Creating a digitally connected world

Creating

a digitally

connected

world

Integrated Report and Annual Accounts

Bharti Airtel Limited

2017-18

About this Report

Bharti Airtel

Limited is pleased

to present its first

Integrated Report.

With this, we begin

a journey aimed

to showcase

the value we

create for all our

stakeholders.

As we take strides to strengthen our value creation philosophy

through ‘Integrated Reporting’ in the coming years, for now

we shall continue to disclose in-depth analysis of the material

impact of our business operations on economic, social and

environmental indicators across the stakeholder fraternity

through our Sustainability Report, which shall be published

separately.

Reporting scope and period

The Integrated Report covers information on business

operations of Bharti Airtel Limited, aptly disclosed through

six capitals as defined by International Integrated Reporting

Council (IIRC). All the six capitals (except financial capital)

cover information on India operations excluding Bharti Infratel

Limited and Airtel Payments Bank Limited. The parameters for

financial capital covered in this report are in relation to ‘Bharti

Airtel Limited’ on standalone basis.

The Integrated Report considers the primary reporting period

as April 01, 2017 to March 31, 2018. However, some of the

sections of the report represent facts and figures of previous

years to provide a comprehensive view to the stakeholders.

Reporting framework

The report follows the International <IR> Framework as

developed by IIRC (

www.integratedreporting.org) and

should be read in conjunction with the financial statements

included herein and the notes thereto. The financial and

statutory data presented is in accordance with the

requirements of the Companies Act, 2013 (including the rules

made thereunder), Indian Accounting Standards, the Securities

and Exchange Board of India (Listing Obligations and

Disclosure Requirements) Regulations, 2015 and the

applicable laws.

The information contained in this report can be

accessed through the Airtel Investor Relations app

available on the iPhone and iPad.

For the online version of the Annual Report please

log on to http://www.airtel.com

Forward-looking statements

Some information in this report may contain forward-looking

statements which include statements regarding Company’s

expected financial position and results of operations, business

plans and prospects etc. and are generally identified by

forward-looking words such as “believe,” “plan,” “anticipate,”

“continue,” “estimate,” “expect,” “may,” “will” or other similar

words. Forward-looking statements are dependent on

assumptions or basis underlying such statements. We have

chosen these assumptions or basis in good faith, and we

believe that they are reasonable in all material respects.

However, we caution that actual results, performances or

achievements could differ materially from those expressed or

implied in such forward-looking statements. We undertake no

obligation to update or revise any forward-looking statement,

whether as a result of new information, future events, or

otherwise.

Key company information

Bharti Airtel Limited

ISIN: INE397D01024

BSE Code: 532454

NSE Code: BHARTIARTL

CIN: L74899DL1995PLC070609

Assurance

To ensure the integrity of facts and information, the Board

of Directors and management have reviewed the Integrated

Report and Ernst & Young LLP (EY) has carried out the

independent assurance on sustainability disclosures presented

in the report. The ‘Independent Assurance Statement’ issued

by EY is available on our website www.airtel.com.

The statutory auditors, Deloitte Haskins & Sells LLP, Chartered

Accountants have provided assurance on the financial

statements and the ‘Independent Auditor’s Report’ has been

duly incorporated as a part of this report.

Sunil Bharti Mittal Gopal Vittal

Chairman Managing Director & CEO

(India & South Asia)

Raghunath Mandava

Managing Director & CEO

(Africa)

Read Inside

006 About Us

008 Segment wise Performance

009 Performance Highlights

010 Looking Back at the Year

012 Message from the Chairman

014 Message from Managing Director & CEO

(India & South Asia)

015 Message from Managing Director & CEO (Africa)

016 Moving ahead on India’s Digitalization Journey

018 Redefining Digital Banking Ecosystem

020 Music to the Ears

021 The Making of a Blockbuster

022 Mobile Money - Banking the Unbanked

024 Board of Directors

026 Risk Management

028 Integrated Strategy for Value Creation

029 Materiality Assessment

030 Our Business and Value Creation Model

032 Financial Capital

033 Intellectual Capital

036 Human Capital

039 Manufactured Capital

041 Social & Relationship Capital

044 Natural Capital

046 The Crowning Moments

048 Corporate Social Responsibility Report

Integrated

Report

006

056

057 Business Responsibility Report

065 Board’s Report

106 Management Discussion and Analysis

131 Report on Corporate Governance

Statutory

Reports

057

159

160 Standalone Financial Statements

226 Consolidated Financial Statements

313 Statement Pursuant to Section 129

of the Companies Act, 2013

Financial

Statements

160

317

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

002

Corporate Information

Board of Directors

Mr. Sunil Bharti Mittal, Chairman

Mr. Ben Verwaayen

Ms. Chua Sock Koong

Mr. Craig Edward Ehrlich

Mr. Dinesh Kumar Mittal

Mr. Manish Kejriwal

Mr. Rakesh Bharti Mittal

Mr. Shishir Priyadarshi

Ms. Tan Yong Choo

Mr. V. K. Viswanathan

Mr. Gopal Vittal, Managing Director & CEO

(India & South Asia)

Managing Director & CEO (Africa)

Bharti Airtel International (Netherlands) B.V.

Mr. Raghunath Mandava

Chief Financial Officer

Mr. Nilanjan Roy

Company Secretary

Mr. Pankaj Tewari

Statutory Auditors

Deloitte Haskins & Sells LLP

Chartered Accountants

Internal Assurance Partners

Ernst & Young LLP

ANB & Co., Chartered Accountants

Cost Auditors

R.J. Goel & Co.

Cost Accountants

Secretarial Auditors

Chandrasekaran Associates

Company Secretaries

Registered & Corporate Office

Bharti Crescent, 1, Nelson Mandela Road,

Vasant Kunj, Phase – II, New Delhi – 110 070, India

CIN: L74899DL1995PLC070609

Website

http://www.airtel.com

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Financial Statements

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003

Integrated Report

Corporate Information

India has always been a mobile first market, and with

the role of a smartphone extending beyond just a

communication device has further expedited a massive

rollout of networks on the part of the providers –

including us, which led to the creation of a high speed

broadband network in India. The penetration of affordable

handsets has increased; convergence of Payments via

smartphones and the demonetization and cashless drive

has acted as a catalyst for the growth of digital payments

in India and the convergence of telecom services like

connectivity, entertainment, education, and banking has

led to a greater level of convenience and freedom for our

customers as they are now able to run their day to day

lives from the gadget in their hand.

As per IAMAI, the number of internet users in India will

grow significantly in 2018 – the growth being visible

in both urban and rural areas. The high-speed mobile

broadband penetration in India has been at an all

time high, and there has been a major shift in the data

consumption trends of both the individual and group

nature. And to top it all, by 2020, India will be the world’s

youngest country with 64% of its population in the

working age group – which will be an unprecedented

edge, considering the crucial relevance of mobile

data usage in this demographic for learning, financial

transactions, healthcare, shopping and so on.

Hence, at Airtel, we are keeping pace with the rapidly

shifting landscape of telecom in modern India by

deepening our roots and extending our reach in the digital

services arena. As always, we are committed to making

the lives of our millions of customers easier by staying

one step ahead, envisioning their present as well as future

needs and being ready to provide them with it all

by creating a digitally

connected world.

Every monumental year for an

industry brings with it certain

decisive turn of priorities that change

its landscape, for good. The same

has been true for telecommunication

this year. FY’18 has been quite

disruptive for the industry in India for

more reasons than one – and hence

quite transformational as well. A

highly competitive intensity reigned,

and amidst all that we chose to

keep our eyes less on the downward

spiral of obstacles and more on the

rising graph of possibilities – the

greatest of which has been venturing

beyond being purely mobile oriented

to a comprehensive digital service

provider.

About Us

Bharti Airtel Limited is a leading global telecommunications company with

operations in 16 countries across Asia and Africa. Headquartered in New

Delhi, India, the Company ranks among the top three mobile service providers

globally in terms of subscribers.

In India, the company’s product offerings include 2G, 3G and 4G wireless services, mobile commerce, fixed line services, high speed

home broadband, DTH, enterprise services including national & international long distance services to carriers. In the rest of the

geographies, it offers 2G, 3G, 4G wireless services and mobile commerce. Bharti Airtel had over 413 million customers across its

operations at the end of March 2018.

Diversified service portfolio World population

24%*

of the total population covered

* Based on UN Report dated January 1, 2013

Indian population coverage

95.3%

Africa presence

14 countries

Recognized brand

Talented people

20,793

Employees

17,263

India & South Asia

3,530

Africa

We own and operate more than 39,523 telecom towers under

our subsidiary Bharti Infratel Limited (on a standalone basis)

with presence across all 22 telecom circles.

Tower Infrastructure

We are India’s leading and most trusted provider of ICT services

with a diverse portfolio of services to enterprises, governments,

carriers and small and medium businesses.

Airtel Business

India’s first payments bank with active operations across 29

states in India.

Payments Bank

We offer postpaid, prepaid, international roaming, data

connectivity and other value-added services to our customers.

Wireless Services

Our Direct-To-Home (DTH) platform offers both standard and

high definition (HD) digital TV services with 3D capabilities and

Dolby surround sound.

Digital TV Services

We offer fixed-line telephone and broadband (DSL) services

across pan-India.

Homes Services

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

006

Shareholding as on March 31, 2018

1 >

5 >

4 >

3 >

2 >

Promoter and Promoter group

67.14%

Mutual Funds and Units Trust of India

6.61%

Financial Institutions, Banks and Foreign Institutions

18.53%

Insurance Companies

5.69%

Others

2.03%

How we will win

Win the 4G Game

decisively

> Win the primary SIM slot and wrest back share.

> Win every market and channel through brilliant micro marketing and a re-energized GTM.

> Drive upgrades through device partnerships and offers.

> Lock-in customers through postpaid, loyalty program and more products.

Win with Brilliant

Network Experience

> Fix network quality through discipline, ownership, right measurement and digitization.

> Future proof the network across access, transport and core layers by investing smartly.

Build New Revenues

> Rapidly grow homes through broadband and DTH expansion.

> Accelerate SME through GTM re-invention and going deeper in large accounts.

> Leverage Customer 360, training and touch points to drive the right recommendation at

the right time.

> Build the largest Music and TV service of India.

> Launch homes, office and payments platforms to drive new revenues.

> Build the largest payments bank through dramatic increase in users and financial

services use cases.

> Drive new revenue streams in the areas of IoT, Cybersecurity and DCs.

Win with War on Waste

> Drive down cost through end to end process re-engineering and digitization.

Win with People

> Drive passion and teamwork while building an Airtel of the future.

Vision

Our vision is to enrich the lives of customers. Our obsession is to win customers for life

through an exceptional experience.

Values

Alive, Inclusive, Respectful.

Objectives

Grow market share. Grow revenue. Drive down cost.

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Integrated Report

About Us

Segment wise Performance

Wireless services

> Bundled plans with unlimited voice packs

> First to launch 4G in India

> Postpaid plans

> MyPlan - customized plans as per customer usage

> Infinity - Options with unlimited benefits

> Pocket-friendly data packs

> Recognized as the smartphone network

Homes services

Landline

> Attractive plans and offers

> Highly reliable services

> 24/7 online support

> Value-added services

Internet

> Introduced ‘V-Fiber’

technology

> Up to 100 Mbps speed

Digital TV services

> Android TV

> Universal Remote

> MyPlan Customized

> Interactive services

* on constant currency, 14 countries operations

Tower Infrastructure

> One of the world’s largest

passive infrastructure

providers

> Over 91,451 towers

(including proportionate

share of Indus)

Airtel Business

> Diverse portfolio of

services - voice, data,

video, network integration,

data centres, managed

services, enterprise

mobility applications and

digital media

> Strategically located

submarine cables and

satellite network

> Global network running

across 250,000 Rkms,

covering 50 countries and

5 continents

22%

Mobile Services

Africa

Homes

Digital TV

13%

Airtel

Business

Tower

Infrastructure

Revenue Mix FY 2017-18

51%

Mobile Services India

and South Asia

565,511227,734

Mobile India

Y-o-Y

Revenues -18% EBITDA -34%

462,639150,888

FY17

FY18

(J Mn)

27,518

Y-o-Y

Revenues -8% EBITDA -9%

25,265

FY17

FY18

12,998

11,802

(J Mn)

34,306

Y-o-Y

Revenues 10% EBITDA 16%

37,570

FY17

FY18

12,219

14,226

(J Mn)

1,09,429

Y-o-Y

Revenues 3% EBITDA 25%

1,13,218

FY17

FY18

33,884

42,296

(J Mn)

60,829

Y-o-Y

Revenues 9% EBITDA 12%

66,284

FY17

FY18

29,177

32,546

(J Mn)

2,894

Mobile Africa*

Y-o-Y

Revenues 5% EBITDA 46%

3,036

FY17

FY18

694

1,014

(USD Mn)

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

008

Performance Highlights

Financial Year Ended March 31

Units IFRS Ind AS**

2014 2015 2016 2017 2018

Operating Highlights

Total Customer Base 000’s 2,95,948 3,24,368 3,57,428 3,72,354 4,13,822

Mobile Services 000’s 2,83,580 3,10,884 3,42,040 3,55,673 3,95,722

Homes Services* 000’s 1,654 1,679 1,949 2,129 2,172

Digital TV Services 000’s 9,012 10,073 11,725 12,815 14,168

Airtel Business* 000’s 1,702 1,732 1,714 1,736 1,760

Consolidated Financials (H Mn)

Total revenues

H Mn

8,57,461 9,20,394 9,65,321 9,54,683 8,36,879

EBITDA (before exceptional items)

H Mn

2,78,430 3,14,517 3,41,682 3,56,206 3,04,479

Cash Profit from Operations before

Derivative and Exchange Fluctuation

(before exceptional items)

H Mn

2,41,813 2,85,280 2,89,083 2,83,668 2,27,169

Earnings Before Tax

H Mn

78,643 1,07,130 1,28,463 77,233 32,669

Net Profit

H Mn

27,727 51,835 60,767 37,998 10,989

Consolidated Financials (H Mn)

Shareholder's Equity

H Mn

5,97,560 6,19,564 6,67,693 6,74,563 6,95,322

Net Debt

H Mn

6,05,416 6,68,417 8,35,106 9,13,999 9,52,285

Capital Employed

H Mn

12,02,976 12,87,981 15,02,799 15,88,562 16,47,607

Key Ratios

Capex Productivity % 72.91 77.40 69.89 65.34 49.88

Opex Productivity % 45.05 43.63 42.75 41.38 42.88

EBITDA Margin % 32.47 34.17 35.40 37.31 36.38

EBIT Margin % 14.22 17.23 17.22 16.42 13.25

Return on Shareholder's Equity % 5.04 8.52 9.44 5.66 1.60

Return on Capital employed % 6.65 8.05 8.32 6.45 4.64

Net Debt to EBITDA Times 2.19 2.08 2.46 2.66 3.19

Interest Coverage ratio Times 7.58 8.43 7.06 5.20 4.37

Book Value Per Equity Share

149.49 154.99 167.03 168.77 173.96

Net Debt to Shareholders’ Equity Times 1.01 1.08 1.25 1.35 1.37

Earnings Per Share (Basic)

7.02 12.97 15.21 9.51 2.75

* Effective FY 2016-17, the company has realigned the reporting of its corporate fixed line voice and fixed line data business with Airtel Business and

accordingly Telemedia Services renamed to Homes Services. Hence, the customer base of ‘Broadband and Telephone Services’ is now represented as

‘Homes’ and ‘Airtel Business’.

** With effect from April 01, 2016, the company has applied Ind AS for the preparation of its financial statements. The transition is carried out from

accounting principles generally accepted in India with the transition date being April 01, 2015.

All figures are based on Consolidated Financial Statements.

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Integrated Report

Segment wise Performance / Performance Highlights

Airtel Nigeria won the 2017

Most Outstanding Customer-centric Telecoms Brand

Award at the National Marketing Stakeholders Summit and

Brands and Advertising Excellence Awards

Looking Back at the Year

Received a formal approval from

Securities and Exchange Board of India (SEBI) for the

acquisition of Telenor India

(an enterprise of Telenor South Asia Investments Pte Limited)

Quarter 1

April – June 2017

Airtel Payments Bank launched UPI enabled digital payments

allowing secure digital payments to online/offline merchants

and instant money transfers to any bank account in India

through smartphones

Announced the deployment of Massive Multiple-Input

Multiple-Output (MIMO) in partnership with Huawei

Telecommunication India as a part of Airtel’s ongoing network

transformation program

Quarter 2

July - September 2017

Won the TM Forum’s Excellence Award 2017

in the ‘Smart Service Provider - Business

of the Year’ category for accelerating digital

transformation in India

Airtel launched ‘Project Next’, aiming to transform customer

experience across its services and touch points. This included

first set of digital innovations with introduction of Next Gen

Airtel Store, New version of My Airtel App and Airtel’s

postpaid promise with ‘data rollover feature’

data

Completed the acquisition of Tikona Digital

Networks making

Tikona a wholly

owned subsidiary of Airtel

One of the three companies from India to

be covered in the Forbes list of

‘The

World’s Most Innovative

Companies 2017’

Announced strategic partnership with SK Telecom

(Korea’s largest telecommunications company)

to leverage their expertize in improving network

experience, machine learning, big data and better

customer experience

Won Aon Best Employer

India 2017 for achieving

high levels of employer

brand, employee

engagement and well

established human

resource practices

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

010

Ranked as the ‘Best Company to Work For’ within the

telecom sector and amongst the top 10 across sectors in

India by Business Today – PeopleStrong Survey, 2017

Airtel Rwanda completed the formalities of acquisition for

Millicom International Cellular to combine their

telecommunication operations in Ghana

Bharti Airtel Limited via its wholly owned subsidiary, Nettle

Infrastructure Investments Limited, divested 150 Mn shares of

subsidiary Bharti Infratel Limited through secondary share sale

in the stock market for a consideration of over

J 58,950 Mn

Quarter 4

January - March 2018

Quarter 3

October - December 2017

Entered into a definitive agreement with Tata

Teleservices Ltd. and Tata Teleservices

(Maharashtra) Ltd. for acquisition of their

Consumer Mobile Businesses (CMB)

Launched ‘Mera Pehla Smartphone’ initiative in

partnership with Karbonn Mobiles to introduce

affordable 4G Smartphone in the Indian market

Announced the sale of 20% equity stake

in Bharti Telemedia Limited (its DTH arm) to an affiliate of

Warbug Pincus subject to regulatory and statutory approvals

Signed an agreement with the

Department of Telecom (DoT) and the

Universal Service Obligation Fund (USOF)

for introducing provision for mobile services

in identified uncovered villages and national

highways in the North Eastern States of

Assam, Manipur, Mizoram, Nagaland, Sikkim,

Tripura and Arunachal Pradesh

Tigo acquisition in Rwanda approved by the

Rwanda Utilities Regulatory Authority (RURA)

Board of Directors of Bharti Airtel

International (Netherlands) B.V.

(a wholly owned subsidiary),

initiated non-binding exploratory

discussion with various banks/

intermediaries to explore the

possibility/feasibility of listing of

its shares on an internationally

recognized stock exchange

Acknowledged as the fastest mobile

network in India by the global leader

in internet speed tests - Ookla for the third time

in a row

Crossed the 300 Mn

mobile subscribers mark in India

during the quarter

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Integrated Report

Looking Back at the Year

Message from the Chairman

Dear Shareholders,

Aided by strong growth in most advanced

and emerging markets, global economy

stayed on course in its rebound mode during

the year. Overall, our company experienced

favorable economic environments in both

India and Africa. While India recovered

remarkably well from the prolonged

dissonance caused by demonetization,

which was undertaken in FY 17, and the

teething troubles of Goods and Service Tax

(GST) introduced during the current year,

African economies benefited from stability

in currencies and commodity prices, which

resulted in healthy balance of payment

situation in many countries.

Digital technologies and internet are pivotal to transformation

happening around us – social, industrial, economic. Global

telecommunications industry, which lies at the heart of this

transformation, too is undergoing a metamorphosis of sorts;

operators are transforming from pure play telecom to being

digital services providers – integrating connectivity and

content across multiple screens. New technologies like IOT,

AI, Block chain and big data analytics are likely to make these

networks the primary facilitator of change in future. Affordable

smartphones, which have become the predominant gateway

to internet for customers across age groups and geographies,

and rapidly proliferating 4G networks helped accelerate market

transformation during the year. It was particularly evident

in India where average data consumption per user went

up by nearly six times to over 6GB per month in Q4 (FY18)

from about 1GB in Q4 (FY17). African markets too exhibited

buoyancy where average usage on our networks expanded by

about 90%.

The telecom industry faced an extraordinarily turbulent year

in India through unprecedented disruption. Extreme pricing

pressure accelerated market exits and industry consolidation,

which evolved towards a 3+1 structure (3 private telcos +

1 public sector telco). Even though the transition is turning

out to be stressful entailing massive dislocation in the short

run, the new industry structure will ultimately prove beneficial

for the sector. We have done well to capitalize on emergent

opportunities from this industry shakeup. While we completed

the acquisitions of Tikona and Telenor, the proposed merger

with the consumer business of Tata Teleservices Maharashtra

and Tata Teleservices is under regulatory approval.

Our strategy of growing our share of high ARPU customers

and improving customer stickiness by offering new products

and content services helped us increase our revenue market

share in a rapidly consolidating market undergoing significant

Aggressive network rollout continued to be an

overriding priority for us as a record

110,000

mobile sites were rolled out during the year to

strengthen our 4G footprint

“Affordable smartphones, which have

become the predominant gateway

to internet for customers across age

groups and geographies, and rapidly

proliferating 4G networks helped

accelerate market transformation

during the year.”

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

012

revenue shrinkage. It was gratifying to see the way we held

ourselves as pressure mounted on the topline of our mobility

business. Aggressive network rollout continued to be an

overriding priority for us as a record 110,000 mobile sites were

rolled out during the year to strengthen our 4G footprint. This

will help us stay ahead of competition through enhanced data

capabilities and better customer service.

Acceleration in non-wireless businesses remained an

unmistakable bright spot for us during the year. DTH and B2B

business registered healthy double digit topline growth, thus

We undertook several initiatives to raise capital to support our

business plans. During the year, we divested around 150 million

shares in our subsidiary Bharti Infratel through secondary sale

for a consideration of over H 5,895 crores. We also issued non-

convertible debentures worth up to H 3,000 crores on a private

placement basis. I am pleased to inform you that the board of

Bharti Airtel International (Netherlands) B.V. has authorized the

management to initiate non-binding exploratory discussions

with various intermediaries to evaluate the possibility of listing

the Africa operations on an internationally recognized stock

exchange.

Bharti Foundation, our group philanthropic arm extended

the reach of its activities significantly during the year. Its

school education programs are today cumulatively reaching

out to nearly 250,000 students across 13 states in India. I

am particularly delighted to inform you that during the year

Bharti Foundation embarked upon its most ambitious Higher

education initiative till date to set up Satya Bharti University,

a world class institution to offer free education to deserving

youth from economically weaker sections of society. The

sanitation program, which is already serving over 90,000

beneficiaries, moved into its second phase under which the

Foundation is providing financial assistance to beneficiaries

to construct household toilets. Airtel Africa’s ‘Adopt-a-School’

Program is now supporting over 32,000 underprivileged

children in 58 adopted schools in different countries. The

Company has also scaled up its Internet for Schools initiative to

benefit over 300,000 students in Kenya and Zambia. We plan

to scale this up significantly over the next year.

Personally, it turned out to be an exciting year for me in my

concurrent global roles - Chairman, ICC and Chairman, GSMA.

As a business entity, we have always believed in staying

ahead of the curve with regard to adopting best practices

in transparency and corporate governance. In line with this

philosophy, we have embraced Integrated Reporting (IR) and

the present report is the first Integrated Report for us.

Telecom markets across emerging economies are in transition.

While life cycles of 2G and 3G are getting truncated, 4G is

taking rapid strides. Market structures are getting reshaped

with fewer players to facilitate these investments. With our

strong balance sheet and robust spectrum portfolio across

markets, we are well positioned to make the best of this

transition to come out stronger.

Sunil Bharti Mittal

highlighting the inherent advantages of a diversified business

portfolio. The Payments Bank had a good start but faced

issues in KYC authentication leading to disruption in acquiring

new customers. The Bank with a new CEO and enhanced

preparedness is now geared to get back on track towards the

goal of driving financial inclusion in the Country.

In Africa, it turned out to be a defining year for us. Sharply

improved EBITDA margins to 33.4% from 24% last year

enabled us to achieve full year PAT for the first time since

acquisition.

Modernized data networks - 3G networks in all 14 countries

and 4G networks in 8 countries (6 of them rolled out this year)

- facilitated a surge in data consumption in different African

markets. Simplified voice and data bundles coupled with

robust distribution and a refined cost model helped us achieve

operational excellence in different markets. Data revenues

expanded by over 22% during the year. Airtel Money too

continued to be a key revenue pillar growing by 47% during

this period.

In-country consolidation with a clear intent to become No. 1 or

No. 2 operator continued to be a strategic imperative for us.

While we merged operations with Millicom in Ghana to form a

50:50 joint venture, we acquired Millicom’s business in Rwanda

to become a viable No. 2 in the market.

Sharply improved EBITDA margins in Africa to

33.4%

in FY 2017-18 from 24% last year

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Message from the Chairman

Message from Managing Director

& CEO (India & South Asia)

accelerating postpaid.‘Mera

Pehla Smartphone’ program

was a major initiative where

we stitched alliances with

several handset OEMs

across all price bands to

offer cashback options to

customers purchasing a new

smartphone bundled with

Airtel. Further, ‘Airtel Online

Store’ went live with Apple

and Samsung devices to sell

them with financing options

to customers. The Postpaid

business was completely

revamped with innovative

propositions to offer more

value to the customers (e.g.

handset security, free music

& TV, free Amazon prime

membership etc.) beyond

the traditional services. As

part of the project ‘Next’

program, we introduced the

‘data roll over’ functionality for

postpaid customers.

To improve customer

stickiness by offering them

more products & services,

we focused on cross selling

our portfolio of telco products

and gaining adoption of our

digital services. A dedicated

‘Homes’ channel was set-up

to sell postpaid and DTH

connections to our existing

broadband customers. Airtel

TV was rejuvenated with a

rich content library of live

channels, movies, premium

OTT content etc., which

enabled it to garner 25Mn+

active users. Wynk music

became India’s #1 app in

terms of consumption. On the

B2B side, we did a strategic

partnership with Symantec to

offer cyber security solutions

to corporate and government

organizations.

Delivering brilliant customer

experience continued

to be our key priority. We

made heavy investments

in network, the core of our

business. A record 110,000 mobile sites were rolled out in the

last year to expand our 4G footprint across the country. We

created a strategic partnership with SK Telecom to leverage

its expertize in improving network experience and create a

future ready network. To enrich voice calling experience, we

launched VoLTE. Re-engineering and digitization of customer

care processes were completed to offer better resolution to

customer queries. We also launched next generation ‘digital’

stores in marquee locations to enhance customer experience in

our stores.

While the mobility business was under competitive pricing

pressure, acceleration in non-wireless businesses played a

strong role in driving the growth of the company. Broadband

business was completely re-launched with first of its kind

propositions like data roll-over, data borrow from postpaid mobile

etc. DTH and B2B business registered healthy double digit topline

growth with strong margins on the back of simplified pricing and

aggressive Go-to market initiatives.

We continued our emphasis on identifying and stripping

out waste from our business through process redesign and

automation. This is demonstrated by the fact that we delivered a

decline in operating expenditures last year.

Finally, we remain committed to ensure growth & well-being of

our people, the most valuable asset of our Company. We have

constantly striven to be amongst the preferred places to work

for the smartest in the industry. This year, Airtel was ranked 10

‘Best Company to Work for’ across all companies and the best

employer in Telecom in India.

As an organization we continue to be committed to sustainable

and inclusive growth. Our Sustainability Report spells out our

initiatives for environment sustainability. Bharti Foundation, with

full support from our employees, has been doing remarkable

work in engaging parents and the community to spread

awareness about education and empowerment of girl child.

These initiatives have made our corporate citizenship more

meaningful.

As we look ahead, we remain excited about the massive

opportunity in India. With three large private operators serving

1.3 Bn people, the industry is poised for sustained long term

growth. While there will be pricing pressure in the short term, the

long term remains promising. We believe your company is well

poised to exploit this future. With massive investments, an iconic

brand, and a team that is obsessed about serving customers we

are confident that Airtel will remain a force to reckon with.

As we enter a new era of telecom industry in the country, I would

like to thank our customers, our people, our partners and our

shareholders for their support and faith in us. We seek your

continued guidance in our journey.

Gopal Vittal

Dear Shareholders,

The FY 2017-18 was a

transformational year for the

telecom industry. Because

of the brutal price war, there

was an unprecedented

consolidation from 8

operators to only 3 private

operators in the market. This

price war also led to a rapid

shift in consumer behavior

from voice to entertainment

that led to explosion of data

usage and ultimately, massive

network investments. Airtel

continued to make robust

investments despite eroding

profitability in order to stay

in the leadership position.

Even during this turbulent

period, Airtel maintained

its leadership position and

remained focused on its

vision to win customers for

life. Our brand continued to

remain in a strong position

winning several accolades

including the ‘Buzziest Brand’

award in telecom category. All

of this was enabled through

solid execution across all the

pillars of our GPS.

To grow share of high ARPU

customers, we focussed

on i) grabbing increased

share of 4G devices through

alliances & simplified pricing,

ii) driving data consumption

through intense focus on

sim consolidation led by

bundled pricing plans and iii)

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

014

Message from Managing Director

& CEO (Africa)

Good progress has been

made across the key focus

areas set about at the

beginning of the year: which

were enhancing distribution

excellence to gain more

customers, winning more

with our existing customers,

delivering network

excellence, building the right

cost model and enhancing

people productivity and

performance.

Over the last year, the

Customer KYC registration

locations grew by over

50% to 180,000, enabling

a higher new customer

addition. This led to growing

the customer base to 89 Mn

through an addition of 12.5

Mn customers during the

year (including 3 Mn through

the acquisition of TIGO

Rwanda). In addition, over

10,000 exclusive mini shops

and kiosks were introduced

across the key operating

countries to build a robust

Airtel money infrastructure

and provide assured float

availability to customers.

Mobile data has been a big

growth driver across the

14 operating companies

and the network has been

modernized through U-900

(3G service in 900 MHZ

spectrum) in 11 Countries

and 4G launched in 6

additional countries, taking

the total countries with 4G

to 8. With this our customers

will get a best in class data

network experience.

During the year, simplified

voice and data bundles

were introduced in most of

the operating companies

with a clear focus on ARPU

enhancement. The Data Customer base has grown by 48%

and Airtel Money Customer base increased by 31%. There has

also been an encouraging increase in data and voice bundle

penetration across all the operating units.

With an enhanced sales and distribution coverage, modernized

network and simplified product bundles, the data usage has

surged by 90%, data revenue has grown by 22.5% and Airtel

Money revenue increased by 47%.

On the people front, the Company invested in functional and

skill based training focusing on digitized delivery methods.

Closer and tighter co-working between the operating countries

and the Headquarters in Nairobi has helped build collaboration

through building trust and fostering joint accountability.

With the intent of being No. 1 or No. 2 in each country, the

Company merged operations with Millicom in Ghana into

a 50:50 joint venture and acquired Millicom’s business in

Rwanda to become a clear No. 2 operator. The merger and the

acquisition respectively will enable the Company to build scale

and run a profitable enterprise that can invest for the future to

benefit customers of the two Countries.

Airtel has undertaken several initiatives to contribute towards

addressing social challenges. The Company has focused

on Technology and Partnerships with various organizations

to drive social change and inclusive growth of the under

privileged people in the Society. It has scaled up its internet

for schools programs in Kenya and Zambia to benefit over

300,000 students and will continue to drive this initiative at a

larger scale. Under the pan African educational program, ‘Adopt

a School’, the Company has adopted 58 schools, supporting

over 32,000 underprivileged children.

The Company’s Board has authorized management to initiate

non-binding exploratory discussions with various intermediaries

to evaluate the possibility of listing on an internationally

recognized stock exchange.

Airtel Africa is poised for continued subscriber and revenue

growth, building on the significant potential for mobile data

and Airtel money in the operating countries, while continually

investing in the network and distribution infrastructure.

Raghunath Mandava

FY 2017-18 has

been a watershed

year for Airtel in

Africa. Along with

decent revenue

growth quarter on

quarter, absolute

opex declined

by 9.2%, thereby

helping EBITDA

margins improve to

33.4% from 24%.

This has helped

Airtel Africa achieve

a full year positive

PAT for the first time

since acquisition.

Statutory Reports

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015

Integrated Report

Message from Managing Director & CEO

Moving ahead on India’s

Digitalization Journey

payments across multiple bill cycles for different Airtel

connections within the family. No need to remember

multiple payment dates from now on. Airtel Home offers the

convenience of a single bill for all services. What’s more you can

add Airtel connections from any location in the country.

> Premium Customer Support: ‘Airtel Home’ users will get

access to premium customer care.

> Discounts of up to 10% on the unified bill: Get up to 10%

discount based on number of connections bundled.

* Airtel Digital TV will be made live on the ‘Airtel Home’ proposition soon

The creation of ‘Airtel Home’ allows customers to bundle their

postpaid, broadband & DTH to for app and web journeys for

existing broadband and existing/new postpaid customers

has been completed. A comprehensive self-care for Homes is

also being integrated; at the same time, a Decision Tree (DT)

has been created to provide a superior experience for our

customers. A pilot is underway in AP circle and a full rollout will

follow subsequently.

Hitting the Bull’s eye:

Network Deployment Process & Analytics

With an objective to digitize all network processes: deployment,

planning, quality – including iWAN site & fiber deployment;

drive increased self-care and online resolution of customer

complaints; and add network experience to the customer

profile for better targeting of offers, we created the Bull’s

Eye portal for internal usage – for deployment process and

analytics.

Airtel and South Korea telecom have partnered to create a

big data analytics platform that can gather large amounts of

network telemetry data to assess the quality of the network at

a granular level in order to take smarter investment planning

decisions and optimize the network for better customer

experience.

On Track with Digital Affordability:

The Online Store (airtel.in/onlinestore)

To unlock affordability for customers, to enable them to buy

their aspirational handsets like the apple iphone, samsung and

nokia, we launched the Airtel Online Store. This is an intricate

ecosystem of lenders, logistics companies & distributors to

offer these handsets at an affordable price at the customer’s

doorstep.

This unique proposition allows customers to purchase

aspirational mobile phones, moving away from the limited

credit card schemes or conventional paper lending. On the

online store, we are working with multiple lenders across India

to solve the affordability issue by innovative digital lending

methodologies that allow credit to be given to people without a

credit rating through loans from banks we have tied up with. It

is a partnership led model of 100% digital lending.

Making Lives Easier:

Airtel Home

To enhance customer experience by enabling one single billing

across postpaid, telemedia and DTH, and discounts on bundles,

we have built the Airtel Home.

One Home, One Bill: The digital platform transforms customer

experience by enabling bundling of multiple Airtel services

within the home – broadband, fixed line, postpaid mobile and

digital TV. Customers also get one bill, premium customer

support and enjoy up to 10% discount on their total bill.

‘Airtel Home’ allows customers to bundle multiple Airtel

relationships – home broadband (and fixed line), postpaid

mobile and digital TV* as a single account with a unified

interface on My Airtel app and enjoy amazing convenience,

peace of mind and loads of other benefits.

Single Bill for all Airtel services: With ‘Airtel Home’,

customers are liberated from the hassle of making multiple

At Airtel X labs, our work fundamentally transforms the way people

communicate and businesses operate. Since our early days in the mobile era,

we have rallied relentlessly to break down communication barriers. Today,

our work goes beyond telecom – we build products that entertain and inform,

connect devices to the internet, and enable businesses to securely harness

the power of their data. Our focus, however, has remained to deliver solutions

that truly enrich the lives of our customers.

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

016

Making Care Simpler:

Self-care for customers & Decision Tree

My Airtel app and airtel.in as self-care channels were developed

with fully digital journeys to enable the customer to manage

Airtel products i.e. Mobile, Homes (Broadband) and Direct-To-

Home. The roll out an intelligent Decision Tree (DT) as a tool for

diagnosis and resolution has transformed the way our advisors

work at our contact centers.

To deliver an enhanced care experience for our customers across

all channels, we have developed decision trees. Decision tree

ensures that our customer care advisors & store representatives

have access to the same information about the customer, leading

to a delightful experience across all touch points.

Digital self-care has enabled our customers to actively engage

on our digital properties to manage their Airtel numbers.

(DT), the self care obviates the need for customers to call the

contact centers for service related issues.

My Airtel App

My Airtel app is meant to be the all-purpose Swiss-knife for

our (potential) users. And to get this done, the team has been

working on enabling personalization in the true sense, using

the recommendation engine which is work in progress. And

to enable acquiring new users, so that they can see true value

the app has to offer, and to incentivize loyal users, the team

has also built a coupon engine platform which can be used to

enable closed-loop discounts/incentives (which return to our

system), thus also helping in retention.

The My Airtel app team is also working on building a generic

referral system in place, which can leverage the coupon

platform to reduce S&D cost, by having our loyal customers

acquire for us. The digital platform is also making payments

democratized, so that new users can be acquired who prefer

other payment modes, like 3

party wallets. One of the core

focus for the app team is to make it super easy for the users to

maximize the usage of all the services they pay for, so that we

can then get to upselling more effectively.

The app team is also leveraging the network-side feasibility

APIs, to better target new connection acquisition. The app will

also enable easy of discovery of features and user requests

using global search in the app.

Digital Brain

The Digital Brain (customer 360) is one of the most powerful

intelligent and predictive platforms of its kind. It will understand

each customer personally and contextually and enable us to

engage with customers how they want, where they want and

when they want for our own services as well as with the string

of partnerships we develop. Leveraging AI it will also allow us to

give our customers the best experience on our network in real

time and allow us to predict problems and resolve them.

It is a game changer.

Enriching Customer Experience:

Broadband digitization

Our aim is to bring out a better customer experience &

significant cost savings by simplifying and digitizing the

broadband journeys of acquisition, installation, fault repair,

shifting; and to enable digital care for customers on the app

and web, as well as through advisors. We have digitized the

journeys end to end. We have also built predictive capabilities

to diagnose the issues of the customer & auto detecting them.

Engaging Socially:

Lighthouse

The platform helps us build capability for Listening,

Engagement and Care across social and digital media,

enabling faster response & care and assisting in benchmarking

and managing brand tonality and engagement – all in the bid

to ensure better experience for our customers on social media.

We have upgraded to the new platform, Sprinklr, which is also

integrated with Airtel Business Support Systems [BSS] to

capture and provide a 360-degree view of the customer.

Marking insights Real-Time: DARTS

(Digital Analytics and Real-Time Strategy)

To enable contextually relevant marketing campaigns, insights

to business for growth initiatives as well as manage customer

experience, DARTS is a unified customer analytics platform that

aggregates data from CRMs, billing systems, network, in store

visits, DTH, Telemedia, WYNK, My Airtel etc to prepare near

real time insights for the customers. This platform serves as

foundation for revenue assurance as well as use cases such as

Airtel Secure, data rollover, proactive experience management,

credit line for customers, recharge information on DT 2.0.

Making Business Savvy:

Global Business voice portal

Airtel Business rolled out the first-of-its-kind carrier digital

platform for wholesale voice. The innovative digital platform

offers paperless sign-up, quick voice interconnects and real-

time traffic analytics for global carriers across the world, along

with allowing customers to buy voice termination services from

Airtel and also enabling them to propose sell rates for their

target markets.

With on-boarding time reduced to a few hours, the platform

also offers live rates for routes across the world enabling

faster decision making for traffic exchange. The voice platform,

designed on the basis of extensive customer insights, will

empower global carriers with ease of business and enhanced

efficiency.

With the first successful step in place we plan to soon provision

a single window on the digital platform for product discovery,

on-boarding, billing, payment, enquiry, and support across

multiple B2B data products.

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017

Integrated Report

Moving ahead on India’s Digitalization Journey

Redefining Digital

Banking Ecosystem

Launched on January 12, 2017, Airtel Payments Bank*

(hereinafter referred to as ‘bank’) is India’s first payments bank

that has brought millions into banking network. Aligning to the

Government’s vision of building a nation that is digital, Airtel

Payments Bank reaches out to a divergent customer base,

driving digital and financial inclusion.

