance Communications also has the wide network to its advantage. Tata tele-services banks on the Tata-trust factor to gain foothold in the market. Vodafone is hitting the Indian market in a huge way. They have large cash reserves at their disposal to wipe out the competition in future. Weaknesses- BSNL lines are mostly marred by congestion,bottlenecks and they have failed to capture the attention of the customers with attractive offers. Unstable range and poor customer support are Airtel’s minuses. Ambiguous schemes have reduced Reliance’s popularity.TATA Indicom has not really been able to fully capitalize its goodwill factor. c.Their basis for competition-Vodafone and Idea are comparatively new entrants into the market and hence the rest of the competition has anadvantage over them. Also both these brands have

undergone rebranding more than once, and subsequently have had hiccups with people not realizing the transformation. Giants like BSNL, Airtel and Reliance have wide networks in the nooks and crannies of thecountry, while Idea is still to open account in several states.

2.Bargaining Power of CustomersThe bargaining power of customers determines how much customers can impose pressure on margins and volumes. Customers bargaining power is likely to be high because

Customersuse multiple mobile services these days and hence have a good knowledge of the pros and cons of each service provider.

Telecommunication industry comprises a number of operatorsThe industry operates with high fixed costsThe product is not much differentiated and can be replacedby substitutesSwitching to an alternative product is relatively simple and is not related to high costsCustomershave low margins and are price sensitiveThecustomer knows about the production costs of the product.3.Bargaining power of suppliersIn this industry there is less number of suppliers compared to other industries such as the manufacturing or textile industry.

I.Mobile handset suppliers –although there are many handset suppliers in the country, some service providers have their own handset manufacturing units operating inthe country like the Reliance Classic and Tata Indicom (backward integration). Some of the telecom companies also have some collaboration

with major handset manufacturers like Samsung, L.G, and the Blackberry for their CDMA services.II.Some other suppliers include optical fibre suppliers and aluminium (for the construction of towers) suppliers. Here the suppliers have a limited bargaining power.III.Another important one is the software assistance where the suppliers have some edge. Major solution providers include TCS, Infosys, Wipro, etc. While Reliance and Tata have their own software services other players like Vodafone and Idea depend on the above mentioned software service providers.

4.Threat ofnew entrantsIndian telecom sector provides unprecedented opportunities for foreign companies in various areas such as 3G, virtual private network, international long distance calls, value added services etc.

The market is witnessing M&A activities that are leading to consolidations in the industry. This trend has assisted companies in expanding their reach in the Indian telecom market to offer better services to the customers. The Indian telecom industry has always attracted foreign investors. In fact, the cumulative FDI inflow, from August 1991 to March 2007, in this sector amounted to $3,892.19 million. This makes telecom the third largest sector to attract FDI since the liberalization.

Although the entry barriers are in place like license and high fixed costs, still we observe many new players emerging from the state-level to national-level. This includes Aircel, Virgin, Spice and Unitech.

5.Threat from substitutesTelecom sector offers a wide range of services in India such as wireline, CDMA, GSM, internet, VoIP, IP etc.

Internet telephone is emerging as a best substitute for the mobile telephony because it is cheaper and video can also be added. The increasing use and penetration of internet in the country also augments this. Other facilities on the internet such as Google talk, Yahoo Messenger, Rediff Bol are used at an unprecedented level by the youngsters of this country. These are the major substitutes for the mobile telephony. Maybe this is on of the reasons why the major service providers also have their presence in internet service. Idea’s strategyIdea is not the market leader in India. They were operating in a few circles earlier and were considered a regional player. Recently Idea started operations in many states as part of their national roll out plan and they have operations in 2200 towns in India. Idea has been focusing on value added services (VAS) from its inception which is reflected in its products. They have always taken extra care in providing customer friendly and competitive Pre Paid offerings. Differentiation and innovation can be associated with Idea right from its beginning. It’s clear from the following:

'Super Power', ‘2 Minutes Outgoing Free’, ‘Lifelong offer’, ‘Women'sCard’, 'Lifetime Idea'etc are some of the offerings of IDEA.

IDEAisthe first cellular company to launch music messaging with 'Cellular Jockey','Background Tones', 'Group Talk',a voice

portal with 'Say IDEA'and a complete suite of Mobile EmailServices.

They are also providing GPRS and EDGE services for transferring data.The new product introduced by IDEA is the EDGE enabled USB Data Card which is named as 'NetSetter'. Initially ‘NetSetter’ was offered to post paid customers only. Now it is available to prepaid customers in selected circles.

IDEA’s partnership with IIFA for 10th Anniversary Awards, its association with Mumbai Indians in IPL and major sought after programs in television like MTV Roadies and Idea Star singerclearly shows its marketing strategies. They always seek something different and is always in touch with the youth of the country as they easily switch to other services.

Their ad campaign showing AbhishekBachanin different settings but all clearly showing their corporate social responsibility is great. Their approach is different from others.Idea was the first to provide one rupee STD calls in the country. Now when every one else gives per second billing and also 50 paisaper minute, Idea offers at 49 paisaper minute.

As far as Idea is concerned it should not start a price war with Vodafone and other large players in the industry. This is because Vodafone has a lot ofmoney with them to suffer the losses and eventually emerge as the winner and it is almost doing that. Idea can only afford to come out with some differentiated tariff plan that does not result in a war with the leaders like Airtel and Vodafone. Indian telecom is already in

trouble with the lowest tariff in the world. Differentiation and innovation is the way forward for Idea in this already bleeding industry, otherwise it will be a severe bloodshed.

Growth in installed capacity- Idea

Cellular Limited

Idea Cellular Limited has a share of 12%

in the total GSM telecom market in India (as on Mar’08). The Entire Telecom

Industry is growing at a rate of 25% as compared to the base year 2006-07.

This can be termed as a moderately growing Industry and it is expected to

grow in the coming years. We are thus putting the middle line of the vertical

axis in our BCG matrix as 15% as a division between low and high growth.

The first BCG matrix will be plotted for Idea Cellular Limited, our chosen

SBU, with respect to the market leader, Bharti Airtel. Taking the market share

of Bharti as 1X, the relative market share of Idea comes as 0.39X. The BCG

matrix thus, would look like as under.

BCG Matrix of Idea Cellular Limited with respect to Airtel

Analysis of BCG matrix:

In the above matrix, Idea Cellular Limited falls in the first quadrant of

“QUESTION MARKS”. The circle size represents the absolute market share

(i.e. 12%) of our SBU in the telecom sector. We will formulate the strategies

which Idea should follow in the later part of this project.

Mar

ket G

row

th R

ate

(in %

)

0

LOW

15

HI

GH

3

0

HIGH

10X 1X 0.39X 0.1X

Relative Market Share

Plotting the Competitors

1. Bharti Airtel: Bharti Airtel is the market leader in the telecom sector

with a market share of 31%. The market challenger in this industry is

Vodafone. So we plot the BCG matrix of Airtel with respect to

Vodafone. Taking the market share of Vodafone (i.e. 23%) as 1X, the

relative market share of Airtel comes as 1.35X. The BCG matrix of

Airtel will look as under:

BCG Matrix of Bharti Airtel with respect to Vodafone

Mar

ket G

row

th R

ate

(in %

)

0

LOW

15

HIG

H

3

0

HIGH

10X 1.35X 1X 0.1X

Relative Market Share

Analysis of BCG matrix:

In the above matrix, Bharti Airtel falls in the quadrant of “STAR” with respect

to the market challenger. The circle size represents the absolute market share

(i.e. 31%) of Airtel in the telecom sector.

2. Vodafone Essar: Vodafone is the market challenger in the telecom

sector with a market share of 23%. The market leader in this industry is

Vodafone and so we plot the BCG matrix of Vodafone with respect to

Airtel. Taking the market share of Airtel (i.e. 31%) as 1X, the relative

market share of Vodafone comes as 0.74X. The BCG matrix of Airtel

will look as under:

BCG Matrix of Vodafone with respect to Airtel

Analysis of BCG matrix:

Mar

ket G

row

th R

ate

(in %

)

0

LOW

15

HIG

H

3

0

HIGH

10X 1X 0.74X 0.1X

Relative Market Share

In the above matrix, Vodafone falls in the quadrant of “QUESTION MARK”

with respect to the market LEADER. The circle size represents the absolute

market share (i.e. 23%) of Vodafone in the telecom sector.

3. BSNL: BSNL is another competitor ahead of IDEA in the telecom

sector with a market share of 19%. The market leader in this industry is

Airtel and so we plot the BCG matrix of BSNL with respect to Airtel.

Taking the market share of Airtel (i.e. 31%) as 1X, the relative market

share of BSNL comes as 0.61X. The BCG matrix of Airtel will look as

under:

BCG Matrix of Idea Cellular Limited with respect

to Airtel

Analysis of BCG matrix:

Mar

ket G

row

th R

ate

(in %

)

0

LOW

15

HIG

H

3

0

HIGH

10X 1X 0.6X 0.1X

Relative Market Share

In the above matrix, BSNL falls in the quadrant of “QUESTION MARK” with

respect to the market LEADER. The circle size represents the absolute market

share (i.e. 19%) of BSNL in the telecom sector.

Growth in production

The GE matrix for Idea Cellular will be made keeping the following two major

dimensions:

1. Market Attractiveness

2. Business Strength

Market Attractiveness: This dimension forms the Vertical axis of the GE

matrix. The factors which we have considered which may affect the industry

attractiveness for our SBU are:

1. Overall Market Size: IDEA operates in an industry which has overall revenue of Rs.

125 Billion and has a subscriber base of 261.07 million customers. Thus it has a huge target

audience and we need to give substantial weightage to this factor. We have given it 0.20

out of 1.0.