In our endeavor to build a digitally connected world, the bank

offers solutions reinforced by convenience. Leveraging the

Airtel’s wide retail network of more than 536,000 customer

touch points, the bank offers a range of basic banking services

to a wider customer base. With the use of technology, wide

distribution scale and a brand that people trust, we have been

successful in reaching out to the undeserved people in society

while expanding the formal financial banking system at the

same time.

*The Payments Bank operations in India are carried out through our

subsidiary Company, Airtel Payments Bank Limited.

Our passion to drive financial inclusion and digitize cash is driven by

solutions that are innovative and technology-led. At Bharti Airtel, we

continue to leverage innovation in financial technology, adapting to

new age developments to facilitate a future that is digital and secure.

Attractive interest

rate on deposits

In association with Master Card, we launched Online

Debit Card for our customers. Unlike any other wallet

or payment banks, we are the first in the country to

introduce an online debit card, enabling customers to

make transactions with any merchant sites for online

payments.

Service offerings that make a difference

With a promise to serve the rural households and increase

access to formal financial mechanism, the bank provides a host

of services including Savings Account, Semi-Closed Prepaid

Payment Instrument, assisted utility payments and Domestic

Remittance services, among others, to the customers.

Open account

within minutes

using e-KYC

(through Aadhaar

card)

Transfer funds

within Airtel

Payments Bank

accounts and third

party accounts

Airtel’s mobile

number is the

account number

Free personal

accident insurance

cover worth H 1 Lac

Easy withdrawal

and deposit of cash

through merchant

partners, including

grocers, kirana

stores, pharmacies

and restaurants,

among others

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

018

J23,550 Mn

Payment using semi-closed

prepaid payment instruments

in FY 2017-18 from

H 14,174 Mn in FY 2016-17

56.8 %

Of total accounts opened

till date in rural / unbanked

areas to ensure financial

inclusion

J66,605 Mn

Domestic remittances in

FY 2017-18 from H 39,718

Mn in FY 2016-17

~300 Mn

Airtel’s customer base as

potential customer base for

the bank

24x7

Dedicated customer care in

12 regional languages

~2.3 Mn

Merchant touch points

across India

536,000

Airtel’s retail customer

touch points (March’18)

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Integrated Report

Redening Digital Banking Ecosystem

Music to the Ears

In a journey of firsts,

Airtel became the first

telco to launch an OTT

entertainment app in

September 2014- Wynk

Music. Driven by an

imperative to create content

delivery platforms made for

the Indian market and for

the unique needs of Indian

customers, Wynk Music was

designed to operate at scale

and create a differentiated

value proposition for Airtel

customers. Four years later,

Wynk Music is today India’s

No. 1 music streaming app

with the highest share of

category time.

The Road to No. 1

With a clear focus on

consumer needs, we have

solved for problems unique

to India- Price sensitivity,

data access, varying network

speeds and no precedence

of paid subscription for

music. Also, in the face of

pre-established players

and a volatile market- we

ensured agility and faster

decision-making by setting

up and operating Wynk as a

start-up within Airtel.

Strong alliances with the

biggest music labels in

the music industry, unique

promotional tie-ups with

individual artists and music

publishers, and an expansive

library of songs in 14 Indian

languages have helped

us carve a niche in an

overcrowded market-leading

Wynk Music claimed the top spot among Indian OTT music streaming apps

with the highest share of category time, and crossed the 100 Mn installs

milestone in June 2018.

to high engagement rates, high average stream time per

user on the app and significant impact on customer churn.

Wynk Music Revamp

As we prepare for the next phase of growth on Wynk Music,

a spanking new version of the music App is being shipped

with industry-first features packaged into a highly intelligent

product that understands user music preferences and

customizes the experience for them using Machine

Learning and AI. Key highlights for the upcoming year are:

> Technology integrations and alliances to create a

seamless, multi-platform music streaming experience

that caters to the latest trends in Music Listening

> Build social communities among users and artists

> Investment in original and exclusive content

> Introduction of vernacular interfaces and expansion of

regional content library

> A simplified version of the app to be launched to capture

the side-loading market and increase rural penetration

Key Highlights

(As on March 31, 2018)

90 Mn+

Total App Installs

1.4 Bn+

Monthly song plays

100%

Growth in regional

language streams in CY ‘17

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

020

The Making of a

Blockbuster

Airtel TV became the most downloaded app on the Playstore between

Jan-Mar ’18. Over 2000 years’ worth of watch-time per month on the app.

With over 350+ Live

Channels, 10,000+ Movies

& TV Shows and a range

of good quality content,

Airtel TV is among India’s

leading OTT entertainment

platforms. Re-launched

with a full blast 360 degree

campaign in December

2017, it became the most

downloaded video app in

the first quarter of CY ‘18,

clocking 4x user growth.

Strategic tie-ups with leading

video content providers,

premium streaming apps

and broadcasters gives

Airtel TV users access

to the best of on-the-go

entertainment content.

Innovations that Fueled

Growth

> Introduction of 350+ Live

TV channels that allowed

users to watch live content

on the go

> The best of movies and TV

shows from HOOQ, Eros

Now, Sony Liv, A LT Balaji,

among others

> Content in 14 languages

including Bhojpuri,

Assamese and Gujarati

> Bundling of Amazon Prime

Video membership for

high-value customers

> 360 degree marketing

campaign coupled with a

robust GTM strategy

Airtel TV 2.0

from strength to strength. Airtel TV will enter into a new phase

of growth in the FY 2018-19 with deep focus on:

> Stronger partnerships with premium video content providers

to unlock further value for our customers

> Live sports streaming- cricket, football world cup, among

others

> Expanding the regional content library

> Integrating rich and exclusive content across genres,

languages

> Tech innovations for a more immersive experience

Key Highlights

(As on March 31, 2018)

50 Mn+

Total App Installs

1 Bn+

Minutes Streamed Monthly

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Integrated Report

Music to the Ears / The Making of a Blockbuster

Mobile Money –

Banking the Unbanked

All around the world, mobile phones have gone beyond just being a

communication device. From being used for voice and data to becoming a

technology platform that allows the development of other services, cellular

technology has changed the face of Africa.

Mobile money has become very popular to both the unbanked

and banked population in Africa due to the safety of money

and convenience it provides. It has turned out to be particularly

useful in countries where the majority of the population is

migrant in nature, where people work in cities and sending

money. The most popular services are cash in, cash out,

transfer, utility payment and buying airtime and bundles.

11.4 Mn

Uganda, Tanzania, Rwanda, Malawi, DRC, Gabon, Kenya and

Madagascar represent 93% of the total active base

As at March 31, 2018, Airtel Money had 11.4 Mn active

subscribers using the service every month for different services

including sending money, receiving money, buying airtime, cash

withdrawals and many more.

Distribution Network Airtel Money

For Mobile Money to succeed, a strong network of agents

with adequate mobile money float and cash is required. Airtel

Money has been able to grow its footprint of agents across the

countries where it operates. Customers can deposit money as

well as withdraw money from their mobile money wallets. As at

March 31, 2018, there were over 240K active agents serving

customers; a growth of 49% over the previous year.

Additionally, an aggressive plan to rollout exclusive Airtel

Money kiosks/mini-shops kicked off in early 2017 to increase

availability of float and cash to customers. Over 10,000 kiosks

and mini-shops have been rolled out so far across 13 countries.

Utilities Bill Payment

Paying for regular utilities without leaving the comfort of one’s

home has been made a reality by Airtel Money. Customers can

pay for a wide range of utilities such as electricity, water, fixed

data and PayTv along with Telecom services of post-paid bill

payments & recharge purchases.

USD 1 Bn

Total amount used for paying different bills in FY 2017-18

Access to Loans

Financial inclusion has always been one of the top priorities for

Airtel and the organization continues to traverse the path by

giving access to micro loans to all Airtel Money customers, using

the Airtel Money Wallets. Customers simply have to dial the

Airtel Money USSD code and they will be able to instantly access

loans based on their credit rating. Mobile money loans are

currently available in 5 countries and during the FY 2017-18,

a total of USD 14.6 Mn was disbursed to over one million

customers.

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

022

Merchant Payments

Still in its nascent stage, Airtel Money has enabled businesses

to receive money electronically for goods and services they

sell to their customers. In Gabon, Tanzania, Madagascar and

Malawi customers are able to purchase goods and services

using the Airtel money merchant pay service. The payment

service provides businesses the opportunity to reduce the risk

of handling cash as well as increase reconciliation efficiency

while enhancing convenience and safety to customers.

36 Mn

Transaction count in FY 2017-18

International Money Transfers

Airtel customers in Zambia and Malawi can send money to

each other, thanks to the IMT product, active in both countries.

A partnership with Terrapay will enable expansion of the

service to other markets, including Tanzania and Congo

Brazzaville. A total of 42K transactions were completed during

FY 2017-18, at a value USD 2.4 Mn.

Partnerships with Banks

Banks play an integral part in the Mobile Money ecosystem.

In each operating country, a trust bank account is opened in

preferred banks, where the E-value in the Airtel Money system

has to be backed by actual cash. To enable a faster flow of

value between the Trust bank and the channel partners,

automation has been embarked on in all Airtel Money

Operations. The automation is already enabled in 6 countries

including Tanzania, Madagascar, Zambia, Malawi, Rwanda &

Kenya. Airtel is in the process of expanding the automated

allocation of float in the above countries as well as finalize the

process in other operations, which include DRC, Gabon and

Uganda.

There are also various partnerships at a retail level with banks,

which allow smooth flow of money from the banks to the wallet

and vice versa.

Robust Airtel Money Platform

Airtel has modernized its Airtel Money platform to enhance

system capacity, stability, incorporate standard APIs for third

party integration and improved reporting.

Our vision is to enrich

the lives of customers.

Our obsession is to

win customers for life

through an exceptional

experience.

023

Board of Directors

Mr. Sunil Bharti Mittal

Chairman

Mr. D. K. Mittal

Independent Director

Mr. Craig Edward Ehrlich

Independent Director

Mr. Gopal Vittal

MD & CEO

(India & South Asia)

Ms. Chua Sock Koong

Non-Executive Director

Mr. Ben Verwaayen

Independent Director

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

024

Mr. Rakesh Bharti

Mittal

Non-Executive Director

Ms. Tan Yong Choo

Non-Executive Director

Mr. Shishir Priyadarshi

Independent Director

Mr. Manish Kejriwal

Independent Director

Mr. V. K. Viswanathan

Independent Director

Chairman Member Committees

Risk Management Committee

HR & Nomination Committee

Stakeholders’ Relationship Committee

Corporate Social Responsibility Committee

Committee of Directors

Audit Committee

Statutory Reports

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025

Integrated Report

Board of Directors

Risk Management

At Bharti Airtel, we have thrived globally by building a culture of innovation

and high performance. We explore new markets and business models across

the world, evolve new ways of customer and stakeholder engagement, enter

into new strategic partnerships. Also, we adopt new technologies and build

exponential efficiencies in existing systems.

While these initiatives unveil a universe of possibilities,

potential risks and uncertainties arise in a volatile business

environment. The distress signals need to be addressed with

urgency for smooth operations Therefore, we have created

a robust risk management that caters to strategic, legal,

financial, operational and climate risks that caters to strategic,

legal, financial, operational and climate risks. We have a sound

practice to identify key risks across the Group and prioritize

relevant action plans for mitigation.

At the Board Governance level, the Risk Management

Framework is reviewed periodically by the Company’s Risk

Management Committee. The Board of Directors performs

an annual review. These apex reviews include: discussing the

management submissions on risks, prioritizing key risks and

approving action plans to mitigate such risks. The Internal

Audit function is responsible to assist the Risk Management

Committee on an independent basis with a full status of

risk assessments and management. The Risk Management

Committee also obtains periodic updates on certain identified

risks, depending upon the nature, quantum and likely impact

on the business.

At the Management level, the respective CEOs for the

Management Boards (AMB and Africa Exco) are accountable

for managing risks across their respective businesses, viz.,

India & South Asia, and Africa. The strategic risk registers

capture the risks identified by the operating teams (Circles or

Operating Companies) as well as the functional leadership

teams at the national level. The AMB / Africa Exco ensure that

the environment – both external and internal – is scanned for

all possible risks. Internal Audit reports are also considered for

identification of key risks.

At the Operating level, the Executive Committees (EC) of

Circles in India and Operating Companies in the international

operations are entrusted with responsibilities of managing the

risks at the ground level. Every EC has local representation

from all functions, including many centrally driven functions

like Finance, SCM, Legal & Regulatory besides customer facing

functions, such as Customer Service, Sales & Distribution and

Networks. It is the responsibility of the Circle CEO or Country

MD to pull together various functions and partners to manage

the risks. They are also responsible for identification of risks,

and escalating it to the Centre for agreeing mitigation plans.

Operating level risk assessments have been concluded at

Function / OpCo risk assessment and mitigation plans agreed

and kicked off.

Internal Audit Plans are being drawn up to ensure scope and

coverage of these critical risks during the course of next year.

Scanning the entire

business environment -

internal and external, for

identifying potential risks

Developing objective

measurement

methodology for

such risks

Agreeing on detailed

action plans to

manage key risks

Approving resources,

including budgets for

risk management

Reporting progress

to the Board and

Audit Committee/

Risk Management

Committee

Fixing accountability of

people and positions

to implement the

mitigating action plans

Listing and

prioritizing the key

risks to be addressed

and managed

Classifying the

various risks in terms

of probability, impact

and nature

Reviewing progress

of action plans, taking

stock of gross and net

exposures and mandating

corrective actions

Reporting on

specific issues to the

Audit Committee/

Risk Management

Committee

Risk identification process

0301 05 07 09

02 04 06 08 10

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

026

Potential risks Risk definition

1 Regulatory and political

uncertainties

Uncertainties pertaining to political instability, civil unrest and other social tensions in India,

Sri Lanka and 14 African countries.

2 Economic uncertainties The volatility in economies with factors like capital controls, inflation, interest rates and

currency fluctuations may impact the earnings and operations of the Company.

3 Poor quality of networks

and information

technology including

redundancies and

disaster recoveries

Risks in Network subject to technical failures, human errors and natural disasters. Erratic

IT connectivity may affecting service delivery. Changing of systems landscapes into newer

version.

4 Inadequate quality

of customer lifecycle

management

Heightened competitive intensity on account of irrational pricing by new entrant leading to

erosion of revenue & customers. Ever-rising customer expectations in terms of quality, variety,

features and pricing.

5 Non-compliance of

subscriber verification

norms and KYC

regulations

Stringent subscriber verification and KYC guidelines, including biometric verification and

quality of KYC documents.

6 Increase in cost

structures ahead of

revenues thereby

impacting liquidity

Increase in cost structures from volumes (new sites rollouts, capacity) and/or rate increases

(inflation, Fx impacts, wage hikes, energy etc.).

7 Adverse regulatory

or fiscal taxation

developments including

compliance risks

Regulatory and tax developments in India, South Asia and Africa can pose several challenges

to the telecom sector.

8 Lack of Digitization and

Innovations around

Digital Content

Rapid technology evolution may impact the functionality of existing assets and accelerate

obsolescence. Keeping pace with changing customer expectations is a big agenda for the

telecom sector.

9 Lack of investment in

infrastructure capacity

building

Telecom companies will be required to invest heavily in building data capacities and

broadband coverage expansion.

10 Gaps in internal

controls (financial and

non-financial)

Gaps in internal controls and / or process compliances not only lead to wastages, frauds and

losses, but can also adversely impact the Airtel brand.

[Read more on page 122.]

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027

Integrated Report

Risk Management

Integrated Strategy

for Value Creation

Financial Capital

Manufactured Capital

Human Capital

Social &

Relationship Capital

Natural Capital

Intellectual Capital

028

Materiality Assessment

Stakeholder Profiles and Mapping

In FY 2017-18, Airtel

revisited the Materiality

Analysis process and

performed a detailed

stakeholder surveys to

identify material issues/

sustainability concerns with

the highest relevance and

impact. In order to streamline

the process, identification

and categorization of its

key stakeholders (both

internal and external)

was performed. The key

stakeholders identified

include: Customers,

Employees, Business

Partners (Suppliers and

Vendors), Community,

Investors, Government

Bodies, Industry

Associations, Non-

Governmental Organizations

(NGOs) and Academic

Institutions. Stakeholder

engagement activities

were carried out among

Airtel’s approach towards responsible and sustainable business practices

undergoes a systematic mapping through regular engagement with its

internal and external stakeholders. This practice helps the Company to

prioritize key sustainability issues in terms of relevance to its business and

stakeholders, including society and environment. It rigorously conducts

a detailed materiality assessment, which enables it to map stakeholders’

expectations with its business priorities, risks and opportunities.

respective categories of

stakeholders with the help of

questionnaires. The similar

exercise was performed

with the Airtel Management

Board to delineate the

business priorities, which

when mapped with the

stakeholders’ concerns,

fetched the sustainability

issues that demanded

enhanced strategic and

operational attention.

Detailed Materiality

Analysis process and

Stakeholder Engagement

shall form a part of

Sustainability Report of

the Company at

www.airtel.in/sustainability

Stakeholder

engagement &

communication

Internal/external

reporting

Process

improvement

activities

Performance

evaluation

Identification &

Monitoring

Our Engagement

Process

Employees

Shareholders

Community

Media

Government

Business

Partners

Key

Stakeholders

Industry

associations

Customers

NGOs

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Materiality Assessment

Source

Financial Capital

Our prudent management

of finances and diligent

allocation of funds help

capitalize long-term

opportunities and ensure

sustainable economic

growth.

Intellectual Capital

Our procedures, governance,

knowledge, technologies and

highly experienced people

support our focus on new

product launches to enhance

customer experience and

drive long-term sustainability.

Human Capital

We strive to provide an

energizing and rewarding

work environment for our

employees to learn, lead and

grow.

Manufactured Capital

The expansion and

enrichment of our customer

base depends on our

network building initiatives,

and hence we make

extensive investments to

meet the said objective.

Social & Relationship

Capital

Being a socially responsible

company is one of our

fundamental business

objectives and we reflect that

in all our business actions

and decisions.

Natural Capital

In our pursuit towards

excellence, we remain vigilant

towards usage of natural

resources and are responsible

regarding reducing the impact

on environment.

Our Business and

Value Creation Model

Inputs

165,748 Mobile Network Towers

298,014 Mobile Broadband Base

Stations

237,893 Optic Fiber Network (RKms)

~9 Mn Home Passes deployed

7 Submarine Cable Systems

65 Global Points of Presence

J388 Mn spent on social activities

4800+ suppliers

18,000+ Pan India Distributors

16,400+ Exclusive contact centre

agents

200,000+ Shareholders

320+ Mn Customers

Deep experience in digital

innovation

Bold, audacious & honest

communication approach

Host of key strategic partnerships

15,000+ Employees on rolls

42,500+ Contractual employees

J99 Mn Spent on training

J1,028,609 Mn Equity

J649,432 Mn Long-term debt

Business Model

Brilliant Network

We acquire the best spectrum and invest in

cutting edge network infrastructure, automation

tools and optimization techniques to provide

best network experience to our customers.

Obsession with Customers - Digital Airtel

We focus on serving our customers digitally

in one touch error free manner through

extensive adoption of digital tools.

Scientific Sales & Distribution

We carry out scientific micro marketing

through our pan India sales & distribution

backbone (of channels partners, retailers and

owned stores) to efficiently serve our 300+

Mn customers. This three tiered machinery

is managed digitally to ensure uninterrupted

services to our customers.

Cost Frugality

We are obsessed with stripping out waste

and driving cost efficiencies. We are pioneers

in infrastructure sharing and have developed

a prudent cost operational model through

focus on smart procurement and process

optimization.

Driving Innovation while managing

complexities

We are able to successfully run and scale

up key business activities (Mobility, DTH,

Broadband and Airtel Business) alongwith

growing new lines (Wynk, Airtel TV etc.)

despite different challenges associated.

Open Telecom Platform - New Businesses

We are in the process of transforming Airtel into

an open platform of tomorrow to seamlessly

connect our customers to the best brands and

thus, create value for entire ecosystem.

3.3 Mn MWh* of electricity

consumed

314.5 Mn Litres* of diesel consumed

* Figures for electricity and diesel are w.r.t.

our network infrastructure

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

030

Outputs

Key Products & Customer

Segments

Mobile Services

Voice & Data on 2G, 3G,

4G technology

Homes Services

Fixed-line telephone and

broadband

Airtel Business

Connectivity, MPLS, IPLC,

VoIP, wholesale voice and

data etc.

Digital TV Services

Direct to Home TV

Digital Apps

Wynk Music, Airtel TV

Outcomes

# Rated by global leader in internet speed tests - Ookla for third time in a row.

* Figures for energy, carbon emission and diesel are w.r.t. network infrastructure as compared to FY 2016-17.

NPS - Net Promoter Score | GJ - Gigajoules

2+ Mn

Community members impacted (cumulative) through social activities of Bharti Foundation

D697,154 Mn

Paid to suppliers

NPS for FY 2017-18

Investor complaints

228,120

Man hours of training

~G3 Mn

Gross Revenue per

employee per month

77.7%

Succession rate in Middle

and Top management

79.4%

Employee engagement

score

‘Best Company to Work for’

In Telecom and among top 10 employers across sectors in India

Highest Ever Scores

On key brand metrics

J896,261 Mn

Intangible assets and goodwill

Numerous Digital

Innovations

India’s Buzziest Brand

Awarded by Afaqs in Telecom category

33.83%

EBITDA margin

G206,045 Mn

Paid to Exchequer

2.65%

Return on Capital Employed

G18,475 Mn

Dividend paid

(Including interim)

G792 Mn

Profit After Tax

G1,594,562 Mn

Market Capitalization (BSE)

~2,900 Tonnes

E-waste recycled

53,745

Green energy sites

~23 Mn* Litres

Diesel saved

>128,000 GJ*

Reduction in energy consumption

~76%*

Reduction in carbon emissions per terabyte

111,176

Data Links deployed

Cities covered

Airtel Business:

Homes Services:

639

Districts covered

100%

Population coverage

95.3%

Population coverage

Fastest Mobile

Network

Mobile Services:

Digital TV Services:

Data Traffic:

3901.8 Bn MBs (Mobile)

1340.8 Bn MBs (Homes)

Total minutes on

Network:

2225.4 Bn Mins (Gross)

Customers:

304.2 Mn Mobile

2.2 Mn Homes

1.8 Mn Airtel Business

14.2 Mn Digital TV

32.5 Mn Digital Apps

Avg time spent on

digital apps per

customer per day:

48.2 Mins on Wynk Music

18.8 Mins on Airtel TV

For more details on capitals, please refer page no. 032 to 045 of the report.

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Our Business and Value Creation Model

Financial Capital

To create sustainable value for all stakeholders, at Airtel we manage

our financial capital in an astute, optimum and diligent manner, thereby

harnessing opportunities for long-term value creation.

Source

Financial capital (includes shareholders’ equity and debt)

is a critical input in executing our business activities and in

generating, accessing and deploying other forms of capital.

Inputs

Our financial strength is based on the primary sources

of financial capital such as shareholders equity, internally

generated cash flows and debt raised from capital market.

These resources serve us to maintain our network, functional

units, fund expansion and modernization & pay dividends to

our shareholders. The components of the debt portfolio are

determined by the Company’s senior management in a manner

which enables the Company to achieve an optimum debt-mix

for its overall objectives and future market expectations.

Bharti’s three line graph -

Key enabler for driving value creation

At the core of the value creation process is Bharti’s three line

graph which measures:

Outcomes

Amount in H Mn

70,000

65,000

60,000

55,000

50,000

70.0%

50.0%

30.0%

10.0%

Value Creation

EBITDA Margin

(%)

PAT

(Amount in H Mn)

Return on Capital

Employed (%)

33.83 792 2.65

38.90 -ve 99,256 -ve 4.79

Amount in G Mn

Contribution to

Stakeholders

Dividend

Market

Capitalization

(BSE)

Contribution to

Exchequer

18,475 1,594,562 206,045

6,543 1,399,289 292,323

FY 2016-17

FY 2017-18

Total

Revenue

Absolute

turnover/ sales

Opex

Productivity

Operating

expenses/

revenues

Capex

Productivity

Revenue/

cumulative capex

2016-17 2017-18

Total Revenue (H Mn) LHS

Opex to Total Rev (RHS) Capex Productivity (RHS)

37.5%

41.6%

47.3%

65.2%

622,763

536,630

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

032

The strength of brand ‘Airtel’ was further demonstrated by the

fact that Airtel was declared India’s second largest brand in

terms of brand valuation i.e. $10.2 Bn by Kantar Milwardbrown

2017 report*. Not only this, for our various campaigns across

different media and consumer segments, the brand received

many awards and accolades.

Recognition of our

brand initiatives

Intellectual Capital

Our Intellectual Capital consists of our strong brand, highly experienced

people, world - class technology and robust processes and systems.

The intellectual capital underpins our vision to ‘win customers for life’.

We consistently strive to innovate with new offerings, technologies and

accessibility to bring brilliant customer experience in an evolving industry

landscape.

Brand Airtel: Innovative, Bold & Honest

Brand ‘Airtel’ stands for its bold & audacious communication

approach and yet at the same time being honest & transparent

with its customers. The brand has always been known for

its industry first initiatives like Open network, wherein we

opened our network information to customer’s scrutiny & in

turn established a stronger connect with them. During the last

year, we also strengthened our innovation & category leader

credentials with initiatives like “Postpaid Promise” - wherein

we redefined the postpaid category, “Launch of Airtel TV” in

OTT space & campaigns like “Sab Kuch Try Karo, Phir Sahi

6.6%

Salience - Y-o-Y increase as

per March 2018 exit scores

5.8%

Consideration - Y-o-Y

increase as per March 2018

exit scores

*Source:

http://www.millwardbrown.com/brandz/top-indian-brands/2017

Olive Crown

Awards: Silver in

“Out of Home”

category for Airtel

Starry Nights

Ad: Tech Digixx

2018 Gold Award

for Digital Marketing

in Telecom

Category

MOBEXX Gold Award

for Mobile Advertising

in programmatic

campaign for Airtel

Postpaid 2017

Smarties Bronze

Award for Innovation

Media plan for Airtel

Postpaid 2017

Chuno” (Try everything and choose what is right for you).

These campaigns have helped us to further fortify the ‘Airtel’

brand which is reflected with highest-ever scores

on key brand

metrics of Saliency and Consideration.

#Data collected by Market

Research agency - Ipsos

Research Private Limited

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Financial Capital / Intellectual Capital

[Read more about our operational achievements

on page 116.]

Project Leap

With a total investment of H 600,000 Mn, Project Leap was

introduced in 2015 to help Airtel emerge as the most preferred

smartphone network in India.

At Airtel, we have always believed in pioneering

innovation for our customers. To empower our

customers with next generation of mobile internet connectivity,

offering faster speeds and more reliable connections on

smartphone, we have already conducted trial for India’s first 5G

network.

Digital Innovation

The digital sphere is the new norm that businesses today

cannot overlook. At Airtel, digital innovation across our

operations has been essential in helping us stay ahead of the

curve and deliver value to our customers. Our digital innovation

team develops quality services that focus on creating better

experiences for our customers.

Project Next

Airtel’s ‘Project Next’ is a digital innovation program aimed

at transforming customer experience. A bouquet of digital

innovative services under this project is expected to enrich

Airtel’s customer experience. Some of the services introduced

were:

Next-Gen Airtel Stores: Highly interactive customer

relationship centres with digital screen, touch screen table top

and entertainment hub.

Online Store: Launched in October 2017, Airtel’s

online store www.airtel.in/onlinestore offers a range of premium

smartphones with affordable down payment, instant credit

verification and financing and bundled monthly plans.

Airtel Secure: As a key differentiator from the market, Airtel

launched handset damage protection as an additional service

for the postpaid customers.

Airtel Postpaid Promise: A first of its kind ‘Data Rollover’

feature for postpaid customers to carry forward unused data to

next billing cycle.

My Airtel App: An updated version with exciting new

features for better customer experience was launched.

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

034

create a stronger security platform amidst the evolving digital

landscape:

Enhanced cyber security

To serve the growing cyber security requirements, Airtel’s

partnership with Symantec Corp makes it an exclusive Cyber

Security Services partner for Symantec in India and aims to

leverage Airtel’s strength in India’s Business to Business (B2B)

segment by helping them address the challenges of the Cloud

Generation with Symantec’s innovative Integrated Cyber

Defense Platform.

Telecom Infra Project (TIP) Community Lab

Airtel announced the launch of India’s first Telecom Infra Project

(TIP) Community Lab. Airtel is among the early members of TIP

- a global initiative founded by Facebook, Deutsche Telekom,

Intel, Nokia and SK Telecom to create a new approach for

building and deploying telecom network infrastructure.

Massive MIMO

An industry first approach aligned to Project Leap, Massive

Multiple-Input Multiple-Output (MIMO) technology in

partnership with Huawei Telecommunications is aimed to

expand our existing network capacity and enhance user

experience.

[Read more about ‘Strategic Partnerships’ on page 115.]

Strategic Partnerships

At Airtel, we have always believed in the philosophy of ‘win

customers for life.’ Anticipating future market trends, we

entered into several strategic partnerships to enrich our service

offerings.

Exclusive Online Content

Digitization continues to gain traction with technology

reshaping the consumer experience. With people increasingly

consuming more content, we have partnered with leading

online content providers to bring our customers closer to

best of content across different genres. Our partnership

with Hotstar, Amazon and ALT Balaji are first-of-its kind

partnerships in the industry, that have helped us strengthen

our competitiveness.

Expanding Smartphone Reach

Mera Pehla Smartphone

Aligning to the Government of India’s ‘Digital India’ campaign,

Airtel entered into exclusive partnership with global players

(including Google, Motorola, Samsung and Itel) to bring

smartphones within the reach of more people and enable

unconnected people to get online.

Other Technology Partnerships

Technology continues to play a critical role in a dynamic

industry like ours. Airtel partnered with SK Telecom, Symantec

Corp, OneWeb, Airbus, Delta and Huawei etc. to leverage

their technical excellence and integrate the same into its

product portfolio. Some of these partnerships have helped

[Read more about our Human Capital on page 036.]

381

Digital Talent base as on March 31, 2018

Highly Skilled and Experienced Workforce

We believe in empowering our employees by building a

culture of excellence in our operating environment. Our

business sustainability is built upon our experienced, engaged,

skilled and talented workforce. Our in-house researchers,

technologists, engineers and innovators act as ‘think tanks’

and deliver relentlessly to help Airtel create long term value for

its stakeholders.

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Intellectual Capital

Human Capital

At Bharti Airtel, we consider ‘Win With People’ to be one of our key business

priorities and firmly believe that Airtel’s success is a true reflection of its

culture of pride, ownership and sense of belongingness. Our ‘People Agenda’

is linked with the organizational strategy where we partner with our employees

for building a world class environment and helping them learn, lead and grow.

A Structured HR Framework underpinned by Digital Culture

We believe our employees are a differentiating factor that has contributed to our growth and

leadership in India and led us to become the third largest telecom service provider in the world

(in terms of subscriber base). Under the overarching strategy of ‘Win With People’, the people

development philosophy during the year 2017-18 was centered around ‘Learn, Lead and Grow’.

We aim to create a ‘best in class’ and seamless employee experience by coalescing employee

journey with a digital culture, right from onboarding to acquiring functional excellence and

leadership.

Learn

We curated a learning

path and curve for each

employee with a host of

digitized learning solutions,

(e-enabled, mobile-enabled

or gamified) launched

to enable employees to

become a ‘Master of

the Craft’ by achieving

higher levels of functional

proficiencies. Some of the

learning initiatives were:

iLearn: During the year,

more than 8,000 learners

completed over 2,000

courses and recorded more

than 120,000 hours on

iLearn.

The telecom industry has

seen a paradigmatic shift in

the last few months. Pricing

simplification, bundled

offers, e-KYC activations and

many other factors have

contributed to a shift in the

way we expect employees

to operate. With a view to re-

invent mindsets, processes,

collaboration, compliance

and more, various functional

and behavioural trainings

were conducted throughout

the year to equip our people

with the required skills and

knowledge.

Functional Training:

Including induction and

functional knowledge/ skill

building viz. sales mindset

in changing times and

customer centricity.

Behavioural Training:

Including collaborative

relationships, problem

solving, design thinking and

communication.

Learn

Lead

Grow

100+

Certifications

15,000+

Total number of employees

30%

Employees under the age

of 30

34 years

Average age of our

employees

124

Differently-abled employees

in our Company

600+

Courses

171,655

No. of man hours of training

20,249

No. of man hours of training

2,404

Training interventions

289

Training interventions

Pluralsight: A partnership to

provide online video training

courses in technology and

innovation.

Skills on demand with

Lynda & Coursera:

We partnered with leading

universities across the

globe to offer certifications

via mobile compatible

and self-paced exhaustive

catalogues on new age skills

to groom employees.

30+

Courses

Airtel 101: Gamified

content in byte sized

modules to enhance the

functional knowhow of

the employee about the

Company and the industry.

This was supplemented by

an exciting weekly contest –

‘Fastest Finger First’.

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

036

Lead

Leaders at every organization, set the pace and nurture the

right mindset. At Bharti Airtel, we believe in grooming leaders

of tomorrow who act as role models for the entire organization

and make a difference especially in challenging times. Under

this pillar, people managers are nurtured and expected to

demonstrate what it is to ‘Lead Right’ by role modeling all key

leadership behaviours, including ‘Leading Self’ and ‘Leading

Others and Teams’. Some of the leadership initiatives were:

Leadership Training: To groom managers to become future

leaders.

77.7%

Succession rate in Middle and Top Management in FY 2017-18

24,655

No. of man hours of training

162

Training interventions

2,000+

Feedbacks initiated

193

Managers covered

Feedback on fingertips:

A 360-degree feedback application that allows

to seek real-time feedback from all stakeholders

(within Airtel) to enable them work on their perceived areas of

improvement.

Coaching Conversations (Leaders as Coaches): A tool

available on the intranet platform that makes coaching real and

actionable for the employees. The platform empowers each

employee to identify his/ her own coach.

Ascent: A leadership experience workshop

for ‘Manager of Managers’ to help them build

bandwidth, credibility and capability to transform

as ‘Leader as a Coach’ for their teams. The workshop was

centered on educating about different leadership styles,

creating self-awareness, identifying different roles as leaders

and developing a coaching framework.

Embark: A workshop to equip first time managers

with practical skills needed to succeed in the ‘People

Leadership’ role. The objective of the workshop was

to help the employees strengthen their emotional intelligence

and performance management abilities.

Airtel Leadership Series: Airtel Leadership Series in 2017-18

saw a galaxy of speakers comprising of internal leaders and

external experts from different industries such as healthcare,

startup, consulting etc. sharing their valuable learning and

experiences with our team. They shared insights on important

topics spanning across technology, digital future, business

partnering, brand value and transformation among others. The

employees got a chance to interact with experts on several

topics giving them a perspective of different organizations and

experiences.

Grow

Career Fair

The year 2017-18 witnessed Career Fair 2.0

in May, which centered on the importance of

“Owning My Development” along with building

a career. With a host of distinguished speakers

across industry, the idea around the Career Fair 2.0 was to

narrate career journeys as examples, stress the need to take

ownership of one’s own career and have meaningful career

conversations by being able to answer the following questions:

1. “I know what skills I need to do my current job well”

2. “What are the possible roles I can aspire for and what

skills are needed to succeed in these?”

3. “How can I build these skills?”

Managers covered

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Human Capital

Impact stories shared under

‘She For Change’

Campus Programs: Under two key programs viz. Young Leader

Program (YL) and Young Technical Leader Program (YTL),

Airtel hires the best minds from the country’s top management

schools and engineering campuses and grooms them for future

leadership and world class technical leaders’ roles.

Career App: We launched the updated version of the

MyCareer App, enabling skill based mapping of all roles within

the organization for the employees.

Gender Diversity and Equal Opportunity

At Bharti Airtel, we consider ‘Diversity’ to be a key enabler

for business and continuously put in efforts to build a team

which represents the society at large. Our flagship diversity

program, “WE- Women Empowered”, under its umbrella,

focuses on empowering its women employees to curate their

career journeys at Airtel via focused interventions including

WE Mentorship, WE Chit Chat, WE Achieve and WE Lead. All

these efforts have also culminated into the launch of ‘She

For Change’ - our compendium featuring narratives of Airtel

women employees on personal or professional impact brought

in their ecosystem.

Fostering an Engaging Work Environment

Employee connect has always been an integral part of our

culture at Airtel. We foster an engaging work environment by

leveraging various channels of communication. Some of the

initiatives undertaken were:

> Workplace by Facebook: To enable digital collaboration and

communication among all employees and foster greater

Leader-People connect.

> HIVE: An information sharing platform empowered with easy-

to-use tools to deliver insight across the entire employee

lifecycle.

> Mood-o-Meter: A mobile based app enabling employees

to share their views and feedback for a better working

environment.

Provide Safe and Healthy Work Conditions

We are committed to ensure a secure work environment.

We have in place stringent workplace health and safety

policies including Workplace Safety Policy, Health Safety and

Environment Policy, Domestic Travel Safety and Security Policy

and Policy for Safety of Women amongst others. To ensure

occupational health and safety throughout our operations, a

dedicated safety team, led by a Safety Officer, is in place to

monitor and maintain safe, healthy and injury-free working

conditions.

Awards and Recognitions

We believe in recognizing and rewarding our employees for

their sustained efforts towards organizational growth. With

the ‘Kudos’ program, we have been able to build a culture of

recognition to celebrate the success of our team members

by awarding them with various category of awards including

Instant Awards, Planned Awards in the nature of Silver, Gold

and Diamond Awards and Long Service Awards etc.

14,000+

Employees underwent safety trainings in FY 2017-18

79.4%

Employee engagement score

146

Recruits from YL and YTL

Programs in FY 2017-18

30+

Campuses visited

8,000+

Unique accesses initiated

2,764

Long Service Awards

2,693

Planned Awards (Silver, Gold and Diamond)

8,306

Instant Awards

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

038

Manufactured Capital

In telecom industry the infrastructure assets define the quality of service

provided to the customers. A superior quality quotient is a result of sustained

investments in building a strong infrastructure base.

Our ability to serve customers rests on the foundation of a strong network infrastructure that delivers brilliant network experience.

The industry table has declined over the year and moved towards an effective 3+1 market structure. Given the changes in the

telecom landscape which have necessitated unprecedented network rollouts with emerging opportunities, at Airtel, our strategy is

to sustain market leadership by setting up an integrated network infrastructure and enhancing the value for our customers.

Sustained Capital Investments

Aligning to the Government of India’s vision of a

‘Digital India’, at Airtel we are making sustained

investments to strengthen our network infrastructure.

Our tower infrastructure, spectrums and other related

assets form a strong manufactured capital base for

the Company. The surging data traffic has made it

imperative for us to have a stronger presence across

the different spectrum bandwidth to widen our

customer base.

We have invested significantly till date in increasing

our presence in spectrum portfolio bandwidth. A

growing customer base in key areas across our

multiple product segments is adequately supported

by our strong spectrum bandwidth. We realize that the

investments we make today will have a lasting impact

on the near future.

232.80 MHz

Spectrum in 900 MHz Band

449.30 MHz

Spectrum in 1800 MHz Band

Service Area (Unpaired)

900, 1800, 2100, 2300 MHz Band

900, 1800, 2300 MHz Band

1800, 2100, 2300 MHz Band

570.00 MHz

Spectrum in 2300 MHz Band

250.00 MHz

Spectrum in 2100 MHz Band

India is divided into

“22 licensed service areas”

Airtel’s Spectrum

Snapshot

Airtel is a leading global telecommunications company with

a portfolio of services that includes voice and data solutions

over fixed, wireless and internet platform, DTH and enterprise

solutions. We are the only telecom company in the Country to

offer an array of services that enhance lives of our customers.

Our sustained investments in expanding our asset base have

empowered millions of customers with accessibility to our

innovative services.

Investments Resulting in a Growing Customer Base

14.2 Mn

Digital TV Services

1.8 Mn

Airtel Business

304.2 Mn

Wireless Services

2.2 Mn

Homes Services

Customers

The above spectrums does not include spectrum acquisition of Telenor.