Market

AttractivenessWeightage Rating(1-5) Weighted Score

Overall Market

Size0.20 4 0.8

Market Growth

Rate0.15 4 0.6

Profitability 0.10 3 0.3

Technological

Development0.15 4 0.6

Global

Opportunities 0.05 5 0.25

Market Rivalry 0.20 5 1.0

Pricing 0.15 3 0.6

Total 1.00 4.05

2. Market Growth Rate: The telecom industry is growing at 25%. As

previously stated, this can be considered as a moderately growing and

having high growth opportunities with the growth of Indian economy.

But in the current recession scenario, we decided to give it a little less

weightage of 0.15 out of 1.0.

3. Profitability: Telecom industry net profits just increased from 12% to

14% from the last fiscal year. Due to no such significant increase in

profitability as compared to sales, we have given it a weightage of 0.10

out of 1.0.

4. Technological Development: With new technologies like 3G knocking

at the doors of Indian telecom sectors, technological development will

be an important factor to be considered in the business policies towards

our chosen SBU. Hence a weight of 0.15.

5. Global Opportunities: Bharti has started making forays into global

markets. With the expected entry of many foreign players in the near

future, this can open the door for global opportunities for Indian players.

Hence the weightage of 0.10.

6. Market Rivalry: Indian telecom sector is an Oligopoly where 80% of

the market share is picked by only 4 players. Also the future guarantees

the entrance of several big global names in this sector. Hence clearly

market rivalry weighs above others at 0.20 out of 1.0.

7. Pricing: Being an Oligopoly, pricing strategies are a key for any player

to make profits in such a competitive sector. Thus we have given it

equal weightage as technology and more than even factors like

profitability and growth rate.

Factors considered for Market Attractiveness

The rating is done on a scale of 1-5 where the industry attractiveness is rated

associated with the industry as a whole. Here 1 represents very unattractive

and 5 represents very attractive. We can see the difference in weightage and

type of rating varying in the different factors. The market growth rate can have

a low weightage as compared to market size but has the same rating because

growth rate is attractive for the players in the market. Also pricing may have

much more weightage as compared to global opportunities but the ratings are

the other way round. This is for the reason that pricing strategies are not that

attractive to the company because of strong competition and regulations

whereas global opportunities are more attractive for the industry.

Based on the above assumptions substantiated by the industry facts and growth

avenues, the weighted total score for market attractiveness in case of Idea

Cellular comes to be 4.05.

Business Strength:

1. Market Share: The market share of Idea Cellular is 12%. Well it just

acquired Spice Communications and is among the top 4 players in GSM

sector. But being a market follower its primary motive is profitability.

Thus we gave less weight to market share.

2. Market Growth Rate: Idea being a small player has ample of scope to

grow but its growth rate puts little effect to market rate as compared to

other players. So it has again been given weightage of 0.10.

3. Profit margin relative to competitors: This is the most important

aspect of Idea’s competitiveness. IDEA’s profit margin increased about

4 percent from 2006-07(11%) to current profit margin (15%) that is

2007-08. This is an area where it would like to have a competitive edge.

4. Technological Innovation: Idea was the first telecom operator to

launch GPRS and EDGE technology. We have given high weightage to

support its innovational outlook. Recently it formed a alliance with

“high tech computers” (HTC). It also launched and secured a position of

leader in value added services like “cellular jockey”, “background

tones”, and “group talk”.

5. Brand Reputation: IDEA already has a backbone “Aditya Birla group”

which has already established as a global and truthful image. Being a

part of Aditya Birla Group, it has to carry a brand name. But now its

strategy would be more of brand building than brand reputation. So we

have given a low weight.

6. Sales Distribution Effectiveness: The breadth of the distribution

network has grown by over 30% in the past year. In addition to this the

company is operating additional 589 Idea ‘n U and showrooms which

supplement the distribution channels and provide customer service.

7. Advertising and Promotional Effectiveness: Idea went for aggressive

promotional techniques such as having Abhishek Bachhan as the Brand

Ambassador. The tag line “What An Idea” was very successful proving

the effectiveness of the advertising and promotional activities carried by

Idea.

8. Pricing strategies and Customer Loyalty: By adopting different pricing

strategy it discriminates among its customers. For example it has different pricing

strategies for postpaid subscribers and prepaid subscribers.

Key Competitive

FactorsWeight Rating(1-5) Weighted Score

Market Share 0.10 4 0.4

Market Growth

Rate0.10 4 0.4

Profit Margin

relative to

competitors

0.15 5 0.75

Technological

Innovation0.15 4 0.6

Brand Reputation0.10 4 0.4

Sales Distribution 0.10 3 0.3

Effectiveness

Advertising and

Promotional

Effectiveness 0.15 4 0.6

Pricing strategies0.05 4 0.2

Customer Loyalty 0.10 3 0.3

Total= 3.95

LOW

M

EDIU

M

HIG

HSTRONG MEDIUM

5

3.66

2.33

15 3.66 2.33 1

19%

1

he factor for Industry attractiveness will remain same for market leader as

well. Bur the competitive strength will differ and so the weights and ratings. It

is evident from our above assumptions about Airtel that they will lesser rating

to profit margins and more towards advertising and promotional effectiveness

and brand reputation. The GE matrix of Airtel will look like as under:-

STRONG MEDIUM 5

3.66

2.33

15 3.66 2.33 1

31%

1

The GE matrix for Airtel indicates that it lies in the 1st quadrant corresponding

to high market attractiveness and strong competitive strength.

GE Matrix for Vodafone

The market challenger Vodafone will again have the same Market Attractiveness dimension as the

other players but will have an entirely different competitive strength dimension. Assuming

Vodafone’s company objectives to be more focused on building a customer loyalty, we assign it a

weight of 0.15. Also its sales and distribution effectiveness is much lesser than Airtel or Idea, so

give a weight of 0.05 to it. Vodafone has a brand reputation of the world’s largest telecom provider

which it has to maintain even in the Indian Telecom Industry. For that it would definitely look to

emphasize more on advertising and promotional effectiveness. So both these factors are given

0.15 weights.

Market

AttractivenessWeightage Rating(1-5) Weighted Score

Overall Market

Size0.20 4 0.8

Market Growth

Rate0.15 4 0.6

Profitability 0.10 3 0.3

Technological

Development0.15 4 0.6

Global

Opportunities

0.05 5 0.25

Market Rivalry0.20 5 1.0

Pricing 0.15 3 0.6

Total 1.00 4.05

Vodafone may still assign lower rates brand loyalty as compared to sales

distribution effectiveness as they would like to put a competitive front in the

distribution network. Moreover they would find advertising effectiveness and

pricing strategies more attractive than a higher profit margin. The above

assumptions led us to the different dimensions and the corresponding GE

matrix. Market Attractiveness

Key Competitive

FactorsWeight Rating(1-5) Weighted Score

Market Share 0.10 4 0.40

Market Growth

Rate0.10 4 0.40

Profit Margin

relative to

competitors

0.10 3 0.30

Technological 0.10 4 0.40

Innovation

Brand Reputation0.15 3 0.45

Sales Distribution

Effectiveness 0.05 5 0.25

Advertising and

Promotional

Effectiveness 0.15 4 0.60

Pricing strategies0.10 4 0.40

Customer Loyalty 0.15 3 0.45

Total= 3.60

Competitive Strength

LOW

M

EDIU

M

HIG

H

STRONG MEDIUM

5

3.66

2.33

1

23%

5 3.66 2.33 1

Plotting the GE matrix for Vodafone, we found that it lies in the

quadrant corresponding to High market attractiveness but average internal

evaluation, i.e. average business strength.

:

Aditya Birla Group

A US $28 billion corporation, the Aditya Birla Group is in the league of

Fortune 500. It is a multinational corporation based in Mumbai, India with

operations in 25 countries. The group is a major player in all the industry

sectors it operates in. The Group has been adjudged the best employer in India

and among the top 20 in Asia by the Hewitt-Economic Times and Wall Street

Journal Study 2007. The origins of the group lie in the conglomerate once held

by one of India's foremost industrialists Mr. Ghanshyam Das Birla. He

bequeathed most of these companies to his grandson, Mr. Aditya Vikram Birla

– the father of the current Chairman of the group, Mr. Kumar Mangalam Birla.

Mr. Kumar Mangalam Birla is the grandson of Mr. Basant Kumar Birla, who

heads his own independent business conglomerate. Several other members of

the Birla Family own and run their independent business groups.

Aditya Birla is organized into various subsidiaries that operate across different

sectors. Among these are viscose staple fibre, non-ferrous metals, cement,

viscose filament yarn, branded apparel, carbon black, chemicals, Modern retail

(under the 'More' brand of supermarkets, and also under the Trinethra, and

Fabmall brands until recently), fertilizers, sponge iron, insulators, financial

services, telecom, BPO and IT services. The Group consists of four main

companies, which operate in various industry sectors through subsidiaries,

joint ventures, etc. These are Hindalco, Grasim, Aditya Birla Nuvo, and

UltraTech Cement.

We have focused on the Idea Cellular SBU of Aditya Birla Group. It is One of

India's leading GSM mobile service operators; IDEA Cellular is headquartered

in Mumbai and has over 30 million subscribers. Innovation is central to

IDEA's Value Added Service products. It was the first to offer 'Global SMS' in

over 540 networks across all technology platforms. It has also acquired Modi

family’s Spice. But then it even faces tough competition from various major

players. The leading Mobile Networks today in India are Airtel, Vodafone

(sold by Hutchinson Essar to Vodafone), BSNL, MTNL, Orange, Aircel, Tata

Indicom, Idea, BPL etc. Each of these companies has a tough competition with

one another. BSNL & MTNL being government sectors have more advantages

than other Private sector Companies.