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Human Capital / Manufactured Capital

Our Infrastructure Presence

Airtel Business

Airtel’s international infrastructure includes the ownership of i2i

submarine cable system, connecting Chennai to Singapore and

consortium ownership of submarine cable systems like South

East Asia - Middle East - Western Europe - 4 (SWM4), Asia

America Gateway (AAG), India - Middle East - Western Europe

(IMEWE), Unity, Europe India Gateway (EIG) and East Africa

Submarine System (EASSy). Along with these seven owned

subsea cables; Airtel Business has a capacity of 22 other

cables across various geographies.

Homes Services Digital TV Services

Cities covered

639

Districts covered

100%

Population Coverage

Submarine cable systems

1,340.8 Bn MBs

Data Traffic

Enabling Connectivity

With almost all the towns

at a height of 3000

meters that extend from

The Great Himalayas

to the Kulum with the

temperature ranging

from - 30

Celsius in

Leh and Kargil to - 50

Celsius in Drass in winters,

Ladakh is the one of the

toughest geographies in

India and in the World. For

most part of the winters, all

these towns are cut-off from

rest of the country/state

leading to a serious crunch

in basic amenities including

communication. The data

service was far from reality as

there was huge dependency

on high quality fiber and the

terrain, weather and passes

made it impossible to lay

fibre. Airtel J&K team took

this challenge on themselves to make this possible - the entire

project of laying around 1000 kms fibre to connect Srinagar

to Manali via the rooftop of world (Ladakh) was divided in 2

phases:

> Phase 1 - Leh & Kargil connectivity to Srinagar

> Phase 2 - Leh to Manali

Airtel becomes the first operator to launch 3G/4G in Ladakh

region in spite of toughest weather & unfavorable terrains.

Ladakh was put on to the Digital Superhighway with launch of

66 new sites in Leh & Kargil districts with 4G technology.

It is testimony of sheer grit & commitment from ‘Team Airtel’

bringing the smiles on faces of people & brave hearts of

Indian Army!

Its global network runs

across 250,000 RKms with

over 1,200 customers,

covering 50 countries

and five continents and

65 Global PoPs (Point of

Presence).

7,899

Census Towns

786,043

Non-Census Towns and

Villages

95.3%

Population Coverage

298,014

Total Mobile Broadband

Base Stations

165,748

Mobile Network Towers

3,901.8 Bn MBs

Data Traffic

237,893 RKms

Optic Fibre Network

1,946.3 Bn

Minutes on Network

India’s Fastest Mobile Network

Rated by global leader in internet speed tests - Ookla for third

time in a row

Mobile Services

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

040

Social & Relationship Capital

At Airtel, we believe being a responsible corporate entails us to creating a

shared economic and social value for our stakeholders. As we prepare to step

up our business for next level growth, value creation for key stakeholders

remains our priority.

Engage Effectively

Inclusive governance and engagement approach is a part of

our value-creation philosophy at Airtel. We continuously strive

towards strengthening the relationship quotient with our

stakeholders. Our leadership team takes active participation

in maintaining a robust communication system with all our

stakeholders.

Customers

Everything that we do is geared towards improving our service

for an enhanced customer experience. Our actions are driven

by our strategy to ‘win customers for life’, as we lead the

change in an evolving digital landscape. During the year, we

made unflagging efforts to keep our customers delighted.

Some of the initiatives were:

Stepping Up Engagement through Digital Platforms

Decision Tree: We strengthened ‘care’ quotient for our

customers and relationship advisors with launch of Decision

Tree functionality. The ‘Decision Tree’ enabled the advisors to

derive accurate resolution across our business verticals with

maximum ‘3 clicks’. On the other hand, the ‘Help & Support’

section at My Airtel app gave the customers holistic self-care

solutions for their concerns.

Enhanced Retail Store Experience: We launched more than 20

Next-Gen Stores across the country with several new digital

experience zones. The ‘Create’ touchscreen table, ‘Share’ and

‘Network’ wall were set-up that brought customers closer to

brand ‘Airtel’ and its knowhow.

Everest: An advanced digital managed services tool for our

corporate customers, giving them advanced network related

capabilities (like comprehensive visibility, real time monitoring

and auto-ticketing).

Happy Code: A digital network complaint resolution for our

Homes customers (fixed-line telephone and broadband) to

close their complaints, wherein they share a code (a specific

SMS code) with the engineer.

Konnect App: A dedicated app for our on-field force to serve

our multiple businesses enabling them to serve customer

queries efficiently.

~96%

Prepaid activations in wireless business through Aadhaar

Online Experience: Created one-stop solution across web

and app platform for our customers across different service

offerings.

e-KYC: We successfully increased the wireless activations

through Aadhaar for Prepaid and Postpaid customers. In

FY 2017-18, we also launched the Broadband customer

activation through Aadhaar. This has significantly reduced the

paper usage in our operations and enhanced the customer

experience by enabling faster onboarding process.

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Ensure Compliance with Rules and Regulations

Government

At Airtel, we ensure compliance to the rules, laws and

regulations set by the regulatory bodies in the countries we

operate, in letter and spirit. The management is responsible for

implementation of our policies in compliant to the legislative

framework. In the course of our business operations, we

engage with several regulatory authorities, maintaining

high governance standards with transparent and timely

communication.

Aligning to the government’s vision of Digital India, we have

stepped up our efforts to provide internet accessibility and

drive inclusive growth of all sections of the society. We are

making investments towards setting up a comprehensive

infrastructure framework, partnering with government’s

institutions for empowering farmers in agricultural sector with

IFFCO Kisan Sanchar Limited (IKSL) initiative.

Investors

We value the relationship with our wide investor fraternity,

continuously improving the relationship quotient and

aligning our business goals with their expectations. A regular

engagement process, driven by our investor relations team

provides all the updates and information on our operations,

and strategies and helps addresses any queries/ doubts.

Investor complaints received and timely resolved during

FY 2017-18

Suppliers

At Airtel, our business strategy revolves around fostering

mutually beneficial relationships for a common sustainable

goal and partnering with the best. We treat our partners with

integrity and respect with transparency in all engagements

with them. Over the years, we have significantly strengthened

our collaborative relationships with the suppliers. While

on-boarding and on periodic basis, our partners go through a

detailed screening to adhere to compliance, regulations and

standards. Airtel’s ‘Partner World’, a one stop online portal

for end to end partner management enables the suppliers to

share information, interact/ collaborate, and ultimately form

Maintain Transparency and Ethical Governance Standards

closer relationships with its external supply base. The Annual

Confluence, a partnership event, provides opportunities for

our partners to interact with the top management and align

towards achieving long-term goals of Airtel. Continuous

Online Surveys and Strategic Partner Satisfaction Survey

with our partners help us identify areas that have scope for

improvement and necessary actions.

7.9

Strategic Partner Satisfaction Survey Rating

Socio-economic Activities Participation

Our business philosophies capture our socio-economic intent

to create value for stakeholders. We take proactive measures to

reduce our impact on both environment and our stakeholders,

particularly on communities that need special attention. Our

actions towards creating value for stakeholders determine our

brand recall and our acceptance as a brand in the society.

Social Contribution by our Circle Offices

To widen the reach of our social impact, the employees at our

circle offices, across the country, focused on activities to create

value in the local communities of the urban landscape. Some of

the initiatives undertaken by them were:

1. Blood donation camps 5. Share to care

2. Safety workshops 6. ACT (A Caring Touch)

3. Distributing school bags

and stationery

7. Disaster management

4. Life saving skills training

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

042

ACT (A Caring Touch)

An employee payroll giving program for Bharti Group

of Companies, ACT encourages employees to make a

contribution (in terms of money, time, skills or knowledge) and

improve lives of the underprivileged.

Age Home, Khapoli Village, Maharashtra and Anubandh,

situated on the outskirts of Jodhpur, help senior citizens who

are deserted by their families. We partnered and supported

Anubandh and Ramadham in furtherance of their initiatives.

Protection and Maintenance of Site of Historical Importance

We, as a socially responsible company, have extended our

contribution towards establishment of Partition Museum in

the city of Amritsar for the purpose of commemorating the

partition of India and for fostering a greater understanding of

the forces and circumstances that shaped the momentous and

historic event. It is the first of its kind museum in India.

Enhancement of Vocational Skills in Hearing Impaired Adults

Aimed at providing high-quality leadership and management

skills training program and empowering environment, the

Company extended its support for vocational training program

to 400 hearing impaired adults. The program and training will

collectively equip them to become “Deaf Change Makers” in

their communities and thrive as vibrant citizens within society.

Airtel and Magic Bus

The main area of focus of this project supported by Airtel is to

empower 1,722 children (722 children in Mumbai and 1,000

children in Delhi) in the area of right to education, gender

equity, awareness on health and hygiene, right to play, life

skills and leadership through Magic Bus Sports based and

mentorship program “Sports for Development”. The aim of the

project is to bring about a positive change in the attitude and

behaviour of children.

Bharti Foundation

Bharti Foundation, the philanthropic arm of Bharti Enterprises,

drives our approach in building positive community relations.

Through its various programs, we reach out to societies in

rural India, empowering lives of the underprivileged through

education with a focus on girl child and sanitation among

others. Our programs have created a positive impact in the

society:

1. Satya Bharti School Program 4. Satya Bharti Abhiyan

2. Satya Bharti Quality Support

Program

5. Higher Education

3. Satya Bharti Learning Centre

Program

Bettering Societal State

Helping the Disadvantaged

We continued the scholarship and skill development

program for underprivileged students of Chhindwara District,

Madhya Pradesh. We expanded the horizons of the program

by including digital literacy, adult literacy and livelihood

enhancement/ vocational skills for women in the program.

During the year we have trained students from various

domains on employability skills helping them to become

corporate ready. Over 1,300 underprivileged students and

women were granted scholarship during the FY 2017-18. Under

the program, we also imparted coaching to the underserved

youth for competitive exams helping them get selected for

central/ state government jobs. Additionally, we run self-

employed tailoring course for women empowerment program

in the tribal areas of Chhindwara.

Caring for the Elderly

During the year, we have increased our contribution towards

well-being and up keeping of senior citizens. Ramadham Old

K4.58 Mn

ACT Employee Contribution*

K5.80 Mn

ACT Employer Contribution*

*Companies included are Bharti Airtel Limited, Bharti Airtel Services

Limited and Telesonic Networks Limited.

[Read more in detail about our social engagements in

corporate responsibility report on page 048.]

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Social & Relationship Capital

Natural Capital

As one of the world’s leading telecommunication companies, we remain

steadfast to responsible environment governance to ensure our operations

have minimum impact on the surrounding environment. Our approach

towards environment protection and conservation of natural resources is

guided by our internal policies and applicable external standards.

(Free Cooling Unit), NCU

(Natural Cooling Unit), TCU

(Transmission Cooling Unit),

SCU (Solar Cooling Unit),

MCU (Micro Cooling Unit),

low power consuming BTS

etc. to reduce the energy

consumption in the past 4-5

years.

Impact: Over 62,000 sites

converted with 25% reduced

energy requirements.

Our environment policies and actions

are aimed at reducing the impact of

our operations on environment. At

Airtel, we focus on understanding

and managing our environmental

impact with three focus areas.

Reducing the impact of

telecom infrastructure

on the environment

Reducing the carbon

footprint in our facilities

and data centres

Resource

and waste

optimization

Airtel has taken

various measures

over the years, in response

to climate change, the

details of which are given

in this section and shall

also form a part of the

annual sustainability

report.

Reducing the Impact of Telecom Infrastructure on

the Environment

We work closely with our tower infrastructure partners to

reduce the environmental impact of their business operations.

As technology continues to evolve, we make sincere efforts

and investments in energy-efficient equipment and utilization

of green energy technologies. Our collaborative efforts have

led to conversion of several conventional DGs and battery

operated telecom tower sites into energy efficient towers

through adoption of renewable energy sources.

Our Milestones

Action: We have installed

Rooftop Solar plants at

Main Switching Centres,

expanding the total installed

capacity over 1MWp across

the several locations in the

last 5 years.

Impact: Rooftop Solar plants

helped us save over 2,300

tonnes of CO

emission in

the last 5 years.

Action: We have procured

over 90 Mn green units per

annum through various power

wheeling agreements.

Impact: Green energy

procurement helped us save

over 73,000 tonnes of CO

emission per annum.

Action: We deployed low-

power consuming Base

Transceiver Stations (BTS).

Impact: 30% reduction in

power consumption in last

4-5 years.

Action: Our pioneering

effort of telecom passive

infrastructure sharing has

helped reduce energy

consumption.

Impact: In FY 2017-18, over

44% sites were deployed as

shared sites.

Action: We deployed 91%

outdoor BTS sites in

FY 2017-18.

Impact: 25% reduced

energy requirements.

Action: We implemented

battery hybrid solutions to

eradicate use of diesel.

Impact: 4 hybrid tower sites

implemented in FY 2017-18.

Action: We converted

sites to outdoor mostly by

utilizing technology like FCU

With strong scientific

evidence supporting

the disruptive nature

of Climate Change, it

has become a global

challenge that will impact

every business. Countries

are taking up individual

emission reduction

targets and these targets

will cascade down to

individual sector and

companies.

> Substitution of existing

energy sources with

lower emissions options

and cost perceived

to transition to lower

technology emissions

will be vital in the

coming years.

> Increased severity of

extreme weather events

such as cyclones,

floods, rising sea levels

and precipitation

can cause disruption

in the Company’s

network system thus

Climate Change – An Emerging Area of Focus

interrupting smooth

delivery of services to

customers.

This has a considerable

impact on our operation

which include:

> Increased Capital

investment and

operating costs due

to higher compliances,

increased insurance

premiums.

> Technological

obsolescence and/

or write-offs, asset

impairments and early

retirement of existing

assets.

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

044

Resource and Waste

Optimization

We have installed specific

systems and processes to

manage both our hazardous

and non-hazardous waste in

compliance with our waste

management guidelines.

Through innovative

technologies, reusing and

recycling, we have managed

Reducing the Carbon Footprint in Our Facilities

and Data Centres

At Airtel, we recognize the significance of safeguarding climate

and make efforts that promote the containment and reduction

of carbon footprint in our operations. We pursue this objective

through sustained investments in assets backed by periodic

assessments of emissions to meet the set targets.

Our Milestones

Action: We installed

energy efficient lighting at

workplace to optimize light

consumption.

We retrofitted old

technologies with energy

solutions.

We optimized energy

consumption through

improving chiller efficiency,

controlling heating / air

conditioning and HVAC

optimization.

We installed Enisaver

(Quasar Enviro) smart high-

tech devices and energy

efficient cooling systems for

our offices.

We installed collective

control system in lifts

such as “Duplexor” to

help in reducing power

consumption.

to reduce waste generated

and reduced its impact on

the environment.

Our Milestones

Action: We encouraged

electronic billing and online

payment methodologies for

our customers.

Impact: Over 1,600 Mn

sheets of paper saved since

2011-12.

Action: Increasingly adopted

verification process through

Aadhaar thereby eliminating

paper work.

Impact: ~96% of prepaid

connections through

Aadhaar.

Our Achievements

Equipped all our facilities to

reduce water consumption

and augment rainwater

harvesting.

Sewage treatment plants

are installed at our facilities

for handling domestic waste

water.

We installed efficient water

fixtures, sensors and other

gears to reduce water

utilization.

A dedicated team works

to trace end-to-end

handling and recycling

of e-waste in accordance

with Waste Electrical and

Electronic Equipment

(WEEE) guidelines and post

clearance from Central/

State Pollution Control

Board(s).

Impact*:

KWH emission reduction

2,568 MWh

Units of electricity saved in

FY 2017-18 in our facilities

17.66%

Reduction in C0

emission

per rack in our data centres

as compared to FY 2016-17

~2900 Tonnes

E-waste from IT and

network infrastructure was

recycled in FY 2017-18

340,000+

DTH units refurbished in

FY 2017-18

Lighting Optimization

(adjusting light intensity,

use of natural light, LED

installation) - 8%

Energy Optimization (UPS

optimization, improving

chiller efficiency) - 19%

Innovative Solutions - 8%

HVAC upgradation for

efficient heating and cooling

- 65%

* above figures relate to impact

made at our facilities.

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Natural Capital

The Crowning Moments

Financial Capital

> Bharti Airtel bagged ‘The Corporate Treasurer Award’ for

‘Asia’s Best Treasury and Finance Strategies, 2016’ under the

‘Best Hedging Strategy’ category.

> Bharti Airtel was ranked second in the ‘Brand Finance India

100 (2017)’- an annual report on the most valuable Indian

brands. According to the report, the Company’s brand was

valued at US$ 7,722 Mn.

Human Capital

> Bharti Airtel was honoured with ‘Aon Best Employer India

2017’ award at the ‘Aon Best Employers India 2017 Learning

Conference and Awards’ ceremony.

> Bharti Airtel was ranked the ‘Best Company to Work For’

in the ‘Telecom & Allied Sector’ in the ‘Business Today -

PeopleStrong Survey’ (2017).

> Bharti Airtel Network Infra team won an award for

excellence in fire security at the ‘IFSEC Awards 2017’.

> Airtel Lanka won the ‘Best Employer Brand’, ‘Best HR

Strategy’ and ‘Best HR Strategy in line with Business’

awards at the ‘12

Employer Branding Awards’ (2017) in

Colombo.

> Airtel Nigeria adjudged the Company with best recruitment

strategy at the ‘HR People Magazine Awards’ (2017) in Lagos.

Manufactured Capital

> Bharti Airtel was ranked second in Business World ‘Most

Respected Companies’ survey (2017).

> Bharti Airtel’s Broadband Team and Open Network Team

were awarded under ‘Broadband Product’ and ‘Marketing

Campaign’ categories respectively at the ‘Economic Times

Telecom awards, 2017’.

> Bharti Airtel was rated as the fastest mobile network in India

by ‘Ookla’ - the global leader in speedtest. This is the third time

in a row that Ookla ranked Airtel as India’s fastest network.

> Nxtra Data, a subsidiary of ‘Bharti Airtel’ was awarded the

‘CIO Choice Award 2018’ for ‘Data Center & Infrastructure

Vendor’ in the category of ‘Co-location Services’.

> Bharti Airtel’s Internet TV won the ‘Tech Peripheral of the

Year’ award at the ‘NEXA NDTV Gadget Guru Awards’ 2017.

> Airtel Global Business won in ‘Best Emerging Market

Initiative’ category at the 7

‘Asia Communication Awards’

(2017) held in Singapore.

> Airtel Global Business won in the ‘Best Wholesale Carrier

(Global)’ category at the ‘Carriers World Awards’ 2017 held

in London, UK.

Social & Relationship Capital

> Bharti Airtel was honoured in the categories of ‘Best Brand

Loyalty Marketing Campaign’ and ‘Best CSR Initiative’ at the

‘Asian Customer Engagement Forum and Awards’ (2017).

> Airtel Nigeria bagged the ‘Most Outstanding Customer-

Centric Telecoms Brand of the Year’ award at the Marketing

Edge’s ‘National Marketing Stakeholders Summit and Brands

& Advertising Excellence Award’ (2017).

> Airtel Seychelles was awarded the ‘Corporate Social

Responsibility of the Year 2017’ at the 5

edition of the

‘Business Awards’ organized by the ‘Seychelles Chamber of

Commerce and Industries’ (SCCI).

> Airtel Kenya won in the ‘Humanitarian/Corporate Award

2017’ at the 5

edition of the annual ‘Kenya Red Cross

Volunteer Awards’.

Intellectual Capital

> Bharti Airtel was ranked amongst the top 100 firms in the list of

‘Most Innovative Companies’ in the world (2017) by Forbes.

> Bharti Airtel won the ‘Best Risk Management Practice Award’

in the ‘Telecom’ category at the ‘India Risk Management

Awards’ (2017) instituted by CNBC TV18 and ICICI Lombard.

> Bharti Airtel was ranked second in the ‘BrandZ Top 50 Most

Valuable Indian Brands 2017’ report. According to the

study, Company’s brand was valued at US$ 10.2 Bn.

> Airtel Global Business won in two categories: ‘Best Voice

Services Innovation – Emerging Market’ and ‘Best SMS

Innovation’ at ‘Global Carrier Awards’ in London.

Natural Capital

> Bharti Airtel bagged the ‘Golden Peacock Award for

Corporate Sustainability’ for the year 2017.

Note: The above include awards and recognitions at India and global level.

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

046

Airtel Global Business - Asia Communication

Awards, 2017

Airtel Seychelles - ‘Business Awards’ organized

by the ‘Seychelles Chamber of Commerce and

Industries’ (SCCI), 2017

Bharti Airtel - Aon Best Employer India, 2017

Airtel Nigeria - Marketing Edge’s ‘National

Marketing Stakeholders Summit and Brands &

Advertising Excellence Award’, 2017

Airtel Nigeria - HR People Magazine Awards,

2017

Airtel Kenya - Kenya Red Cross Volunteer Awards, 2017

Bharti Airtel - India Risk Management Awards,

2017

Bharti Airtel - Business Today-PeopleStrong

survey, 2017

Airtel Lanka - Employer Branding Awards, 2017

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The Crowning Moments

Corporate Social

Responsibility Report

At Bharti Airtel sustainability is defined in the context of operating our

business responsibly. Operating in 16 countries with more than 4 Bn

customers, it is our endeavour to make a difference in our communities.

Our approach to sustainability is guided by our values and principles. Our employees across the globe make sincere efforts to

leave a positive impact on the lives of people that need aid. We empower the stakeholders through several initiatives in the field of

education, women empowerment, sanitation, employment generation and healthcare, among others.

India

At Bharti Airtel, we strive to inspire and empower people

to create a financially secure and sustainable future. Over

the course of the year, we worked towards achieving socio-

economic growth through our programs. We stepped up our

efforts during the year through several programmes that bring

about life-lasting changes in the lives of the people.

Bharti Foundation

Bharti Foundation is the philanthropic arm of Bharti

Enterprises. The Foundation provides free and quality

education to underprivileged children with a focus on the girl

child, across rural India through its flagship initiative - the Satya

Bharti School Program. Post completion of 10 successful years

in 2016, the Foundation’s education focus is being scaled up

by transferring learning and best practices of the Satya Bharti

School Program to Government schools through the Satya

Bharti Quality Support Program. The Foundation has also made

significant contributions in the field of secondary education

through its higher education programs in partnership with

renowned institutions like Indian Institute of Technology (IIT) –

Delhi & Mumbai, Indian School of Business – Mohali, University

of Cambridge – UK and Newcastle University – UK. Since 2014,

the Foundation has extended its service beyond education to

improve sanitation in Ludhiana, as well as in Amritsar with the

initiation of Satya Bharti Abhiyan.

Areas we

make a

difference

Education Sanitation

Youth

empowerment

Disaster

management

Healthcare

Satya Bharti School Program

The Satya Bharti School Program is the flagship initiative of

Bharti Foundation. This rural education initiative provides

quality education to underprivileged children, completely

free of cost, with a special focus on the girl child. The

program envisions transforming students into educated,

confident, responsible and self-reliant employable citizens

of India with a deep sense of commitment to their society.

The program’s reach is multi-pronged: encouraging active

involvement of the rural community, parents of students and

other organizations working in the field of education in India.

Making a lasting and sustainable impact on the community

where schools are present and finding innovative solutions

Education

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

048

Agents of Change: The road connecting the villages

of Jharunangal and Dhulka in District Amritsar, Punjab

had deteriorated causing several road accidents and

injuries to people. Satya Elementary School, Dhulka

started witnessing a steady decline in attendance rates

of students due to challenges faced by students by the

worsening condition of the road.

The students of Satya Elementary School, Dhulka,

along with the active support of their teachers, resolved

to change the situation. It spurred them to initiate a

road safety project. The children went door to door,

approached the village sarpanch, community members

and the students of nearby schools, informing them

about the situation. The determination of the students

led to a change, inspiring the community to pitch in by

providing construction materials and labour. Within a

short time-frame of less than a month, the students’

efforts led to a repaired road that was safe for use.

through its primary and senior secondary schools, the Satya

Bharti School Program is being implemented with the intent

to arrive at replicable and scalable components of quality

education which may be adapted by the Government and

other like-minded organizations. Reaching out to thousands

of underprivileged children, the program, through its focus on

holistic development, aims to bring forth a new generation of

citizens eager to usher in positive change.

Key Achievements, 2017-18

National level

> 23 students from Satya Bharti School were winners

(Eight Gold, Eight Silver, Seven Bronze) at ‘Natural Capital

Olympiad’ (Environment based competition)

> 35 students secured admission in Jawahar Navodaya

Vidyalayas (JNVs) - complete residential schools for gifted

students in India supported by the Ministry of Human

Resource Development, Government of India

> Two Satya Bharti School teachers were declared winners

by Centre for Teacher Accreditation (CENTA - a hallmark of

teaching excellence)

> Exemplary performance by students of Satya Bharti Schools

at India Art National level Painting Competition ‘Khula

Aasmaan’, receiving 11 medals and 87 honorable mentions

> Nine Satya Bharti students among the coveted Top 100 at

the ‘Design For Change’ contest that recognizes impactful

community campaigns addressing social change

> Three students were declared winners at ‘Pramerica Spirit

of Community Awards’ celebrating volunteer community

program in India

International level

> Satya Bharti Adarsh Senior Secondary School, Rauni,

Punjab was awarded at ‘School Enterprise Challenge’, an

international initiative that promotes entrepreneurship

> 14 Satya Bharti Schools students were declared winners at

‘Inspire Aspire’

Poster Making Competition 2017

Students of Satya Elementary School, Dhulka, Punjab:

Narinderpal Singh (15 yrs old), Simranjot Kaur (13 yrs

old), Sanehdeep Kaur (12 yrs old), Daljit Singh (10 yrs

old), Arshdeep Singh (10 yrs old)

254

Schools

50%

Percentage of girls

76%

Percentage of students

from SC/ST/OBC

communities

70%

Percentage of female

teachers

States

45,388

Students

1,617

Teachers

All data as on March 31, 2018

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049

Integrated Report

Corporate Social Responsibility Report

Satya Bharti Quality Support Program

Key Achievements, 2017-18

> The remediation program has helped increase the learning

levels of 3,817 students thereby improving their English

language and Math across 151 schools

> Leadership positions at clubs were led by girls witnessing

more than 60% girls at the helm compared to 31% last year

> A total of 558 awards won by schools at different levels with

five students winning National Means-cum-Merit scholarship

awarded by Ministry of Human Resource Development; two

winning All India Kung Fu championship and one gold medal

in wrestling at 4

Indo-Nepal Golden Cup Youth Rural Games

2017-18

> Leadership training organized for 104 schools to empower

the school leadership (Principals and senior staff). Also,

capacity building exposure trips organized for Army Goodwill

Schools’ staff (100 participants) to Satya Bharti Adarsh

Senior Secondary Schools in Ludhiana

> Schools connect with communities increased with average

number of meetings of School Management Committee up

from two in FY 2016-17 to five by end of FY 2017-18

> Increased Parent-Teacher Meetings per school from two to

three over previous year. Average attendance increased from

35% to 48% witnessing a rise of more than 1,300 basis

points

> Three girl students were felicitated by the then President of

India, Hon’ble Sh. Pranab Mukherjee in Sohna for exceptional

roles and leadership skills in club activities under Rashtrapati

Bhavan’s secretariat’s ‘Smartgram’ project

Program Approach:

The Satya Bharti Quality Support Program is an education

initiative with Government Schools. Through this Program,

Bharti Foundation engages the school leadership, teachers,

students and the surrounding communities towards enhancing

the schooling experience and strive for excellence. The

approach is to identify, integrate and optimize best practices

from Satya Bharti Schools with the intent of encouraging

innovation, participation and ownership to facilitate sustainable

change.

Optimize use of existing

resources, policies and

systems

Collaborate with school

leadership and staff to

maximize usage

Support schools leaders

to achieve higher goals

and bridge existing gaps

Facilitate, support and

enhance school resources,

processes and efforts

*Program Footprint

across 10 states

of India: Delhi, Goa,

Haryana, Jammu

& Kashmir, Punjab,

Rajasthan, Andhra

Pradesh, Telangana,

Uttar Pradesh &

Jharkhand

398

Schools (in ten states*)

159,298

Students

5,982

Teachers

50%

Girls

69%

SC/ST/OBC communities

All data as on March 31, 2018

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

050

Satya Bharti Learning Centre Program (2013 to 2018)*

This remedial/bridge courses program run by the Foundation,

aims to bridge the education gap of Out-of-School Children to

mainstream them into regular schools. The first phase of the

program, started in 2013 and deployed in partnership with the

Government of Rajasthan was scaled up to Madhya Pradesh

and Jharkhand, thereby extending program reach to the

remote blocks of all three states.

Till March 2018, following have been the major achievements

of the program:

Key Achievements, 2017-18

> 9,265 students were mainstreamed in year FY 2017-18

> 15 blocks (Nine in Rajasthan and Six in Jharkhand) declared

Out-of-School Children free by the Education departments. In

these 15 blocks, Bharti Foundation contributed by operating

846 School Learning Centres and mainstreamed 18,646

students

> Nearly 1,600 Education Volunteers (EV) worked in this

program, which has generated trained human resource for

remedial teaching at the village level

> 1,522 Satya Bharti School Learning Centres have been

operated and closed successfully

> Education Department, at all block and district levels have

formally appreciated and acknowledged Bharti Foundation’s

contribution for identifying Out-of-School Children, remedial

teaching and mainstreaming them in government schools

> 79 EVs appreciated by Education Department in Rajasthan

> Rajasthan Council of Elementary Education appreciated

the program

> Over 250 appreciation letters and formal recognitions

received from government officials

> Over 200 print and electronic media reports came about

Bharti Foundation’s School Learning Centres program

> MP Shri Nishikant Dubey appreciated the work of Bharti

Foundation

> Secretary, MHRD, Government of India appreciated Bharti

Foundation’s work to reopen a school

33,353

Students mainstreamed

49%

Percentage of girls

1,522

Centres operational since

program inception

98%

Percentage of SC/ST/OBC

students

“Bharti Foundation’s Quality Support Program has benefitted

us in various ways and it has helped us in improving overall

development of students. Their focus on innovative activities

like library week, art and craft workshops, study skills

workshops and celebration of national day have created an

impact on students’ lives.”

Mrs. Poonam Nijhawan,

Government School Principal

Sarvodaya Senior Secondary School, Pitam Pura, Delhi

“We would like to express our gratitude to Bharti Foundation

for their tireless contribution in changing the overall

atmosphere of our school. Their initiatives like Lecture Series,

Students Competitions, Student-Teacher Excursions, Teacher

Training and Club Formation are priceless contributions in

development of a child’s future. Apart from this we highly

appreciate the role of the Foundation in streamlining Parent

Teacher Meetings and community connect.”

Mrs. Santosh Kumari,

Government School Principal

Govt. Girls Higher Secondary School, Kandoli, Nagrota, J&K

*From April 2018, this program has been integrated with the Satya Bharti Quality Support Program for the comprehensive support of Government schools.

All data as on March 31, 2018

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“We appreciate Bharti Foundation’s Satya Bharti Learning

Centre Program and their collaboration with Government

of Rajasthan in identifying Out-of-School Children and

mainstreaming them in government schools. We would like

to highlight Bharti Foundation’s support in achieving the

goal of 100% mainstreaming of drop out children. We hope

that Bharti Foundation will continue this commendable work

across all districts of Rajasthan”.

Dr. Priya Balram Sharma,

Deputy Commissioner (REI)

Rajasthan Council of Elementary Education, Jaipur

“Wonderful initiative by Bharti Foundation in Naxal-hit district

of Jharkhand to bring back Out-of-School Children. Such

public–private partnerships can help transform education.

The need now is to scale such efforts and expand nexus of

good work”.

Sh. Anil Swarup,

Secretary, MHRD

Government of India

(Courtesy: Twitter)

A role model

Bokrabandh, is a village

approximately 400 kms

north of Ranchi, falling

under Sunderpahari

block of Godda district.

This remote village

(the nearest station

is Bhagalpur Railway

Station which is 94 kms

away) has a population of around 600 people, primarily

belonging to a tribal community. The only Government

school in Bokraband was closed for years due to lack of

infrastructure and basic facilities.

Lukas Hansda, a youth from a tribal village pledged to

bring the change that mattered. Working as an Education

Volunteer with Bharti Foundation, Lukas Hansda, followed

the processes under Satya Bharti Learning Center Program.

The first challenging task was to get Out-of-School Children

back into school. After a lot of hard work and persuasion,

24 children underwent the remedial course in Satya Bharti

Learning Centers.

The Satya Bharti Learning Center provided remedial

courses for Out-of-School Children and Satya Bharti Quality

Support Program, helped the school to set up co-scholastic

processes such as School Management Committee,

Community Volunteering Program, Students’ Council,

Parent Teacher Meeting, School Development Plan etc.

Government teachers were encouraged and persuaded

to attend the school regularly. The activity based learning

approach and healthy teacher-student’s relationship

helped in enriching the overall schooling experience for

all stakeholders. Today the village has a fully functional

school and has institutionalized key processes that make

the initiative sustainable with Lukas motivating another 20

students to join in 2017-18 academic year.

> Bharti Foundation nominated in the 13 member core

Education reformation committee team at Pakur, Jharkhand

> Many students in this program (erstwhile Out-of-School

Children) went on to be selected in Jawahar Navodaya

Vidyalaya (JNV), Eklavya Vidyalaya and Kasturba Gandhi

Balika Vidyalaya (KGBV), besides 16 students completing

class 5 with over 60% marks (first division)

> Three centres have been awarded ‘Swachh Vidyalay

Purashkar’ (one in Category green band and the other two in

category blue band by MHRD, GOI)

> MLAs from constituency of Barmer, Ramsar, and Sawai

Madhopur visited centres and appreciated Bharti

Foundation’s work with government schools

> MLA from constituency of Dahua in Jharkhand visited the

Centre and appreciated the program

State Wise Achievement (since inception)

States No of

Centers

No of Children

Mainstreamed

No of

Children

Impacted

Rajasthan 1,114 23,070 26,273

Jharkhand 320 8,373 8,758

Madhya

Pradesh

88 1,910 2,469

Total 1,522 33,353 37,500

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

052

90,276

Total beneficiaries

1,010

Villages surveyed

18,286

Toilets constructed

(rural & urban Ludhiana

and rural Amritsar)

792

Villages (toilets

constructed)

Urban local bodies

(toilets constructed)

Girls’ toilets (government

schools)

* Data as of March 31, 2018, with

total figures from inception in

August 2014

Satya Bharti Abhiyan

On August 18, 2014, Bharti Foundation launched the Satya

Bharti Abhiyan, an initiative to improve sanitation facilities

with rural Ludhiana as a focus area. Phase one of the program

has been completed with individual toilets constructed and

handed over across rural and urban Ludhiana. In addition,

14 Government schools, identified by Punjab Education

Development Board, have been provided a separate toilet for

girls in rural Ludhiana. In the urban areas of Ludhiana district,

201 households in a list provided by the Punjab Municipal

Infrastructure Development Company (PMIDC), that did not

have a toilet, have been provided one.

On July 15, 2017, the Foundation announced the expanded

outreach of the sanitation initiative with the launch of the

Abhiyan in Amritsar. An MoU was signed with the Department

of Water Supply and Sanitation (DWSS), Punjab in September

2017 for providing financial assistance to beneficiaries for the

construction of toilets as identified by the DWSS.

Key Highlights, 2017-18

> Reduction in open defecation enabling better health and

wellbeing. A survey of usage of toilets provided to the

beneficiaries, revealed 98.54% being used

> Ludhiana district (rural), one of the largest and most

populated districts of Punjab became the second self-

declared “Open Defecation Free” district in the state in

November 2016. Amritsar district (rural) has achieved self-

declared Open Defecation Free (ODF) status on March 28,

2018 and Punjab (rural) on March 30, 2018

> Satya Bharti Abhiyan received ‘CORPORATE TRAILBLAZER’

Award at ‘India Today Safaigiri Summit & Awards 2017’

> The program has been appreciated at the village, district,

state as well as National level of governance. On January

24, 2018, Hon’ble Prime Minister, Shri Narendra Modi lauded

Bharti Foundation’s sanitation initiative during a CEO meet at

the World Economic Forum in Davos

Commemoration ceremony for completion of Abhiyan in Ludhiana graced

by then Minister of Finance and Corporate affairs, Govt. of India, Shri Arun

Jaitley, Shri Manpreet Badal, Finance Minister Govt. of Punjab, Shri Tript

Rajinder Singh Bajwa, then Cabinet Minister for Department of Water

Supply and Sanitation, Govt of Punjab, and Mr. Rakesh Bharti Mittal, Co-

Chairman, Bharti Foundation. Event joined by many government officials,

political fraternity and industry officials

Sanitation

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Airtel Connect

Airtel Delhi Half Marathon

The Airtel Delhi Half Marathon (ADHM) continues to be bring

together corporates, individuals, employees and students of

schools and colleges, giving them the opportunity to increase

their awareness about the Satya Bharti School Program, help

raise funds and enjoy the marathon run.

Young Leader Programme

The Young Leader Programme is a two-week initiative (part of

corporate induction program) to engage new team members

of Bharti Airtel as volunteers to support various initiatives of

Bharti Foundation.

Number of Youth Leaders

ACT (A Caring Touch)

It is an employee payroll giving programme encouraging

employees to give back to society in terms of money, time,

skills or knowledge. In FY 2017-18 more than 4,145 employees

(from Bharti Airtel Limited, Bharti Airtel Services Limited and

Telesonic Networks Limited) participated contributing H 4.58

Mn, while the employer contribution was H 5.80 Mn.

Higher Education

Bharti Foundation has also partnered with premier National and

International Institutes in the sphere of Higher Education:

The Bharti School of Telecommunication Technology

and Management at Indian Institute of Technology (IIT),

Delhi, established as a premier institute developing ‘Young

Telecom Leaders’. The Airtel IIT Delhi Centre of Excellence in

Telecommunications (AICET) was established to bring about a

sustained growth and progress in the Telecom sector through

various innovative initiatives.

The Bharti Centre for Communication at IIT, Bombay is

dedicated to being a contributor in expanding the frontiers

of knowledge through research and education in the

telecommunication industry.

The Bharti Institute of Public Policy, Mohali was set up in a

partnership between Indian School of Business (ISB) and Bharti

Enterprises with Fletcher School of Law and Diplomacy, Tufts

University (USA) as its partner school.

Key partnerships

Partnerships with University of Cambridge (UK):

The University of Cambridge and Bharti Foundation, signed a

Memorandum of Understanding (“MoU”) on September 12,

2016 to conduct a baby corn crop improvement research

program in India. The program is being funded through a

grant from Bharti Foundation to the University of Cambridge.

The grant supports a three-year research program carried out

between Cambridge’s Department of Plant Sciences and the

Cambridge Centre for Crop Science (3CS), Punjab Agricultural

University and FieldFresh Foods.

Manmohan Singh Bursary Fund:

Begun in 2010, this scholarship program enables high school

students of remarkable caliber to pursue their education at the

University of Cambridge University, thus removing the financial

barrier.

Partnership with University of Newcastle (UK):

Bharti Foundation and Newcastle University, UK signed

and MoU in March 2018 to extend cooperation in the area

of student’s internship and joint academic research. The

students from Newcastle University, UK, will make a visit to the

remote villages in India and conduct their research on various

educational reform projects run by Bharti Foundation. The

findings of their research will be used to further develop and

enhance the ongoing programs.

Satya Bharti University Announcement

In November 2017, Bharti Foundation announced its

plans to set up Satya Bharti University with the vision

of “Being a global leader in creating and disseminating

cutting-edge knowledge that transforms lives and

creates a brighter future”.

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

054

Africa

We operate in a complex and dynamic environment, with economic controls, technological progressions and increasing focus on

digitization. As a responsible corporate, we align our business growth with social and economic wellbeing of the communities where

we operate. Our programs are executed at local level through our employees, thereby directing contributions to areas of greatest

impact in the particular regions.

300,000

Students benefitted through Internet for School program

Internet hubs: Airtel Zambia employees scaled up their efforts

to bridge the digital gap in the country through donation of

computers and providing internet accessibility by setting

up dedicated ‘internet hubs’ across the country. Through

partnerships with the British Council, Samsung Electronics,

Huawei and the Ministry of Education, Airtel is helping

students to realize their full potential and contribute to national

development. The hubs helped students and teachers to use

the computers for improving their Internet and Communication

Technology (ICT) capabilities.