STRATEGIES FOR IDEA CELLULAR

The Idea Cellular Limited falls in the “question mark” quadrant of BCG

matrix and in the High attractive and Strong Competitive strength category as

per the GE Matrix. Thus they need to formulate some strategies to try

capturing some market share, growing and building their brand image as well

as brand value.

Market penetration

The company enters where the products and the market already exists. IDEA

being a question mark that means it is competing in a high growth market but

with a relatively low share compare to its competitors. Market penetration can

be done by attracting competitor’s customers that implies increase in market

share. The strategy that IDEA can adapt under market penetration is to attract

non-users and convince to use their product more often. They are different

market penetration strategies like cutting price, increase in promotion, and

creating innovative distribution tactics. The target should be in such a way that

IDEA sales volume relative to its competitors should be high as expressed in

percentage. IDEA’s present market share is about 12%, and competitors like

airtel, Vodafone, and bsnl have a market share of about 31, 23, and 19 percent

respectively. Though telecom industry is growing rapidly every year, there is

always a little increment in the percentage of sales for IDEA. To overcome

this problem and to occupy the competitor’s position we recommend

following strategies.

Increasing the mobile circles which are at present are only 11, so there

is always a need to expand its services.

Target the rural segment in India which is expected to grow by 15%

every year

Launch different types of packages as per the requirements for different

segments of the customers

Provide more high end services like GPRS, mobile internet services

Collaboration with different service providers on global basis to provide

better facility to customers on roaming.

Tracing out the search patterns which are left untapped by the

competitors to reveal new markets.

Backward Integration – In July 2008 Swedish equipment supplier entered

into a contract to provide technology “Ericsson Mobile organizer” to Idea

cellular enabling its subscribers to serve email facility on its cell phones.

Forward Integration – Company operate approximately 589 Idea” n “U and

other showrooms which supplement the distribution channels and provide

customer service.

Horizontal Integration: Idea acquired the Modi family’s stake of 40.8% in

spice which ultimately in a way increased the market share of Idea. This can

be seen as horizontal integration

Strategic Alliance

3) Product alliance

Idea should form product alliance with a company that has a strong

brand image and carry a promotion for one another. E.g. Acer in

collaboration with Ferrari launched Acer Ferrari laptops which are

catering to high end niche segment having high specifications and high

price.

Promotional Alliance:

Idea should form promotional alliances in collaboration with big movie

houses or big retail brands to promote their products. Recently SONY

Viao had a promotional alliance with “James Bond” latest movie

“Casino Royale”.

300

250

200

150

100

50

0

1 2 3 4 5 6

2014

2012

2010

2008

2006

2004

2002

2000

1998

1996

Rs. Billion

Years

Fig. INDIAN CELLULAR GROWT FORCAST

AREAS OF OPPORTUNITIES

1) New Horizons of investment

Cellular companies have shown an unquenchable thirst to offer

customized solutions Based on individual risk appetite of customers rather

than mundane, one size fits all endowenment. Based cellular products.

Cellular products are similar to investment product with less or risk

coverage, signifying changing preferences of investors. They offer risk-

cover, as well as returns by investing in stock markets, even out

performing equity returns in certain instances. We can have the same

plans from other private players like ai r te l i.e.funds, RELIENCE

Prudential maximizer,VODAFONE standard growth. Total premium under

return for unit-linked plans in the financial year 2004-2005 stood at Rs.

82.47 billion, and outstanding growth of 422% over the previous year.

2) Indian Rural MarketA large number of Indians lives in rural India, so this market should be

tabbed by cellular companies and it require a different approach of sales

services with respect to meeting such challenges as low awareness, irregular

incomes and geographical distances. The focus has to be on simple coverage

and return. Very few companies have plans for rural India.

3) Customized SolutionsCompetitive cellular market exploring the new customer segments, it

includes pension plans and children plans. By 2026 India will have 179

million people who wear above 60 years of age. According to that cellular

companies should have a marketing plan. Special children plans

are the current requirements, as the education is becoming more important

and expensive. So such plans must be introduced by all cellular

companies. ICICI Prudential and LIC have already done this.

II. WHAT IS NEEDED TO BE EXPLORERED?

1) The industry in general faces the challenge of building the credibility

of being a financial service provider while meeting a customer s

expectation of what it means to be a financial services company. Financial

service brands are based on insuring long-term financial security throw a

broad range of inherently risky services and investment options. In the

insurance sector, branding has typically involved the concept of stability;

trust and protection from risks in time of crises, or even protecting from a

crises throw a standard set of products. It will help to establish what insurers

stand for and promise and will eventually help to give a industry new image.

2) The altered scenario of the cellular market in India has brought in

new and differentiated products and services offerings to the public

and has opened new challenges for cellular companies. Devising specific

strategies to reach out to specific segments of the market, different countries

and across social strata has been one aspect of the challenge. The other

more complex one has entailed designing the products, marketing

them, ensuring the smooth selling of products, collecting premiums,

managing claims, managing & investing the funds and managing a vast

enterprise. This has created a need of strong Risk Management.

3) The core function of the marketing force of an cellular company is to

generate awareness about the cellular products among the target market.

4) Branding the marketplace is similar to branding on a cattle ranch, the

purpose of a branding program to differentiate our cow from the cattle of

range.

According to an article in the cellular marketing magazine, Feb-March

2002, brand strategy is one of the most critical parts of the underlying

business strategy of any organization. It will help to establish what

insurers stand for and promise and will eventually help to give a industry

new image. This positioning helps to give credibility to sell Risk-Free

products design to help customers insure that their family and assets are

protected.

5) Branding is the new key challenge in the financial services industry.

Life in the 21st century will be longer with more choice in more

fields of activity. The financial consequences of an increased life span are

particularly likely to be tough. Inevitably, this will lead to more complexity,

which in turn necessitates greater clarity and appeal from the service

providers. Branding is more relevant in the financial services market,

which not only faces the problem of securing and retaining customers

in an increasingly competitive marketplace but also experiences the need

for heightened relevance of the brand proposition in a world where brand

has been termed the new religion.

The industries, businesses and individuals are considerably by the services

of cellular organization.

A. The first registered life office was “Hand in Hand Society” established in 1696.

B. In India the first life cellular was started in the Bengal Presidency in

1818 knows as oriental life insurance company.

C. Experiencing so many ups and downs the cellular business was

found in changed shapes. Particularly after attaining independence

and to the more specific after nationalizing in 1956.

D. There was major change in the cellular sector after globalization in

2001.

E. The different MNC s company of foreign country enters in the

cellular industry with the joint venture with Indian companies.

.

ENTRANCE OF PRIVATE PLAYERS IN INSURANCE SECTORS

India still has low cellular penetration of 1.95 percent, 51st in the world.

Despite the fact that India boosts a saving rate of around 25 percent, less

than 5 percent is spent on .

The cellular landscape in India is undergoing major changes. Close to

foreign competition since nationalization in 1956, the life insurance industry

had been protected from competitive pressures. Now, with the reopening of

the sector, several new players have entered the scene.

The acronym for the Insurance Regulatory and Development authority of

India, it overseeing the cellular business in India. It protects the interests

of the policyholders received and ensures orderly growth of the cellular

industry and for matters connected there thereto.

Beside idea cellular limited there are other 11 private players working in

cellular sector, which are as follows.

IDEA CELLULAR LIMITED

A Lifetime of Value

Old MutualOld Mutual was established more than 150 years ago and has

developed into an International services group w focused on asset gathering and asset management. The old mutual Group offers a diverse range of financial services geographics : South Africa, the United States and United Kingdom. The company is listed on the London Stock Exchange capitalization of approximately $6 billon and is member of the elite FSTS 100 index. In the 2003 rankings of the corporations Fortune magazine, Old mutual climbed 87 places to position number 366 and was also listed 14th company in the world.

Old Mutual is the largest financial services business in South

Africa, through its life insurance, asset management, and cellular

operations. The company serves 4 million idea cellular policyholders and

employs over 13000 South Africa operations.

In the USA Old Mutual is one of the top ten fixed annuity business

offering an array of specialist asset management. The company s US Life

business recorded sales of $4 billion at the end of 2002.

Operations in the United Kingdom are focused on wealth

management, through Gerrard as one the leading private business in the

UK.

The Old Mutual Group has the ability to cater for variety of

consumer segments and offers a comprehensive and in products for all

income groups.

IDEA Old Mutual cellular Limited An uncommon bond. Strengthened

by a common vision. Apart from common beliefs, values and objectives we

believe in the vision of a better tomorrow. It is this deep veneer of faith that

has brought us together and fortified our bond. The Global Indian financial

services brand. Our Customers will enjoy the benefits of dealing with a global

Indian brand that best understands their needs and delivers customized

pragmatic solutions across multiple platforms. We will be a world class

Indian financial services group. Our technology and best practices will be

benchmarked along international lines while our understanding of customers

will be uniquely Indian. We will be more than a repository of our customers'

savings.

We, the Group, will be a single window to every financial service in a

customer's universe. The most preferred employer in financial services. A

culture of empowerment and a spirit of enterprise attracts bright minds with

an entrepreneurial streak to join us and stay with us. Working with a home-

grown, professionally-managed company, which has partnerships with

international leaders, gives our people a perspective that is universal as well

as unique. The most trusted financial services company. We will create an

ethos of trust across all our constituents. Adhering to high standards of

compliance and corporate governance will be an integral part of building

trust.

Value Creation.