7,000

Students used internet hubs created by Airtel Zambia

Education

Adopt-a-School: Our flagship program in Africa, through

‘Adopt-a-School’ initiative we have created an impact in lives of

more than 32,000 under-privileged children. We have helped

schools rebuild infrastructure, provide reading materials,

support feeding programs and promote e-learning.

Internet for School: Airtel Kenya partnered with more than

315 schools in 36 counties across the country with its flagship

program ‘Airtel Internet for Schools’. The program has provided

internet accessibility to several school students who cannot

afford cost of connection. Till date more than 300,000 students

have been impacted through the initiative.

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“With changes in the education

system that have seen more

students turning to the Internet for

learning resources, the organization

continues to harness the strength

of the Company’s technology to

drive change in the community.

Airtel Africa is committed to support

schools across the continent

connect to the Internet.”

Raghunath Mandava

Message from MD and CEO (Africa)

40,000+

Calls received daily for information on plague

12,000+

Annual calls received from subscribers seeking healthcare advice

Health

Health Centre by Phone: Airtel Malawi is part of “Chipatala

cha Pa Foni” (CCPF) or ‘Health Centre by phone. The toll free

health and nutrition program in partnership with NGO Village

Reach and Ministry of Health has helped the subscribers reach

out to trained health professionals for advice to any health

related issue. Originally focused on women and children, the

hotline now covers all health topics, including nutrition, HIV, and

TB, youth-friendly service and content.

Youth empowerment

Train my generation: Train My Generation project was

initiated to train young Gabonese students in New Information

and Communication Technology (ICT). Airtel Gabon signed

the partnership agreement with UNESCO at the UNESCO

Headquarters in November 2014. A first of its kind agreement

between UNESCO and a private company, the initiative helped

improve digital literacy in centres by training more than 5,000

students between the age of 17-35 years. Airtel opened 13

such training centres across Gabon with 62 teachers being

imparted training by African Institute of Information and

Technology.

Disaster management

Fight against plague: Airtel Madagascar partnered with World

Health Organization (WHO) and Malagasy Government in

implementing a strategy and response plan to help people fight

the plague outbreak that affected more than 23 Mn in August

2017. Airtel Madagascar provided a short code number so

that all subscribers would have free access to information,

creating awareness to prevention, symptoms, transmission

and treatment of the plague from WHO. Around 40,000

calls were received on a daily basis. The initiative received a

commendation from the WHO (World Health Organization).

Our employees set up.

On March 29, 2018, the graduation ceremony for the “Train My

Generation Program” was conducted with Audrey Hazouley,

the Managing Director of UNESCO and the President of Gabon

were present as guests at the ceremony and commended

Airtel for this ground-breaking initiative.

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

056

Business Responsibility Report

Section A

General Information about the Company

Section B

Financial Details of the Company

* Please refer Annexure D of the Board’s Report viz. the Annual Report on CSR activities for details

Corporate Identity Number (CIN) of the Company L74899DL1995PLC070609

Name of the Company Bharti Airtel Limited

Registered Address Bharti Crescent 1, Nelson Mandela Road, Vasant Kunj, Phase II,

New Delhi - 110070

Website www.airtel.com

Email ID compliance.officer@bharti.in

Financial Year reported 2017-18

Sector(s) that the Company is engaged in

(Industrial activity code-wise)

> Telecommunication Services – mobile telecommunication, fixed line

services and telecommunication enterprise solutions.

> Direct-to-Home Services (through subsidiary company)

> Payments Bank (through subsidiary company)

Key products / services that the Company

manufactures / provides (as in balance sheet)

> Mobile Services

> Broadband Services

> Enterprise Services

> Direct to Home (DTH) Services

Total number of locations where business activity

is undertaken

Number of international

locations (major 5)

Operations in 16 countries including India and

Sri Lanka.

Number of national

locations

Headquartered in New Delhi, the Company has

business in all 22 licensed telecom service areas.

Markets served by the Company- Local / State /

National / International

Besides India, operations in Africa and South Asia

Paid up capital (H Millions)

19,987

Total turnover (H Millions)

536,630

Total profit after taxes (H Millions)

792

4. Total spending on Corporate Social

Responsibility (CSR) as percentage of average

Net Profit of the Company for last 3 financial

years (%)

0.26*

5. List of activities in which expenditure in point

(4 above) has been incurred

> Education promotion

> Higher and technical education

> Community development

> Employability and entrepreneurship

> Sanitation

> Restoration and establishment of building of historical importance

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160-317

Section C

Other Details

1. Does the Company have any Subsidiary Company/

Companies?

Bharti Airtel Limited (hereinafter referred as Airtel) has 14

direct and 75 indirect subsidiary companies, as on March

31, 2018.

2. Does the Subsidiary Company / Companies participate

in the Business Responsibility (BR) initiatives of the

parent company?

Nearly all subsidiary companies, either directly themselves

or jointly with Airtel, participate in the BR initiatives.

3. Do any other entity / entities (e.g. suppliers and distributors,

among others) that the Company does business with

participate in the BR initiatives of the Company?

Airtel supports and encourages its partners to undertake

sustainability and CSR initiatives. At present, the Airtel’s

infrastructure and facility management partners support

its drive towards environment protection, which represents

less than 30% of all its partners.

Section D

Business Responsibility Information

1.0 Details of Director / Directors responsible for BR

(a) Details of Director / Directors responsible for the

implementation of BR policy / policies

DIN Number 00042494

Name Mr. Rakesh Bharti Mittal

Designation Director

(b) Details of the BR head

DIN Number N.A.

Name Mr. Sameer Chugh

Designation Director - Legal & Regulatory

Telephone Number +91 124 4243188

E-mail ID [email protected]

2.0 Principle-wise (as per NVGs) BR Policy / Policies

Ethics, Transparency and Accountability

Businesses should conduct and govern

themselves with ethics, transparency

and accountability

Principle 1

Stakeholder Engagement

Businesses should respect the

interests of and be responsive towards

all stakeholders, especially those who

are disadvantaged, vulnerable and

marginalised

Principle 4

Responsible Policy Advocacy

Businesses, when engaged in

influencing public and regulatory policy,

should do so in a responsible manner

Principle 7

Products Lifecycle Sustainability

Businesses should provide goods and

services that are safe and contribute to

sustainability throughout their life

Principle 2

Human Rights

Businesses should respect and

promote human rights

Principle 5

Support Inclusive Growth

Businesses should support inclusive

growth and equitable development

Principle 8

Employees’ Well-being

Businesses should promote the well-

being of all employees

Principle 3

Protection of the Environment

Businesses should respect, protect and

make efforts to restore the environment

Principle 6

Providing Customer Value

Businesses should engage with and

provide value to their customers and

consumers in a responsible manner

Principle 9

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

058

a) Details of Compliance (Reply in Y/N)

(A) The policies are formulated with detailed consultation with relevant stakeholders and benchmarking across the industry. They are developed and aligned to

applicable legal and regulatory requirements, and guidelines, SEBI listing regulation and its internal mandates.

(B) All policies are administered under the overall supervision of the Airtel Management Board (AMB) of the Company, headed by the Managing Director and Chief

Executive Officer. The Audit Committee of the Board along with other Board Committees reviews implementation of policies.

1. Code of Conduct Policy

2. Code of Conduct Policy for Partners

3. CSR Policy

4. Ombudsperson Policy and Process

5. Stakeholder Engagement Framework

6. Human Rights Policy

7. Environment Health and Safety Policy

8. Tax Policy

(D) Except policies listed above, all other policies are meant for internal consumption of employees and are available on the Company’s intranet. All policies have

been periodically communicated to the relevant internal and external stakeholders.

(E) All policies are owned by the respective AMB member and their senior leadership teams are responsible for the effective implementation policy.

(F) Any clarifications for grievances related to either of the policies are addressed by the respective leadership team member and if not addressed to satisfaction

can be escalated to the Ombudsperson.

Governance related to BR

> Performance assessment frequency of BR

The CSR Committee and Board assess and review the BR performance annually and give a strategic direction to Airtel’s BR initiatives, as

required.

> Details of BR and Sustainability Report

Airtel publishes an annual Sustainability Report in accordance with the Global Reporting Initiative (GRI) framework. The report has been

uploaded on Airtel’s website and can be viewed at www.airtel.in/sustainability.

Sl. No. Questions P1 P2 P3 P4 P5 P6 P7 P8 P9

1. Do you have a policy / policies for…? Y Y Y Y Y Y Y Y Y

2. Has the policy been formulated in consultation with the relevant

stakeholders? (A)

Y Y Y Y Y Y Y Y Y

3. Does the policy conform to any national / international standards?

If yes, specify? (50 words) (A)

Y Y Y Y Y Y Y Y Y

4. Has the policy being approved by the Board? If yes, has it been

signed by MD / Owner / CEO / appropriate Board Director? (B)

Y N N Y N Y N N N

5. Does the Company have a specified committee of the Board /

Director / Official to oversee the implementation of the policy? (B)

Y Y Y Y Y Y Y Y Y

6. Indicate the link for the policy to be viewed online? (C) Y N N Y Y N N Y N

7. Has the policy been formally communicated to all relevant internal

and external stakeholders? (D)

Y Y Y Y Y Y Y Y Y

8. Does the Company have in-house structure to implement the

policy / policies? (E)

Y Y Y Y Y Y Y Y Y

9. Does the Company have a grievance redress mechanism related

to the policy/policies to address stakeholders’ grievances related

to the policy / policies? (F)

Y - Y Y Y - - - Y

10. Has the Company carried out independent audit / evaluation of

the working of this policy by an internal or external agency?

Y Y Y N N Y Y N Y

Statutory Reports

Business Responsibility Report

059

Integrated Report

006-056

Financial Statements

160-317

Section E - Principle-wise performance

Airtel is committed to achieving the highest principles of

integrity and ethics. Its Code of Conduct (COC / Code) outlines

the Company’s expected standards of ethical conduct and

behaviour. Airtel’s core values represent mutual respect, trust

and personal growth for all. The Code of Conduct extends to

employees at all levels and other individuals working with the

Company, its subsidiaries, associates, suppliers, contractors,

service providers, channel partners and explicitly prohibits

bribes, kickbacks, improper payments and direct them to

ensure ethical business conduct.

For effective implementation of the above mentioned Code

of Conduct, the Company has established the office of the

ombudsperson, which is an independent forum for employees

and stakeholders of the Company. It is fully accessible to all

stakeholders who have grievances with regard to the conduct

of any employee / individual representing the Company. A

formal process of reviewing and investigating any concern is

undertaken by the Ombudsperson and appropriate action is

taken to resolve the matter in accordance with the Consequence

Management Policy. The instances of such misconduct are

periodically reported to the Audit Committee. All employees

are required to undergo an annual e-certification on Code of

Conduct to reinforce their commitment to the Code. During

2017-18, 24 allegations of corruption or bribery were received.

Investigations were completed in 22 cases. The remaining 2

cases are under various stages of investigation. The allegations

were substantiated in 7 cases and suitable actions initiated, as

per Consequence Management Policy.

and implemented procurement guidelines to confirm safety

and resource optimisation. Besides, it adheres to standard

practices and procedures for waste disposal in accordance

with regulations. Airtel gives primary importance to community

health and safety.

The Company acknowledges the growing concern over the

exposure to electromagnetic fields (EMF) and maintains

complete transparency in its position. It also shares updated

and extensive research-based information on this matter with

its employees, partners, customers and the community, at large.

The Company’s existing practices comply with the relevant

guidelines issued by the Department of Telecommunication

(DoT), Government of India (GoI). Airtel’s sites are subjected to

random checks and audits by the DoT’s Telecom Enforcement

Resource and Monitoring (TERM) Cells. In FY 2017-18, over

99% of the base stations audited by TRAI were found compliant

with emission norms. The Company in partnership with the

Cellular Operators Association of India (COAI) conducts

various programmes, workshops, seminars and stakeholder

engagements. Such initiatives are taken to build awareness

about the issue.

Airtel declared ‘War on Waste’ as one of its business priorities.

This initiative intends to improve the Company’s operating

efficiencies by eliminating waste. Airtel is consistently deploying

innovative technologies with the aim to reduce its operational

wastes. More details on waste management can be found in

the organization’s latest Sustainability report at www.airtel.in/

sustainability.

The most substantial waste generated from Airtel is e-waste,

owing to its nature of business. The Company has adopted

a focused approach on e-waste management. It has made

significant efforts to reduce environmental impact of its

operations, by minimising waste and ensuring proper disposal

and recycling. Airtel has also implemented various awareness

strategies to reduce waste by promoting extended use of

network and IT based equipment. The Company adheres to

the Government of India’s (GoI) guidelines to recycle the waste

generated from its source, due to technology up gradation or

any other reason. In FY 2017-18, around 2,900 tons of e-waste

generated from IT and network infrastructure was recycled

through authorised recycling partners.

Airtel leverages its diverse platforms to deliver services to its

wide customer base. Thus, it does not have any impact on

sourcing, production or distribution. The Company also ensures

that there is no broad-based impact on energy and water due

to use of its services. The Company is strongly committed

to building a responsive and sustainable supply chain. The

Company carries out a due diligence process including outlining

contract clauses before enlisting any supplier which includes

While evaluating the impact of business operations, Airtel aims

to reduce any fallouts during the lifecycle of its products and

services across the value chain. The Company is leveraging its

existing services such as Mobile DTH, Payments Bank, Fixed

line and Broadband and Enterprise solutions to provide basic

life services. It is helping enhance financial inclusion, health and

education along with raising awareness around agriculture.

Airtel relentlessly works to provide value across its value chain

to minimise environmental fallout. Airtel took some significant

steps like promoting reduced energy consumption, minimising

waste and focusing on developing innovative solutions to

ensure environmental stability. The Company has formulated

Ethics, Transparency and Accountability

Principle 1

Product Lifecycle Sustainability

Principle 2

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

060

‘Win with People’ is one of the key business priorities of Airtel.

The Company believes that its success depends on its ability

to develop knowledge, skills and expertise of its employees.

This belief translates in ensuring that every business vertical

is equipped with right talent, which is both competent and

engaged. The Company achieved this objective by undertaking

various initiatives for talent development, employee engagement

and communication.

This approach has helped the Company in building an inclusive

organisation, driven by entrepreneurship providing equal

opportunity to all. Airtel has consistently tried to create and

promote an inclusive work environment for employees from

diverse backgrounds to help them realise their full potential.

The objective is to ensure that the strong workforce of ~15,500

employees are both skilled and engaged.

The Company is fully committed to the promotion of diversity

across all levels of the organisation. There were 1,412 permanent

women employees, which represented around 9.1% of the total

certain sustainability and statutory aspects like environmental

protection, health and safety, human rights and child labour,

and ethics. In addition to this we target to empanel 100% of our

suppliers through contract clauses of sustainability parameters

by 2020. Regular assessments of suppliers are conducted

through the vendor compliance monitoring process, on statutory

and sustainability requirements like minimum compensation,

benefits, labour issues etc. and the non-compliances identified

are promptly remediated. To optimise resources, reduce

adverse environmental impact and promote indigenous

entrepreneurship, Airtel promotes local procurement from India

based suppliers. In FY 2017-18 of the 4800+ suppliers Airtel

engaged with, 96% were based in India which constituted

over 58% of its procurement spent. In addition to this the

Company strives for a minimum of 98% of procurement from

India based suppliers by 2020. Airtel constantly encourages

its suppliers to adhere to international standards like ISO

9001:2008, ISO 14001, OHSAS 18001, ISO 27000 and target

atleast 50% of its procurement through suppliers holding

one of these certification by 2020. The Company has been

continually working to consolidate its supply chain to make

its socio-economic engagements more meaningful. Airtel has

taken various initiatives in developing a framework to help

marginalised sections, with a special focus on promoting women

entrepreneurs and small businesses.

workforce. A total of 124 people with special abilities were

employed at various Company locations. To nurture workforce

diversity, with a particular focus on gender, the Company has

implemented practices and support systems that specifically

address the requirements of its female employees. This is

backed by stringent policies and procedures, which ensures the

workplace environment free from sexual harassment.

In addition, the Company had 42,558 sub-contracted employees

for calendar year 2017, employed at its various sites. During the

period, the Company did not engage any temporary or casual

staff in the organisation. Airtel currently does not have any

employee associations in the organisation however, employees

have full access to raise their concerns with the management

without fear or coercion which are addressed and resolved

satisfactorily.

Airtel’s aspiration is a zero injury / accident workplace.

Its commitment to health and safety is driven by the

stringent workplace health and safety policies that provides

a comprehensive framework for ensuring safe and incidence-

free workplace, effective investment in health promotion and

disease prevention activities at all levels of the business.

To ensure occupational health and safety throughout the

operations, a dedicated safety team, led by a Safety officer, was

setup up to monitor and maintain a safe, healthy and injury-free

working conditions. The Company’s commitment to health and

safety is driven by the various stringent health and safety policies.

These provide a comprehensive framework for ensuring a safe

and incident-free workplace and effective investment in health

promotion and disease prevention activities at all levels of its

business. In FY 2017-18, more than 14,000 employees attended

the safety trainings including over 2,000 women employees and

31 specially abled employees.

The Bharti Code of Conduct ensures to build a workplace

culture that fully reflects Bharti’s values of trust, mutual

respect and inclusive growth for all. The Code encompasses

a wide array of issues pertaining to harassment, workplace

conduct, labour conditions, and community responsibility. The

Ombudsperson administers a formal process to review and

investigate all concerns and undertakes appropriate actions

required to resolve the reported matters. In FY 2017-18 nine

cases regarding sexual harassment at the workplace were

reported and investigated. In six of these cases, the allegations

were substantiated and the accused personnel were released

from their services. Airtel received no complaints regarding child

labour, forced labour and discriminatory employment in the year

under review.

Employees’ Well-being

Principle 3

Statutory Reports

Business Responsibility Report

061

Integrated Report

006-056

Financial Statements

160-317

Bharti’s Code of Conduct, Airtel’s Human Rights Policy and

various HR Polices demonstrates its commitment toward

protection of Human Rights across value chain and upholding

Airtel’s approach towards responsible and sustainable business

practices undergoes a systematic mapping through regular

engagement with its internal and external stakeholders. This

practice helps the Company to prioritize key sustainability issues

in terms of relevance to its business and stakeholders, including

society and environment. It rigorously conducts a detailed

materiality-assessment, which enables it to map stakeholders’

expectations with its business priorities, risks and opportunities.

In FY 2017-18 Airtel revisited the Materiality Analysis process

and performed a detailed stakeholder surveys to identify

materiality issues / sustainability concerns with the highest

relevance and impact. In order to streamline the process,

identification and categorisation of its key stakeholders, (both

internal and external) was performed. The key stakeholders

identified include: Customers, Employees, Business Partners

(Suppliers and Vendors), Community, Investors, Government

Bodies, Industry Associations, Non-governmental Organizations

(NGOs) and Academic Institutions. Stakeholder engagement

activities were carried out among respective categories of

stakeholders with the help of questionnaires. The similar

exercise was performed with the Airtel Management Board to

delineate the business priorities, which when mapped with the

stakeholder concerns, fetched the sustainability issues that

demanded enhanced strategic and operational attention.

The Company has identified the disadvantaged, vulnerable

and marginalised stakeholders through Bharti Foundation,

the philanthropic arm of Bharti Enterprises. The foundation’s

beneficiaries include economically-challenged and

disadvantaged groups, especially girls. Bharti Foundation

touches all aspects of stakeholder empowerment through

multiple community initiatives in the realm of education,

employment generation, sanitation along with healthcare, and

disaster management. Conducting need-based training for

key stakeholders forms a significant part of the foundation’s

empowerment and financial inclusion strategy. Please refer

to the CSR section of the annual report and the sustainability

report for details on the Company’s intervention through Bharti

Foundation.

the highest levels of ethical business practices. Strong

commitment to performance with integrity, and human rights

are embedded in the Company’s policies, which lays down

acceptable behaviour on various aspects including human

rights. Where the Human Rights policy is applicable to all

employees across the organization and the code of conduct for

associates and the vendor compliance policy details acceptable

standards and statutory obligations expected from the partners

and suppliers. Detailed monitoring is conducted internally

through its group wide compliance monitoring initiative to track

performance of each site on human rights risks such as labour

rights, work place standards, compensation, privacy and more

in line with the legal requirements of the country and standards.

The process involves identification of risks, identification of

vulnerable groups monitoring like child labour, forced labour etc.,

mitigation plans for identified risks and reporting on an ongoing

basis to the management through its enterprise compliance

monitoring system. Corrective actions if any range from process

changes, feedback and disciplinary action for violations to even

suspension in line with the consequence management policy of

the organization.

In addition to this to prevent sexual harassment in workplace,

the company has set up Internal Complaints Committees

across geographies comprising a Presiding officer who is

a senior level woman employee, one member with legal

knowledge or experience in social work, one member from

the Ombudsperson’s office and one independent member

from outside the organization who expertise in dealing with

such matters and has the relevant knowledge and experience.

The Committee is responsible for dealing with all matters

related to the subject. The committee constitution has been

communicated to all employees and also prominently displayed

in the public areas of all offices.

In the statutory compliance assessments on the above

parameters, conducted for all offices in India, no material

violations have been reported in the previous financial year. In

addition to this an independent audit is conducted periodically

to assess the statutory risks pertaining to Human rights and

any observations are promptly remediated. No incidences

of discrimination was reported to the ombudsman office in

FY 2017-18. The details of complaints related to sexual

harassment and labour rights and the subsequent actions

taken have been detailed in Principle 3 of this report.

Human Rights

Principle 5

Airtel along with its network-infrastructure partners resolved

to re-invent and reduce the environmental footprint of their

business and operations. Along its journey towards path of

Protection of the Environment

Principle 6

Stakeholder Engagement

Principle 4

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

062

The Company works closely with all industry associations and

trade chambers to ensure its public policy positions complement

and advance its sustainability and citizenship objective. The

Company strives to drive digital inclusion, promote green

telecom, advance innovation, enhance competitiveness and

increase job creation opportunities. In turn these activities

create economic growth and help elevate sustainable standards

of living for stakeholders at large. Its policy agenda is centred

on the provision of network coverage, affordable access to

customers, building transparency and awareness around

network radiations. Moreover, it deals with creating adaptability

of internet, easing and automating subscriber acquisition,

quality of service offerings, tariff and environment protection

As India’s leading telecommunication service provider, Airtel

has been taking sustained efforts to ensure value creation and

sustainable growth of community. It sustainability framework

is structured to create a positive impacts on its customers,

partners, communities and society, helping them grow together

and inclusively. Airtel has empowered millions across the length

and breadth of the country through its exhaustive bouquet of

innovative services and products that enhance community

life and e-governance, by working with the communities and

increasing its network reach.

It is widely acknowledged across the world that internet

accessibility is vital for enhancing socio-economic well-being.

The Government of India, through its ‘Digital India’ initiative,

is focusing on preparing a comprehensive framework for

transforming India’s economy into a digitally empowered society

and knowledge economy. The key objective of the initiative is

to help elevate the life of a common citizen in multiple ways

and in a cost-effective manner. To support the efforts of the

Government and to drive the pursuit of driving digital inclusion,

rural connectivity is one of the major focus areas at Airtel.

With over 156.9 Mn mobile customers from rural market, Airtel

serves India’s largest rural mobile customer base. The rural and

emerging markets constitute over 51 % of its customer base

and its constant endeavor is to develop tailor-made services

and systems to cater to the ever dynamic requirements of its

diverse subscriber base.

The Company’s philanthropic efforts, employee volunteerism

and community outreach initiatives support the desire to be

seen as a trusted partner. Its activities are aligned to play an

active role in community wellness. It is determined to create a

deep-rooted, positive impact on the society at large. It, therefore,

proactively applies its competence and partnerships to promote

community wellness through initiatives undertaken by the

Bharti Foundation, the philanthropic arm of Bharti Enterprises

and through its own telecom circles offices at the regional level.

Responsible Policy Advocacy

Principle 7

Support Inclusive Growth

Principle 8

sustainability, the Company explored and implemented several

green solutions to curb emissions. It is also continuously in

search of more energy efficient technologies and innovative

solutions for a greener future.

In today’s fast moving world, the network infrastructure needs to

be at its optimal best at all times. The non-availability of reliable

power is a critical factor for remote network sites. DGs and

batteries are usually used as alternatives to keep the equipment

running in absence of grid power supply. Through its persistent

efforts, along with its network partners, the Company has been

able to upgrade and convert the existing telecom towers into

energy efficient towers, reducing the reliance on electricity from

grid or diesel. The next step is maximizing the adoption of green

wheeling for sourcing power from renewable sources and in the

process, reducing its carbon footprint significantly.

In addition to this, Airtel has taken various initiatives towards

deployment of renewable energy solutions in network towers,

installation of rooftop solar panels at Main Switching Centres

(MSCs) and captive green energy generation through

solar / wind energy. It is also committed to operate and provide

products and services in an environmentally responsible and

sustainable manner. The Health, Safety and Environment

(HSE) policy specifies its approach towards protection of the

environment; and is applicable for all employees of the Company

and its subsidiaries. The emissions or wastes generated by the

Company are within the permissible limits given by Central

Pollution Control Board (CPCB) and State Pollution Control

Boards (SPCBs). As on March 31, 2018, there were 3 notices/

cases received by the organization from pollution control boards

and all of them have been resolved to satisfaction.

Details of the Company’s environmental initiatives are available

in the Natural Capital section of this report and its annual

sustainability report at www.airtel.in/sustainability.

among others. As these issues continue to be scrutinised and

deliberated by a very proactive government, they are likely to

have a material impact on the lives of millions.

The Company generally conveys its policy positions through its

membership with the Cellular Operators Association of India

(COAI). Besides, it is member of other industry associations like

Confederation of Indian Industry (CII) and Federation of Indian

Chambers of Commerce and Industry (FICCI). Internationally,

Airtel is a member of the International Telecommunication

Union (ITU) and GSM Association (GSMA).

Statutory Reports

Business Responsibility Report

063

Integrated Report

006-056

Financial Statements

160-317

‘Win with Customers’ is key business priority for the Company.

Through its world-class network, innovative yet affordable

services and an exceptional customer experience, the Company

aims to win customers for life. The long-term strategic goal of

the Company is to innovate and deliver a wide range of cost-

effective, secured, timely, and customized services with the best

technology. The Company actively seeks customer feedback,

act on it, and improve its customer service and in the process

improve its products, services, and processes.

At Airtel, the Company believes its customers are also its

business partners. They help them to greatly improve and evolve

the services it offers. Their ongoing feedback is the greatest

stimulus in improving its products, services and processes.

Through an integrated end-to-end experience, improving its

overall retail store experience and delivering impeccable voice

and internet services- the Company strives to increase its

customer retention. Airtel relies on various mechanisms such

as the Net Promoter Score (NPS), social media mentions,

feedback over a call / point of sale, customer grievances,

complaint management and exit surveys to measure customer

satisfaction score. Holistic tools such as the NPS enables it to

gather feedback and ascertain its customers’ experiences.

Airtel believes in transparency and empowering users to

manage their own Airtel products & services with ease. Airtel has

consistently made efforts in this direction whether it is through

its Open Network, enriched self-care or ever evolving powerful

MyAirtel App. This year, Airtel has successfully implemented

various initiatives to increase transparency for its customers

and/or reduce the surprises arising due to bill shock during

international roaming and lack of awareness about services.

Airtel has been communicating mandatory usage information

(as specified by the law) regarding enrolment and deactivation,

tariff, usage, contact and grievance on its welcome kits, periodic

bills, enrolment forms, booklets, websites and point of sales

displays.

Airtel works closely with the industry, government, law

enforcement and community organizations to help its customers

understand and manage the risks associated with the online

world. Airtel supports a range of government initiatives to raise

awareness, and provide online education and guidance. Some

of the measures undertaken in the last few years include:

1. Proactively filtering offensive content available online which

is not compliant with the state laws

2. Upgrading technology constantly to reduce threat

exposures

3. Associating with Law Enforcement Agencies (LEA) to

support investigations by provision of customer information

and complying with all requests as per regulatory norms.

In addition to this, Airtel also takes prior consent of all customers

at the time of acquisition, collection, transfer and disclosure of

personal data details of which can be found in our privacy policy;

https://www.airtel.in/forme/privacypolicy. All subscribers have an

option to opt-out of usage of customer information for promotional

purposes and they can readily opt out at any time through Airtel’s

website / application including at the time of enrollment.

As on March 31, 2018, 133 consumer cases and around 0.11%

of the consumer complaints are at various stages of resolution.

In FY 2017-18, no cases have been filed against the company

before the Competition Commission of India for anti-competitive

behaviour and 2 cases filed are pending resolution as on March

31, 2018. In addition to this 7 complaints were filed before ASCI

in the last financial year out of which 5 have been resolved

successfully.

Providing Customer Value

Principle 9

During FY 2017-18, Airtel made significant contributions

towards various philanthropic projects, which include:

H 207.3 Mn

Bharti Foundation towards

furtherance of its objectives.

H 70.6 Mn

Other contributions

With a vision to help underprivileged children and young

people of country realize their potential, Bharti Foundation is

committed to implement and support programs in the fields of

primary, elementary, senior secondary and higher education.

Education being its core focus area, Bharti Foundation has

been working steadfast to enable the cognitive, creative and

emotional development of students along with the instilling

values and attributes of responsible citizens.

The Satya Bharti School Program, the flagship program of

Bharti Foundation involves the communities towards operation

of schools. The programme actively engages community

members in making monetary and tangible contributions to

schools and related activities and events. Further details about

the initiatives undertaken by Bharti Foundation and by Airtel’s

regional circle offices are available in the CSR section of the

Company’s integrated report.

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

064

Board’s Report

Dear Members,

Your Directors have pleasure in presenting the 23

Board Report

on the Company’s business and operations, together with audited

financial statements and accounts for the financial year ended

March 31, 2018.

Company Overview

Bharti Airtel is one of the world’s leading providers of

telecommunication services with significant presence in 16

countries, representing India, Sri Lanka and 14 countries in Africa.

The Company’s diversified service range includes mobile, voice

and data solutions, using 2G, 3G and 4G technologies. We provide

telecom services under wireless and fixed line technology, national

and international long distance connectivity and Digital TV; and

complete integrated telecom solutions to our enterprise customers.

All these services are rendered under a unified brand ‘Airtel’ either

directly or through subsidiary companies. Airtel Money (known as

‘Airtel Payments Bank‘ in India) extends our product portfolio to

further our financial inclusion agenda and offers convenience of

payments and money transfers on mobile phones over secure and

stable platforms in India, and across all 14 countries in Africa.

The Company also deploys and manages passive infrastructure

pertaining to telecom operations through its subsidiary, Bharti

Infratel Limited, which also owns 42% of Indus Towers Limited.

Together, Bharti Infratel and Indus Towers are the largest passive

infrastructure service providers in India.

Financial Results

In compliance with the provisions of the Companies Act, 2013,

and SEBI (Listing Obligations and Disclosure Requirements)

Regulations, 2015 (‘Listing Regulations’) the Company has

prepared its standalone and consolidated financial statements as

per Indian Accounting Standards (Ind AS) for the FY 2017-18. The

standalone and consolidated financial highlights of the Company’s

operations are as follows:

Standalone Financial Highlights (Ind AS)

Particulars FY 2017-18 FY 2016-17

Millions

USD

Millions*

Millions

USD

Millions*

Gross revenue 536,630 8,327 622,763 9,273

EBITDA before

exceptional

items

181,529 2,817 242,242 3,607

Cash prot from

operations

131,674 2,043 211,891 3,155

Particulars FY 2017-18 FY 2016-17

Millions

USD

Millions*

Millions

USD

Millions*

Earnings before

taxation

(6,812) (106) (85,095) (1,267)

Net Income /

(Loss)

792 12 (99,256) (1,478)

*1 USD = H 64.44 Exchange Rate for the financial year ended March 31, 2018.

(1 USD = H 67.16 Exchange Rate for the financial year ended March 31, 2017).

Consolidated Financial Highlights (Ind AS)

Particulars FY 2017-18 FY 2016-17

Millions

USD

Millions*

Millions

USD

Millions*

Gross revenue 836,879 12,986 954,683 14,214

EBITDA before

exceptional

items

304,479 4,725 356,206 5,304

Cash prot from

operations

227,169 3,525 283,668 4,224

Earnings before

taxation

32,669 507 77,233 1,150

Net Income /

(Loss)

10,989 171 37,998 566

*1 USD = H 64.44 Exchange Rate for the financial year ended March 31, 2018.

(1 USD = H 67.16 Exchange Rate for the financial year ended March 31, 2017)

The financial results and the results of operations, including

major developments have been further discussed in detail in the

Management Discussion and Analysis section.

Secretarial Standards

Pursuant to the provisions of Section 118 of the Companies

Act, 2013, the Company has complied with the applicable

provisions of the Secretarial Standards issued by the Institute of

Companies Secretaries of India.

Share Capital

During the year, there was no change in the Company’s issued,

subscribed and paid-up equity share capital. On March 31,

2018, it stood at H 19,987 Mn, divided into 3,997,400,102

equity shares of H 5/- each.

Statutory Reports

Board’s Report

065

Integrated Report

006-056

Financial Statements

160-317

General Reserve

During the year, the Company has transferred H 3,510 Mn

into General Reserve from the Share Based Payment Reserve

pertaining to gain / loss on exercise / lapse of vested options.

During the year, the Company has created Debenture

Redemption Reserve and transferred H 7,500 Mn out of the

General Reserve representing 25% of the value of unsecured

redeemable non-convertible debentures issued by the Company.

Dividend

Your Directors have recommended a final dividend of H 2.50 per

equity share of H 5 each fully paid-up (50.00 % of face value)

for FY 2017-18. The total final dividend payout will amount

to H 9,993.50 Mn, excluding tax on dividend. The payment of

final dividend is subject to the approval of shareholders in the

Company’s ensuing Annual General Meeting (AGM).

The Register of Members and Share Transfer Books will remain

closed from Saturday, August 04, 2018 to Wednesday, August

08, 2018 (both days inclusive) for the purpose of payment of

final dividend for the FY 2017-18, if declared at the ensuing

AGM.

Dividend Distribution Policy

As per Regulation 43A of the Listing Regulations, top 500

listed companies are required to formulate a dividend

distribution policy. Accordingly, the Company has adopted the

dividend distribution Policy which sets out the parameters and

circumstances to be considered by the Board in determining

the distribution of dividend to its shareholders and / or retaining

profits earned by the Company. The Policy is enclosed as

Annexure A to the Board’s Report and is also available on the

Company’s website at https://s3-ap-southeast-1.amazonaws.

com/bsy/iportal/images/Airtel-Dividend_Distribution_

Policy_35406A496EEC3AB50D0C777F006C6D41.pdf.

Transfer of amount to Investor Education and

Protection Fund

During FY 2017-18, the Company has transferred the unpaid

/ unclaimed dividend amounting to H 7.42 Mn to the Investors

Education and Protection Fund (IEPF) Account established

by the Central Government. The Company has also uploaded

the details of unpaid and unclaimed amounts lying with the

Company as on July 24, 2017 (date of last Annual General

Meeting) on the Company’s website www.airtel.com.

Pursuant to the provisions of Investor Education and Protection

Fund Authority (Accounting, Audit, Transfer and Refund) Rules,

2016, as amended, the shares on which dividend remains

unpaid / unclaimed for seven consecutive years or more shall be

transferred to the Investor’s Education and Protection Fund (IEPF).

Accordingly, during the year Company has transferred 49,273

equity shares to the IEPF. The details of equity shares transferred

are available on the Company’s website www.airtel.com.

The shareholders whose unpaid dividend / shares are

transferred to the IEPF can request the Company / Registrar and

Transfer Agent as per the applicable provisions in the prescribed

Form for claiming the unpaid dividend / shares from IEPF. The

process for claiming the unpaid dividend / shares out of the IEPF

is also available on the Company’s website at https://www.airtel.

in/about-bharti/equity/shares.

Deposits

The Company has not accepted any deposits and, as such,

no amount of principal or interest was outstanding, as on the

balance sheet closure date.

Capital Market Ratings

As on March 31, 2018, the Company was rated by two domestic

rating agencies, namely CRISIL and ICRA and three international

rating agencies, namely Fitch Ratings, Moody’s and S&P.

CRISIL and ICRA maintained their long-term ratings of the

Company. As on March 31, 2018, they rate the Company at

[CRISIL] AA+ / [ICRA] AA+, with a stable outlook. Short-term

ratings were maintained at the highest end of the rating scale

at [CRISIL] A1+ / [ICRA] A1+. Fitch, S&P and Moody’s rate the

Company at BBB-/ Stable, BBB-/Stable and Baa3/Negative,

respectively.

As on March 31, 2018, the Company was rated ‘Investment

Grade’ by all three international rating agencies.

Employee Stock Option Plan

At present, the Company has two Employee Stock Options

(ESOP) schemes, namely the Employee Stock Option Scheme

2001 and the Employee Stock Option Scheme 2005. Besides

attracting talent, the schemes also helped retain talent and

experience. The HR and Nomination Committee administers

and monitors the Company’s ESOP schemes.

Both the ESOP schemes are currently administered through

Bharti Airtel Employees Welfare Trust (ESOP Trust), whereby

shares held by the Trust are transferred to the employee, upon

exercise of stock options as per the terms of the Scheme.

Pursuant to the provisions of SEBI (Share Based Employee

Benefits) Regulations, 2014 (the ESOP Regulations), a

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

066

disclosure with respect to ESOP Schemes of the Company as

on March 31, 2018, is available on Company’s website at http://

www.airtel.in/wps/wcm/connect/c9e25993-5b80-4ebo-9874-

37614225b876.

During the year, to make the aforesaid ESOP Schemes more

employee friendly, the shareholder’s in its meeting dated July

24, 2017 had approved the reduction in the period for transfer

of vested / unvested options in the name of legal heir / nominees

of deceased employee from 3 months to 1 month. Apart from

the aforesaid change, there were no other changes in the ESOP

Schemes of the Company.

Further, ESOP Schemes are in compliance with ESOP

Regulations. A certificate from Deloitte Haskins & Sells LLP,

Chartered Accountants, Statutory Auditors of the Company with

respect to the implementation of the Company’s ESOP schemes,

would be placed before the shareholders at the ensuing AGM.

A copy of the same will also be available for inspection at the

Company’s registered office.

Material changes and commitments affecting the

financial position between the end of financial year

and date of report after the balance sheet date

There were no material changes and commitments affecting the

financial position of the Company between the end of financial

year and the date of this report.

Debentures

During the financial year, your Company raised H 30,000 Mn

through issuance of unsecured, listed, rated, non-convertible

debentures at face value of H 1 Mn each on private placement

basis as per the following details:

> 15,000 Series I debentures at a coupon rate of 8.25% per

annum [Tenor: 2 years, 1 month and 7 days];

> 15,000 Series II debentures at a coupon rate of 8.35% per

annum. [Tenor: 3 years, 1 month and 7 days].

The aforesaid debentures are listed on National Stock Exchange

of India Limited.

Directors and Key Managerial Personnel

Inductions, Re-appointments, Retirements & Resignations

Pursuant to the provisions of the Companies Act, 2013, Mr.

Rakesh Bharti Mittal and Ms. Tan Yong Choo, Directors of the

Company will retire by rotation at the ensuing AGM and being

eligible, have offered themselves for re-appointment. The Board

recommends their re-appointment.

Sheikh Faisal Thani Al-Thani, Non-Executive Director resigned

from the Company’s Board w.e.f. July 25, 2017. Mr. Rashid Fahad

O J Al-Noaimi was appointed as a Non-Executive Director on the

Board w.e.f. July 25, 2017 and resigned from the Company’s

Board w.e.f. November 22, 2017.

Mr. Craig Ehrlich, Independent Director will be completing his

present term as an independent director of the Company on

April 28, 2018. On the recommendation of HR and Nomination

Committee, the Board in its meeting held on April 24, 2018,

subject to the approval of shareholders by special resolution,

has re-appointed Mr. Craig as an Independent Director of the

Company for a further term of five years w.e.f. April 29, 2018 to

April 28, 2023.

On the recommendation of the HR and Nomination Committee,

the Board in its meeting held on April 24, 2018 subject to the

amendment in the Articles of Association, had changed the

nature of directorship of Mr. Gopal Vittal, Managing Director

& CEO (India & South Asia) from director not liable to retire by

rotation to a director liable to retire by rotation.

Brief resume, nature of expertise, details of directorships held in

other companies of the Directors proposed to be re-appointed,

along with their shareholding in the Company, as stipulated under

Secretarial Standard 2 and Regulation 36 of the Listing Regulations,

is appended as an Annexure to the Notice of the ensuing AGM.

The Board in its meeting held on July 18, 2017 has appointed

Mr. Pankaj Tewari as the Company Secretary of the Company.

Declaration by Independent Directors

The Company has received declarations from all Independent

Directors of the Company confirming that they continue to meet

the criteria of independence, as prescribed under Section 149

of the Companies Act, 2013 and Regulation 25 of the Listing

Regulations. The Independent Directors have also confirmed

that they have complied with the Company’s code of conduct.

Board Diversity and Policy on Director’s Appointment and

Remuneration

The Company believes that building a diverse and inclusive

culture is integral to its success. A diverse Board will be able to

leverage different skills, qualifications, professional experiences,

perspectives and backgrounds, which is necessary for achieving

sustainable and balanced development. The policy on ‘Nomination,

Remuneration and Board Diversity’ adopted by the Board sets

out the criteria for determining qualifications, positive attributes

and independence while evaluating a person for appointment /

re-appointment as Director or as KMP, with no discrimination on

the grounds of gender, race or ethnicity, nationality or country of

origin. The detailed policy is available on the Company’s website at

http://www.airtel.in/wps/wcm/connect/92b49e0e-8810-497a-

9c3e-9b80657a3688/Policy-on-Remuneration-Nomination-and

Board-Diversity.pdf?MOD=AJPERES and is also annexed as

Annexure B to this report.

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Annual Board Evaluation and Familiarisation

Programme for Board Members

A note on the familiarisation programme adopted by the

Company for orientation and training of the Directors, and

the Board evaluation process undertaken in compliance with

the provisions of the Companies Act, 2013 and the Listing

Regulations is provided in the Report on Corporate Governance,

which forms part of this Report.

The HR and Nomination Committee has put in place a robust

framework for evaluation of the Board, Board Committees and

Individual Directors. Customised questionnaires were circulated,

responses were analyzed and the results were subsequently

discussed by the Board. Recommendations arising from the

evaluation process were considered by the Board to optimize

its effectiveness. A detailed update on the Board Evaluation is

provided in the report on Corporate Governance which forms

part of this report.

Committees of Board, Number of Meetings of the

Board and Board Committees

The Board of Directors met eight (8) times during the previous

financial year. As on March 31, 2018, the Board has nine

committees, namely, the Audit Committee, the Risk Management

Committee, the HR and Nomination Committee, the Corporate

Social Responsibility (‘CSR’) Committee, the Stakeholders’

Relationship Committee, the Committee of Directors, the Airtel

Corporate Council, the Special Committee of Directors (for

Monetization of stake in Bharti Infratel Limited) and the Special

Committee of Directors (for Restructuring of overseas holding

structure).

All the recommendations made by committees of the Board

including the Audit Committee were accepted by the Board. A

detailed update on the Board, its composition, detailed charter

including terms and reference of various Board Committees,

number of Board and Committee meetings held during FY

2017-18 and attendance of the Directors at each meeting is

provided in the Report on Corporate Governance, which forms

part of this Report.

Subsidiary, Associate and Joint Venture

Companies

As on March 31, 2018, your Company has 89 subsidiaries,

6 associates and 8 joint ventures, as set out in note 34 of the

Annual Report (for Abridged Annual Report please refer note 17).

During FY 2017-18, Juggernaut Books Private Limited became

associate of the Company. Bharti Airtel Ghana Holdings B.V.,

Airtel Ghana Limited, Airtel Mobile Commerce (Ghana) Limited,

Milicom Ghana Company Limited, Mobile Financial Services

Limited became joint ventures of the Company.

During FY 2017-18, Bharti Digital Networks Private Limited

(formerly known as Tikona Digital Networks Private Limited),

Bharti Airtel International (Mauritius) Investments Limited, Airtel

Mobile Commerce Nigeria Limited and Tigo Rwanda Limited

became subsidiaries of the Company. Bangladesh Infratel

Networks Limited, Bharti Infratel Lanka (Private) Limited, Airtel

(Ghana) Limited, Airtel Mobile Commerce Ghana Limited, Bharti

Airtel DTH Holdings B.V., Bharti Airtel Ghana Holdings B.V., Airtel

DTH Services Nigeria Limited, Bharti Airtel Nigeria Holdings B.V.,

MSI-Celtel Nigeria Limited, Towers Support Nigeria Limited and

Zap Trust Company Nigeria Limited ceased to be subsidiaries of

the Company.

Pursuant to Section 129(3) of the Companies Act, 2013 read

with Rule 5 of Companies (Accounts) Rules, 2014, a statement

containing salient features of financial statements of subsidiary,

associate and joint venture companies is annexed to the

Abridged and full version Annual Report. The statement also

provides the details of performance and financial position of

each of the subsidiary, associate and joint venture companies

and their contribution to the overall performance of the

Company.

The audited financial statements of each of its subsidiary,

associate and joint venture companies are available for

inspection at the Company’s registered office and also at

registered offices of the respective companies and pursuant to

the provisions of Section 136 of the Companies Act, 2013, the

financial statements of each of its subsidiary companies are also

available on the Company’s website www.airtel.com.

Copies of the annual accounts of the subsidiary, associate

and joint venture companies will also be made available to the

investors of Bharti Airtel and those of the respective companies

upon request.

Abridged Annual Report

In terms of the provision of Section 136(1) of the Companies

Act, 2013, Rule 10 of Companies (Accounts) Rules, 2014

and Regulation 36 of the Listing Regulations, the Board of

Directors has decided to circulate the Abridged Annual Report

containing salient features of the balance sheet and statement

of profit and loss and other documents to the shareholders for

FY 2017-18, who have not registered their e-mail id. The

Abridged Annual Report is being circulated to the members

excluding Annexures to the Board’s Report viz. ‘Dividend

Distribution Policy’, ‘Nomination, Remuneration and Board

Diversity Policy’, ‘Secretarial Audit Report’, ‘Annual Report on

Corporate Social Responsibility u/s 135 of the Companies

Act, 2013’, ‘Extract of Annual Return’, ‘Particulars of Energy

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

068

Conservation, Technology Absorption and Foreign Exchange

Earnings and Outgo’, ‘Statement of Disclosure of Remuneration

under Section 197(12) of Companies Act, 2013 read with

Rule 5(1) of Companies (Appointment and Remuneration of

Managerial Personnel) Rules, 2014’, ‘Auditors’ Certificate on

Corporate Governance’.

Members who desire to obtain the full version of the report may

write to the Corporate Secretarial Department at the registered

office address and will be provided with a copy of the same.

Full version of the Annual Report will also be available on the

Company’s website www.airtel.com.

Auditors and Auditors’ Report

Statutory Auditors

In terms of the provisions of Section 139 of the Companies

Act, 2013, Deloitte Haskins & Sells LLP were appointed as

the Company’s Statutory Auditors by the shareholders in the

AGM held on July 24, 2017, for a period of five years i.e. till the

conclusion of 27

AGM.

The said appointment is subject to ratification by the members

at every AGM. Accordingly, the appointment of Deloitte

Haskins & Sells LLP, Chartered Accountants, as the Company’s

Statutory Auditors, is placed for ratification by the members. The

Company has received certificate from the Statutory Auditors

to the effect that ratification of their appointment, if made, shall

be in accordance with the provisions of Section 141 of the

Companies Act, 2013. The annual ratification of auditors at the

next AGM (to be held in calendar year 2019) for their remaining

term, shall be done, if required by the statutory provisions.

The Board has duly examined the Statutory Auditors’ Report to

the accounts, which is self-explanatory. Clarifications, wherever

necessary, have been included in the Notes to Accounts section

of the Annual Report.

As regards the comments under para i(a) of the Annexure 1

to the Independent Auditors’ Report regarding updation of

quantitative and situation details relating to certain fixed assets,

the Company is in the process of executing a comprehensive

project with the involvement of technical experts, for deploying

automated tools and processes which will enable near real-time

tracking of fixed assets and reconciliation thereto.

Internal Auditors and Internal Assurance Partners

The Board had appointed Group Director - Internal Assurance

as the Internal Auditor of the Company and Ernst & Young LLP

and ANB & Co., Chartered Accountants, Mumbai as the Internal

Assurance Partners to conduct the internal audit basis a detailed

internal audit plan which is reviewed each year in consultation

with the Internal Audit Group and the Audit Committee.

The Board, on the recommendation of the Audit Committee

has re-appointed Ernst & Young LLP and ANB & Co., Chartered

Accountants, Mumbai as the Internal Assurance Partners for FY

2018-19.

Cost Auditors

The Board, on the recommendation of the Audit Committee has

approved the appointment of R. J. Goel & Co., Cost Accountants,

as Cost Auditors, for FY 2018-19. The Cost Auditors will submit

their report for FY 2017-18 on or before the due date.

In accordance with the provisions of Section 148 of the

Companies Act, 2013 read with the Companies (Audit and

Auditors) Rules, 2014, since the remuneration payable to the

Cost Auditors is required to be ratified by the shareholders, the

Board recommends the same for approval by shareholders at

the ensuing AGM.

Secretarial Auditors

The Board had appointed Chandrasekaran Associates,

Company Secretaries, to conduct its Secretarial Audit for the

financial year ended March 31, 2018. The Secretarial Auditors

have submitted their report, confirming compliance by the

Company of all the provisions of applicable corporate laws. The

Report does not contain any qualification, reservation, disclaimer

or adverse remark. The Secretarial Audit Report is annexed as

Annexure C to this report.

The Board has re-appointed Chandrasekaran Associates,

Company Secretaries, New Delhi, as Secretarial Auditors of the

Company for FY 2018-19.

Sustainability Journey

We, at Bharti Airtel, strongly believe that power of communication

can bring in multi-dimensional transformations, ensuring

smooth functioning of life and businesses, and helping society

to become sustainable and inclusive. We recognize our role in

this sustainable approach in the way we conduct our business

by integrating sustainability in our strategies and operations.

Our Vision defines what we aim to do, whereas our Core

Values - Alive, Inclusive and Respectful - expound how we

aim to embrace the responsible business practices. As the

stakeholders have played a crucial role in Airtel’s sustained

success over the years, Airtel’s sustainability approach has

been carefully developed through systematic engagement

with its stakeholders worldwide. We continuously strive to

provide long-term sustainable value to all our stakeholders

including investors, customers, employees, business partners

and suppliers, government and regulators and communities.

This is performed through systematic stakeholder dialogue to

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gauge their expectations, share information and sustainability

priorities, practices and performance and explore avenues of

partnerships to achieve the goals. The Company publishes

an annual Sustainability Report in accordance with the Global

Reporting Initiative (GRI) framework which can be downloaded

from the Company’s website www.airtel.in/sustainability.

Corporate Social Responsibility (CSR)

Building upon and scaling up on various interventions initiated

in areas as prescribed in our CSR policy, the Company has

increased its CSR spending during the previous financial year i.e.

from H 55.84 Mn in FY 2016-17 to H 245.37 Mn in FY 2017-18.

Additionally, the Company has also contributed H 32.59 Mn

towards various other charitable causes. The consolidated

contribution of the Company towards various CSR activities

during the financial year 2017-18 is H 277.96 Mn (i.e. 0.26% of

net profit of last three years).

Company is committed to build its CSR capabilities on a

sustainable basis and is also committed to gradually increase

its CSR contribution in the coming years. The CSR spending

is guided by the vision of creating long-term benefit to the

society. The Company through its Board and CSR Committee

is determined to beef up its efforts to meet the targeted CSR

expenditure. With the strong foundation which has been

established during the year along with the proposed scaling up

of a number of its CSR Projects, the Company believes that it

has made meaningful progress towards reaching the target in

the coming financial years.

Further, during the year, Bharti Family has pledged a significant

amount towards philanthropy, which will step-up scope and

reach of Bharti Foundation’s initiatives to create opportunities

for the underprivileged and contribute to nation building. Plan is

to set up a world-class University namely Satya Bharti University,

to offer free education to deserving youth from economically

weaker sections of society. During the previous year, Mr. Sunil

Bharti Mittal, Chairman had also contributed H 50 Mn towards

CSR in his personal capacity.

A detailed update on the CSR initiatives of the Company is

provided in the Corporate Social Responsibility and Sustainability

Report, which forms part of the Annual Report.

The Annual Report on Corporate Social Responsibility u/s 135

of the Companies Act, 2013 is annexed as Annexure D to this

Report.

Integrated Reporting

The Securities and Exchange Board of India (SEBI) vide circular

no: SEBI/HO/CFD/CMD/CIR/P/2017/10 dated February 06,

2017 has recommended voluntary adoption of ‘Integrated

Reporting’ (IR) from 2017 - 2018 by the top 500 listed companies

in India. In line with its philosophy of being a highly transparent

and responsible company and considering IR as a journey, your

Company adopts its first ‘Integrated Report’ in accordance with

the framework of the International Integrated Reporting Council

(IIRC). The Integrated Report covers capital approach of IIRC

Framework as well as the value that your Company creates for

its stakeholders. The board acknowledges its responsibility for

the integrity of report and information contained therein.

Business Responsibility Report

As stipulated under the Listing Regulations, the Business

Responsibility Report, describing the initiatives taken by

the Company from environmental, social and governance

perspective forms a part of the Annual Report.

Management Discussion and Analysis Report

Pursuant to Regulation 34 of the Listing Regulations the

Management Discussion and Analysis Report for the year under

review, is presented in a separate section, forming part of the

Annual Report.

Risk Management

Risk management is embedded in Bharti Airtel’s operating

framework. The Company believes that risk resilience is key

to achieving higher growth. To this effect, there is a process

in place to identify key risks across the Group and prioritize

relevant action plans to mitigate these risks.

To have more robust process, the Company during the year,

constituted separate Risk Management Committee which

shall focus on the risk management including determination

of Company’s risk appetite, risk tolerance and regular risk

assessments (risk identification, risk quantification and risk

evaluation) etc. Risk Management framework is reviewed

periodically by the Board and Audit & Risk Management

Committee / Risk Management Committee, which includes

discussing the management submissions on risks, prioritizing

key risks and approving action plans to mitigate such risks.

The Company has duly approved a Risk Management Policy. The

objective of this Policy is to have a well-defined approach to risk.

The policy lays down broad guidelines for timely identification,

assessment, and prioritization of risks affecting the Company in

the short and foreseeable future. The Policy suggests framing

an appropriate response action for the key risks identified, so as

to make sure that risks are adequately addressed or mitigated.

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

070

The Internal Audit function is responsible to assist the Audit

Committee (erstwhile Audit & Risk Management Committee)/

Risk Management Committee on an independent basis with

a complete review of the risk assessments and associated

management action plans.

Operationally, risk is being managed at the top level by

Management Boards in India and South Asia and in Africa

(AMB and Africa Exco) and at operating level by Executive

Committees of Circles in India and Operating Companies in the

international operations.

Detailed discussion on Risk Management forms part of

Management Discussion & Analysis under the section ‘Risks

and Concerns’, which forms part of this Annual Report. At

present, in the opinion of the Board of Directors, there are no

risks which may threaten the existence of the Company.

Internal Financial Controls and their adequacy

The Company has established a robust framework for internal

financial controls. The Company has in place adequate controls,

procedures and policies, ensuring orderly and efficient conduct

of its business, including adherence to the Company’s policies,

safeguarding of its assets, prevention and detection of frauds

and errors, accuracy and completeness of accounting records,

and timely preparation of reliable financial information. During

the year, such controls were assessed and no reportable

material weaknesses in the design or operation were observed.

Accordingly, the Board is of the opinion that the Company’s

internal financial controls were adequate and effective during

FY 2017-18.

Other Statutory Disclosures

Vigil Mechanism

The Code of Conduct and vigil mechanism applicable to

Directors and Senior Management of the Company is available

on the Company’s website at http://www.airtel.in/about-bharti/

investor-relations/corporate-governance.

A brief note on the highlights of the Whistle Blower Policy and

compliance with Code of Conduct is also provided in the report on

Corporate Governance, which forms part of this Annual Report.

Extract of Annual Return

In terms of provisions of Section 92, 134(3)(a) of the Companies

Act, 2013 read with Rule 12 of Companies (Management

and Administration) Rules, 2014, the extracts of Annual

Return of the Company in form MGT-9 is annexed herewith as

Annexure E to this report.

Significant and material orders

There are no significant and material orders passed by the

regulators or courts or tribunals impacting the going concern

status and Company’s operations in future.

Particulars of loans, guarantees and investments

Particulars of loans, guarantees and investments form part

of note 10, 23 and 8 respectively to the financial statements

provided in the full version of the Annual Report.

Related Party Transactions

A detailed note on the procedure adopted by the Company in

dealing with contracts and arrangements with Related Parties is

provided in the Report on Corporate Governance, which forms

part of this Annual Report.

All arrangements / transactions entered into by the Company

with its related parties during the year were in the ordinary

course of business and on an arm’s length basis. During the

year, the Company has not entered into any arrangement /

transaction with related parties which could be considered

material in accordance with the Company’s Policy on Related

Party Transactions and accordingly, the disclosure of Related

Party Transactions in Form AOC - 2 is not applicable. However,

names of Related Parties and details of transactions with them

have been included in note 34 of the financial statements

provided in the full version of the Annual Report and note 17

of the financial statements provided in abridged version of the

Annual Report under Indian Accounting Standards 24.

The Policy on the Related Party Transactions is available

on the Company’s website at http://www.airtel.in/wps/

wcm/connect/36a5305d-f0ba-490c-9eff-152ef6811917/

BALPolicy-on-Related-Party Transactions.pdf?MOD=AJPERES.

Energy Conservation, Technology Absorption and Foreign

Exchange Earnings and Outgo

The details of energy conservation, technology absorption and

foreign exchange earnings and outgo as required under Section

134(3) of the Companies Act, 2013, read with the Rule 8 of

Companies (Accounts of Companies) Rules, 2014 is annexed

as Annexure F to this report.

Particulars of Employees

Disclosures relating to remuneration of Directors u/s 197(12)

read with Rule 5(1) of Companies (Appointment and

Remuneration of Managerial Personnel) Rules, 2014 is annexed

as Annexure G to this report.

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The information, as required to be provided in terms of Section

197(12) of the Companies Act, 2013, read with Rule 5(2) of

Companies (Appointment and Remuneration of Managerial

Personnel) Rules, 2014, is annexed as Annexure H to this report.

Corporate Governance

A detailed report on Corporate Governance, pursuant to the

requirements of Regulation 34 of the Listing Regulations, forms

part of the Annual Report.

A certificate from Deloitte Haskins & Sells LLP, Chartered

Accountants, the Statutory Auditors of the Company, confirming

compliance of conditions of Corporate Governance, as stipulated

under the Listing Regulations, is annexed as Annexure I to this

report.

Directors’ Responsibility Statement

Pursuant to Section 134 of the Companies Act, 2013, the

Directors, to the best of their knowledge and belief, confirm that:

a) in the preparation of the annual accounts, the applicable

accounting standards had been followed, along with proper

explanation relating to material departures;

b) the Directors had selected such accounting policies and

applied them consistently and made judgements and

estimates that are reasonable and prudent, so as to give a

true and fair view of the state of affairs of the Company at

the end of the financial year and of the profit and loss of the

Company for that period;

c) the Directors had taken proper and sufficient care for the

maintenance of adequate accounting records in accordance

with the provisions of this Act for safeguarding the assets

of the Company and for preventing and detecting fraud and

other irregularities;

d) the Directors had prepared the annual accounts on a going

concern basis;

e) the Directors, had laid down internal financial controls to be

followed by the Company and that such internal financial

controls are adequate and were operating effectively;

f) the Directors had devised proper systems to ensure

compliance with the provisions of all applicable laws and

that such systems were adequate and operating effectively.

Acknowledgements

The Board wishes to place on record their appreciation to

the Department of Telecommunications (DoT), the Central

Government, the State Governments in India, Government

of Sri Lanka and Governments in the 14 countries in Africa,

Company’s bankers and business associates, for the assistance,

co-operation and encouragement extended to the Company.

The Directors also extend their appreciation to the employees

for their continuing support and unstinting efforts in ensuring

an excellent all-round operational performance. The Directors

would like to thank various partners, viz., Bharti Telecom Limited,

Singapore Telecommunications Ltd. and other shareholders

for their support and contribution. We look forward to their

continued support in future.

For and on behalf of the Board

Place: New Delhi Sunil Bharti Mittal

Date: April 24, 2018 Chairman

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

072

Dividend Distribution Policy

Annexure A

1. Preamble, Objective and Scope

In terms of Regulation 43A of the SEBI (Listing Obligations

and Disclosure Requirements) Regulations, 2015 (‘Listing

Regulations’), the Company is required to formulate a

Dividend Distribution Policy which shall be disclosed in its

Annual Report and on its website.

To comply with the above requirement and with an

endeavor to maintain a consistent approach to dividend

pay-out plans, the Board of Directors (‘Board’) of Bharti Airtel

Limited (‘the Company’) adopts this Dividend Distribution

Policy (‘Policy’).

The objective of this Policy is to:

(i) specify the parameters (including internal and external

factors) that shall be considered while declaring the

dividend;

(ii) lay down the circumstances under which the

shareholders of the Company may or may not expect

dividend; and

(iii) provide for the manner of utilization of retained

earnings.

2. Dividend Philosophy

The Dividend philosophy of the Company is enshrined in

the principle that along with maintaining a reasonably

conservative policy in respect of liquidity and leverage,

‘surplus’ cash in the Company shall be returned to its

shareholders when it is concluded by the Board that:

> The Company doesn’t / wouldn’t have avenues to

generate significantly higher returns on such ‘surplus’

than what a common shareholder can generate

himself; or

> By returning such ‘surplus’, the Company would be able

to improve its return on equity, while simultaneously

maintaining prudent & reasonably conservative

leverage in every respect viz. interest coverage, DSCR

(Debt Service Coverage Ratio) Net Debt: EBITDA and

Net Debt : Equity etc.

The Company aims to distribute to its shareholders, the

entire dividend income (net of taxes) it receives from its

subsidiary / associate companies.

3. Parameters / Factors considered by the

Company while declaring dividend

In line with the philosophy stated in clause 2 above, the

Board of Directors of the Company shall consider the

following parameters before declaring or recommending

dividend to shareholders:

A) Financial Parameters / Internal Factors:

(a) Financial performance including profits earned

(standalone), available distributable reserves etc.;

(b) Impact of dividend payout on Company’s return on

equity, while simultaneously maintaining prudent

and reasonably conservative leveraging in every

respect viz. interest coverage, DSCR (Debt Service

Coverage Ratio) Net Debt: EBITDA and Net Debt:

Equity, including maintaining a targeted rating –

domestically and internationally;

Investment opportunities or capital expenditures

and resources to fund such opportunities/

expenditures, in order to generate significantly

higher returns for shareholders;

(d) Debt repayment schedules;

(e) Fund requirement for contingencies and

unforeseen events with financial implications;

(f) Past Dividend trend including Interim dividend

paid, if any; and

(g) Any other factor as deemed fit by the Board.

B) External Factors:

(a) Macroeconomic conditions: In the event of

uncertain or recessionary economic and business

conditions, the Board may consider retaining a

larger part of the profits to have sufficient reserves

to absorb unforeseen circumstances;

(b) Statutory requirements: Statutory requirements,

regulatory conditions or restrictions as applicable

including tax laws, The Companies Act, 2013 and

SEBI regulations etc.;

Board may consider protective covenants in

a bond indenture or loan agreement that may

include leverage limits & restrictions on payment

of cash dividends in order to preserve the

Company’s ability to service its debt; and

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(d) Capital Markets: In favorable market scenarios, the

Board may consider for liberal pay – out. However,

it may resort to a conservative dividend pay-out in

case of unfavorable market conditions.

4. Circumstances under which the shareholders

of the Company may or may not expect

dividend

In line with Dividend Philosophy of the Company, there may

be certain circumstances under which the shareholders

of the Company may not expect dividend, including the

circumstances where:

(a) The Company has sufficient avenues to generate

significantly higher returns on such ‘surplus’ than what

a common shareholder can generate himself;

(b) The Company is in higher need of funds for acquisition/

diversification / expansion / investment opportunities/

deleveraging or capital expenditures;

entirety for alternative forms of distribution such as

buy-back of securities; or

(d) The Company has incurred losses or in the stage of

inadequacy of profits.

5. Utilization of retained earnings

The profits retained by the Company (i.e. retained earnings)

shall either be used for business purposes/ objects

mentioned in its Memorandum & Articles of Association or

shall be distributed to the shareholders.

6. Parameters with regard to various classes of

Presently, the issued and paid-up share capital of the

Company comprises of equity shares only. In case, the

Company issues other kind of shares, the Board may

suitably amend this Policy.

7. General

This Policy shall be reviewed at least once every 3 years.

The Chief Investor Relations Officer and the Company

Secretary are jointly authorized to amend the Policy to give

effect to any changes / amendments notified by Ministry of

Corporate Affairs, Securities and Exchange Board of India or

any appropriate authority from time to time. Such amended

policy shall be periodically placed before the Board for

noting and ratification. Any questions and clarifications

relating to this Policy should be addressed to the Company

Secretary at [email protected].

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

074

Preamble

The Board of Directors (the “Board”) on the recommendation

of the HR & Remuneration Committee (the “Committee”) has

approved and adopted this Nomination, Remuneration and

Board Diversity Policy (the “Policy”) in compliance with the

provisions of Section 178 of the Companies Act, 2013 and rules

made thereunder, and Clause 49 of the Listing Agreements with

the Stock Exchanges.

Objectives

The main objectives of this Policy are:

> To lay down criteria and terms and conditions with regard to

identifying persons who are qualified to become Directors

(Executive and Non-Executive including Independent

Directors), Key Managerial Personnel (“KMP”) and persons

who may be appointed in Senior Management positions.

> To lay down criteria for determining the Company’s

approach to ensure adequate diversity in its Board.

> To retain, motivate and promote talent and to ensure long

term sustainability of talented managerial persons and

create competitive advantage for the Company.

> To determine remuneration of Directors, KMPs and other

senior management personnel’s, keeping in view all relevant

factors including industry trends and practices.

> To provide for rewards linked directly to their effort,

performance, dedication and achievement of the

Company’s target.

A. Attributes, Qualifications and Diversity

Directors and Key Managerial Personnel

The Committee shall be responsible for identifying a suitable

candidate for appointment as Director or as KMP of the

Company.

The Board shall consist of such number of Directors as is necessary

to effectively manage the Company of the size and nature as of

Bharti Airtel, subject to a minimum of 3 and maximum of 15,

including woman Directors. The Board shall have an appropriate

combination of Executive, Non-Executive and Independent

Directors. The Board shall appoint a Chairman and a Managing

Director or CEO and the roles of Chairman and Managing Director

or CEO shall not be exercised by the same individual.

While evaluating a person for appointment / re-appointment as

Director or as KMP, the Committee shall consider and evaluate

number of factors including but not limited to background,

knowledge, skills, abilities (ability to exercise sound judgement),

professional experience & functional expertise, educational

and professional background, personal accomplishment, age,

experience, understanding of the telecommunication sector /

industry, marketing, technology, finance and other disciplines

relevant to the business etc. and such other factors that the

Committee might consider relevant and applicable from time to

time towards achieving a diverse Board.

The Committee shall ensure that the proposed Director satisfies

the following additional criteria:

> Eligible for appointment as a Director on the Board of the

Company and is not disqualified in terms of Section 164

and other applicable provisions of the Companies Act,

2013, and the Listing Agreements.

> Has attained minimum age of 25 years and is not older

than 70 years.

> Does not hold directorship in more than 20 companies

(including private and public limited companies) or 10

public limited companies incorporated in India.

> Will be able to devote sufficient time and efforts in discharge

of duties and responsibilities effectively.

While evaluating a person for appointment / re-appointment as

an Independent Director, the Committee shall ensure that the

proposed appointee satisfies the following additional criteria:

> Meet the baseline definition and criteria of “independence”

as set out in Section 149 of the Companies Act, 2013 and

Clause 49 of the Listing Agreements and other applicable

laws.

> Should not hold the position of Independent Director in

more than six Indian listed companies and if serving as

Whole-time Director in any Indian listed company then in

not more than three Indian listed companies.

> Should not hold any Board / employment position with

a competitor in the geographies where the Company is

operating. However, the Board may in special circumstances

waive this requirement.

The re-appointment / extension of term of any Board members

shall be on the basis of their performance evaluation report.

Senior Management

While evaluating a person for appointment / re-appointment in a

senior management position, the management shall considers

various factors including individual’s background, competency,

Nomination, Remuneration and Board

Diversity Policy

Annexure B

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skills, abilities (viz. leadership, ability to exercise sound

judgement), educational and professional background, personal

accomplishment, age, relevant experience and understanding

of related field viz. marketing technology, finance or such other

discipline relevant to present and prospective operations

of the Company.

Senior Management means personnel of the Company

who are members of its core management team excluding

Board of Directors and shall comprise of all members of

management one level below the Executive Directors, including

all functional heads.

B. Remuneration Policy

Board Members

The overall limits of remuneration of the Board members

including Executive Board members (i.e. Managing Director,

Whole-time Director, Executive Directors etc.) are governed by

the provisions of Section 197 of the Companies Act, 2013, rules

made thereunder and shall be approved by the shareholders

of the Company and shall be subject to availability of

profits of the Company.

Within the overall limit approved by the shareholders, on

the recommendation of the Committee, the Board shall

determine the remuneration. The Board can determine different

remuneration for different Directors on the basis of their role,

responsibilities, duties, time involvement etc.

Non-Executive Directors including Independent Directors

Pursuant to the provisions of Section 197 of the Companies Act,

2013, rules made thereunder and the shareholders’ approval,

the Board has approved the following remuneration for Non-

Executive Directors (including Independent Directors):

I. Commission on Net Profit (Calculated as per Section 198

of the Companies Act, 2013)

Amount of Commission per annum:

Subject to availability of sufficient profits and within an

overall ceiling of 1% of the net profits for all non-executive

directors in the aggregate, the amount of commission

payable to:

A. Non-Independent Non-executive directors:

> USD 60,000 for directors not residing in India

> H 3,000,000 for directors residing in India

B. Independent non-executive directors:

> USD 100,000 for directors not residing in India

> J 5,000,000 for those residing in India

The Independent Directors shall also be entitled to following

additional commission:

i. Audit Committee:

Chairmanship:

> Not residing in India: USD 50,000/- per annum

> Residing in India: H 3,000,000/- per annum

Membership:

> Not residing in India: USD 10,000/- per annum

> Residing in India: H 500,000/- per annum

ii. HR and Nomination Committee:

Chairmanship:

> Not residing in India: USD 50,000/- per annum

> Residing in India: H 3,000,000/- per annum

Membership:

> Not residing in India: USD 10,000/- per annum

> Residing in India: H 500,000/- per annum

iii. Risk Management Committee:

Chairmanship:

> H 2,000,000/- per annum

Independent Directors will also be entitled to Travel fee of

USD 10,000 per meeting if not residing in India.

Frequency of Payment:

The commission is payable annually after the approval of the

financial results.

II. Sitting Fees

In addition to the profit linked commission, the Independent

Directors will also be entitled to sitting fee of H 100,000/- for all

Board meetings and all Committee meetings held in a single

day. For avoidance of doubt, in case an Independent Director

attends more than one Board and / or Committee meeting in a

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

076

day, he will be paid consolidated sitting fee of H 100,000/- for all

such meetings. If the Board appoint any person as an alternate

Director to an Independent Director, such person will be entitled

to sitting fee for the relevant meeting.

Executive Board Members (Managing Director,

Whole-time Director, Executive Directors etc.)

The remuneration (including revision in the remuneration) of

Executive Board members shall be approved by the Board on

the basis of the recommendation of the HR and Nomination

Committee.

The remuneration payable to Executive Board members shall

consist of (a) Fixed Pay, which is payable monthly, and shall

include basic pay, contributions to retirement benefits, house

rent allowance or company-leased accommodation and other

allowances as per the Company’s policy (b) Variable Pay (paid

at the end of Financial Year) directly linked to the performance

of the individual employee (i.e. achievement against pre-

determined KRAs), his / her respective Business Unit and the

overall Company’s performance (c) Long term incentive /

ESOPs as may be decided by the HR & Nomination Committee

from time to time.

Remuneration to Key Managerial Personnel (other

than Managing Director and Whole-time Director),

Senior Management and other employees

The remuneration of Key Managerial Personnel (other than

Managing Director and Whole-time Director), shall be as per the

compensation and appraisal policy of the Company.

The remuneration payable to key managerial personnel (other

than Managing Director and Whole-time Director), senior

management and other employees shall consist of (a) Fixed Pay,

which is payable monthly and include basic pay, contributions

to retirement benefits, house rent allowance or company-leased

accommodation and other allowances as per the Company’s

policy (b) Variable Pay (paid at the end of Financial Year) directly

linked to the performance of the individual employee (i.e.

achievement against pre-determined KRAs), his / her respective

business unit and the overall Company performance (c) Long

term incentive / ESOPs as may be decided by the Committee

from time to time.

Disclosures by the Company

This Policy shall be disclosed in the Company’s Annual Report.

General

The Group Director – HR and the Company Secretary are jointly

authorised to amend the Policy to give effect to any changes

/ amendments notified by Ministry of Corporate Affairs or

Security Exchange Board of India w.r.t. Directors’ any matter

covered by this policy. The amended policy shall be placed

before the Board for noting and ratification. Any questions

and clarifications relating to this Policy should be addressed

to the Group General Counsel and Company Secretary at

compliance.officer@bharti.in.

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Secretarial Audit Report

Annexure C

For the financial year ended March 31, 2018

The Members,

Bharti Airtel Limited

Bharti Crescent, 1, Nelson Mandela Road,

Vasant Kunj, Phase-II,

New Delhi – 110070

We have conducted the secretarial audit of the compliance

of applicable statutory provisions and the adherence to good

corporate practices by Bharti Airtel Limited (hereinafter

called the Company). Secretarial Audit was conducted in a

manner that provided us a reasonable basis for evaluating the

corporate conducts / statutory compliances and expressing our

opinion thereon.

Based on our verification of the Company’s books, papers, minute

books, forms and returns filed and other records maintained

by the Company and also the information provided by the

Company, its officers, agents and authorized representatives

during the conduct of secretarial audit, we hereby report that in

our opinion, the Company has, during the audit period covering

the financial year ended on March 31, 2018 complied with the

statutory provisions listed hereunder and also that the Company

has proper Board-processes and compliance-mechanism in

place to the extent, in the manner and subject to the reporting

made hereinafter:

We have examined the books, papers, minute books, forms and

returns filed and other records maintained by the Company

for the financial year ended on March 31, 2018 according to

the provisions of:

(i) The Companies Act, 2013 (the Act) and the rules made

thereunder;

(ii) The Securities Contracts (Regulation) Act, 1956 (‘SCRA’)

and the rules made thereunder;

(iii) The Depositories Act, 1996 and the Regulations and Bye-

laws framed thereunder to the extent of Regulation 55A;

(iv) Foreign Exchange Management Act, 1999 and the rules

and regulations made thereunder to the extent of Foreign

Direct Investment, Overseas Direct Investment and External

Commercial Borrowings;

(v) The following Regulations and Guidelines prescribed under

the Securities and Exchange Board of India Act, 1992 (‘SEBI

Act’):-

a) The Securities and Exchange Board of India

(Substantial Acquisition of Shares and Takeovers)

Regulations, 2011;

b) The Securities and Exchange Board of India (Prohibition

of Insider Trading) Regulations, 2015;

c) The Securities and Exchange Board of India (Issue of

Capital and Disclosure Requirements) Regulations,

2009;

d) The Securities and Exchange Board of India (Share

Based Employee Benefits) Regulations, 2014;

e) The Securities and Exchange Board of India (Issue and

Listing of Debt Securities) Regulations, 2008;

f) The Securities and Exchange Board of India (Registrars

to an Issue and Share Transfer Agents) Regulations,

1993 regarding the Companies Act and dealing with

client to the extent of securities issued;

g) The Securities and Exchange Board of India (Delisting of

Equity Shares) Regulations, 2009; Not Applicable and

h) The Securities and Exchange Board of India (Buyback

of Securities) Regulations, 1998. Not Applicable

(vi) The other laws, as informed and certified by the management

of the Company which are specifically applicable to the

Company based on their Sectors/Businesses are:

a) The Indian Telegraph Act, 1885;

b) The Telecom Regulatory Authority of India Act, 1997

and Rules and Regulations made thereunder; and

c) The Indian Wireless Telegraphy Act, 1933.

We have also examined compliance with the applicable clauses

of the following:

a) Secretarial Standards issued by The Institute of Company

Secretaries of India and notified by Ministry of Corporate

Affairs.

b) SEBI (Listing Obligations and Disclosure Requirements)

Regulations, 2015.

During the period under review the Company has generally

complied with the provisions of the Act, Rules, Regulations,

Guidelines, Standards, etc. mentioned above.

We further report that,

The Board of Directors of the Company is duly constituted with

proper balance of Executive Directors, Non-Executive Directors

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

078

and Independent Directors. The changes in the composition of

the Board of Directors that took place during the period under

review were carried out in compliance with the provisions

of the Act.

Adequate notice is given to all directors to schedule the Board

Meetings, agenda and detailed notes on agenda were sent least

seven days in advance (except in cases where meetings were

convened at a shorter notice for which necessary approvals

obtained as per applicable provisions), and a system exists for

seeking and obtaining further information and clarifications

on the agenda items before the meeting and for meaningful

participation at the meeting.

All decisions at Board Meetings and Committee Meetings are

carried out unanimously as recorded in the minutes of the

meetings of the Board of Directors or Committee of the Board,

as the case may be.

We further report that there are adequate systems and

processes in the Company commensurate with the size and

operations of the Company to monitor and ensure compliance

with applicable laws, rules, regulations and guidelines.

We further report that during the audit period following major

events have happened which are deemed to have major bearing

on the Company’s affairs in pursuance of the above referred

laws, rules, regulations, guidelines, standards, etc.

1. Scheme of amalgamation of Tikona Digital Networks

Private Limited with the Company was approved, subject to

necessary approvals.

2. Scheme of arrangement between the Company

and Telesonic Networks Limited for the demerger of

the optical fibre business was approved, subject to

necessary approvals.

3. Scheme of arrangement between the Company and

Tata Teleservices (Maharashtra) Limited (‘TTML’) for the

demerger of the consumer wireless mobile business of

TTML into the company, subject to necessary approvals.

4. Scheme of arrangement between the Company, Bharti

Hexacom Limited and Tata Teleservices Limited (‘TTSL’) for

the demerger of the consumer wireless mobile business of

TTSL into the company, subject to necessary approvals.

5. Inter-se transfer of 44% stake (96,938,000 equity shares)

in Telesonic Networks Limited to Nettle Infrastructure

Investments Limited, a wholly owned subsidiary of the

Company

6. Secondary sale of 8.14% % stake (15,05,34,392 equity

shares) in Bharti Infratel Limited through its wholly owned

subsidiary Nettle Infrastructure Investments Limited.

7. The Company has made Private Placement of 30,000

unsecured, rated, redeemable, listed non-convertible

debentures of H 10,00,000/- each for an aggregate

consideration of H 30,000,000,000.

Chandrasekaran Associates

Company Secretaries

Dr. S. Chandrasekaran

Senior Partner

Place: New Delhi Membership No. FCS No.: 1644

Date: April 24, 2018 Certificate of Practice No.: 715

Note: This report is to be read with our letter of even date which

is annexed as Annexure-A to this report and forms an integral

part of this report.

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The Members

Bharti Airtel Limited

Bharti Crescent, 1, Nelson Mandela Road,

Vasant Kunj, Phase-II,

New Delhi – 110070

1. Maintenance of secretarial record is the responsibility of

the management of the Company. Our responsibility is to

express an opinion on these secretarial records based on

our audit.