Value Creation rather than size alone will be our business driver.

Vision and Mission Statement

Performance Highlights

- Sequential drop in Top-line due to subdued rural demand: Idea Cellular

recorded a 0.1% qoq drop in its consolidated top-line, on account of the

subdued rural demand due to the delayed monsoon (rural areas contribute

~40% to the company’s top-line). However, on a yoy basis, the top-line grew

by 29.1%. Idea’s standalone subscribers moved up from 42.8mn to 46.8mn

qoq in 2QFY2010 (30.4mn in 2QFY2009), while the total subscriber base,

including Spice, has moved up from 47.1mn to 51.5mn qoq in 2QFY2010

(34mn in 2QFY2009). However, the ARPU (Idea standalone), was down by

20.5% yoy and 9.9% qoq to Rs209. Segment-wise, the top-line growth,

(including Spice) was backed by National Long Distance (NLD) services,

which grew by 25% qoq (87% yoy growth) to Rs269cr. The revenues from

Passive Infrastructure services, which had a miniscule revenue contribution of

Rs9cr in 2QFY2009, were up by 2.1% qoq in 2QFY2010 to Rs225cr. The only

laggard in the growth during 2QFY2010 was a 2.8% qoq de-growth (27.5%

yoy growth) in the Mobility services segment to Rs2,926cr.  Minutes of Usage

(MoUs) declined by 11% yoy and 6% qoq to 375 minutes for Idea Standalone,

while MoUs in Spice stood at 429, down by 1.1% yoy and 5.5% qoq. In

2QFY2010, Idea Standalone recorded Rs182.2cr of Revenues from its newer

circles, Mumbai, Bihar, Orissa and Tamil Nadu (incl. newly launched services

in Chennai), witnessing a growth of 27.6% qoq.  

GROWTH IN INSTALLED CAPACITY

- EBITDA losses in newer service areas contracts EBITDA margins:

Idea standalone continued to witness EBITDA losses in its new service

areas, while the existing 11 areas witnessed a 40bp qoq drop in margins. On a

consolidated basis in 2QFY2010, Idea recorded a 167bp qoq contraction in its

EBITDA Margins. This was mainly due to a 73bp increase in personnel

expenditure, and an 80bp rise in subscriber acquisition and business promotion

expenses. The margins in the Indus business witnessed a 110bp qoq increase

on account of pass-through costs and benefits from vendors on recurring

expenses. On a yoy basis, the margins were up by 89bp, mainly on account of

a 447bp reduction in Roaming and Access Charges, and a 224bp drop in

subscriber acquisition and business promotion expenses, vis-à-vis an increase

of 600bp in Network Operating Expenditure. 

- Higher Interest costs and effective tax rate suppress the Bottom-line:

Owing to a 21.6% qoq increase in interest costs and an increase in the

effective tax rate from 6.4% to 14% in 2QFY2010, the Bottom-line declined

by 25.9% qoq. On a yoy basis, the Bottom-line spurted by 52.8%, mainly on

account of strong operational efficiency. 

 

 

 

 

 

 

 

Outlook and Valuation  

In addition to the five newer service areas, Idea has recently expanded to the

service areas of Jammu & Kashmir, Kolkata & West Bengal, and North East

& Assam. It now covers a total of 18 service areas, which will contribute to

revenues from 3QFY2010 onwards. This move is in line with the company’s

expansion plan to garner a pan-India presence, for seizing upcoming

opportunities, like the demand in Broadband services, Value Added Services

and the forthcoming 3G auction, once the regulatory and pricing environment

in the Indian Telecom Sector stabilises. Hence, the company’s operational

expense is expected to be on the higher side in the coming quarters, as it

focuses on brand-building and high-end technology to match up with the

growing demand, and for increasing its coverage in rural areas. For these

initiatives, Idea has planned a capex of Rs45bn in FY2010.

Going forward, we expect Idea Cellular to record a CAGR of 23% in its

consolidated Top-line over FY2009-11E, while the Bottom-line is expected to

record a CAGR de-growth of 1.5% over the same period. We estimate the

company’s mobile subscriber base (excluding Spice) to post a CAGR of 32%

over FY2009-11E and to touch 67.9mn, while including Spice, the subscriber

base is estimated to post a CAGR of 31.4% to touch 74.3mn. We estimate

blended ARPUs (ex-Spice) to post a CAGR decline of 15% to Rs190.4 by

FY2011E. At the CMP, the stock is trading at a P/E of 20.2x FY2011E EPS

and an EV/EBITDA of 6.1x FY2011E EBITDA. 

On account of the significant headwinds being faced by the Indian Telecom

Sector in general, and little scope of an improvement in the near-term

profitability of Idea in particular (with an increase in the opex and capex), we

believe that the company is currently trading at expensive valuations. Hence,

we maintain a Reduce on the stock, with a Target Price of Rs49. We have

valued Idea’s core business at Rs27 and have valued the Tower business (16%

stake in Indus) at Rs22 per share, based on our DCF estimates. 

ACCUMULATE

Performance Highlights Price Rs43 „ Top-line soars on strong subscriberadds, Spice consolidation: Idea Cellular recorded a

strong 59.6% yoy and18.5% qoqgrowth in consolidated Target Price Rs48 Top-line in 3QFY2009driven byaincrease in its

mobile subscriber base, which grew byimpressive 62.4%yoyand 12.6% qoq. At the end of Investmemonths

3QFY2009, Idea had a mobile subscriber base of 34.2mn, recording net adds of 3.8mn over the quarter. Including Spice, the company’s subscriber Stock Info base stands at 38mn. Gross mobile average revenues per user (ARPUs, ex-Spice) rose 1.6% qoq (fall of 5.7% yoy) to Rs271 (Rs266 in 2QFY2009, Sector Telecom Rs287 in 3QFY2008). The sequential rise in ARPUs was due to higher Market Cap (Rs cr) 13,299 in-roaming Revenues. Spice ARPUs rose 8% qoq to Rs279 (Rs259 in 2QFY2009). Part of the Revenue growth was due to consolidation of Spice Beta 1.0 with effect from October 16, 2008 (proportionate basis, with 41.09% stake) and proportionate Revenues from Indus Towers.

52 WK High / Low 129 / 34

Minutes of Usage (MoUs) declined 1.7% qoq to 410 minutes per user per Avg Daily Volume 1948137 month. On a yoy basis, however, this metric grew by a decent 8.8%. Thus, Face Value (Rs) 10 the MoU fall sequentially led to rise in realisations, with Revenues per Minute (RPMs) increasing 3.2% qoq, even as they fell by over 13% on a yoy basis. BSE Sensex 8,674 In 3QFY2009, the company launched operations in the Bihar circle and full impact of the Mumbai launch was also absorbed. These circles recorded Nifty 2,679

Rs48.3cr of Revenues. Top-line for the 13 service areas of the company (ex-Spice) grew by a robust 53.2% yoy and 13.9% qoq. BSE Code 532822 NSE Code IDEA „ Margins fall on expansion, higher rental sites and Access Charges: In 3QFY2009, Idea recorded a significant 777bp yoy and 81bp qoq contraction Reuters Code IDEA.BO in EBITDA Margins. Network Expansion costs rose, as a percentage of Sales, by 513bp yoy and by 270bp qoq. This quarter, the number of Bloomberg Code IDEA@IN rent-paying sites for Idea rose by 146% yoy to 21,459 (8,721 in 3QFY2008). Shareholding Pattern (%) This led to the significant rise in Network Expenses. Roaming & Access Charges also rose by 148bp yoy, as a percentage of Sales (7bp qoq). Promoters EBITDA losses of 158.4% (Rs76.5cr) in the Mumbai and Bihar circles also 49.1 adversely impacted the company’s Margin profile.

MF/Banks/Indian FIs

6.7 „ Lower Margins, higher Depreciation reduce Bottom-line: Owing to FII/ NRIs/ OCBs Margin contraction and higher

Depreciation (up 72.9% yoy),

Idea’s 40.1

Bottom-line for the quarter declined 7.3% yoy. However, on a qoq basis, Indian Public/Others 4.1 strong growth of 52.3%

was recorded due to lower Net Interest Costs (down 42% qoq) due to Rs179.4cr of Interest Income recorded.

Abs. 3m 1yr 3yr*

Key Financials (Consolidated)

Sensex (%) (11.2) (50.7) (32.7) Y/E March (Rs cr) FY2007 FY2008 FY2009E FY2010E Net Sales 4,366 6,720 10,094 14,451 Idea Cellular (%) (3.5) (61.3) (49.9) % chg 47.2 53.9 50.2 43.2 * Since listing on March 9, 2007

Net Profit 502 1,042 804 909

% chg 148.2 107.6 (22.8) 13.0 Harit Shah

EBITDA Margin (%) 33.6 33.5 26.7 25.1

FDEPS (Rs) 1.6 3.2 2.5 2.8 Tel: 022 – 4040 3800 Ext: 345

P/E (x) 27.6 13.3 17.2 15.3 e-mail: harit.shah@angeltrade.com

EV/EBITDA (x) 10.7 8.6 5.3 4.3 RoE (%) 30.3 36.4 10.5 7.4

RoCE (%) 18.4 19.8 12.2 17.1 Sales/GFA (x) 0.6 0.6 0.6 0.7

Mobile ARPUs (Rs/user/month)340 295 257 247

Source: Company, Angel Research

January 23, 2009 1

Idea Cellular

Idea cellular Telecom Subscriber growth drives Top-line; first quarter of Spice consolidation In 3QFY2009, Idea Cellular recorded a strong 59.6% yoy and an impressive 18.5% qoq growth in consolidated Top-line primarily driven by growth in the company’s mobile subscriber base, which grew 62.4% yoy and 12.6% qoq to 34.2mn. Over the year, Idea added 13.1mn mobile subscribers, while over the quarter it added 3.8mn subscribers, implying monthly net adds of 1.3mn. Gross

GROWTH IN PRODUCTION.

mobile ARPUs fell by 5.7% yoy but rose 1.6% qoq to Rs271 (Rs287 in 3QFY2008 and Rs266 in 2QFY2009).