2. We have followed the audit practices and processes as

were appropriate to obtain reasonable assurance about

the correctness of the contents of the secretarial records.

The verification was done on the random test basis to

ensure that correct facts are reflected in secretarial records.

We believe that the processes and practices, we followed

provide a reasonable basis for our opinion.

3. We have not verified the correctness and appropriateness

of financial records and Books of Accounts of the Company.

4. Where ever required, we have obtained the Management

representation about the compliance of laws, rules and

regulations and happening of events etc.

5. The compliance of the provisions of Corporate and

other applicable laws, rules, regulations, standards is the

responsibility of management. Our examination was limited

to the verification of procedures on the random test basis.

6. The Secretarial Audit report is neither an assurance as to

the future viability of the company nor of the efficacy or

effectiveness with which the management has conducted

the affairs of the Company.

Chandrasekaran Associates

Company Secretaries

Dr. S. Chandrasekaran

Senior Partner

Place: New Delhi Membership No. FCS No.: 1644

Date: April 24, 2018 Certificate of Practice No.: 715

Annexure-A to the Secretarial Audit Report

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

080

Annexure D

The Annual Report on Corporate Social Responsibility

(CSR) Activities

1. Brief Outline of Company’s CSR Policy

At Bharti Airtel, business success is not just about profits and shareholder returns. We believe in pursuing wider socio-economic

and cultural objectives and have always endeavoured to not just live up to it, but to try and exceed the expectations of the

communities in which we operate.

The CSR policy of the Company which is available on its website, was adopted by the Board of Directors on April 29, 2014. The

Company’s CSR activities focus on promoting education with special emphasis on girl child, livelihood enhancement education

programs, eradicating hunger, promoting preventive health care and sanitation and providing legal assistance to underprivileged

under-trials. Bharti Airtel’s CSR activities are committed to create and support programs that bring about sustainable changes

through education.

The detailed CSR Policy of the Company is available on Company’s website at: http://www.airtel.in/wps/wcm/connect/fd7b3172-

02e5-4e25-af7e-51d64cc17534/CSR+Policy.pdf?MOD=AJPERES&ContentCache=NONE.

The overview of various CSR projects and programs undertaken by the Company has been provided in the Corporate Social

Responsibility Report section of this Annual Report.

2. Composition of CSR Committee

Name Category

Mr. Rakesh Bharti Mittal, Chairman Non-Executive Director

Mr. D. K. Mittal Independent Director

Mr. Gopal Vittal Managing Director & CEO (India & South Asia)

(H Millions)

3. Average net profit before tax of the Company for last three financial years

107,313.00

4. Prescribed CSR Expenditure (2% of the amount as above)

2,146.26

5. Details of CSR spent during the year

a) Total amount to be spent for the financial year

i) Amount spent towards CSR activities

ii) Amount spent towards other charitable activities

2,146.26

245.37

32.59

b) Amount Unspent 1,900.89*

c) Manner in which the amount spend during the financial year is detailed below:

*The Companny has contribued 245.37 Mn as CSR contribution under Section 135 of Companies Act, 2013. In addition the Company has also

contributed 32.59 Mn to various other charitable activities. The consolidated contribution of the Company towards various CSR programs during the

financial year 2017-18 is 277.96 Mn.

(H Millions)

No.

CSR project or

activity identied

Sector in which the

project is covered

Projects or

programs

(1) Local area or

other

(2) Specify the

State and district

where projects

or programs was

undertaken

Amount

outlay

(budget)

project or

programs

wise

Amount spent on

the projects or

programs

Sub-heads:

(1) Direct

expenditure

on projects or

programs

(2) Overheads:

Cumulative

expenditure

up to the

reporting

period

Amount

spent: Direct

or through

implementing

agency

Eligible CSR Programs/ Projects

1 Satya Bharti School

Program

Promotion of education Specied below* 448.80 179.79 1390.90 Bharti

Foundation

2 Satya Bharti Abhiyan Sanitation Ludhiana & Amritsar,

Punjab

120.5 10.81 119.51 Bharti

Foundation

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# Program discontinued w.e.f. March 2018.

* District / State wise details of Satya Bharti School Program – Jodhpur, Amer and Neemrana in Rajasthan, Amritsar, Ludhiana and Sangrur in Punjab,

Kaithal, Kurukshetra, Rewari, Mahendergarh and Jhajjar in Haryana, Farrukhabad, Shahjahanpur, Sitapur and Bulandhahar in Uttar Pradesh, Murshidabad

in West Bengal, Sivaganga in Tamil Nadu. District / State wise details of Satya Bharti Learning Centres Kurukshetra, Rewari, Mahendergarh, Gurgaon and

Karnal in Haryana, Bhatinda and Fazikla in Punjab, Barmer, Sawaimadhopur and Udaipur in Rajasthan, Godda, Pakur, Sahibganj, Dhumka and Deoghar

in Jharkhand. District /State wise details of Quality Support Program Jodhpur, Barmer Tonk and Ajmer in Rajasthan, Ghazipur in Uttar Pradesh, Rajanna

Sircilla in Telangana, Leh, Jammu, Kashmir and Nagrota in Jammu and Kashmir, Kurnool in Andhra Pradesh, Dhumka and Deoghar in Jharkhand, Barwani

and Jhabua in Madhya Pradesh, Delhi and Goa.

** Haryana, Delhi and NCR Region, Bihar, Gujarat, Uttar Pradesh, Rajasthan and Madhya Pradesh.

(H Millions)

No.

CSR project or

activity identied

Sector in which the

project is covered

Projects or

programs

(1) Local area or

other

(2) Specify the

State and district

where projects

or programs was

undertaken

Amount

outlay

(budget)

project or

programs

wise

Amount spent on

the projects or

programs

Sub-heads:

(1) Direct

expenditure

on projects or

programs

(2) Overheads:

Cumulative

expenditure

up to the

reporting

period

Amount

spent: Direct

or through

implementing

agency

3 Educate a Child Promotion of education Specied below** 70.00 0.00 242.60 Bharti

Foundation

4 Nyaya Bharti

initiative

Promoting measures

for reducing inequalities

faced by economically

backward groups

Delhi and NCR region 14.10 5.00 16.55 Bharti

Foundation

5 Crop science

research and

development

program

Livelihood enhancement

Program

Punjab 20.60 11.72 24.97 Bharti

Foundation

6 Magic Bus

Foundation

Promotion of education Delhi and Mumbai 2.50 2.00 4.30 Direct

7 Anubandh - Old Age

Home

Setting up and

supporting old age

homes

Jodhpur, Rajasthan 3.00 3.00 8.00 Direct

8 Partition Museum Restoration and

establishment of

building of historical

importance

Amritsar, Punjab 5.00 5.00 10.00 Direct

9 Ramadham Old Age

home

Setting up and

supporting old age

homes

Raigad District,

Maharashtra

2.50 2.50 2.50 Direct

10 Skill development

program for youth

and vocational skills

for women

Employment enhancing

vocation skills

Chhindwara, Madhya

Pradesh

13.95 13.95 30.00 Centum

Foundation

11 Vocational training

program for hearing

impaired young

adults

Employment enhancing

vocation skills to

dierently abled

Delhi 23.20 11.60 23.20 Centum

Foundation

Total 722.15 245.37 1872.53

Other Contributions

1 Miscellaneous Miscellaneous Miscellaneous 32.59 32.59 93.23 Direct

Total 32.59 32.59 93.23

Grand Total 754.74 277.96 1965.76

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

082

6. Reason for not spending the prescribed 2% amount

Despite the unprecedented challenges and pressure on the telecom industry, the Company had scaled-up various CSR

interventions during the FY 2017-18 which resulted into increased CSR spending vis-à-vis previous financial year i.e. from H 55.84

Mn in FY 2016-17 to H 245.37 Mn in FY 2017-18. Additionally, the Company has also contributed H 32.59 Mn towards various

other charitable causes (disclosed as ‘other contributions’ in the above mentioned table) which are not covered within the ambit

of the provisions of Section 135 of the Companies Act, 2013. The aggregate CSR spending of the Company for FY 2017-18

(including other contributions) is H 277.96 Mn (i.e. 0.26% of net profit of last three years).

Company is committed to build its CSR capabilities on a sustainable basis and is also committed to gradually increase its CSR

contribution in the coming years. The CSR spending is guided by the vision of creating long-term benefit to the society. The

Company through its Board and CSR Committee is determined to beef up its efforts to meet the targeted CSR expenditure. With

the strong foundation which has been established during the year alongwith the proposed scaling up of a number of its CSR

Projects, the Company believes that it has made meaningful progress towards reaching the target in the coming financial years.

Further, during the year, Bharti Family has pledged a significant amount towards philanthropy, which will step-up scope and reach

of Bharti Foundation’s initiatives to create opportunities for the underprivileged and contribute to nation building. Plan is to set

up a world-class University namely Satya Bharti University, to offer free education to deserving youth from economically weaker

sections of society. During the previous year, Mr. Sunil Bharti Mittal, Chairman had also contributed H 50 Mn towards CSR in his

personal capacity.

Responsibility statement of the CSR Committee

The Committee confirms that the implementation and monitoring of CSR Policy is in compliance with CSR objectives and policy

of the Company.

Gopal Vittal Rakesh Bharti Mittal

Managing Director & CEO (India & South Asia) Chairman, CSR Committee

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Extract of Annual Return

Annexure E

Form No. MGT-9

as on the financial year ended on March 31, 2018

[Pursuant to Section 92(3) of the Companies Act, 2013 and rule 12(1) of the Companies

(Management and Administration) Rules, 2014]

II. Principal Business Activities of the Company

Businesses contributing 10% or more of the total turnover of the company are given below:

I. Registration and Other Details:

III. Particulars of Holding, Subsidiary and Associate Companies

Note: * As per National Industrial Classification – Ministry of Statistics and Programme Implementation.

CIN L74899DL1995PLC070609

Registration Date July 07, 1995

Name of the Company Bharti Airtel Limited

Category of the Company Limited by shares

Sub-Category of the Company Indian Non- Government Company

Address of the Registered office and contact details Bharti Crescent, 1, Nelson Mandela Road, Vasant Kunj, Phase II,

New Delhi – 110 070.

Phone : +91 011-46666100

Whether listed company Yes

Name, Address and Contact details of Registrar and

Transfer Agent

Karvy Computershare Private Limited

Karvy Selenium Tower B, Plot number 31 & 32, Gachibowli, Financial

District, Nanakramguda, Hyderabad – 500032, India.

Phone : +91 040-67162222

Sl.

No.

Name and Description of main products/services NIC Code of the product/

service*

% to total turnover of the

company

1 Wireless telecommunications activities 612 85.43%

Sl.

No.

Name of the Company Address CIN/Registration No. % of shares

held

Holding Company u/s 2(46) of the Companies Act, 2013

1 Bharti Telecom Limited Airtel Centre, Plot No. 16, Udyog Vihar,

Phase - IV, Gurgaon, Haryana - 122001

U32039HR1985PLC032091 50.10

Subsidiary Companies u/s 2(87)(ii) of the Companies Act, 2013

1 Bharti Airtel Services Limited Bharti Crescent, 1, Nelson Mandela Road,

Vasant Kunj, Phase - II, New Delhi - 110 070

U64201DL1997PLC091001 100

2 Bharti Hexacom Limited Bharti Crescent, 1, Nelson Mandela Road,

Vasant Kunj, Phase - II, New Delhi - 110 070

U74899DL1995PLC067527 70

3 Bharti Infratel Limited Bharti Crescent, 1, Nelson Mandela Road,

Vasant Kunj, Phase - II, New Delhi - 110 070

L64201DL2006PLC156038 53.51

4 SmarTx Services Limited Bharti Crescent, 1, Nelson Mandela Road,

Vasant Kunj, Phase - II, New Delhi - 110 070

U64202DL2015PLC285515 53.51

5 Indo Teleports Limited (Formerly known

as Bharti Teleports Limited)

Bharti Crescent, 1, Nelson Mandela Road,

Vasant Kunj, Phase - II, New Delhi - 110 070

U32204DL2008PLC183976 99.99

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

084

Sl.

No.

Name of the Company Address CIN/Registration No. % of shares

held

6 Bharti Telemedia Limited Bharti Crescent, 1, Nelson Mandela Road,

Vasant Kunj, Phase - II, New Delhi - 110 070

U92200DL2006PLC156075 51

7 Airtel Payments Bank Limited Bharti Crescent, 1, Nelson Mandela Road,

Vasant Kunj, Phase - II, New Delhi - 110 070

U65100DL2010PLC201058 80.1

8 Telesonic Networks Limited Bharti Crescent, 1, Nelson Mandela Road,

Vasant Kunj, Phase - II, New Delhi - 110 070

U64200DL2009PLC325406 95

9 Nxtra Data Limited Bharti Crescent, 1, Nelson Mandela Road,

Vasant Kunj, Phase - II, New Delhi - 110 070

U72200DL2013PLC254747 56

10 Wynk Limited Bharti Crescent, 1, Nelson Mandela Road,

Vasant Kunj, Phase - II, New Delhi - 110 070

U74140DL2015PLC275325 56

11 Nettle Infrastructure Investments

Limited (formerly known as Nettle

Developers Limited w.e.f. March 14,

2017)

Floor, Worldmark 2 Asset 8, Aerocity, NH-

8, New Delhi - 110037

U93000DL2010PLC301236 90

12 Bharti Digital Networks Private Limited

(Formerly known as Tikona Digital

Networks Private Limited) (w.e.f. August

24, 2017)

Bharti Crescent 1 Nelson Mandela Road,

Vasant Kunj, Phase II, New Delhi - 110070

U72900DL2008PTC325106 100

13 Bharti Airtel (France) SAS 88, Ter Avenue Général Leclerc – 92100

Boulogne Billancourt

RCS Nanterre 523 035 426 100

14 Bharti Airtel (Hong Kong) Limited 4

Floor, Cheung Hing Industrial Building,

12P Smitheld Road, Kennedy Town, Hong

Kong

1080074 100

15 Bharti Airtel (Japan) Private Limited Shinjuku Park Tower, 30

Floor, 7-1, Nishi

Shinjuku 3-chome, Shinjuku-ku, Tokyo

0111-01-055989 100

16 Bharti Airtel (UK) Limited 10, Queen Street Place, London, United

Kingdom EC4R 1AG

5917314 100

17 Bharti Airtel (USA) Limited 335 Madison Avenue 12

oor, New York

10017

F-060912000-217 100

18 Bharti Airtel International (Mauritius)

Limited

SGG Corporate Services (Mauritius) Ltd.,

33, Edith Cavell Street, Port Louis, 11324,

Mauritius

094380 CI/GBL 100

19 Bharti Airtel International (Netherlands)

B.V.

Overschiestraat 65, 1062 XD Amsterdam,

The Netherlands

34387410 100

20 Bharti Airtel Lanka (Private) Limited Level 11, West Tower, World Trade Centre,

Echelon Square, Colombo 1, Sri Lanka

PV10652 100

21 Bharti International (Singapore) Pte. Ltd. 150, Orchard Road, #08-01, Orchard Plaza,

Singapore

2010-05788-R 100

22 Bharti Airtel International (Mauritius)

Investments Limited (w.e.f. March 26,

2018)

SGG Corporate Services (Mauritius) Ltd.,

33, Edith Cavell Street, Port Louis, 11324,

Mauritius

154803 C1/GBL 100

23 Network i2i Limited SGG Corporate Services (Mauritius) Ltd.,

33, Edith Cavell Street, Port Louis, 11324,

Mauritius

25951/6339 100

24 Africa Towers N.V. Overschiestraat 65, 1062 XD Amsterdam,

The Netherlands

50979965 100

25 Africa Towers Services Limited (under

liquidation)

Plot Number LR No 209/11880, Parkside

Towers, Mombasa Road, PO Box 73146-

00200, Nairobi, Kenya

CPR/2011/56039 100

26 Airtel (Seychelles) Limited Emerald House, PO Box 1358, Providence,

Mahe, Seychelles

841930-1 100

Statutory Reports

Board’s Report

085

Integrated Report

006-056

Financial Statements

160-317

Sl.

No.

Name of the Company Address CIN/Registration No. % of shares

held

27 Airtel Congo S.A. 2ème étage, Immeuble SCI MONTE

CRISTO, Rond-point de la Gare, Croisement

du Boulevard Denis SASSOU NGUESSO

et de l’avenue Orsy, Centre-Ville, B.P. 1038,

Brazzaville - République du Congo

CG/BZV/07 B299 90

28 Airtel Gabon S.A. Rue Pecqueur, Immeuble Libreville Business

Square, B.P. 9259, Libreville, Gabon

RG LBV 2001/B01000 90

29 Airtel Madagascar S.A. Immeuble Kube B, Zone Galaxy, Andraharo,

101 Antananarivo, Madagascar

1997B00392 100

30 Airtel Malawi Limited Immeuble Kube B Building, Zone Galaxy,

Andraharo, Antananarivo 101, Madagascar

5114 100

31 Airtel Mobile Commerce B.V. Overschiestraat 65, 1062 XD Amsterdam,

The Netherlands

34375413 100

32 Airtel Mobile Commerce Holdings B.V. Overschiestraat 65, 1062 XD Amsterdam,

The Netherlands

34381129 100

33 Airtel Mobile Commerce (Kenya) Limited Parkside Towers, Mombasa Road, P.O. Box

73146-00200, Nairobi, Kenya

C 169576 100

34 Airtel Mobile Commerce Limited Airtel Complex, City Centre, O Convention

Drive, P.O. Box 57, Lilongwe, Malawi

9831 100

35 Airtel Mobile Commerce Madagascar

S.A.

Immeuble Kube B Building, Zone Galaxy,

Andraharo, Antananarivo 101, Madagascar

2011B00235 100

36 Airtel Mobile Commerce Rwanda

Limited

Remera, Gasabo, P.O. Box 4164, Kigali,

Rwanda

102933620 100

37 Airtel Mobile Commerce (Seychelles)

Limited

Emerald House, P.O. Box 1358, Providence,

Mahe, Seychelles

8412656-1 100

38 Airtel Mobile Commerce (Tanzania)

Limited

Block 41, Kinondoni, Corner of Ali Hassan

Mwinyi & Kawawa Road, P.O. Box 9623,

Dar es Salaam, Tanzania

79802 100

39 Airtel Mobile Commerce Tchad S.A.R.L Immeuble du Cinéma Etoile, Rue du

Commandant Galyam Negal, B.P. 5665,

N’Djamena, Tchad

TC/NDJ/10B 183 100

40 Airtel Mobile Commerce Uganda Limited Airtel House, Plot 16-A, Clement Hill Road, P.

O. Box 6771, Kampala - Uganda

123833 100

41 Airtel Mobile Commerce Zambia Limited Airtel House, Corner of Addis Ababa Drive

and Great East Road, Stand 2375, P.O. Box

320001, Lusaka, Zambia

80052 100

42 Airtel Money (RDC) S.A. 127, Avenue du Plateau, Commune de

la Gombe, République Démocratique du

Congo

CD/KIN/RCCM/14-B-6552 100

43 Airtel Money Niger S.A. 2054, Route de l'aéroport, B.P. 11922

Niamey, Niger

NI-NIA-2012-M-2191 90

44 Airtel Money S.A. Libreville, Centre Ville, Avenue Du Colonel

Parrant, B.P. 23 899, Libreville, Gabon

RG LBV 2010B09955 100

45 Airtel Networks Kenya Limited Parkside Towers, Mombasa Road, P. O. Box

73146-00200, Nairobi, Kenya

C. 140223 100

46 Airtel Networks Limited Plot L2, Banana Island, Foreshore Estate/

Ikoyi Lagos, Nigeria

398557 83.25

47 Airtel Networks Zambia Plc Airtel House, Corner of Addis Ababa Drive

and Great East Road, Lusaka, Stand 2375,

P.O. Box 320001, Lusaka, Zambia

38136 96.36

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

086

Sl.

No.

Name of the Company Address CIN/Registration No. % of shares

held

48 Airtel Rwanda Limited Remera, Gasabo, P.O. Box 4164, Kigali,

Rwanda

102437818 100

49 Airtel Tanzania Public Limited Company Airtel House, Block 41, Kinondoni, Corner of

A.H. Mwinyi Road & Kawawa Road, P.O. Box

9623, Dar es Salaam, Tanzania

41291 60

50 Airtel Tchad S.A. Immeuble du Cinéma Etoile, Rue du

Commandant Galyam Negal, B.P. 5665,

N’Djamena, Tchad

TC-NDJ 063/B/99 100

51 Airtel Uganda Limited Airtel Towers, Plot 16-A, Clement Hill Road,

Nakasero P.O. Box 6771, Kampala - Uganda

V-232-36 100

52 Bharti Airtel Africa B.V. Overschiestraat 65, 1062 XD Amsterdam,

The Netherlands

08076497 100

53 Bharti Airtel Burkina Faso Holdings B.V. Overschiestraat 65, 1062 XD Amsterdam,

The Netherlands

08077622 100

54 Bharti Airtel Chad Holdings B.V. Overschiestraat 65, 1062 XD Amsterdam,

The Netherlands

34125184 100

55 Bharti Airtel Congo Holdings B.V. Overschiestraat 65, 1062 XD Amsterdam,

The Netherlands

08077621 100

56 Bharti Airtel Developers Forum Limited Airtel House, Corner of Addis Ababa Drive

and Great East Road, Lusaka, Stand 2375,

P.O. Box 320001, Lusaka, Zambia

82795 96.36

57 Bharti Airtel Gabon Holdings B.V. Overschiestraat 65, 1062 XD Amsterdam,

The Netherlands

08078528 100

58 Bharti Airtel Kenya B.V. Overschiestraat 65, 1062 XD Amsterdam,

The Netherlands

38023926 100

59 Bharti Airtel Kenya Holdings B.V. Overschiestraat 65, 1062 XD Amsterdam,

The Netherlands

34164357 100

60 Bharti Airtel Madagascar Holdings B.V. Overschiestraat 65, 1062 XD Amsterdam,

The Netherlands

34204848 100

61 Bharti Airtel Malawi Holdings B.V. Overschiestraat 65, 1062 XD Amsterdam,

The Netherlands

08077659 100

62 Bharti Airtel Mali Holdings B.V. Overschiestraat 65, 1062 XD Amsterdam,

The Netherlands

34164359 100

63 Bharti Airtel Niger Holdings B.V. Overschiestraat 65, 1062 XD Amsterdam,

The Netherlands

34143743 100

64 Bharti Airtel Nigeria B.V. Overschiestraat 65, 1062 XD Amsterdam,

The Netherlands

34164360 100

65 Bharti Airtel Nigeria Holdings II B.V. Overschiestraat 65, 1062 XD Amsterdam,

The Netherlands

08077623 100

66 Bharti Airtel RDC Holdings B.V. Overschiestraat 65, 1062 XD Amsterdam,

The Netherlands

34125193 100

67 Bharti Airtel Services B.V. Overschiestraat 65, 1062 XD Amsterdam,

The Netherlands

08077657 100

68 Bharti Airtel Tanzania B.V. Overschiestraat 65, 1062 XD Amsterdam,

The Netherlands

08078747 100

69 Bharti Airtel Uganda Holdings B.V. Overschiestraat 65, 1062 XD Amsterdam,

The Netherlands

08078530 100

70 Bharti Airtel Zambia Holdings B.V. Overschiestraat 65, 1062 XD Amsterdam,

The Netherlands

08076501 100

Statutory Reports

Board’s Report

087

Integrated Report

006-056

Financial Statements

160-317

Sl.

No.

Name of the Company Address CIN/Registration No. % of shares

held

71 Celtel (Mauritius) Holdings Limited C/o Abax Corporate Services Ltd, 6

oor,

Tower A, 1 Cybercity, Ebene, Mauritius

18259/3238 C1/GBL 100

72 Airtel Congo (RDC) S.A. 278, Avenue de'l Equateur, Kinshasa,

Gombe, République démocratique du

Congo

CD/KNG/RCCM/13-B-01054 98.50

73 Celtel Niger S.A. 2054 Route de l'aéroport, B.P. 11 922,

Niamey, Niger

NI-NIM-2007-B 1848 90

74 Channel Sea Management Company

(Mauritius) Limited

C/o Abax Corporate Services Ltd., 6

oor,

Tower A, 1 Cybercity, Ebene, Mauritius

18258/3237 C1/GBL 100

75 Congo RDC Towers S.A. Croisement des Avenues du Tchad et du Bas

Congo, Commune de la Gombe, Kinshasa,

République démocratique du Congo

CD/KIN/RCCM/14-B-4040 100

76 Gabon Towers S.A. (under dissolution) 124 Avenue Bouet / B.P. 9259, Libreville,

Gabon

2013B11106 90

77 Indian Ocean Telecom Limited C/o Minerva Trust & Corporate Services

Limited, The Le Gallais Building, 54 Bath

Street, St Helier, Jersey, JE1 8SB Channel

Islands

70138 100

78 Madagascar Towers S.A. Immeuble Kube B, Zone Galaxy Andraharo,

101- Antananarivo, Madagascar

2011 B 00184 100

79 Malawi Towers Limited Airtel Complex, City Centre, O Convention

Drive, P.O. Box 57, Lilongwe, Malawi

10995 100

80 Mobile Commerce Congo S.A. 1er et 2ème étages, Immeuble SCI Monte

Cristo, Rond Point de la Gare, Croisement

du Boulevard Denis Sassou Nguesso et

de l'avenue Orsy, Centre Ville, B.P. 1038,

Brazzaville - République du Congo

CG/BZV/09 B 1796 100

81 Montana International C/o Abax Corporate Services Ltd., 6

oor,

Tower A, 1 Cybercity, Ebene, Mauritius

6/97/2593 C2/GBL 100

82 Partnership Investments S.A.R.L Croisement des Avenues du Tchad et

du Bas Congo, Commune de la Gombe,

République démocratique du Congo

CD/KIN/RCCM/14-B-4497 100

83 Société Malgache de Telephone

Cellulaire S.A.

C/o Abax Corporate Services Ltd., 6

oor,

Tower A, 1 Cybercity, Ebene, Mauritius

19022/3479 C1/GBL 100

84 Tanzania Towers Limited Airtel House, Block 41 Kinondoni, Corner

of A.H. Mwinyi Road / Kawawa Road,

Kinondoni, Dar es Salaam, Tanzania

84005 60

85 Bharti Airtel Rwanda Holdings Limited C/o Abax Corporate Services Ltd., 6

oor,

Tower A, 1 Cybercity, Ebene, Mauritius

C083311 C1/GBL 100

86 Airtel Money Transfer Limited Parkside Towers, Mombasa Road, L.R. Nr.

209/11880, P.O. Box 73146-00200 Nairobi,

Kenya

CPR/2015/199517 100

87 Airtel Money Tanzania Limited Airtel House, Block 41 Kinondoni, Corner

of A.H. Mwinyi Road / Kawawa Road,

Kinondoni, Dar es Salaam, Tanzania

127040 60.04

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

088

Sl.

No.

Name of the Company Address CIN/Registration No. % of shares

held

88 Airtel Mobile Commerce Nigeria Limited

(w.e.f. August 31, 2017)

Plot L2, Banana Island, Foreshore Estate/

Ikoyi Lagos, Nigeria

1435923 83.25

89 Tigo Rwanda Limited (w.e.f. January 31,

2018)

Floor, West Wing, Kigali Heights, KG7

Ave, Plot 772, Kimihurura, P.O. Box 6979,

Kigali, Rwanda

101 775 989 100

Associates u/s 2(6) of the Companies Act, 2013

1 Seychelles Cable Systems Company

Limited

Third Floor, Caravelle House, Victoria, Mahe,

Seychelles

846498-1 26

2 Robi Axiata Limited 53, Gulshan South Avenue, Gulshan-1,

Dhaka - 1212, Bangladesh

C29552 25

3 Seynse Technologies Private Limited Villa No. 4, House No. 22/296 Naroo

Heights, Opp. Manipal Hospital Dona Paula,

North Goa

U74999GA2015PTC007655 20

4 Aban Green Power Private Limited Anpriya Crest 113, Pantheon Road Egmore,

Chennai, Tamil Nadu

U40103TN2013PTC090446 24.88

5 Juggernaut Books Private Limited (w.e.f.

December 14, 2017)

118, Shahpur Jat 4

Floor, K.S. House,

New Delhi - 110049

U22219DL2015PTC280186 11.32

6 Greenergy Wind Corporation Private

Limited

No.3, 2

Floor Queens Road Cross Near

Congress Committee Oce, Bangalore,

Karnataka - 560052

U40104KA2012PTC062414 20.33

Joint Venture Companies u/s 2(6) of the Companies Act, 2013

1 Indus Towers Limited Bharti Crescent, 1, Nelson Mandela Road,

Vasant Kunj, Phase - II, New Delhi - 110070

U92100DL2007PLC170574 22.47

2 Bridge Mobile Pte Limited 750 Chai Chee Road, Technopark@

ChaiChee,

The Oasis, #03-02/0, Singapore 469000

200413856E 10

3 Firey Networks Limited A-19, Mohan Co-operative Industrial Estate,

Mathura Road, New Delhi - 110044

U74999DL2014PLC264417 50

4 Bharti Airtel Ghana Holdings B.V. (w.e.f.

October 12, 2017)

Overschiestraat 65, 1062 XD Amsterdam,

The Netherlands

34204633 50

5 Airtel Ghana Limited (w.e.f. October 12,

2017)

Milicom Place, Barnes Road, PMB-TUC,

Accra, Ghana

CS0002840316 49.95

6 Airtel Mobile Commerce (Ghana)

Limited (w.e.f. October 12, 2017)

Milicom Place, Barnes Road, PMB-TUC,

Accra, Ghana

CS050612017 49.95

7 Milicom Ghana Company Limited (w.e.f.

October 12, 2017)

Milicom Place, Barnes Road, PMB-TUC,

Accra, Ghana

CS417992014 49.95

8 Mobile Financial Services Limited ( w.e.f.

October 12, 2017)

Milicom Place, Barnes Road, PMB-TUC,

Accra, Ghana

CA-72,549 50

Statutory Reports

Board’s Report

089

Integrated Report

006-056

Financial Statements

160-317

Sl.

No.

Category of shareholders Number of shares held at the beginning of

the year i.e. April 01, 2017

Number of shares held at the end of

the year i.e. March 31, 2018

change

during

the

year

Demat Physical Total % of

total

Demat Physical Total % of

total

(I) (II) (III) (IV) (V) (VI) (VII) (VIII) (IX) (X) (XI)

(A) Promoters

(1) Indian

Individual /HUF - - - - - - - - -

Central Government/State

Government(s)

- - - - - - - - -

Bodies Corporate 1,81,79,87,269 - 1,81,79,87,269 45.48 2,00,28,18,452 - 2,00,28,18,452 50.10 4.62

Financial Institutions / Banks - - - - - - - - -

Any other - - - - - - - - -

Sub-Total A(1) : 1,81,79,87,269 - 1,81,79,87,269 45.48 2,00,28,18,452 - 2,00,28,18,452 50.10 4.62

(2) Foreign

Individuals (NRIs/Foreign Individuals) - - - - - - - - -

Others - Individual

Bodies Corporate 86,56,73,286 - 86,56,73,286 21.66 68,09,63,103 - 68,09,63,103 17.04 (4.62)

Banks / FI - - - - - - - - -

Any other - - - - - - - - -

Sub-Total A(2) : 86,56,73,286 - 86,56,73,286 21.66 68,09,63,103 - 68,09,63,103 17.04 (4.62)

Total A=A(1)+A(2) 2,68,36,60,555 - 2,68,36,60,555 67.14 2,68,37,81,555 - 2,68,37,81,555 67.14 -

(B) Public Shareholding

(1) Institutions

Mutual Funds 12,84,31,707 - 12,84,31,707 3.21 26,57,39,997 - 26,57,39,997 6.65 3.43

Financial Institutions /Banks 21,41,271 - 21,41,271 0.05 31,08,671 - 31,08,671 0.08 0.02

Central Government / State

Government(s)

- - - - - - - - -

Venture Capital Funds - - - - - - - - -

Insurance Companies 31,54,20,470 - 31,54,20,470 7.89 22,74,66,498 - 22,74,66,498 5.69 (2.20)

Foreign Institutional Investors 60,82,26,075 - 60,82,26,075 15.22 73,74,53,635 - 73,74,53,635 18.45 3.23

Foreign Venture Capital Funds - - - - - - - - -

Others (specify) - - - - - - - - -

Sub-Total B(1) : 1,05,42,19,523 - 1,05,42,19,523 26.37 1,23,37,68,801 - 1,23,37,68,801 30.86 4.49

(2) Non-Institution

Bodies Corporate

(i) Indian 27,21,800 54,44,250 81,66,050 0.20 1,86,57,340 54,44,250 2,41,01,590 0.60 0.40

(ii) Overseas

Individuals

(i) Individuals holding nominal share

capital upto H 1 lakh

2,47,56,135 7,661 2,47,63,796 0.62 2,45,34,573 6,904 2,45,41,477 0.61 (0.01)

(ii) Individuals holding nominal share

capital in excess of H 1 lakh

45,44,671 - 45,44,671 0.11 1,33,24,375 - 1,33,24,375 0.33 0.22

Others (Specify)

Clearining Members 90,58,391 - 90,58,391 0.23 2536099 - 2536099 0.06 (0.16)

Foreign Companies 20,31,77,716 - 20,31,77,716 5.08 2532710 - 2532710 0.06 5.02

NBFC 8,614 - 8,614 - 12,358 - 12,358 - -

Non Resident Indians 12,83,871 - 12,83,871 0.03 15,68,737 - 15,68,737 0.04 0.01

Non Resident Indians

(Non-Repatriation)

5,73,389 - 5,73,389 0.01 7,47,080 - 7,47,080 0.02 -

ESOP Trust 13,45,184 - 13,45,184 0.03 17,19,041 - 17,19,041 0.04 0.01

Trusts 65,98,342 - 65,98,342 0.17 87,17,006 - 87,17,006 0.22 0.05

Investor Education and Protection

Fund

- - - - 49,273 - 49,273 - -

Sub-Total B(2) : 25,40,68,113 54,51,911 25,95,20,024 6.49 7,43,98,592 54,51,154 7,98,49,746 2.00 5.54

Total Public Shareholding

B=B(1)+B(2) :

1,30,82,87,636 54,51,911 1,31,37,39,547 32.86

1,30,81,67,393 54,51,154 1,31,36,18,547 32.86 10.04

Total (A+B) : 3,99,19,48,191 54,51,911 3,99,74,00,102 100.00 3,99,19,48,948 54,51,154 3,99,74,00,102 100.00 10.04

GDR’s and ADR’s

- - - - - - - - -

Grand Total (A+B+C) : 3,99,19,48,191 54,51,911 3,99,74,00,102 100.00 3,99,19,48,948 54,51,154 3,99,74,00,102 100.00

IV. Share Holding Pattern (Equity Share Capital Breakup as percentage of Total Equity)

(i) Category- Wise Share Holding

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

090

(ii) Shareholding of Promoters

(iv) Shareholding Pattern of top ten Shareholders (other than Directors, Promoters and Holders of GDRs and ADRs):

1. Bharti Telecom Limited is promoter of Bharti Airtel Limited as prescribed in its IPO Prospectus dated February 07, 2002.

2. Pastel Limited qualifies as “deemed promoter” u/r 2(1)(t) of SEBI (Substantial Acquisition and Takeover) Regulations, 2011 but is not having control over

the listed company nor is “person acting in concern” with promoter (Bharti Telecom Limited) as specified u/r 2(1) (q) of the Regulations.

3. Indian Continent Investment Limited is person acting in concern with promoter (Bharti Telecom Limited).

4. Viridian Limited is person acting in concern with Pastel Limited. As mentioned above Pastel Limited qualifies as “Deemed Promoter” u/r 2(1)(t) of SEBI

(Substantial Acquisition and Takeover) Regulations, 2011 but is not having control over the listed company nor is “person acting in concern” with promoter

(Bharti Telecom Limited) as specified u/r 2(1) (q) of the Regulations.

(iii) Change in Promoter Shareholding

Sl.

No.

Name of the Share

Holder

Shareholding at the beginning of the Year Shareholding at the end of the Year % change in

shareholding

during the

year

No. of Shares % of total

of the

Company

% of shares

pledged/

encumbered

to total shares

No. of Shares % of total

of the

Company

% of shares

pledged/

encumbered

to total shares

1 Bharti Telecom Limited 1,81,79,87,269 45.48 - 2,00,28,18,452 50.10 - 4.62

2 Pastel Limited 59,13,19,300 14.79 - 59,13,19,300 14.79 - 0.00

3 Indian Continent

Investment Limited

26,58,60,986 6.65 - 8,11,50,803 2.03 - -4.62

4 Viridian Limited 84,93,000 0.21 - 84,93,000 0.21 - 0.00

Sl.

No.

Name of the Shareholder Shareholding Cumulative Shareholding during

the Year

No of Shares % of total shares

of the Company

No of Shares % of total shares

of the Company

Life Insurance Corporation of India

At the beginning of the year 211,834,356 5.30 211,834,356 5.30

Bought during the year - - - -

Sold during the year 61,651,493 1.54 150,182,863 3.76

At the end of the year 150,182,863 3.76 150,182,863 3.76

ICICI Prudential Life Insurance Company Limited

At the beginning of the year 82,165,754 2.06 82,165,754 2.06

Bought during the year 13,978,109 0.35 96,143,863 2.41

Sold during the year 44,957,322 1.12 51,186,541 1.28

At the end of the year 51,186,541 1.28 511,865,41 1.28

3 Dodge and Cox International Stock Funds

At the beginning of the year 49,441,504 1.24 49,441,504 1.24

Bought during the year - - - -

Sold during the year 49,441,504 1.24 - -

At the end of the year - - - -

Sl.

No.

Name of the Promoter Shareholding at the

beginning of the Year

Date Increase/

Decrease

during the

year

Reasons Cumulative Shareholding

during the year/Shareholding

at the end of the Year

No. of Shares % of total

shares of the

Company

No. of Shares % of total

shares of the

Company

1 Bharti Telecom Limited 1,81,79,87,269 45.48 August 18,

2017

1,21,000

Inter-se

Transfer

1,81,81,08,269 45.48

November

03, 2017

18,47,10,183 2,00,28,18,452 50.10

2 Indian Continent

Investment Limited

26,58,60,986 6.65 November

03, 2017

18,47,10,183 8,11,50,803 2.03

Statutory Reports

Board’s Report

091

Integrated Report

006-056

Financial Statements

160-317

Sl.

No.

Name of the Shareholder Shareholding Cumulative Shareholding during

the Year

No of Shares % of total shares

of the Company

No of Shares % of total shares

of the Company

4 ICICI Prudential Mutual Funds

At the beginning of the year 45,724,712 1.14 45,724,712 1.14

Bought during the year 54,795,760 1.37 100,520,472 2.51

Sold during the year 37,303,767 0.93 63,216,705 1.58

At the end of the year 63,216,705 1.58 63,216,705 1.58

5 Franklin Templeton Mutual Funds

At the beginning of the year 37,733,651 0.94 37,733,651 0.94

Bought during the year 13,734,605 0.34 51,468,256 1.29

Sold during the year 12,622,959 0.32 38,845,297 0.97

At the end of the year 38,845,297 0.97 38,845,297 0.97

6 Government Pension Fund Global

At the beginning of the year 9,444,613 0.24 9,444,613 0.24

Bought during the year 22,807,424 0.57 32,252,037 0.81

Sold during the year 6,115,767 0.15 26,136,270 0.65

At the end of the year 26,136,270 0.65 26,136,270 0.65

7 Capital World Growth and Income Fund

At the beginning of the year 25,940,837 0.65 25,940,837 0.65

Bought during the year 3,447,439 0.09 29,388,276 0.74

Sold during the year 17,475,177 0.44 11,913,099 0.3

At the end of the year 11,913,099 0.3 11,913,099 0.3

8 Reliance Capital Trustee Co. Ltd.

At the beginning of the year 1,886,546 0.05 1,886,546 0.05

Bought during the year 33,307,115 0.83 35,193,661 0.88

Sold during the year 11,332,886 0.28 23,860,775 0.6

At the end of the year 23,860,775 0.6 23,860,775 0.6

Government of Singapore

At the beginning of the year 11,068,086 0.28 11,068,086 0.28

Bought during the year 15,261,249 0.38 26,329,335 0.66

Sold during the year 2,580,760 0.06 23,748,575 0.59

At the end of the year 23,748,575 0.59 23,748,575 0.59

10 SBI Mutual Fund

At the beginning of the year 22,475,610 0.56 22,475,610 0.56

Bought during the year 35,240,792 0.88 57,716,402 1.44

Sold during the year 4,666,980 0.12 53,049,422 1.33

At the end of the year 53,049,422 1.33 53,049,422 1.33

11 Fort Canning Investments Pte. Ltd.

At the beginning of the year 2,859,947 0.07 2,859,947 0.07

Bought during the year 19,200,170 0.48 22,060,117 0.55

Sold during the year - - - -

At the end of the year 22,060,117 0.55 22,060,117 0.55

12 Tybourne Equity Master Fund

At the beginning of the year - - - -

Bought during the year 21,939,623 0.55 21,939,623 0.55

Sold during the year - - - -

At the end of the year 21,939,623 0.55 21,939,623 0.55

13 Vangaurd Emerging Markets Stock Index Fund

At the beginning of the year 20,702,111 0.52 20,702,111 0.52

Bought during the year 24,423,683 0.61 45,125,794 1.13

Sold during the year 23,741,485 0.59 21,384,309 0.53

At the end of the year 21,384,309 0.53 21,384,309 0.53

14 Comgest Growth Plc.

At the beginning of the year 18,484,273 0.46 18,484,273 0.46

Bought during the year 1,521,866 0.40 20,006,139 0.50

Sold during the year 12,423,775 0.31 7,582,364 0.19

At the end of the year 7,582,364 0.19 7,582,364 0.19

15 Morgan Stanley Mauritius Company Limited

At the beginning of the year 17,564,459 0.44 17,564,459 0.44

Bought during the year 6,096,985 0.15 23,661,444 0.59

Sold during the year 22,055,775 0.55 1,605,669 0.04

At the end of the year 1,605,669 0.04 1,605,669 0.04

Note: The details of shareholding are maintained by respective Depositories and it is not feasible to provide daily change in the shareholding of top ten

shareholders. Therefore, consolidated changes during the year 2017-18 has been provided.

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

092

(H Millions)

Secured Loans

excluding

deposits

Unsecured Loans Deposits Total Indebteness

Indebtedness at the beginning of

the nancial year

i) Principal Amount 31 602,240 - 602,271

ii) Interest due but not paid - - - -

iii) Interest accured but not due - 2,796 - 2,796

Total (i+ii+iii) 31 605,036 - 605,067

Change in indebtedness during the

nancial year

Addition 10 520,024 - 520,034

Reduction 12 468,414 - 468,426

Net Change (2) 51,610 - 279

Indebtedness at the end of the

nancial year

i) Principal Amount 29 654,129 - 654,159

ii) Interest due but not paid - - - -

iii) Interest accured but not due - 23,681 - 23,681

Total (i+ii+iii) 29 677,810 - 677,840

V. Indebtedness

Indebtedness of the Company including interest outstanding/accrued but not due for payment

(v) Shareholding of Directors and Key Managerial Personnel

Sl.

No.

Name of the

Director or KMP

Shareholding at the

beginning of the Year

Date Increase /

Decrease

in share

holding

Reasons Cumulative Shareholding

during the year/ Shareholding

at the end of the Year

No. of

% of total

shares of the

Company

No. of Shares % of total

shares of the

Company

Key Managerial Personnel

1 Mr. Gopal Vittal 3,29,885 0.01 August 10, 2017 1,21,000 Market Sale 2,08,885 0.01

December 01, 2017 30,000 Share

allotted

under ESOP

2,38,885 0.01

December 13, 2017 30,000 2,68,885 0.01

January 25, 2018 10,000 2,78,885 0.01

February 16, 2018 10,000 2,88,885 0.01

March 05, 2018 10,000 2,98,885 0.01

2 Mr. Nilanjan Roy - - March 05, 2018 13,003 Share

allotted

under ESOP

13,003 -

Note: No other Director and Key Managerial Personnel hold shares as on March 31, 2018

Statutory Reports

Board’s Report

093

Integrated Report

006-056

Financial Statements

160-317

(H Millions)

Sl.

No.

Particulars of Remuneration Name of Managing Director /

Whole-time Director / Manager

Total Amount

Mr. Sunil Bharti Mittal

Chairman

Mr. Gopal Vittal

Managing Director & CEO

(India & South Asia)

(1) Gross salary

(a) Salary as per provisions contained in

section 17(1) of the Income-tax Act, 1961

269.78 120.17 389.95

(b) Value of perquisites u/s 17(2) Income-tax

Act, 1961

10.62 0.03* 10.65

17(3) Income-tax Act, 1961

- - -

(2) Stock Option** - 43.29** 43.29

(3) Sweat Equity - - -

(4) Commission - - -

- as % of prot - - -

- others, specify… - - -

(5) Others – PF Contribution 21.57 6.24 27.81

Total (A) 301.97 169.73 471.70

Ceiling as per the Act

H 690.39 Mn. (being 10% of Net Prots of the Company calculated as

per Section 198 of the Companies Act, 2013)

VI. Remuneration of Directors and Key Managerial Personnel

A. Remuneration to Managing Director, Whole-time Directors and / or Manager:

B. Remuneration to Non-Executive Directors including Independent Directors:

Note:

> During the year, Mr. Gopal Vittal was granted 105,000 and 30,000 stock options on August 08, 2017 under ESOP Scheme 2005 at an exercise price of

H 5 per option, with a vesting period spread over 3 years and 2 years respectively.

> Value of Performance Linked Incentive (PLI) considered above represents incentive which will accrue at 100% performance level for FY 2017-18 and will

get paid basis actual performance parameters in the next financial year.

* Value of perquisites u/s 17 (2) Income Tax Act, 1961 does not include perquisite value of H 43.29 Mn towards stock options exercised by Mr. Gopal Vittal

during FY 2017-18. The same has been shown separately in point no. (2).

** In accordance with the definition of perquisite under the Income Tax Act, 1961, the value of stock options only on those shares that have been exercised

during the period is provided. Accordingly, the value of stock options granted during the financial year is not included.

(H Millions)

Independent Directors Fee for attending board /

committee meetings

Commission Total

Mr. Ben Verwaayen 0.30 14.46 14.76

Mr. Craig Ehrlich 0.20 8.47 8.67

Mr. D.K. Mittal 1.30 7.08 8.38

Mr. Manish Kejriwal 0.40 6.34 6.74

Mr. Shishir Priyadarshi 0.50 9.78 10.28

Mr. V.K. Viswanathan 0.80 8.00 8.80

Total B1 3.50 54.13 57.63

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

094

(H Millions)

Sl.

No.

Particulars of Remuneration Key Managerial Personnel Total

Amount

Mr. Nilanjan Roy

Global CFO

Mr. Pankaj

Tewari

(1) Gross salary

(a) Salary as per provisions contained in section 17(1) of the Income-tax

Act, 1961

40.73^ 11.78^^ 51.00

(b) Value of perquisites u/s 17(2) Income-tax Act, 1961 0.09* - 0.09

(2) Stock Option** 5.36* - 5.36

(3) Sweat Equity - - -

(4) Commission - - -

-as % of prot - - -

-others, specify… - - -

(5) Others – PF Contribution 1.42 0.46 1.80

Total (A) 47.60 12.24 58.25

B. Remuneration to Non-Executive Directors including Independent Directors:

C. Remuneration to Key Managerial Personnel other than Managing Director / Whole-time Director / Manager:

VII. Penalties / Punishment/ Compounding of Offences

There were no penalties / punishment / compounding of offences for breach of any section of Companies Act against the Company

or its Directors or other officers in default, if any, during the year.

*The shareholders of the Company had approved the limit of 0.5% instead of prescribed limit of 1% of Section 198 net profits, for the payment of commission

to non-executive directors. The Commission for the FY 2017-18 will be paid post approval from the shareholders in the ensuing annual general meeting for

the amendments in limits of payment of commission from 0.5% to 1% w.e.f. April 01, 2017.

Notes:

> Value of Performance Linked Incentive (PLI) considered above represents incentive which will accrue at 100% performance level for FY 2017-18 and will get

paid basis actual performance parameters in the next financial year.

*Value of perquisites u/s 17(2) Income Tax Act, 1961 does not include perquisite value of H 5.36 Mn towards stock options exercised by Mr. Nilanjan Roy during

FY 2017-18. The same has been shown separately in point no. (2).

** In accordance with the definition of perquisities under the Income Tax Act, 1961, the value of stock options only on those shares that have been exercised

during the period is provided. Accordingly, the value of stock options granted to KMPs viz. 23,952 stock options to Mr. Nilanjan Roy, Global CFO and 3,842

stock options to Mr. Pankaj Tewari, Company Secretary, is not included.

^Salary u/s 17(1) includes value of cash payout of H 14.28 Mn under performance based long term incentive plan.

^^ Mr. Pankaj Tewari had joined the Company w.e.f. June 01, 2017 and was designated as Company Secretary of the Company w.e.f. July 18, 2017. The

remuneration above of Mr. Pankaj Tewari is for the FY 2017-18 and includes joining bonus.

(H Millions)

Other Non-Executive Directors Fee for attending board /

committee meetings

Commission Total

Mr. Rakesh Bharti Mittal - 3.00 3.00

Ms. Chua Sock Koong - 3.91 3.91

Ms. Tan Yong Choo - 3.91 3.91

Sheikh Faisal Thani Al-Thani - 1.23 1.23

Mr. Rashed Fahad Al-Noaimi - 1.29 1.29

Total B2 - 13.34 13.34

Total B = (B1+B2) 3.50 67.47* 70.97

Ceiling as per the Act

H 69.04 Mn (being 1% of Net Prots of the Company calculated as per Section 198 of

the Companies Act, 2013)

Total Managerial Remuneration

(A+B)

H 542.67 Mn

Total ceiling as per the act

(11%)

H 759.43 Mn (being 11% of Net Prots of the Company calculated as per Section 198

of the Companies Act, 2013)

Statutory Reports

Board’s Report

095

Integrated Report

006-056

Financial Statements

160-317

(A) Conservation of energy

(i) The Company undertook various initiatives to reduce

and conserve energy:

a. On Network side:

> Maximizing outdoor – 91% New sites have been

deployed as outdoor sites with reduced need of air-

conditioners and diesel.

> Sites on shared basis – Our constant endeavour is to

promote infrastructure sharing, along with our partners.

Our efforts with partners to consolidate passive

infrastructure and green initiatives have considerably

reduced carbon emission in the entire industry. This

initiative not only reduces operational cost for service

providers by eliminating operational waste, but also

promotes optimal use of resources. In FY 2017-18,

over 44% sites were deployed as shared sites, which

results in reduction of their energy consumption by

30% as compared to standalone sites

> Airtel partnered with Towercos to convert indoor sites to

outdoor sites. Over 66,000 sites have been converted

to outdoor till date, reducing the energy consumption

by about 25%. Sites are being converted mostly

by utilizing technology like low power consuming

BTS, Free Cooling Unit (FCU), Natural Cooling Unit

(NCU), Micro Cooling Unit (MCU), Solar Cooling Units

(SCU), Transmission cooling Unit (TCU) and Power

Management Units (PMUs).

> Installed 745 sites own sites with advance VRLA

battery banks, Li-ion Battery solutions and other

operational measures till date.

> Introduced air-conditioning rationalization over 706

own sites, reducing the consumption by 10%.

> Deployed energy efficient retrofits in BTS sites such as

integrated power management systems, efficient DC

to AC convertors, efficient aircons.

> Installed energy efficient air-conditioning and LED

lighting in core locations.

> Introduced innovative design modifications at sites.

> Designed and installed outdoor small cell sites with

ground based mast with Li-ion batteries reducing the

energy consumption by with 30-40%.

> Installed sites with auto-TRX shutdown feature, which

reduces the energy requirement at non-peak hours.

> Pilot Auto TRX shutdown feature with cell, sector and

cluster level on all technologies is progress in four

circles for reduction power consumption.

> Reduced the indoor placement of BTS, which reduced

the air-conditioning load.

> Deployed SRAN to optimized the energy consumption

at sites.

b. Energy efficiency across Data Centres:

The Company puts emphasis on optimising the data center

facilities, operations for energy conservation, improved

space utilisation and enhanced performance. Some of the

initiatives undertaken:

> Use of cold aisle containment a physical barrier to

reduce the mixing of cold supply air and hot exhaust

air in data center aisles. This delivers lower energy

consumption and more efficient cooling.

> Installed Variable Frequency Drives (VFDs) in for the

HVAC systems, which helps to automatically reduce

the motor’s speed and power driven.

> Performed identification and rectification of hot spots

and optimized lighting and aircon usage.

> Maintained an average Power Utilization Efficiency to

improve efficiency across all Data Centres.

c. Energy efficiency in Airtel facilities:

> Use of Variable Frequency Drive for HVAC system.

> Retrofitted the various buildings with energy efficient

air-conditioning and LED lights.

> Introduced UPS optimisation at its technology centers.

> Installed Automatic Power Factor Controller, (APFC) at

office across Pan India.

ii) Utilisation of green energy:

1) Rooftop Solar at Main Switching Centres (MSCs): The

Company has installed solar power plants at total 17

MSC locations by the end of FY 2017-18, expanding

the total installed capacity to 1MWp. Work in progress

for 175KWp more on 3 sites.

2) Green Power Wheeling for MSC: To enhance the energy

efficiency, the Company implemented the renewable

sources of energy at its core locations. Green Power

Wheeling Agreements were made agreements

Particulars of Energy Conservation, Technology Absorption and Foreign Exchange Earnings and Outgo

Annexure F

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

096

for procuring green energy for 8 locations and are

planning to extend the same for 10 more sites over

90 Mn green Units/annum procured through various

wheeling arrangements for our core locations.

3) Solar hybrid solution: The Company installed over 4

sites were converted to green sites using the solar and

battery hybrid solutions in FY 2017-18.

4) Reduction by using battery back-ups: In FY 2017-

18, over 5700 sites were installed with advance

VRLA batteries and Li-Ion battery solutions to reduce

the running of DG set with our ToCo partners. Few

sites were also installed with Li-ion battery banks by

utilizing ground based mast designs with lithium ion

battery solution.

5) Project Green City was launched with Indus & Infratel

few years back; and over 53745 sites have been

tagged as green sites till date.

iii) The capital investment on energy conservation

equipment is shown below:

Sr.

Location Capex

(J Mn)

Remarks

1 Own sites

(Hexacom &

Core)

(Amount derived from

issued P.O.'s, Including ED

& CST):

2 TOCO (Indus

& Infratel) &

SP (Ericsson/

NSN)

831

1) From ToCo: cost of

solution to be paid in 60

Installments, which will be

built in monthly site rental.

2) BTS and MW IP 55

cabinet is procured

against P.O.’s to SP’s

3 Solar Roof to

sites

170 KWp P.O. are issued

in FY 2017-18. Installation

and commissioning will be

completed in FY 2018-19.

TOTAL 853

(B) Technology absorption

1. The efforts made towards technology absorption:

With over 460 Mn internet users, India is the second largest

online market, ranked only behind China. 90% of the users

are using internet service on mobile network. There are

1.18 Bn wireless subscribers as opposed to a mere 23 Mn

wire line subscribers.

With an objective to provide best in class mobile broadband

experience to our customers and improvement in spectrum

efficiency, Airtel envisaged deployment of 100,000 4G

sites last year. This was a challenging task as this had to be

deployed across India in partnership with multiple vendors.

Every tower installation required proper wireless planning,

MW planning, transport planning, availability of material,

permission, alignment of material with ASP team, MW team,

provisioning team. All the deployment was happening on live

sites, which made this deployment exercise even more critical.

Data consumption increased by staggering 450%, to meet

Increase in Data demand we have planned measures like

1800MHz spectrum refarming to 4G for improved indoor

coverage for mobile broadband network, spectrum addition

i.e. 20+10 in 4G along with 3CC carrier aggregation,

spectrum integration of acquired operators for increasing

capacity of 4G networks and increasing efficiency of the

scarce spectrum resources.

Airtel network has now become truly heterogeneous. From

2 technology & 3 layers, we have moved to 4 technology

& 6 layers, this has made the network very complex. As

customers now have to traverse across technologies and

layers, maintaining and improving the network experience

becomes a challenge. To tackle this, Airtel has embarked

on innovative tools for near real time network operation

through cutting edge virtualized NOC, optimization through

Self Optimization Network (SON), Geo analytical tools and

various process automation and analytics tools.

These platforms have enabled automatic optimization

of multi-layered networks, thereby reducing drop calls,

network blocking, and increasing data throughputs for

setting new benchmarks in end user experience.

2. The benefits derived like product improvement, cost

reduction, product development or import substitution:

Through meticulous and effective planning and project

management, we managed to deploy more than 100,000

4G towers in our network and additional 21,000 Km of fibre

across India. We now connect more than 480,000 towns

and villages through high speed broadband. We are now

4G provider in all circles.

Airtel became first company in India to launch 3CC carrier

aggregation, LTE TD (20+10 MHz) and FD, on a commercial

device reaching a speed of 145 Mbps. Airtel launched dual

carrier in 2100 MHz in 7 circles reaching a peak speed on 42

Mbps. Low band LTE using dynamic sharing of spectrum were

launched in Karnataka. Spectrum sharing done in GSM 1800

& FDD to increase 4G capacity. Implementation of 256 QAM

in 4G done to improve user experience. VOLTE launch done

in 19 circles now for better Voice experience. Massive MIMO

Statutory Reports

Board’s Report

097

Integrated Report

006-056

Financial Statements

160-317

trails done in IPL matches across India in 8 cities has shown

unparalleled performance. 4K+ simultaneous connected

users during match hours at Bangalore, nearly 200 mbps of

Peak cell throughput clocked during the match hours at Delhi.

This technology adaption and innovation helped us to

manage the spectrum efficiently and provide a great

broadband experience to our customers.

Airtel has done an alliance with SK Telecom for establishing

a network analytics stack. Partnership across several areas

including developing bespoke software to dramatically

improve network experience, leveraging advanced digital

tools including machine learning, big data and building

customized tools to improve network planning based on

every customer’s device experience.

This will develop the capability to identify, monitor and

deliver improvements to the network experience on an

individual device basis will be a first in India.

3. In case of imported technology (imported during the

last three years reckoned from the beginning of the

financial year):

a. the details of technology imported:

Only telecom equipment is imported, no technology is

imported.

b. the year of import:

N.A.

c. whether the technology been fully absorbed:

N.A.

d. if not fully absorbed, areas where absorption has not

taken place, and the reasons thereof:

N.A.

4. The expenditure incurred on Research and

Development:

NIL

The efforts made towards creating a digital airtel;

Airtel has grown by leaps & bounds towards creating a digital

organization. We are committed towards delivering a digitally

sound experience for our customers, our on ground field

force and our employees.

At airtel we ensure that the power of technology is used to

disrupt the conventional way of doing things and in return

creating a brilliant customer experience. We are building

innovations through our digital teams, both in Gurgaon &

now in Bangalore – airtel X labs.

The company completely focuses on digitizing customer

experience through our myairtel app & website. We are

building platforms – like Airtel Home, Online Store, Project

Next to ensure a brilliant customer experience. We are

revamping existing processes & systems with the customer

at the heart of what we do. With our deep data analytics we

are building for the airtel of the future.

Due to all these advanced developments, Airtel has

won the prestigious Global TM forum digital award for

Outstanding Contribution to Improved Business Agility

Award – Communications Industry.

C. Foreign Exchange Earnings and Outgo

Activities relating to initiatives taken to increase exports;

development of new export markets for products and

services, and export plans.

Total foreign exchange used and earned for the year:

(a) Total Foreign Exchange Earnings H 45,088 Mn

(b) Total Foreign Exchange Outgo H 196,540 Mn

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

098

Statement of Disclosure of Remuneration under Section 197(12) of Companies Act, 2013 read with Rule

5(1) of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014

Annexure G

i. The percentage increase in remuneration of each Director, Chief Financial Officer, Chief Executive Officer and Company Secretary

during FY 2017-18 and ratio of the remuneration of each Director to the median remuneration of the employees of the Company

for FY 2017-18 are as under:

Notes:

1. The value of performance linked incentive (PLI) in remuneration of Key Managerial Personnels (KMPs) represents incentive @ 100% performance level.

For effective comparison, the PLI component of their remuneration for FY 2016-17 has also been considered @ 100% performance level.

2. Percentage increase in remuneration is based on annualised remuneration.

3. Remuneration of KMPs does not include perquisite value of stock options exercised during FY 2017-18.

4. Change in remuneration of Non-Executive Directors vis-à-vis previous year, if any, is due to change in their Committee membership, meetings attended,

sitting fee paid and change in foreign exchange rates.

5. Sheikh Faisal Thani Al-Thani resigned w.e.f. July 25, 2017.

6. Mr. Rashed Fahad Al-Noaimi was appointed w.e.f. July 25, 2017 and resigned w.e.f. November 22, 2017.

* The remuneration of Mr. Gopal Vittal excludes perquisite value of H 43,286,800 on exercise of stock options during FY 2017-18.

# The remuneration of Mr. Nilanjan Roy excludes perquisite value of H 5,355,285 on exercise of stock options and cash payout of H 14,279,481 under

performance-based long-term incentive plan of the Company during FY 2017-18.

^ Mr. Pankaj Tewari had joined the Company w.e.f. June 01, 2017 and was designated as Company Secretary of the Company w.e.f. July 18, 2017. The

remuneration above of Mr. Pankaj Tewari is for the FY 2017-18 and includes joining bonus.

ii. The percentage increase in the median remuneration of the employees in the financial year: There has been an increase

of 4.11% in median remuneration of employees in FY 2017-18 as compared to FY 2016-17.

iii. The number of permanent employees on the roll of the Company: There were 8,453 employees on the rolls of the Company

as on March 31, 2018.

iv. Average percentage increase already made in the salaries of employees other than the managerial personnel in

FY 2017-18 and its comparison with the percentage increase in the managerial remuneration and justification thereof:

The average increase in the remuneration of employees excluding KMPs during FY 2017-18 was 7.1% and the average increase in

the remuneration of KMPs was 14.84%. The increase in remuneration of KMP is mainly attributed to the changes in the remuneration

of the Managing Director & CEO (India & South Asia) of the Company which was approved by the Board on the recommendation

of HR and Nomination Committee on the basis of external benchmarking in relevant peer group to be reflective of the appropriate

remuneration level for this position, Company’s continued market leadership and his individual performance level. The aforesaid

remuneration is within the limits approved by the shareholders in their Annual General Meeting held on August 19, 2016.

Mr. Pankaj Tewari was appointed as Company Secretary of the Company w.e.f. July 18, 2017 and since his last comparable

remuneration is not available, the same is not considered for above calculation.

v. Affirmation that the remuneration is as per the remuneration policy of the Company: The remuneration of Directors was as

per the Remuneration Policy of the Company.

No.

Name of the Director Remuneration

of Director /

KMP for FY

2017-18 (in J)

Percentage

increase in

remuneration

in FY 2017-18

Ratio of remuneration of

each Director to median

remuneration of the

employees of the Company

2,3

Executive Directors

1. Mr. Sunil Bharti Mittal, Chairman 301,968,769 0.17 352.44

2. Mr. Gopal Vittal, Managing Director & CEO (India &

South Asia) 126,446,716* 36.13 147.58

Non-Executive Directors

3. Mr. Rakesh Bharti Mittal

3,000,000 - 3.50

4. Ms. Chua Sock Koong

3,910,500 0.52 4.56

5. Ms. Tan Yong Choo

3,910,500 0.52 4.56

6. Sheikh Faisal Thani Al-Thani

1,232,075 (0.62) 4.52

7. Mr. Rashed Fahad Al-Noaimi

1,285,644 N.A. 4.53

Independent Directors

8. Mr. Ben Verwaayen

14,463,506 (9.38) 16.88

9. Mr. Craig Ehrlich

8,672,750 (15.19) 10.12

10. Mr. D.K. Mittal

8,380,822 (0.23) 9.78

11. Mr. Manish Kejriwal

6,738,356 (2.34) 7.86

12. Mr. Shishir Priyadarshi

10,276,250 (0.48) 11.99

13. Mr. V.K. Viswanathan

8,800,000 - 10.27

Key Managerial Personnel other than Executive Directors

14. Mr. Nilanjan Roy, Global Chief Financial Officer

27,962,023

8.20 -

15. Mr. Pankaj Tewari, Company Secretary 12,242,883

N.A. -

Statutory Reports

Board’s Report

099

Integrated Report

006-056

Financial Statements

160-317

Annexure H

Statement of particulars under Section 197(12) of the Companies Act, 2013 read with the Companies (Appointment and Remuneration of Managerial

Personal) Rules, 2014 for the year ended March 31, 2018

* Remuneration of Mr. Gopal Vittal does not include perquisite value of H 43,286,800 towards exercise of stock options during FY 2017-18.

# Remuneration of Mr. Nilanjan Roy includes perquisite value of H 5,355,285 towards exercise of stock options and H 14,279,481 towards payout under performance based long term incenticve plan

during FY 2017-18.

Notes:

1. There are no specific terms and conditions for employment.

2. None of the employees mentioned above is a relative of any Directors of the company except Mr. Sunil Bharti Mittal and Mr. Rakesh Bharti Mittal, who are brothers.

3. None of the employees mentioned above hold 2% or more share capital of the Company.

4. The designation - ‘Director’ wherever prefixed describing the area of responsibility occurring in the above Statement is not a Board position except that of Mr. Sunil B Mittal and Mr. Gopal Vittal.

5. Nature of employment for all the employees is permanent except for Mr. Sunil Bharti Mittal & Mr. Goptal Vittal which is contractual.

Top ten employees in terms of remuneration drawn

(A) Employed Throughout the Financial Year

(B) Employed for the Part of Financial Year

Sl.

No.

Name Designation Qualication(s) Age

(In

years)

Date of

Commencement

of Employment

Total

experience

(in years)

Nature of

duties of the

employee

Gross

Remuneration

(in J)

Previous employment / Designation

1 Ajai Puri Chief Operating Ocer

(India & South Asia)

Post Graduation 57 15-May-04 37 Business Head 7,28,88,938 Cargill Foods India / Business Head-India

Foods

2 Deven

Khanna

Group Director - CMD's

Oce

CA, B.Com 58 01-Sep-04 32 Finance 4,72,54,002 Triveni Engineering Industries Ltd. / VP-Corp

Finance & Planning

3 Gopal Vittal MD & CEO - India &

South Asia

MBA 52 03-Apr-12 27 Business Head 126,446,716* Hindustan Uniliver Limited / Executive

Director

4 Harmeen

Mehta

Global CIO B.E. (Computer Sc. &

Engg)

44 24-Oct-13 19 Information

Technology

8,44,52,973 BBVA / CIO Global Markets

5 Moti

Gyamlani

Director - Global Supply

Chain

Masters in International

Business Administration

44 17-Dec-12 22 Supply Chain

Management

5,72,98,361 GE Energy / Group Vice President - Global

Supply Chain

6 Nilanjan Roy Global CFO CA 52 01-Mar-06 28 Finance 47,596,789# Unilever Nv / Plc, Usa / Finance Director

7 Srikanth

Balachandran

Global CHRO CA, B.Com 57 17-Nov-08 37 Human

Resources

5,70,70,961 Hindustan Unilever Limited / Programme

Leader – Global Finance

8 Sunil Bharti

Mittal

Chairman Graduate 60 01-Oct-01 42 General

Management

30,19,68,769 Bharti Cellular Limited / CMD

9 V.M. Raj

Pudipeddi

Director- Consumer

Business & CMO

MBA 46 06-Feb-17 23 Business Head 4,83,17,675 Procter & Gamble / VP, North America, Oral

Care

Sl.

No.

Name Designation Qualication(s) Age

(In

years)

Date of

Commencement

of Employment

Total

experience

(in years)

Nature of

duties of the

employee

Gross

Remuneration

(in J)

Previous employment / Designation

1 Campbell

Mcclean

CIO - Non Wireless Graduate (Royal Military

Academy Sandhurst)

54 07-Jul-14 35 Engineering 4,67,06,784 Telefonica / Global Chief Architect

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

100

Statement of particulars under Section 197(12) of the Companies Act, 2013 read with the Companies (Appointment and Remuneration of Managerial

Personal) Rules, 2014 for the year ended March 31, 2018

(A) Employed Throughout the Financial Year

Sl.

No.

Name Designation Qualication(s) Age

(In

years)

Date of

Commencement of

Employment

Total

experience (in

years)

Nature of duties of

the employee

Gross

Remuneration

(in H)

Previous employment /

Designation

1 Abhay Savargaonkar Director Networks

& CTO

B.E / B.Tech 53 5-Aug-06 28 Operations 3,73,20,239 Bharti Infotel Ltd / Chief Technology

Ocer

2 Aditya Kohli Head HR - Enabling

Functions

PG Diploma 42 13-Oct-14 20 Human Resources 1,97,43,494 Standard Chartered Bank / Head

P&R

3 Ajay Chitkara Director - Global Voice

& Data Business

PGDBM 46 1-May-01 24 Business Head 3,21,55,718 Comsat Max Limited / Area Sales

Manager

4 Amit Anchal Head - Business

Development and

M & A

MBA 41 10-Jun-02 19 Business

Development

1,11,07,549 Kucheri & Associates, Mumbai /

Audit Assistant

5 Anant Arora CEO - Strategic

Accounts-Airtel

Business

B.E / B.Tech 51 11-Apr-03 28 Sales 2,33,63,550 Reliance Infocomm Ltd / Head -

Sales Operations

6 Anjani Rathor CIO - Postpaid Homes

& DTH

PGDBM 45 10-Dec-07 21 Engineering 1,97,85,141 Delhi Accenture Boeing / Director,

Strategy and Business Development

7 Archana Aggarwal Head - Media

Planning & Buying

MMM, marketing 46 9-Dec-13 23 Marketing 1,16,36,104 Procter & Gamble / Country Media

Manager

8 Aruna Pidikiti Head - Operations

(Network)

M.Tech 48 21-Dec-00 27 Network 1,28,50,887 STPI / Dy. Director (Tech)

9 Ashish Arora CEO - Key Accounts-

Airtel Business

MBA 48 3-Apr-07 23 Sales 1,89,92,393 Sify Ltd / National Sales Head

10 Ashish Goenka Financial Controller

- NSG

MBA 39 3-Oct-16 15 Finance 1,54,39,930 Hindustan Unilever Limited /

General Manager, Finance

11 Ashok Ganapathy Director - Airtel

Business

PGDBM 52 3-May-13 29 Business Head 2,98,80,354 Reliance Mediaworks / CEO

12 Atul Sachdeva Head Wireless

Planning

PGDBM 45 29-Aug-06 23 Network 1,85,48,856 Tata Teleservices Ltd / Head- BSS,

Transmission and Core Planning

13 Badal Bagri CFO - India & South

Asia

CA 46 16-Jan-17 18 Finance 2,41,38,231 Aircel Limited / CFO

14 C Surendran CEO-Market

Operations KK

B.E & MBA 52 4-Nov-03 30 Business Head 2,17,85,974 Modi Xerox / Head-Outsourcing

15 Chamakura Venkatanarasimha

varaprasad

Head-Core SAE-

Network

B.E 48 29-Apr-10 25 Network 1,82,53,712 Etisalat / AVP

16 Chandrasekar Ramamoorthy Head - Network

Experience

MBA 36 3-Feb-14 13 Network 1,24,83,401 Booz & Company / Senior Associate

17 Deepak Sanghi Head-Transport

Planning-Network

B.E 44 29-Mar-04 23 Network 1,17,43,904 Nortel Networks / Technical

Consultant

18 Dharmender Khajuria CEO-Market

Operations-MP&CG

MBA 49 21-Nov-01 26 Business Head 1,63,54,082 National Panasonic / Sr. Sales

Ocer

Statutory Reports

Board’s Report

101

Integrated Report

006-056

Financial Statements

160-317

Sl.

No.

Name Designation Qualication(s) Age

(In

years)

Date of

Commencement of

Employment

Total

experience (in

years)

Nature of duties of

the employee

Gross

Remuneration

(in H)

Previous employment /

Designation

19 Dushyant Kumar Head - Fiber Factory

Operations

B.E / B.Tech 52 2-Nov-98 26 Network 1,61,12,432 Bharti BT Internet Ltd / Manager

20 Gaurav Khandelwal Group Financial

Controller

CA 40 3-Nov-14 17 Finance 2,11,70,307 Hindustan Unilever Limited/Director

- Financial Controls

21 Gautam Anand Head HR - GTM &

Market Ops

MBA 41 30-Jul-09 19 Human Resources 1,74,91,247 Citibank / Portfolio Management

22 George Mathen CEO - Homes Post Graduation 49 17-Nov-06 27 Business Head 2,77,24,537 Coca Cola India / Head - Sales

23 Hemanth Kumar Guruswamy CEO-Market

Operations -

Rajasthan

PGDBM 47 27-Jan-14 23 Marketing 1,24,99,144 Matrimony.com / Sr. VP Retail

24 Kamal Dua Financial Controller

- CB

ICWA 39 8-Mar-07 17 Finance 1,02,27,610 Idea Cellular Limited / Assistant

Manager

25 Kartik Sheth Chief Innovation

Ocer & CEO Wynk

MBA 40 6-May-13 16 Marketing 2,65,03,247 Lakme Lever Private Limited / Chief

Operating Ocer

26 Krishnan Govindan Chief Contact

Experience

MBA 50 9-May-16 22 Customer

Experience

1,84,87,636 ICICI Bank Limited / JGM

27 Manish Agarwal Global Head Taxation CA / CS 44 11-Dec-08 20 Finance 2,09,71,891 HCL TEchnologies, Noida / Deputy

General Manager

28 Manoj Murali CEO-Market

Operations-Hexacom

Rajasthan

MBA 47 1-Oct-01 23 Business Head 2,17,02,839 Crompton Greaves / Area Sales

Manager

29 Manu Sood CEO-Market

Operations-Punjab

MBA 45 13-Jan-12 17 Business Head 3,41,32,883 Hindustan Lever Limited / General

Manager - North India

30 Mohan Shukla Head - External

Aairs

B.A. 64 2-Sep-13 34 Corporate

Regulatory

1,16,03,702 Carrefour WC&C Indian Pvt Limited

/ Director - Corporate Aairs

31 Mukesh Bhavnani Group General

Counsel

LL.B., CS 63 42522 40 Legal 4,59,55,608 Vedanta Resources Plc / Group

Legal Counsel and Head

Compliance

32 Pankaj Sarna Lead - India Taxation CA 57 16-Jan-99 33 Finance 1,03,78,043 Modi Xerox Limited / Controller

Indirect channels

33 Papiya Banerjee CLO & Global Head

of Talent

MA (PM & IR) 44 1-Feb-16 20 Human Resources 1,36,91,236 Edelweiss Tokio Life Insurance /

CHRO

34 Rajiv Mathrani Chief Brand & Online

Ocer

MBA 43 1-Sep-15 18 Brand 2,00,74,011 PepsiCo / Senior Marketing Director

35 Ram Kuppuswamy Chief Global Sourcing

Ocer

MBA 42 5-Jan-15 19 SCM 2,42,29,603 Microsoft Mobile (China) Investment

Company Ltd. / Director Materials

Management

36 Ranjan Sharma Head - Network

Sourcing-SCM

B.Tech 43 9-Mar-15 22 SCM 1,27,18,330 ZTE Telecom India Pvt Ltd / Director

37 Rashim Kapoor Head - Core

Operations

B.Tech 45 31-Aug-05 23 Network 1,06,78,437 Reliance Infocomm Ltd / Team

Leader

38 Ravi Parkash Gandhi Chief Regulatory

Policies

B.Tech 47 3-Mar-08 26 Legal 2,08,47,730 Reliance Communication Limited

Usha / Vice President

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

102

Sl.

No.

Name Designation Qualication(s) Age

(In

years)

Date of

Commencement of

Employment

Total

experience (in

years)

Nature of duties of

the employee

Gross

Remuneration

(in H)

Previous employment /

Designation

39 Ravindra Singh Negi CEO-Market

Operations-NCR

PGDBM 46 1-Aug-00 23 Business Head 2,62,38,145 Koshika Telecom Ltd. / Product

Manager - Prepaid

40 Rohit Marwha CEO-Market

Operations - ROM

PGDBM 42 16-Jul-01 20 Marketing 1,50,94,488 Vijaya Prints & Packs / Director

41 Rohit Relan Head Market Ops CA 48 4-Apr-05 23 Customer

Experience

1,38,83,500 Tata Teleservices Ltd. /

Sr. Manager

42 Sachin Verma Head - Cloud

Operations

B.Tech 42 9-Jul-07 20 Engineering 1,08,72,867 COLT Telecom / Principal Consultant

43 Sameer Batra CEO - Wynk PGDM / B.E 42 21-Feb-06 18 Business Head 1,57,68,107 BPL Mobile Ltd / Product Manager

44 Sameer Chugh Director - Legal LL.B., PGDBM 44 4-Aug-14 23 Legal 30,906,334 Cummins India Limited / VP - Legal

and Secretarial

45 Sameer Kala Global Head - ACE MBA 47 6-Jun-16 24 Finance 1,50,04,998 Capgemini Consulting / Vice

President - Global Engagements

46 Sameer Kirit Anjaria CEO-Market

Operations-WBO

MMS / B.E 45 3-Dec-12 21 Business Head 1,79,99,661 Nokia Corporation MEA / Head Care

Channel Development, IMEA

47 Sandeep Gupta Head-Wireless SAE-

Network

B.Tech 48 30-Nov-12 27 Network 2,01,90,716 Huawei Telecommunications India

Pvt. Limited / Director - Wirelsss &

PS Solution Sales

48 Sanjiv Mishra Head - Operations PGDBM 48 1-Aug-07 26 Sales 1,33,03,052 Becton Dickinson / RSM North

49 Sarang Kanade Director - Customer

Experience & Retail

B.E (Mech.), MMS

(Mkg.)

47 2-Mar-10 21 Business Head 3,22,29,182 Spencers Retail Ltd / VP Operation

50 Shailendra Singh CEO-Market

Operations-UP

Post Graduation 52 16-Mar-16 26 Business Head 1,44,35,845 Tata Teleservices / Sr. VP

51 Shefali Malhotra Global Head Revenue

Assurance

CA 45 1-Mar-00 23 Finance 1,23,25,201 Airborne Express / Manager

Accounts

52 Shyam P Mardikar CTO - Wireless B.E / B.Tech 47 26-Jul-12 25 Network 3,87,04,635 Leara / Chief Technical Ocer

53 Swati Kamat Head - Network

Experience

B.E 52 29-Aug-14 31 Network 1,11,54,294 Tech M / Corperate Head Director

54 Vani Venkatesh Chief Marketing

Ocer

MBA 43 1-Nov-16 17 Business Head 1,44,08,200 Abbott Healthcare Private Limited /

Associate Director - Sales

55 Venkatesh Vijay Raghavan CEO-Market

Operations AP

PGDBM 45 4-Jul-03 23 Business Head 2,19,92,354 Reliance Infocom Ltd. / Product

Manager-Marketing

56 Vir Inder Nath CEO - Retail PGDBM 45 23-Apr-07 21 Business Head 1,90,44,751 IDEA Cellular / DGM

57 Vivek Manglik Head - Global Voice

VAS & Roaming

PGDBM 47 6-Sep-10 23 Sales 1,53,26,550 Tata Communications Limited /

GM Sales

Statutory Reports

Board’s Report

103

Integrated Report

006-056

Financial Statements

160-317

Sl.

No.