This was the first quarter of consolidation of Spice with the company. The consolidation is with effect from October 16, 2008. At the end of the quarter, Idea held 41.09% stake in Spice Communications, with the balance holding distributed amongst Telecom Malaysia International (TMI) and Green Acre, an affiliate. Proportionate consolidation of Indus Towers was also done, with proportionate Revenues from joint ventureatRs127.3cr. This boosted Top-line. Excluding this, Revenues from its 13 service areas (including Mumbai and Bihar) grew 53.2% yoy and 13.9% qoq. Mumbai and Bihar recorded Rs48.3cr in Top-line and ended the quarter with 3.3 lakh and 2.7 lakh subscribers, respectively. At the end of 3QFY2009, Idea’s marketshare in its circles of operations stood at 17.6% v/s 17.2% at the end of 2QFY2009 and 17.3% at the end of 3QFY2008.

argins. Network Operating Expenditure rose, as a percentage of Sales, by 513bp yoy and by 270bp qoq. This quarter, the number of rent-paying sites for Idea rose by 146% yoy to 21,459 (8,721 in 3QFY2008). This led to the significant rise in Network Expenses. Roaming

& Access Charges also rose by 148bp yoy, as a percentage of Sales (7bp qoq).

Issues 1.925mn Compulsorily Convertible Preference Shares to Providence affiliate Idea Cellular on December 5, 2008 received Rs2,100cr from an affiliate of Providence Equity Partners by way of subscription to 1.925mn Compulsorily Convertible Preference Shares, which will be converted into 16.14% of the equity capital of Aditya Birla Telecom

(ABTL) post conversion.

Signs IRU with Indus Towers to transfer 11,100 towers; to impact Margins by 4-5% Idea Cellular has signed an Indefeasible Right to Use (IRU) agreement with Indus Towers, the tower joint venture (JV) between itself, Bharti and Vodafone involving the transfer of 11,100 of its towers to Indus, each of which will have one cell site for Idea. Thus, out of the

balance of 17,830 towers that were until now non-rent paying, 11,100 will become rent-paying on the books of Indus. The approximate book value of these towers is Rs1,450cr.

This will lead to a significantly higher component of rent-paying towers for Idea and capex will get converted into opex. There will be a 4-5% impact on EBITDA Margins in FY2010 on account of this. However, lower Depreciation and Interest costs will offset the impact to an

extent on the Bottom-line. Moreover, with consolidation of 16% of Indus, the impact is likely to be limited to around 2-

2.5% at the Net Profit level.

January 23, 2009 3

Accumulate on the stock and believe that while the company’s recent initiatives will enable it to build a strong

business in the longer-term, the increasingly difficult environment is likely to exert significant strain on its key

operating and financial parameters, thereby limiting major upsides in the stock price.

FUTURE PLANS

Future plane :

Idea Cellular bets big on 3G, WiMAX

Our Bureau

Plans to enter rural, neglected circles to gain subscribers

Bangalore , Jan. 11

Telecom operator Idea Cellular is betting on both 3G and WiMAX.

3G is the third generation telecom network which will bring faster data access

to subscribers who want to connect to the Internet. A WiMAX (Worldwide

Interoperability for Microwave Access) network will mean users can avail

themselves of high-speed broadband Internet wirelessly over their laptops.

The Aditya Birla owned company has 3G ready networks as it has sourced

latest equipment from global vendors. Hence upgrading to 3G will not be an

issue, said sources.

The worldwide 3G subscriber base is expected to be 540 million in 2010,

according to market researcher InStat.

Trials in 3 cities

Idea is simultaneously conducting indoor WiMAX trials in three cities - Pune,

Bangalore and Kochi. The Government has freed spectrum for a limited

amount of time for Idea and a few other operators to conduct indoor and

outdoor trials in various parts of the country.

Eyes rural circles

Idea also plans to enter rural and neglected circles as a strategy to gain

subscribers.

The company recently filed for an IPO with SEBI and hopes to use part of the

funds to roll out network in Bihar. It has paid Rs 10 crore as licence fees to

enter the state. The state suffers a tele-penetration of just 7 per cent, compared

to a national teledensity average of 14 per cent.

However, Bihar is the third most populated circle in the country, according to

sources. The North East, another circle where telecom revolution is still in its

early stages, is also on Idea's radar.

The operator will begin to catch up with other players with its new backing by

a single promoter - the Birla group. It plans to `cover gaps quickly', reported

sources on Thursday.

Other advancements in the telecom industry will help it cut costs - use of e-

mail to send bills to customers; sharing cell sites; smaller base transmission

stations that will mean lesser infrastructure requirements and expenses and

independent tower operators. Along with its plan to go for a national long

distance licence, it will also look at international long distance in the near

future.

Idea has a net worth of Rs 600 crore while its accumulated losses are in the

range of Rs 1,500 crore. It has 1.3 crore subscribers and an average revenue

per user of Rs 376. The market share owned by the operator is 8.4 per cent.

The company's IPO is expected to fetch Rs 2,500 crore. It has also opted for

15 per cent greenshoe option, which will bring the value to Rs 2,875 crore. It

plans to pay back preferential shares worth Rs 600 crore once the IPO is out

by mid-Februrary.

Financial Analysis Of The Company For At Least Three Years

Idea Cellular seems like a good investment for the long term.India is one of the fastest growing cellular markets in the world and this is likely to continue for next five years at least.

PE valuation

If we look at FY 2008 Q1 results, the PAT figure stood at Rs 305.8 crore.With 2,635,360,539 shares outstanding, the eps works out to be around Rs 1.16.However this quarter had an investment and forex gains of Rs 78.8 crore.Removing these as exceptional items, the profit figure stands at Rs 227 crore and eps stands at Rs 0.86.

For FY 2008, the eps is expected to be Rs 4+. At Rs 120, the stock is trading at 30 times FY 2008 earnings.

Idea Cellular will nearly double its PAT in FY 2008 compared to FY 2007.Considering the growth that Idea has been showing, a forward PE of 30 seems fair valuation.For last four finnacial years, the PAT for Idea Cellular has been

FY 2004 - Rs -200 crore (loss).FY2005 - Rs 66.60 croreFY 2006 - Rs 210.61 croreFY 2007 - Rs 509.30 croreFY 2008E - Rs 1050 crore (estimates)

As April 2008 comes closer, people will start looking at FY 2009 (April 2008 – March 2009) earnings.Idea Cellular's FY 2009 eps is estimated to be around Rs 5.5. At Rs 120, the forward PE based on FY 2009 earnings works out to be 21.81.FY 2010 eps should be surely more than Rs 7.

If we give Idea Cellular a forward PE of 22-23 in 2009, one can expect a price of Rs 160+ in next two years (mid 2009).Investors can accumulate the stock around Rs 110-Rs 112.The stock has gone below the 50 day EMA and may see some downside in the short term.

Currently the stock is fairly valued. There isn't much upside in the near term and this is not a trading call.

Idea has been struggling to enter the Mumbai, Bihar and Jharkhand market because of spectrum unavailability. This issue is expected to be resolved by end of FY 2008. Once Idea starts operating in these circles, it will get the

fuel required for growth for next 2-3 years.

Idea Cellular board has approved the formation of a separate subsidiary for its tower business. There will surely be some cost benefits and value unlocking due to this restructuring, but there is not enough clarity regarding it. Most probably the gains will be marginal and will have no major impact on the actual earnings.

My view remains the same right now. The margins are getting squeezed and this is

having an effect on the PAT figures. Also government's new spectrum policy will

make it difficult and expensive for existing GSM players to get fresh spectrum.

News in today's papers = Reliance Communications wants to reduce rates in the

GSM sector - this means even thinner margins for players like Idea.

The high growth time for mobile operators is now almost over.

Once CDMA players like Reliance Communications enter GSM market, the

competition will increase further.I still think the target of Rs 160 by mid 2009 is

achievable. (Actually it has already touched 160 twice in October. - 160.8 on 16th

and 160.9 on 18th).However, if you buy Idea at Rs 130, Rs 160 in 18-21 months will

not be that great a return If you wish to invest in this stock, I suggest you buy it at a

lower levels - something like Rs 115.There is less risk in this stock for the long term,

but I don't think it can give spectacular growth from now on.Personally, I would

look at other sectors like power, capital goods, financial services etc. Telecom no

longer attracts me.Not a bad move. Idea is losing its sheen.However Reliance

Communications seems fully valued at this price (going at a PE ratio of more than

50). You should not really expect anything more than moderate returns in next one

year. It will soon enter the GSM arena and this may bring in some additional

revenue. However, the whole mobile space is now getting saturated and margins are

unlikely to improve in the next few quarters.

Problem being faced by the organization :

On its Q1-11 financial results earnings confernece call, Idea Cellular MD

Sanjeev Aga fielded quite a few questions around 3G. While declining to

share specific rollout plans, he said that the company will not be stingy with

its 3G launch, and that their 3G coverage will be much more than 25% in less

than a year.

Idea Cellular is expecting allotted of spectrum in September, expects all large

companies to truly launch services in the months of December, January and

February. “You could always sneak in and launch something earlier, but by

the time you test, integrate and provision, it would be around that period.”

Idea expects to launch 3G services within the 2010-11 fiscal.

- Idea expects 3G to release voice capacity and data, with data being a

function of how many people have 3G devices and want to use data, “but

inter alia the voice capacity will also be transferred from 2G to 3G,

particularly where there is congestion and where there are 3G enabled

terminals.”

- Of about Rs. 58 billion for the 3G Spectrum fee, only Rs. 19 billion was short-

term debt. As of 30th June 2010, Idea had a total debt of about Rs. 98

billion.

– Handset Subsidies: Aga doesn’t believe that handset subsidies will play a

big role in India, and it never has. “handset subsidies work when there are

two or three operators. So one big handset guy might tie up with someone.

These things do not work when there are so many operators on a large term

basis. Current handset penetration of 3G in India is still in single digits.(Ed: we

think he meant single digit millions)

– Operating cost because of 3G will go up, replacing 2G investments. “So yes,

it will open up our cost stream but it will also open up revenue stream. It

could be that the cost stream kicks in ahead of the revenue stream.”

– Payback on 3G: it cannot be calculated because 2G flows into 3G, so the

costs “flow into one another and the revenues co-live. One way of looking at

is if you paid a certain amount of money for 20 year spectrum.”

– Data versus voice margins: worldwide, data demand has increased

substantially, but margins have been hard “and there are technical problems

around actually billing data which makes it hard.”

– Data Approach: ‘In the beginning data or 3G services were not picking up in

Western Europe and USA and there were a lot of “eat as much as you can”

plans, which are now becoming problematic. So we will do the sensible thing,

we will be very careful. But it is very difficult for me to say because it is a

competitive market and it is hard to say what will happen. But we will be

sensible about it.” Aga said that they will be serving both voice and data, and

doesn’t forsee a data capacity crunch, until about two or three years

– 3G Equipment: Equipment procurement issues not fully resolved for 3G

Mobile Number Portability

- Idea Cellular has been ready for MNP for a long time, and has made enormous investments. Just that “this is one of those things where the slowest camel determines the pace of the caravan, and until everyone is ready it would not happen.”- MNP will help consolidate stronger players, and will not be disruptive. “we do not think it is going to be game changing at all. Given the fact that, a number of people who are looking to retain their number, who have had their number for years, their revenue contribution to the total national sector revenue is not very large. The nature of the Indian market has changed over the years, so we do not think it is going to be a game changing event.

Indian Market Scenario & Tariffs

- Indian market moved from 6.6 operators per circle (on an average) on 1st January 2009 to 10.2 as of 30th June 2010. However, for the last two years, Idea’s revenue market share has gone up from 9.8% to 12.6% between April 2008 and March 2010, whereas it would have been expected to go down.- In the last one year, “when we saw the bloodbath at its bloodiest, Idea increased its revenue market share by 0.9%.”

- “In the quarter ended June 2009, that is exactly one year ago, Idea had reported a realized rate of 58 paisa per minute and a variable cost per minute of 44 paisa. For the latest quarter, which is the quarter that just ended, the realized rate itself is down to 44 paisa, which was the variable cost per minute

one year ago. Now, if we had stayed at the variable cost one year ago, we would have had a nil EBITDA margin. However, in the quarter that just ended, the variable cost per minute is down to 35 paisa…we are not the lowest in India (in terms of realised rate per minute), but there are indeed very few companies in India or in the world who can run a quality operation at 44 paisa per minute, keep investing in the future, support losses from nine gestating circles and still make a cash profit of over Rs. 700 Crores per quarter. In fact, over the last six to eight quarters, while the world around us might have changed, our cash profits have remained largely steady.”

- Tariffs have declined by about 5.5% on a quarter-on quarter basis.

- But if you see last six months, the decline was steeper in the first three of these six months. Since then, the decline, say, from March, April to June, has been slower. It appears that the rate of decline is slowing. That means there is a tendency to flatten, based on pure numbers.

- “(Tariff) Bloodbaths don’t happen because anyone wants it. They happen because you have a situation where no one is in control. You get sucked into it. But looking at the economic analysis, if a large number of companies are burning cash, it places an inherent restriction for long term. In short term you can always get some adventurous or courageous bank to lend money and they are plenty of them in India. But at some point of time, the chickens come home to roost and I think those days are not very far away. So I would be surprised if you have another round of bloodbath”

Formulation of problem for the project report :

Objective of the project

1. To find out the perception of the general people towards the land line &

Mobile phone.

2. To find out the telecom market share of different companies in Gwalior.

3. To find out the consumer satisfaction towards the different plans offered

by the company.

4. Managing the distribution channel of idea cellular

Scope of the Study:

As learning is a human activity and is as natural, as breathing. Despite of the

fact that learning is all pervasive in our lives, psychologists do not agree on

PRODUCT

how learning takes place. How individuals learn is a matter of interest to

marketers. They want to teach consumers in their roles as their roles as

consumers. They want consumers to learn about their products, product

attributes, potential consumers benefit, how to use, maintain or even dispose

of the product and new ways of behaving that will satisfy not only the

consumer’s needs, but the marketer’s objectives.

The scope of my study restricts itself to the analysis of students preferences,

perception of different mobile service providers. The scope of my study is

also restricts itself to RIMT-IMCT only.

Period of study

IDEA Cellular Limited was incorporated in 1995 and is one of the leading GSM

mobile services operators. Headquartered in Mumbai, it has licenses to

operate in all 22 service areas across the country, though commercial

operations are currently in 13 services areas.

IDEA enjoys a market leadership position in many of its operational areas. It

offers GPRS on all its operating networks for all categories of subscribers, and

was the first company in India to commercially launch the next generation

EDGE technology in Delhi in 2003. As a pioneer in technology deployment, it

has been in the forefront through the adoption of bio fuels to power its base

stations, and by employing satellite connectivity to reach inaccessible rural

areas in Madhya Pradesh.

IDEA has been a leader in the introduction of value-added services, and there

are several firsts to its credit, including a voice portal ‘Say Idea’, Idea TV, voice

chat, instant messenger, and many more. Tariff plans have been customer

friendly, catering to the unique needs of different customer segments

In 2007 IDEA was listed on the National Stock Exchange (NSE) and the

Bombay Stock Exchange (BSE).

Contact us

Idea Cellular Ltd.

Corporate office

5th Floor, Windsor

CST Road, Kalina

SantaCruz (E),

Mumbai 400 098

India

Tel: 022 6682 0000 (board line)

Website: www.ideacellular.com

Idea Cellular

Idea Cellular started its operations in 1995 and is under the Aditya Birla

Group, which holds 98.3% stake in the company. The Company Idea Cellular

Limited is one of the telephony wireless companies that functions in many

states in India.

The Company Idea Cellular is the leading mobile services GSM operator in the

country. The Company Idea Cellular Limited is the only cellular operator in

India to launch EDGE and GPRS. The chairman of the company is Mr. Kumar

Mangalam Birla and the managing director is Mr. Sanjeev Aga. Idea Cellular

Limited has the license to provide services in 11 telecom circles in the

country. The telecom circles where the Company Idea Cellular has operations

are Goa, Maharashtra, Andhra- Pradesh, Chattisgarh, Kerala, Haryana,

Uttaranchal, Gujarat, Delhi, UP- West, and Madhya Pradesh. The company's

footprint at present covers around 45% of the population of India and more

than 50% of the telecom market.

Idea Cellular Limited was the 1st cellular company in the country to launch

the scheme of music messaging with background tones, cellular jockey, and

group talk. The company was also the 1st to launch mobile email services and

voice portal. Idea Cellular Company offers various services to its customers

that includes prepaid and post paid mobile services. The company also offers

roaming, value added services, and call management services to its

customers. The Company Idea Cellular Limited has offered revolutionary tariff

plans to its customers such as Lifetime Idea, Super Power, Women's Card,

Lifelong offer, and Outdoing 2 Minutes Free.

Idea Cellular in call management services offers various services to its

customers such as call conference, CLIP, CLIR, call divert, itemized bill, and

call wait facilities. The company provides roaming facility to its customers

who is very efficient for the company has a very wide network, which covers

more than 530 cities in the country and also in around 80 countries across

the world. The Company Idea Cellular also provides it customers with the

facility that they can pay their mobile bills on line through the company's

website. As the company provides the best services to its customers, the

subscriber base of the company has increased at a very rapid pace. The

subscriber bases of Idea Cellular in various states of India are:

• Andhra Pradesh - 1,737,116

• Haryana - 834,786

• Rajasthan - 235,330

2

• Maharashtra - 2,807,982

• Madhya Pradesh - 1,328,780

• Gujarat - 1,715,774

• Kerala - 1,482,799

The Company Idea Cellular Limited has won the GSM Association Award in

the category of Bill Flash. The company is the 1st cellular operator in the

country who has won an award on such a big platform. Idea Cellular Limited

in order to expand even more has acquired the Company Escotel in 2004. The

number of telecom circles where the company operates has increased with

this acquisition and thus it has helped the company to have a pan India

presence. The Company Idea Cellular is also planning to upgrade its network

that will ensure that the best quality of service is provided to its customers.

Idea Cellular has become the topmost company in the telecom sector in India

on the basis of the quality of its services. And so in the future also, the

company must continue to provide its customers with better facilities for this

will help the company to grow and prosper.

Method of study:

The study is a cross sectional study because the data were collected at a

single point of time. For the purpose of present study a related sample of

population was selected on the basis of convenience.

Sources of Information:

Idea Cellular Limited

Idea Cellular is India's fifth largest telecom wireless service operator with ~11% of the wireless subscriber base and ~13% revenue market share. Idea is a leading GSM (Global System for Mobile Communication) mobile services operator with about 66.7 millionsubscribers at the end of May, 2010. The company covers all the 22 2G telecom circles in India. It operates both in the 900 MHz & 1800 MHz spectrum. The company bagged 11 circles in the recently concluded 3G auction. Idea also has NLD and ILD operations.Idea has acquired Spice Telecom which is a leading player in the Punjab and Karnataka telecom markets. Aditya Birla Group is the promoter of Idea Cellular.

KEY INVESTMENT ARGUMENTS_ Successful 3G spectrum auction for the companyIdea’s strategy for the 3G auction was considered the most successful among the telecom operators who participated in it. It bagged 11 service areas, covering 49% of all India revenue generation. They include Kerala, Maharashtra, Andhra Pradesh,Gujarat, Madhya Pradesh, Uttar Pradesh (West), Uttar Pradesh (East), Haryana, Panjab, Himachal Pradesh & Jammu & Kashmir. It is a market leader in 4 of these circles and is ranked second in other 3 circles. Its average revenue market share in the bagged 3G markets is 21%, which augurs well from a payback perspective. It also protects Idea’s 80% existing 2G revenue as and when the number portabilitybecomes a reality. Total payment for 3G spectrum stands at Rs 5769cr., which is the circles it lost. The mobile penetration in the circles it won is around 53%. The average monthly revenue per user in the circles it has won is Rs 199 compared with Rs 146 in the circles it lost.

_ Addition of new 2G telecom circles to boost financialsThe company launched its services in Orissa, Chennai & Tamil Nadu, Jammu &Kashmir, Kolkata & West Bengal and Assam & North East states in phases duringFY 2009-10. It is now a pan India operator. The impact of the subscriber addition inthese areas would accrue in the coming quarters.

_ Attractive 2G spectrum profileSource: CompanyInvestment DetailsCMP (Rs.) 58.0Target (Rs.) 69.0Upside Potential (%) 19.0Horizon (Months) 10-12 MShareholdingSource: BSE. Figures as on March 31, 2010.

Analyst:Atul Kanwaratulkanwar@bajajcapital.comReviewed by:Alok Agarwalaaloka@bajajcapital.comProfileIndustry TelecomMarket Cap (Rs cr.) 19141.3Face Value (Rs.) 10.052-week high/low (Rs.) 84.8/47.8Book Value (Rs.) 34.3Price / Book Value 1.7PE Ratio (TTM) 20.1Dividend (%) 0.0Average Daily Volume (1 Y) 6425658Stock idea – Idea Cellular Ltd.Bajaj Capital Centre for Investment Research 2/6_ Idea is doing very well in the 900Mhz frequency service areasOut of the nine 900 MHz circle under its belt, Idea is the leader in four of them. It isthe no. 2 player in other three service areas. Overall it is the no. 2 player in these 9service area with a market size of 20.6%.Telecom Service Area(900 Mhz)Revenue Market Share(RMS)RankMadhya Pradesh 29.1% 1Kerala 29.0% 1Maharashtra 28.4% 1Uttar Pradesh (West) 27.7% 1Haryana 20.4% 2Punjab 17.8% 2Andhra Pradesh 16.1% 2Gujarat 18.0% 3

Karnataka 6.4% 6TOTAL 20.6% 2

Source: Company_ Growth in subscriber base, Minutes of use on network & VASIdea closed FY09 with ~39 million subscribers. The company crossed the ~50 million subscriber mark in August 2009. The growth has been very strong with the subscriber base touching 66.7 million by the end of May 2010. Total Minutes of Usage on the network were 44.2 billion in Q4FY09, against 68.3 billion in Q4FY10, showing a growth of 54.5% on a YoY basis. Value Added Services (VAS) as % of revenue has grown from 9.5% in Q4FY09 to 12.4% in Q4FY10.

_ The Indus advantageIndus is the largest independent tower company in the world, having about 1,03,000 towers under its management. It provides infrastructure service in 15 service areas. Indus benefits from assured tenancy from its promoters and the other operators. Idea benefits from the reduced capital expenditure and the embedded value of the shareholding.

Source: Company_ Strong promoters & managementIdea cellular, belonging to the Aditya Birla group has a strong promoter background. It also has a strong management. The management quality was very evident in the recently concluded 3G spectrum auction where Idea managed to bag most of the 3G service areas it aspired for, paying the least amount among the major telecom wireless service providers.

Idea Cellular V/s NSE2G Telecom Circles CoveredSource: CompanySubscriber Base (million)Source: CompanyStock idea – Idea Cellular Ltd.

Bajaj Capital Centre for Investment Research 3/6_ Increase in revenue market shareIdea’s revenue market share has increased from ~10% in Q4FY08 to ~13% in Q4FY10. Market Share – Q4 2008 Market Share – Q4 Source: CompanyKEY CONCERNS_ Broadband woes

The company failed to win any broadband spectrum in the recently concludedBroadband Wireless auction._ Hyper Competition and OvercapacityThe overcapacity in the telecom sector has led to cut throat competition among theservice provider’s with prices dipping to all time lows._ Decline in Operational IndicatorsAverage Revenue per user (ARPU) has declined from Rs. 255 in Q4FY09 to a lowof Rs. 185 in Q4FY10. Realized Rate per minute has declined from Rs.0.63 toRs.0.47 for the same period._ TRAI may charge the company for excess 2G spectrumTRAI may charge GSM players Rs. 10,500cr. as a one time fee for the excess 2Gspectrum held by them. Idea’s share comes to Rs. 1100cr.

VALUATIONSThe decision of the government to increase the number of players in each circle has led to a sharp fall in the telecom tariffs. The prices that were already among the lowest in the world seem to have nosedived further and may not be sustainable in the long term. We feel that the tariffs have bottomed out and so has the Idea stock, which has priced in all the bad news. Idea cellular, a Rs 19141.3 cr. company by market capitalization, is currently trading at a share price of Rs 58.0. The current EPS is Rs 2.9, which translates into a PE of 20.1. Interms of price to book value, it is current available at 1.7. Market cap to sales ratio is 1.5. Given the growth prospects of the company, the stock is an attractive

buy. We recommend a “BUY” on the stock with an investment horizon of 10-12 months and target price of Rs. 69.

CellSitesSource: CompanyAverage Revenue per User(ARPU)Source: CompanyValue Added Services as % ofRevenueSource: CompanyStock idea – Idea Cellular Ltd. (%)Net Sales 3319.0 3135.8 2930.1 5.8 13.3Other Income 51.9 0.0 0.0Total Income 3399.7 3149.5 2942.5 7.9 15.5Total Expenditure 2424.2 2335.3 2130.6 3.8 13.8PBIDT 975.5 814.1 811.9 19.8 20.2PBIDT Margin % 29.4 26.0 27.7Interest 114.1 93.8 104.9 21.6 8.8PBDT 861.4 720.4 707.0 19.6 21.8Depreciation 566.7 513.1 431.0 10.5 31.5PBT 294.7 207.3 276.1 42.2 6.8Tax 28.1 37.2 21.1 -24.4 33.4Adjusted PAT 266.6 170.1 255.0 56.7 4.6APAT Margin (%) 8.0 5.4 8.7Financials: ConsolidatedRs. Cr.0903 200803 200703 2006034 yrCAGR %Share Capital 3300.2 3100.1 2635.4 2592.9 2259.5

Networth 13245.2 3540.8 2179.8 650.6Capital Employed 22159.3 10056.2 6430.3 4419.2Total Income 12530.7 10652.2 6919.1 4411.4 2989.6 43.1Total Expenditure 9039.9 7309.9 4458.5 2889.3 1890.9 47.9Revenues 12397.9 10131.3 6720.0 4366.4 2966.2 43.0PBIDT 3490.8 3342.2 2460.6 1522.1 1098.7 33.5Other Income 83.6 516.3 199.1 46.2 24.5

Interest 400.5 1000.3 469.0 341.1 329.4Depreciation 2014.9 1402.8 876.8 671.8 549.5PBIT 1475.9 1939.4 1583.8 850.3 549.2 28.0APAT 953.9 664.5 1004.1 493.9 210.3 45.9Operating Cash Flows 2264.2 2522.4 1605.7 1277.7Free Cash Flows -7613.8 -3454.4 -669.4 755.6Dividend % 0.0 0.0 0.0 0.0 0.0CEPS (Rs.) 7.4 7.3 4.5 3.4EPS (Rs.)* 2.9 2.1 3.8 1.9 0.9 32.8Debt-Equity Ratio 0.9 1.9 2.3 2.9Interest Coverage Ratio 1.7 3.4 2.5 1.7RoNW % 7.1 21.8 14.4 9.0PBIDT Margin % 28.2 33.0 36.6 34.9 37.0PBIT Margin % 11.9 19.1 23.6 19.5 18.5APAT Margin % 7.7 6.6 14.9 11.3 7.1Total Asset Turnover Ratio 0.5 0.6 0.6Fixed Asset Turnover Ratio 0.8 0.9 0.8Market Cap/Sales 1.5PE Multiple 20.1P/BV Ratio 1.7

Stock idea – Idea Cellular Ltd.Bajaj Capital Centre for Investment Research 6/6Disclaimer: This document has been prepared by Bajaj Capital Centre for Investment Research (BCCIR), a unit of Bajaj Capital

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Statistical tools and techniques used:

The current state of industrial application of statistics does not live up to its glorious creative past. We have statistical methodology but not the clarity of purpose or the market image that facilitates its use. When statistically based Quality and Reliability methods are used they are not always used correctly.

Taking stock of the current and future state of the application of statistics in quality improvement in industry and commerce, the first question must be do the old needs for statistics still exist? Have the questions changed? Technological change and a change of mind set have indeed clearly made their mark. Just as for most purposes we no longer need tables of logarithms, computing power and on-line instrumentation have converted some of the analysis, forecasting and control issues of the past into history. Of course, change has also created new problems, as old methodologies prove inadequate and new needs are revealed. But the problems are more complex, more complicated and more academic – and therein lies the real problem.

From being a well-founded routine analysis process, employing relatively large numbers of statistical assistants to carry out the laborious calculations of numbers according to an assured well-defined unchanging enumerative framework, statistics has evolved into an elitist, remote, obtuse – and for many in industry and commerce, unnecessary – set of approaches and people. There are two dimensions of this change. Firstly, the work of statistics has changed: computational power together with the switch in statistical emphasis from enumerative to analytic studies, which draw inferences about future but currently badly defined processes, mean that statistics has become less automatic and hence less accessible. Secondly, statisticians have not adequately tackled the consequent public relations challenge and, by some of their more “academically interesting” work, have added to the “bad press”. For example, O’Connor (1991), in arguing that statistical methods for quality and reliability prediction and measurement are counter-productive and should be discarded in favour of a return to traditional engineering and quality values, stated

“They lead to over-emphasis on expensive, bureaucratic and esoteric approaches to quality and reliability. Many successful equipment designers and manufacturers generate highly complex yet reliable products without recourse to these methods.”

Similar points were made by some respondents in the recent study by the Engineering Quality Forum on the Quality Education of Engineers (Cullen et al, 1997). The real question therefore is that, with all this bad press, does statistics and statisticians, have a future in industry and business at all?

The gap between the potential of statistics to help quality improvement and what is actually achieved is not a specifically British or specifically Western phenomenon. It was present also in the early days of the introduction of statistically based quality improvement methods into Japan and for much the same reasons (Ishikawa, 1985). There is evidence also of a similar situation in the USA and Germany (McMunigal et al, 1990; Bendell, 1994). The subsequent success of statistically based quality improvement methods in helping to transform the Japanese economy is evidence not just that this problem is solvable but that in bringing the messages and methods of statistics to the people in business and industry they do need to be clarified, simplified, communicated and “packaged”. The emphasis in Ishikawa’s work of the simplification, “packaging”, mass education, team basis and consequent mass use of statistical tools by all or many employees (eg the “seven tools of quality control”) reappears also in the work of other Japanese quality gurus such as Taguchi and Shingo (Bendell, 1991). The emphasis is on making statistical techniques understandable and usable by the customer and not on blaming the customer for not understand or not using them.

It can be argued that the need is not just to re-educate others: the engineers, managers and other professionals who just do not appreciate the importance of variation and the part that statistics has to play. Even more importantly, the need is to re-educate the statistical community. For statistics to have a future, now is the time for statisticians to come out of their closets, to cross the boundaries into the real work problems, to avoid unnecessary complexity, to start their role earlier in the project and to end it later, to become fully integrated, to lose their “statistician” stigma, to become the facilitators of large-scale simplistic routine application of statistical methods by all workers (like Ishikawa’s seven tools of quality control). There are few enough statisticians left in industry (eg Greenfield, 1996) and the need and the opportunities are strong; maybe never stronger. All around we see examples of the lack of use, misuse and abuse of statistics.

The responsibility is not only with those in industry. The role of academic statisticians, and the academic tradition of statistics, is also in much need of attention. It is here that the greatest elitism and barriers are created and carried on through education to future generations. And it is here that the greatest opportunity exists for a new ethos of statistical service; of removing the jargon, complexity and elitist barriers and of creating clarity, simplicity and focus.

To illustrate many of the points in this section, we shall now discuss three key areas of statistical application in quality.

LIMITATIONS OF THE STUDY:

The research will be conducted in a limited area.

The internet information can be irrelevant.

Time will be a major constraint.

Significance of the study :

IDEA CELLULAR (IDEA)

 Live BSE Quotes Aug 11, 2010 9:48:00 AM

Price (Rs)

71.50

Open (Rs)70.70

High (Rs)72.00

Low (Rs)

70.45

% Change

1.49

Volume182,846

Value (Rs)13,073,489

52-Week H/L

84.85 /

48.05

 Live NSE Quotes Aug 11, 2010 9:49:57 AM

Price (Rs)

71.55

Open (Rs)71.50

High (Rs)72.00

Low (Rs)

70.35

% Change

1.27

Volume1,371,980

Value (Rs)98,096,570

52-Week H/L

84.80 /

48.80

 Valuation

EPS (Rs)*2.60

P/E Ratio (x)27.49

Market Cap (Rs m)

235,966.45

P/BV (x)1.78

*Trailing 12 months earnings, excluding extraordinary / exceptional items.

BSE Sensex | S&P CNX Nifty | Best Performing Stocks & Funds | BUY/SELL?

PEER GROUP: QUOTE &

AGC NETWORKSBHARTI AIRTELHFCLIDEA CELLULARITI LTD.KRONE COMM.MTNLRELIANCE COMMTATA COMM.TATA TELESERV (MAH)

1. Total Activations/month

Reliance 30%

Vodaphone 15%

Idea 20%

Uninor 15%

Airtel 20%

2.      Highest Selling Brand

Reliance 25%

Vodaphone 15%

Idea 40%

Uninor 10%

Airtel 10%

3.      Total Recharge (value/month) Rs

Reliance 25%

Vodaphone 20%

Idea 30%

Uninor 10%

Airtel 15%

4. Which is the most preferred Brand

Reliance 20%

Vodaphone 15%

Idea 30%

Uninor 10%

Airtel 25%

5. Which operator has in shop branding

Vodaphone 15%

Idea 35%

Uninor 20%

Airtel 30%

6. Does Idea has Glow sing Board(GSB)

Yes 85%

No 15%

7. Which other brand has GSB

Reliance 20%

Vodaphone 15%

Idea 30%

Uninor 10%

Airtel 25%

8. Does Idea have Non lit Board

Yes 75%

No 25%

9. Which other operator has Non lit board

Reliance 25%

Vodaphone 10%

Idea 30%

Uninor 15%

Airtel 20%

10. Does Idea have POP poster/dangler ect.

Reliance 12%

Vodaphone 20%

Idea 26%

Uninor 12%

Airtel 30%

FINDINGS

55% of the people use only mobile, and 40% of respondents use both

the services & only 5% people use the telephone service. It shows the

popularity of cellular phone services.

34% of respondents are using the idea services, which is the highest

percentage of users of cellular phone. Airtel takes 2nd place in Gwalior

with 28% of users. Then comes reliance and BSNL, and tata indicom

having least customers in the Bhopal.

Prepaid service is most popular in the cellular services with 95% of

customers. The remained uses postpaid services.

In current situation 73% of respondents are using lifetime plans, where

the rest are using general plan of the cellular companies.

64% of respondents are satisfied with the call rates of the lifetime plans;

it is because telecom companies have slashed their call rates few months

ago. Still in this situation 36% of respondents did not satisfy with the

call rates which service they are using.

In the lifetime plan of cellular companies most of the respondents are

using this service because of its validity period with 83% of answer.

Where 15% of people like this services because of its call rates.

78% of customer satisfied with the lifetime plans of cellular companies,

and which are not satisfy with the service they are mostly BSNL and

TATA indicom users.

Most of the people are using lifetime services because of money savings

with the percentage of 48. Where 29% of people like this service

because of the facilities provided by the operators. And 23% of people

are using this service because of incoming only.

Questionnaire

Name of Trainee

Location :

1. Shop

Name……………………………………………………………………

……………

2. Mailing

Address…………………………………………………………………

…………….

3. Cantact

Person……………………………………………………………………

……………

4. Contact No.

……………………………………………………………………………

………..

5. Total

Activations/month………………………………………………………

…………...

6. Highest Selling Brand……………………………… How much(per

mth)…………………

7. Total Recharge (value/month)

Rs…………………………………………………………..

8. Which is the most preferred

Brand…………………………………………………………

9. Reason for most preferred

Brand…………………………………………………………..

10.Which operator has in Shop

Branding??......................................................

11.Does Idea has Glow sing Board(GSB)(Yes/No)

…………………………………………

12.Which other brand has

GSB…………………………………………………………………….

13.Does Idea have Non lit Board(Yes/No)

…………………………………………………….

14. Which other operator has Non lit

board………………………………………………..

15. Does Idea have POP (poster/dangler ect)

Yes/No?......................................

BIBLIOGRAPHY

BOOKS:

Philip Kotler, ‘marketing management’ prentice Hall of India Pvt. Ltd.

New Dehli.

C. R. Kothari ‘Research methodology’, vishwa publication, New Delhi.

Saxena Rajan ‘marketing management’ Tata McGraw-hill publication Co.

Ltd. New Delhi.

H. V. Verma ‘marketing of services’ Global business press, New Delhi.

Business today magazine of February issue, 2008.

Web Resources :

www.trai.gov.in

http://www.tataindicom.com/t-aboutus-ttsl-organization.aspx

http://www.rcom.co.in/webapp/Communications/rcom/Aboutus/aboutus_h

ome.jsp

http://www.ideacellular.com/IDEA.portal?

_nfpb=true&_pageLabel=IDEA_Page_AboutIdea

http://www.bsnl.co.in/about.htm

http://www.bsnl.co.in/service/tariff_excel_pre.htm

http://210.212.144.243/utility/tariff.htm

http://www.trai.gov.in/trai/upload/PressReleases/15/pr16jan06.pdf

www. airtel .in

http://www.rcom.co.in/webapp/Communications/rcom/index.jsp