Name Designation Qualication(s) Age

(In years)

Date of

Commencement of

Employment

Total experience

(in years)

Nature of duties of

the employee

Gross

Remuneration

(in H)

Previous employment / Designation

1 A Ganesh Distribution Head -

Market Ops

B.Tech, PGDBM 41 1-Feb-13 17 Sales 73,90,952 Hindustan Unilever Limited / General

Manager

2 Anupam Bhat Sr. VP - Internal

Assurance

CA 53 1-Mar-17 27 Finance 1,32,85,031 BAIN B.V / Head - Internal Asurance

3 Arvind Chopra Group Director - Internal

Assurance

B.Com (H), CA 54 30-Sep-15 27 Internal Assurance 3,00,02,141 Essar Services India Pvt Ltd / President

- Group Assurance and Cost Control

4 Harjeet Kohli Group Treasurer MBA 44 19-Jan-09 20 Finance 2,72,26,317 Citigroup India / Director

5 K C Narendran CEO-Market

Operations- Gujarat

Graduate, Cost

Accounting

51 6-Nov-17 27 Business Head 41,84,986 Telenor (India) Communications Pvt Ltd /

Sr. Vice President

6 Pankaj Tewari* Company Secretary CS 46 1-Jun-17 17 Corp Secretarial &

Regulatory

10,674,069 PWC Consulting / Director

7 Ritesh Kumar Singh CEO-Market

Operations- Bihar

B.E 44 16-Nov-16 19 Business Head 46,88,481 Telenor Asia (ROH) Limited / Vice

President

8 Santanu Bhattacharya Chief Data Scientist Doctor of Phylosophy

(PhD)

52 19-Feb-18 30 Engineering 16,85,118 Massachusetts Institute of Technology /

Research

9 Satyamoorti Sivasubramanian Sr VP-Engineering PhD 60 2-Jun-14 37 Engineering 1,85,68,995 SingTel-Optus / Director, Information

Security

10 Sreerama Murthy Chaganti CEO-Market

Operations-Gujarat

PGDBM, B.E 48 10-Apr-14 23 Business Head 2,04,64,031 Aircel / Circle Business Head

11 Srinivas S Vemuri Head CS - PS Planning MBA 49 11-Jul-98 27 Network 1,06,78,683 Vizag Steel Plant / Lecturer

12 Subarno Krishna Ghosh Head FAM & TSS

Project

CA 52 1-Mar-12 25 Network 73,41,842 Reliance Communications Ltd. / Head -

Netwrok Commercial

13 Subramanian Balasubramanian Head - Integration

Project

CA 52 6-Apr-17 24 Business Head 1,67,04,314 Quess Corporation Limited / Group

Chief Financial Ocer

14 Sundeep Sahi Head - Digital Brain B.Tech (Electrical) 41 10-Jul-17 19 Engineering 1,08,83,510 Indi Technologies Pvt. Ltd / Cofounder

& CTO

15 Tushar Vijay Kamat CEO - Major Accounts MBA 44 4-Apr-16 17 Sales 1,97,15,991 SAP India Pvt. Ltd. / Vice President

16 Vidur Rattan CEO-Market Operations

- Maharashtra

PGDBM 40 16-Apr-01 17 Business Head 1,41,08,303 Standard Chartered Bank /

Management Trainee

17 Vidyut Gulati Director - Legal LL.B. 39 17-Jul-17 16 Legal 1,76,83,926 Cairn India Limited / General counsel &

Member Executive Committee

(B) Employed for the Part of Financial Year

Notes:

1. Gross remuneration comprises of Salary, Allowances, Company’s contribution to Provident Fund and taxable value of perquisites.

2. The employee would qualify for being included in Category (A) or (B) on the following basis:

For (A) if the aggregate remuneration drawn by him during the year was not less than H 10,200,000 p.a.

For (B) if the aggregate remuneration drawn by him during the part of the year was not less than H 8,50,000 p.m.

3. None of the employees mentioned above is a relative of any Director of the Company.

4. None of the employees mentioned above hold 2% or more share capital of the Company.

5. There are no specific terms and conditions for employment.

6. The designation - ‘Director’ wherever prefixed describing the area of responsibility occurring in the above Statement is not a Board position.

* Mr. Pankaj Tewari had joined the Company w.e.f. June 01, 2017 and was designated as Company Secretary of the Company w.e.f. July 18, 2017.

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

104

Annexure I

1. This certificate is issued in accordance with the terms of our

engagement letter dated July 25, 2017.

2. We, Deloitte Haskins & Sells LLP, Chartered Accountants,

the Statutory Auditors of Bharti Airtel Limited (“the

Company”), have examined the compliance of conditions

of Corporate Governance by the Company, for the year

ended on March 31, 2018, as stipulated in regulations 17

to 27 and clauses (b) to (i) of regulation 46(2) and para C

and D of Schedule V of the SEBI (Listing Obligations and

Disclosure Requirements) Regulations, 2015 (the Listing

Regulations).

Managements’ Responsibility

3. The compliance of conditions of Corporate Governance is

the responsibility of the Management. This responsibility

includes the design, implementation and maintenance of

internal control and procedures to ensure the compliance

with the conditions of the Corporate Governance stipulated

in Listing Regulations.

Auditor’s Responsibility

4. Our responsibility is limited to examining the procedures

and implementation thereof, adopted by the Company for

ensuring compliance with the conditions of the Corporate

Governance. It is neither an audit nor an expression of

opinion on the financial statements of the Company.

5. We have examined the books of account and other relevant

records and documents maintained by the Company for

the purposes of providing reasonable assurance on the

compliance with Corporate Governance requirements by

the Company.

6. We have carried out an examination of the relevant records

of the Company in accordance with the Guidance Note

on Certification of Corporate Governance issued by the

Institute of the Chartered Accountants of India (the ICAI),

To The Members of Bharti Airtel Limited

the Standards on Auditing specified under Section 143(10)

of the Companies Act 2013, in so far as applicable for the

purpose of this certificate and as per the Guidance Note

on Reports or Certificates for Special Purposes issued by

the ICAI which requires that we comply with the ethical

requirements of the Code of Ethics issued by the ICAI.

7. We have complied with the relevant applicable requirements

of the Standard on Quality Control (SQC) 1, Quality Control

for Firms that Perform Audits and Reviews of Historical

Financial Information, and Other Assurance and Related

Services Engagements.

Opinion

8. Based on our examination of the relevant records and

according to the information and explanations provided to

us and the representations provided by the Management, we

certify that the Company has complied with the conditions

of Corporate Governance as stipulated in regulations 17 to

27 and clauses (b) to (i) of regulation 46(2) and para C and

D of Schedule V of the Listing Regulations during the year

ended March 31, 2018.

9. We state that such compliance is neither an assurance as

to the future viability of the Company nor the efficiency or

effectiveness with which the Management has conducted

the affairs of the Company.

For Deloitte Haskins & Sells LLP

Chartered Accountants

(Firm’s Registration No. 117366W/W-100018)

Hemant M. Joshi

Place: New Delhi Partner

Date: April 24, 2018 (Membership No. 38019)

Independent Auditor’s Certificate on Corporate Governance

Statutory Reports

Board’s Report

105

Integrated Report

006-056

Financial Statements

160-317

Management Discussion and Analysis

Overview

The Indian Telecom Sector is the second largest in the world

and has been growing rapidly. The pace of transformation of the

telecom market over the course of years has been staggering.

Of the 1.3 Bn addressable population in India, there are only

0.7 Bn unique connections today, presenting a large residual

opportunity in the sector. Further, at 58.7%, rural teledensity

also has massive potential to grow and enable the masses to

realize the Digital India vision.

In a mobile first market like India, with massive data offtake,

telecom operators are transforming from pure play mobile

to being a digital services provider - integrating connectivity

and content across various screens. The role of a smartphone

is emerging as more than just a connection. It is leading to a

convergence of connectivity, entertainment, education, and

banking.

The sector is witnessing exponential data traffic growth led by

increased smartphone penetration, cheaper data tariffs, and

proliferation of regional content. Though the mobile broadband

penetration is ~30% today, it is expected to grow manifold and

make India the second largest smartphone market (ahead of US

and just behind China). Further, data traffic is expected to grow 7

fold from 2016-2021. To ensure a market leading position, Airtel

continues to invest heavily in providing high speed broadband

networks in the country and spent H 240,000 Mn this year in

capital expenditure.

Large opportunities exist in non-wireless space of the telecom

industry as well. With less than 5% of the households connected

by fixed broadband, single digit SMB (Small and Medium

Businesses) connectivity, large cash based economy, and low

digital TV penetration, Airtel with an integrated suite of offerings

is very well positioned to catalyse the digital transformation of

the country.

FY 2017-18 was a decisive year for the Indian Telecom Sector

on numerous counts. Industry revenue table continued to

remain under pressure, with the launch of aggressive price

offerings by the latest entrant. The continuing disruption

hastened consolidation and operators with stretched balance

sheets found it difficult to survive. The industry has moved

towards a 3+1 structure with early signs of SIM consolidation. In

this phase of high competitive intensity, Airtel’s priorities center

around growing market share, stripping out costs, and improving

margins. Putting customers at the heart is the key foundation of

our strategy and we continue to maintain network leadership

and provide brilliant customer experience to our more than

300 Mn customers.

We believe that the telecom industry in India is going through a

once in a lifetime transformation and we are truly well poised to

capitalize on this with our industry leading position in customers,

revenues, best in class spectrum and network assets.

In Africa, macroeconomic factors turned favorable with

stabilization in prices of crude oil and commodities. Airtel

remains committed to Africa and with consolidation in 2

countries (Ghana and Rwanda), a better industry structure

is emerging. Low banking penetration, ~20% smartphone

penetration, and exponential data traffic growth are creating

massive opportunities for telecom operators in Africa. Airtel is

creating a strong foundation for a solid, sustainable business in

Africa. Twin engines of data and mobile money, underpinned by

strict cost controls have strengthened our competitive position

during the year.

Economic Review

Global Review

Globally, 2017 witnessed strong growth across most advanced

and emerging economies aided by rebound in investment

and trade, accommodative government policies, improved

confidence, favorable financing costs, rising profits, and

improved business sentiments. Global growth is projected to be

3.1% during 2018.

Global goods trade volumes have gathered significant

momentum since mid-2016, following two years of marked

weakness. Momentum was sustained throughout 2017. The

recovery in global trade is connected to a cyclical upturn in

global manufacturing, which was encouraged by stronger

capital spending. Services trade also recovered in 2017, albeit

at a slower pace.

Growth in 2017 in advanced economies rebounded to more

than 2%, driven by a pickup in capital spending, a turnaround

in inventories, and strengthening external demand. In the US,

economic data largely printed on a positive note, powering the

Fed to raise rates in its last policy meeting by 25bps to 1.50-

1.75%. The U.S. tax reform and associated fiscal stimulus are

expected to raise U.S. growth going forward. Policy stimulus and

strengthening global demand, along with private sector credit

growth to respond to the simulative stance of European Central

Bank led to markedly stronger than expected improvement in

Euro Area. The unemployment rate reached its lowest level

since 2009.

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Growth in emerging markets rose to ~4.3% in 2017, reflecting

firming activity in commodity exporters and continued growth in

commodity importers. Most emerging markets benefitted from

improvements in exports. East and South Asia accounted for

nearly half of the global growth as both regions continued to

develop at a rapid pace.

2018 will continue to be a year of broad based economic growth

both in Developed and Developing Economies. With easing

financial conditions and fiscal support, strong expansion is

expected in the world economy.

Actual Projections

Global Growth Trend

(%)

2016 2017 2018 2019

World Output 3.2 3.8 3.9 3.9

Advanced Economies 1.7 2.3 2.5 2.2

Emerging and

Developing Economies

4.4 4.8 4.9 5.1

China 6.7 6.9 6.6 6.4

India 7.1 6.7 7.4 7.8

Sub-Saharan Africa 1.4 2.8 3.4 3.7

(Source: IMF April 2018)

Indian Economy

India’s macroeconomic fundamentals remained strong

throughout the year. India’s growth story showcases improving

growth dynamics and domestic consumption with supportive

tailwinds from global growth and exports. India is expected to be

the top three economic powers of the world in next 10-15 years.

Going ahead strong private consumption project high growth

rate in India.

(Source: CSO)

Quarterly GDP Growth Rate for India FY 2017-18*

(in %)

5.7

6.5

7.2

7.7

Q1 Q2 Q3 Q4

*GDP growth rates at constant (2011-12) prices

Economic scenario improved with investments in various

sectors of the economy. Key events during the year were:

a) Ratings Upgrade: Moody’s upgraded India’s sovereign

rating with a stable economic outlook. There was a progress

in structural reforms.

b) Implementation of GST: GST will help reduce internal

barriers to trade, increase efficiency and improve tax

compliance.

c) Bank recapitalization: To encourage private participation

thus boosting growth.

d) Improved Ranking: India jumped 30 places to include

itself among top 100 companies under World Bank’s Ease

of Doing Business ranking.

India’s Foreign Direct Investment inflows were bullish with

maximum contribution from services, computer software

and hardware, telecommunication, trading and automobiles.

The Union Budget for 2018-19 focuses on uplifting the rural

economy and strengthening the agricultural sector, healthcare

and quality of education. Make in India initiative to boost the

manufacturing sector, and to increase the purchasing power

would boost domestic demand further. As per World Bank,

private investments in India are expected to grow and overtake

private consumption growth and thereby drive the growth in

GDP. India is expected to achieve upper middle income status

on the back of digitization, globalization and new economic

reforms.

Africa Economy

Aided by strong global growth, higher commodity prices, and

improved market access, sub-Saharan Africa is expected to grow

by 3.4% during 2018 as compared to 2.8% a year ago. Better

terms of trade contributed to narrowing of current account

deficits in most resource intensive countries, but demand

compression also played a role in few resulting in non-uniform

growth across the region. Portfolio flows fueled stock markets,

however they were restricted to economic hubs. Although

growth impetus stems mainly from improved commodity prices,

countries are making structural transformations as well.

The upward momentum in global economic growth is likely

to be sustained, which will continue to create a supportive

environment for commodity prices. The Balance of Payments

problems that plagued many of the continent’s commodity-

exporting countries are mostly behind, partly due to recovering

commodity prices and some bold policy measures taken in

some countries. There are still signs of long-running structural

deficiencies that would likely restrain the medium-term recovery

path. But, overall, the outlook for growth in Africa is positive.

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There are fundamentally positive dynamics which play in Africa’s

favour, including a growing labour force, increased urbanisation

and advanced technology. Africa has the potential to emerge

as one of the world’s most productive and dynamic economies

where the telecom sector continues to witness a revolution in

the areas of data and mobile commerce.

Mobile has become a platform of choice for creating, distributing

and consuming innovative digital solutions in Africa. This

scenario is also leading to a tech start-up ecosystem in the

region. Mobile devices are now the primary means through

which about 80% of internet users in sub-Saharan Africa access

the internet.

Megatrends that drive our business:

a) Convergence of payments via smartphones is driving

financial inclusion. Demonetisation and cashless initiative

has pushed the digital payments in India significantly.

Telecom industry, with an expansive distribution network

is best placed to capture this opportunity. According to

a white paper by ACI Worldwide along with AGS Transact

Technologies (AGSTTL), digital transactions in India could

be worth USD 1 Tn annually by 2025, with four out of every

five transactions being done digitally. The user base for

digital transactions in India is currently close to 90 Mn, but

could triple to 300 Mn by 2020 as new users from rural and

semi-urban areas enter the market, the report said.

b) Sub-Saharan Africa is home to 338.4 Mn mobile money

accounts which grew by 18.4% YoY. A steady uptick in

active customers, transactions and direct revenue are

expected to drive the digital transactions further.

c) Increased penetration of affordable devices, combined

with cloud computing, analytics and rising consumer

expectations is driving the rapid growth of the IOT market.

The IOT market in India is poised to reach USD 15 Bn by

2020, accounting for nearly 5% of total global market.

Telecom will play a critical role in providing connectivity and

solutions in this market. Number of M2M connections in

Africa is expected to reach 26 Mn by 2020.

d) Convergence of fixed and wireless technologies is

becoming more tangible with improvements in handsets,

increased data speed, and development of backhaul.

e) Indian smartphone market witnessed a 14% annual growth

with a total shipment of 124 Mn units in 2017, expected to

reach 500-600 Mn by 2020.

f) The number of internet users in India will reach 500 Mn by

June 2018, rising by 11.34% from 481 Mn users in 2016.

Users in urban India grew by 9.66% till December 2017

from December 2016, while users in rural India grew by

14.11% during the same period.

g) The penetration of high-speed mobile broadband in India

continues to outpace industry expectations, driven by rapid

adoption of low cost smartphones and lower data pricing.

A divergent consumer base has led to consumption of

video / entertainment in varied patterns (smaller durations

and multiple times a day). The increasing usage of digital

service will push the consumption through Over the top

(OTT) platform in near future.

h) Smartphone connections in sub-Saharan Africa have doubled

over the past two years to nearly 200 Mn, accounting for a

quarter of mobile connections in 2016. Affordability of new

devices and growing second-hand mobile devices market

have led to increase in mobile data traffic.

i) By 2020, India is set to become the world’s youngest country

with 64% of its population in the working age group. This

demographic potential will offer India an unprecedented

edge with increase in mobile data penetration.

j) With digitization Phase III and IV, DTH operators are likely

to benefit from a rising subscriber base and higher market

penetration. Innovations in paid TV services, migration

from SD to HD boxes have increased consumption of –

smart TV’s and HD services, offering more opportunities to

service operators.

Industry overview

Indian Telecom Sector

India’s total customer base stood at 1,206.22 Mn with tele-

density of 92.84%, as on March 31, 2018. The year saw financial

stress across the industry ultimately leading to hastening of

the eventual consolidation in the industry. The year saw a host

of operator shut downs and M&A announcements. This has

fast tracked the customer consolidation and consequently

the customer base has registered a muted growth of 1.0% in

FY 2017-18 vis-à-vis 1,194.58 Mn last year and there has been a

marginal decline in the tele-density from 92.98% last year.

The sector has witnessed a strong growth of internet users

and remains to have world’s second highest number of internet

users. The wire-line customer base was at 22.81 Mn at the end of

March 31, 2018 vis-à-vis 24.40 Mn at the end of March 31, 2017.

Among the service areas excluding metros, Himachal Pradesh

has the highest tele-density (135.52%) followed by Tamil

Nadu (134.11%), Punjab (123.30%), Kerala (121.61%),

Gujarat (112.44%), Karnataka (109.01%), Jammu & Kashmir

(108.63%) and Maharashtra (108.46%). Among the three

metros, Delhi tops with 252.93% tele-density. On the other hand,

the service areas, such as Bihar (63.12%), Madhya Pradesh

(66.99%), Uttar Pradesh (71.21%) and Assam (74.63%) have

comparatively low tele-density.

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A population of over a billion people and growing economic

potential continue to offer opportunities for the African telecom

sector. The company has witnessed robust growth across

mobile data and digital economy offerings on the back of

sustained customer focus, enhanced capex spends toward

data capacities and expansion of its mobile money offering.

With the smartphone prices coming down and increase in data

adaptability, the African telecom market is at the cusp of its long

term profitable growth story.

Development in Regulations

The year saw several regulatory changes and developments.

The significant regulatory changes were:

India

> Revision of Mobile Termination Charges (MTC): In

September, 2017 the sector regulator Telecom Regulatory

Authority of India (TRAI) came out with final regulation on

termination rates for the industry effective from October 1,

2017. The Mobile Termination charge has been reduced

from H 0.14 per min to H 0.06 per min. The regulation also

lays out a roadmap to phase out these charges completely

w.e.f. January 1, 2020.

> Revision in International call termination charges:

The sector regulator, Telecom Regulatory Authority of

India (TRAI) has announced a reduction in International

Termination Rate (ITR) from H 0.53 per min to H 0.30 per min

w.e.f. February 1, 2018.

> Implementation of the Goods and Services Tax (GST): With

the enactment of GST Act, 2017, various central and state

taxes have been subsumed in a unified Goods & Services tax

(GST) w.e.f. July 1, 2017. The GST rate for telecommunication

and broadcast services has been fixed at 18%.

> Re-verification of existing subscribers through Aadhar

based e-KYC: Pursuant to Hon’ble Supreme Court’s order

dated February 6, 2017 and the subsequent DoT direction

dated March 23, 2017, licensees are required to re-verify

all existing mobile subscribers (prepaid and postpaid)

through Aadhar based E-KYC process. The last date for

re-verification has been extended by DoT vide its direction

dated March 21, 2018 till the matter is finally heard and the

judgement is pronounced by the Hon’ble Supreme Court

on its interim order passed on December 15, 2017.

> Amendment in Unified License Agreement for

deployment of Switches and other network elements:

DoT vide its direction dated June 23, 2017 has permitted

Telecom Service Providers (TSPs) to deploy its equipment

anywhere in India subject to the interconnection points

Tele Density: India

(Source: Telecom Regulatory Authority of India)

FY 2013-14

Customer Base (Million) Tele Density (%)

FY 2014-15 FY 2015-16 FY 2016-17 FY 2017-18

75.23

79.38

83.36

92.98

92.84

933.00 996.49 1058.86 1194.58

1206.22

While the rural penetration improved during the year and touched

59.05% as on March 31, 2018 vis-à-vis 56.91% as on March 31,

2017, there is still a strong headroom for growth. With urban

tele-density of over 160%, customer service and experience will

be the key growth drivers in urban areas. With the government’s

favourable regulations and policies, the fast changing

high-speed 4G ecosystem, India’s telecommunication sector is

expected to witness a continued surge in data consumption in

the coming years.

The financial stress across the industry was further exacerbated

by the explosion of voice and data traffic and the need to invest

to sustain network capacities. The company continued to invest

in capex to enhance data capabilities and better customer

experience. It remains best placed to capture the ever growing

data market.

African Telecom Sector

Fuelled by improved economic conditions, the African continent

continues to present great opportunities in the telecom sector.

The liberalization of the sector, the extension of services by

multinational conglomerates and the active competition currently

have all contributed to the continued expansion of the sector.

The currencies across the continent have remained comparatively

stable versus the US dollar over the last 12 months (exit March

31 rates) except for CFA franc (which appreciated by 13%) and

Nigeria where the company transitioned from ‘administered’ to

‘market based’ exchange rate during the year. In terms of the

12-month average rates, the revenue weighted Y-o-Y currency

depreciation has been 3.5%, mainly caused by depreciation in

Ugandan Shilling by 5% and Rwandan Franc by 7%.

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being located and operated in the respective service areas

and meeting the security conditions as mentioned in the

license.

> Regulation on Quality of Service: TRAI has released

an amendment to the Quality of Service regulation w.e.f.

October 1, 2017 and key highlights are as below:

> Methodology for assessment of Drop Call Rate (DCR)

has been revised from ‘simple average’ of call drop

across all Base Transceiver Station (BTS) in a month

to a ‘percentile’ based approach which better reflects

area-to-area and day-to-day variations.

> To ensure a technology agnostic performance

measurement, the DCR assessment will be done

across all technologies (GSM, WCDMA, CDMA, LTE

etc.) as a whole.

> Graded financial disincentives for failing to meet DCR

benchmarks have been introduced. Disincentives

range up to H 5 lakhs per parameter in the first month.

> Telecommunication Interconnection Regulations, 2018:

The regulation, effective from February 1, 2018, lays down

rules for drafting network connectivity agreements along

with norms for initial provisioning of such connectivity,

augmentation of Points of Interconnect (PoI), applicable rates

or charges, disconnection of ports, and financial disincentive

on interconnection issues. The key features are:

> Post receipt of a request for interconnection, service

providers now have a defined time frame of 30 days to

enter into a non-discriminatory agreement.

> A financial disincentive, not exceeding rupees one lakh

per day per licensed service area, has been introduced

for violation of these regulations and timelines.

> Regulation on Telecom Tariff Order: Telecom Regulatory

Authority of India (TRAI) notified the “Telecommunication

Tariff (63

amendment) Order, 2018” dated February 16,

2018. The key features are:

> The term significant market power (SMP) has been

defined. Any service provider holding a share of at

least thirty percent of total activity (subscriber base or

revenue) in a relevant market is now categorized as an

SMP.

> A SMP will be considered to be involved in predatory

pricing if it provides services at a price which is

below the average variable cost with intent to reduce

competition or eliminate the competitors in the

relevant market.

> No service provider can discriminate its offerings

between subscribers of the same class and such

classification of the subscribers shall not be arbitrary.

> In case of tariff being found to be predatory, the service

provider shall be liable to pay an amount not exceeding

fifty lakh rupees per tariff plan for each service area.

> All segmented offers are required to be reported to

TRAI and published on the operator’s website as well.

However, as per TDSAT Interim order dated April 24, 2018,

the Hon’ble TDSAT has stayed the reporting requirement

and definition of SMP as quoted in TTO 63

Amendment.

Africa

> Rwanda: The Regulator has set a new glide path for Mobile

Termination Revenue (MTR) effective from September 1,

2017. The current MTR rate of 20.7 FRW will change to

15 FRW till December 31, 2017, 10 FRW till December 31,

2018 and finally 5 FRW from January 1, 2019.

> Malawi:

> A new Telecommunication Bill has made it mandatory

for companies to have 20% local shareholding before

August 1, 2018.

> The Regulator has set a glide path for Mobile

Termination Revenue (MTR) effective from January 1,

2018. The current MTR of USD 0.04 has changed to

USD 0.02, will become USD 0.012 effective January 1,

2019 and finally USD 0.006 effective January 1, 2020.

> The Reserve Bank has passed a law in June, 2017

which makes mobile money interoperability mandatory

with an implementation timeline of six months.

> Zambia:

> The Regulator has awarded fresh license to Uzi Zambia

Limited making it the 4

mobile operator in the market.

> The Zambian regulator has completed the process of

migrating existing licences to a unified licence regime.

> Tanzania: The Regulator has set a new glide path for

Mobile Termination Revenue (MTR). The current MTR of

TZS 26.96 has been changed to TZS 15.60 effective from

January 1, 2018. Thereafter the rates will steadily decline

every year in January.

> Uganda: The regulator has set a new glide path for Mobile

Termination Revenue (MTR). The current MTR of 112

UGX will change to UGX 65 effective from July 1, 2018.

Thereafter the rates will steadily decline every year in July.

> Madagascar: The regulator in Madagascar has issued

new Mobile Termination Revenue (MTR) determination

terms. The current MTR of Ar 125 has been replaced with

operator-wise terms.

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Integrated Report and Annual Accounts 2017-18

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Strengths

> Leadership: #1 telecom player in India and #2

operator in Africa. Market leadership (Rank 1 & 2) in

12 of 14 African countries.

> Scale: Largest Revenue and Subscriber Market Share

in India.

> Distribution Platform: Large distribution platform

enabling services like Mobile Money, OTT applications

- Wynk Music and Airtel TV.

> QuadPlay: Only operator to leverage quad play

Mobile, Fixed Voice, Broadband and DTH.

> Network: Only player with Pan India 4G/3G spectrum.

Highest spectrum market share (~30%). Large

deployments of Network Towers and Base Stations.

SCOT analysis

Opportunities

> Tele Density: Low teledensity in India and Africa.

Unique users in India ~750 Mn (<60% penetration).

420 Mn unique users in Africa (<50% penetration).

> Data Usage Growth: Data explosion with the

proliferation of affordable smartphones and

Government of India’s digital drive. Data usage

exploding in Africa.

> Digital Payments: India’s digital payments space is

expected to grow the segment by about five-fold to

USD 1 trillion by 2023. Underpenetrated banking

opportunity in Africa.

> Content: Increased interest in digital content.

Video consumption contributes to >70% of data

consumption.

> Active Infra Sharing: Active infra sharing to lead to

reduced expenditures.

> Other Non-Mobile Businesses: Low fixed broadband

penetration in India (1.4 fixed broadband subscriptions

per 100 inhabitants). Digitization phase 3 and 4 to

uplift DTH homes. Large SMB’s with low connectivity.

> Consolidation: Consolidation in the industry with exits

of various telcos leading to better industry dynamics

and higher/better market share.

Threats

> Competition: Decline in average revenue per user due

to increasing competition.

> Regulatory: Political and Economic uncertainties

across regions.

> Currency Exposures: Volatility in currencies due to

global macro-economic uncertainties.

Challenges

> Operations: Geographically varied presence,

integrating operations across India, South Asia and

Africa leveraging common platform.

Customer Needs: Understanding evolving customer

perceptions in fast-changing multi-cultural and multi-

lingual environment.

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Financial review

Consolidated Figures

Standalone Figures

*1 USD = H 64.44 Exchange Rate for financial year ended March 31, 2018 (1 USD = H 67.16 for financial year ended March 31, 2017).

Particular FY 2017-18 FY 2016-17

G Millions

USD Millions*

G Millions

USD Millions*

Gross revenue 8,36,879 12,986 9,54,683 14,214

EBITDA before exceptional items 3,04,479 4,725 3,56,206 5,304

Interest, Depreciation & Others before

exceptional items

2,63,878 4,095 2,67,277 3,979

Prot before exceptional items and Tax 40,601 630 88,930 1,324

Prot before tax 32,670 507 77,233 1,150

Tax expense 10,835 168 34,819 518

Prot for the year 10,990 171 37,998 566

Earnings per share (In H / USD)

2.75 0.04 9.51 0.14

Particular FY 2017-18 FY 2016-17

G Millions

USD Millions*

G Millions

USD Millions*

Gross revenue 5,36,630 8,327 6,22,763 9,273

EBITDA before exceptional items 1,81,529 2,817 2,42,242 3,607

Interest, Depreciation & Others before

exceptional items

1,82,300 2,829 1,54,629 2,302

Prot before exceptional items and Tax (771) (12) 87,613 1,304

Prot before tax (6,812) (106) (85,095) (1,267)

Tax expense (7,604) (118) 14,161 211

Prot for the year 792 12 (99,256) (1,478)

Earnings per share (In H / USD)

0.20 0.00 (24.84) (0.37)

The Company’s consolidated revenues stood at H 836,879 Mn

for the year ended March 31, 2018, as compared to H 954,683

Mn in the previous year, decrease of 12.3% (decrease of 9.8%

after normalising for impact of IUC rate cut in India, divested

operating units of Africa / Bangladesh and acquisition of Tigo,

Rwanda). The revenues for India and South Asia (H 644,217 Mn

for the year ended March 31, 2018) represented a de-growth

of 13.5% compared to that of previous year (de-growth of

11.6% after normalising for impact of IUC rate cut and impact

of Bangladesh divestment). The revenues across 14 countries

of Africa, in constant currency terms, grew by 4.9% (growth of

4.6% adjusting for the impact of divestment of tower assets and

acquisition of Tigo, Rwanda).

The Company incurred operating expenditure (excluding access

charges, cost of goods sold, license fees and CSR costs) of

H 358,888 Mn representing a decrease of 9.2% over the

previous year. Consolidated EBITDA at H 304,479 Mn decreased

by 14.5% (decrease of 13.3% after normalising for impact of IUC

rate cut in India, divested operating units of Africa / Bangladesh

and acquisition of Tigo, Rwanda) over the previous year. The

Company’s EBITDA margin decreased during the year to 36.4%

as compared to 37.3% in the previous year. Depreciation and

amortization costs for the year were lower by 2.7% to H 192,430

Mn. Consequently, EBIT for the year at H 110,845 Mn decreased

by 29.3% (decrease of 31.1% after normalising for impact of

IUC in India and impact of divestments) resulting in margin of

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

112

13.2% vis-à-vis 16.4% in the previous year. The cash profits

from operations (before derivative and exchange fluctuations)

for year ended March 31, 2018 was H 227,169 Mn vis-à-vis

H 283,666 Mn in the previous year.

Net finance costs at H 80,712 Mn were higher by H 3,737 Mn,

compared to previous year, mainly due to lower investment

income by H 3,488 Mn (FY 2017-18 – H 5,117 Mn, FY 2016-17 –

H 8,606 Mn). The increase on account of spectrum related debt

in India was partially off-set by lower forex losses in current year

compared to previous year. Consequently, the consolidated

profit before taxes and exceptional items at H 40,601 Mn

compared to H 88,930 Mn for the previous year.

The consolidated income tax expense (before the impact on

exceptional items) for the full year ending March 31, 2018 was

H 14,918 Mn, compared to H 44,230 Mn for the previous year. The

decline is primarily led by drop in profits in India. After adjusting

for certain losses where no DTA was created, the underlying

effective tax rate in India for the year ended March 31, 2018 was

at 26.5% vs 29.4% in the previous year. The tax charge in Africa

for the full year (excluding divested units) was at USD 159 Mn vs

USD 148 Mn in the previous year on account of change in profit

mix of the countries.

Net income before exceptional items for the full year came in

at H 13,960 Mn as compared to H 38,134 Mn in the previous

year. Exceptional items during the year accounted for net

impact of H 2,970 Mn. These included impact of gains / losses

on divestment of subsidiaries, translation impact in Nigeria

due to transition to market based exchange rate, litigation

related assessments, operating costs on network re-farming &

upgradation programmes and assessment of tax provisions.

After accounting for exceptional items, the resultant consolidated

net income for the year ended March 31, 2018 came in at

H 10,990 Mn as compared to H 37,998 Mn in the previous year.

The capital expenditure for the full year was H 268,176 Mn (USD

4.2 Bn) as compared to H 198,745 Mn in the previous year (an

increase of 34.9%). Consolidated operating free cash flow for

the year was at H 36,303 Mn as compared to H 157,461 Mn in

previous year. Higher investments and continued pricing pressure

in India has resulted in decline of Return on Capital Employed

(ROCE) to 4.6% from 6.5% in the previous year.

Liquidity and funding

As on March 31, 2018, the Company had cash and cash

equivalents of H 47,886 Mn and short-term investments of

H 68,978 Mn. During the year ended March 31, 2018, the

Company generated operating free cash flow of H 36,303 Mn.

The Company’s consolidated net debt as on March 31, 2018

increased by USD 517 Mn to USD 14,611 Mn as compared to

USD 14,094 Mn last year, mainly on account of increased capital

expenditure. The Net Debt - EBITDA ratio (USD terms LTM) as on

March 31, 2018 stood at 3.13 times as compared to 2.63 times

in the previous year, mainly on account of increased borrowings

and reduced EBITDA. The Net Debt-Equity ratio stood at 1.37

times as on March 31, 2018, compared to 1.35 times in the

previous year.

During the year, the Company undertook several initiatives to

meet its liquidity and funding requirements. The Company

completed the secondary sale of its subsidiary Bharti Infratel

Limited (“Bharti Infratel”) to global fund managers and global

tower company investors for a consideration of approx H 25,700

Mn and H 33,250 Mn in Q2’18 and Q3’18 respectively, thereby

reducing it’s equity stake to 53.51% in Bharti Infratel. These

proceeds were primarily used by the Company to reduce its

debt. The Company also made its maiden unsecured listed NCD

issuance of H 30,000 Mn in Q4’18. The Company continues to

maintain its credit ratings and has access to both domestic and

international debt capital markets.

Awards and Recognition

> Airtel has won the ‘Aon Best Employer India 2017’ award

for its innovative people practices and achieving high

levels of employer brand, employee engagement and well

established people practices.

> Airtel won the TM Forum’s Excellence Award 2017 in the

‘Smart Service Provider – Business of the Year’ category for

accelerating digital transformation in India. TM Forum is a

global non-profit industry association for service providers

and their suppliers within the telecommunications industry.

> Airtel has won the prestigious ‘Golden Peacock Award for

Corporate Sustainability – 2017’. The award assesses

the responsiveness of organizational strategy to the

needs of different stakeholders, integration of sustainable

development issues with corporate functioning and

development of innovative partnership models to fulfill

social responsibility.

> Airtel is one of the only 3 companies from India to be

ranked amongst the Forbes list of 100 most Innovative

Companies in the world for 2017.

> Airtel won the ‘Best Brand Loyalty Marketing Campaign’

and ‘Best CSR Initiative Award’ at the Asian Customer

Engagement Forum (ACEF) awards. The Forum honors

campaigns that display the highest proficiency and

creativity in fields of integrated marketing and customer

engagement.

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> Airtel has been rated as the fastest mobile network in

India by the global leader in internet speed tests - Ookla for

third time in a row.

> Airtel has been ranked as the ‘Best Company to Work

For’ within the telecom sector and amongst the top 10

across sectors in India by Business Today – PeopleStrong

Survey, 2017.

Segment-wise Performance

B2C services

Mobile Services: India

Overview

The year saw a number of impactful regulatory developments

and heightened financial stress across the industry. The year

began with the implementation of customer verification norms

through the Aadhar based e-KYC. This ushered in a paper less

and digital activation process which led to improvement in the

customer on boarding experience. Goods and Services Tax

(GST) was made effective July 1, 2017 and the indirect tax

on telecommunication and broadcasting services was fixed

at 18%. The sector regulator, Telecom Regulatory Authority

of India (TRAI) came out with regulations on the interconnect

termination rates. The domestic mobile termination charge

(MTC) was reduced from H 0.14 per min to H 0.06 per min

effective October 1, 2017 and the international MTC rate was

reduced from H 0.53 per min to 0.30 per min effective February

1, 2018. These rate cuts have led to further decline in industry

ARPU.

Low priced bundle products with unlimited voice calling benefits

and large data download became the norm and consequently,

voice and data traffic saw unprecedented levels of growth.

The financial stress across the industry ultimately led to the

hastening of the eventual consolidation in the industry. The year

saw a host of operator shut downs and M&A announcements.

The financial stress across the industry was further exacerbated

by the explosion of voice and data traffic, and the need to

invest to sustain network capacities. Airtel entered into several

M&A transactions to harness operational synergies and scale

benefits from consolidation. During the year, the acquisition

of Telenor India has also been approved by the Department

of Telecommunications (DoT). The company also completed

the acquisition of Tikona Digital Networks. The company also

entered into agreements with Tata Teleservices Ltd. (TTSL)

and Tata Teleservices (Maharashtra) Ltd. (TTML) to merge

their Consumer Mobile Business (CMB). The deal is currently

under regulatory approvals. The above acquisitions have further

strengthened the company’s spectrum portfolio and are in line

with company’s commitment to provide the best network and

customer experience.

The company crossed the milestone of 300 Mn customers in

India; the latest 100 Mn customers have joined the Airtel family

in less than 2 years. As on March 31, 2018, the Company

had 304.2 Mn GSM customers. During the year, total minutes

on network increased by 45.3% to 1,946.3 Bn. The churn

decreased to 3.5% for the current year, compared to 3.7%

during the previous year. The Company had 86.1 Mn data

customers at the end of March 31, 2018, of which 76.6 Mn were

mobile broadband customers. The total MBs on the network for

the full year has increased by 432.2% to 3,901.8 Bn MBs. The

company has also expanded its reach within the digital space.

Wynk music remains the number 1 music app in the country

and Airtel TV is now ranked number 3 amongst comparable

video OTT apps. It offers more than 350 live channels, 8000+

movies and is available in 14 languages.

During the year, revenues decreased by 18.2% to H 462,639 Mn

as compared to H 565,511 Mn in the previous year. The segment

witnessed decline in the EBITDA margin to 32.6% during the

year, compared to 40.3% in the last year. EBIT margin for the year

declined to 4.5%, compared to 18.7% in the last year.

In line with its commitment to provide best network & customer

experience to its customers, the company launched a number

of innovative offerings to maintain differentiation in a highly

competitive market. There were a number of ‘industry firsts’

through the year such as:

> ‘Data rollover’: Allows the un-used data of a customer to be

carried forward into the next billing cycle;

> ‘Project Next’: A digital innovation program aimed at

transforming customer experience across all of its services

and touch points;

> *121#: A digital care platform in 10+ regional languages;

> A digital platform dedicated for B2B customers.

These innovations increased Airtel’s innovation premium and

made it feature on the Prestigious Forbes’ list of 100 most

innovative companies in the world for 2017 - one of the only 3

Indian companies to feature on the same.

The company expanded its “project leap” initiative announced

last year and continued to invest in building data capabilities

and provide a world class network to customers who are on

a journey of digital transformation. The capex investment, its

highest ever, were almost entirely targeted to this end. These

investments resulted in the company being named as the

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

114

‘fastest mobile network in India’ by the global leader in internet

speed test – Ookla for three consecutive times in a row.

The Company had 165,748 network towers, compared to

162,046 network towers in the last year. Mobile broadband

(MBB) base stations were at 298,014 the end of the year,

compared to 190,860 at the end of last year.

Particulars FY 2017-18 FY 2016-17 Y-O-Y

Growth

G Millions G Millions

Gross Revenues 4,62,639 5,65,511 -18%

EBIT 20,829 1,05,484 -80%

Wireless Subscribers: India (Million)

304.2

273.6

251.2

FY 2015-16 FY 2016-17 FY 2017-18

Key Highlights

Strategic Alliances & Partnerships: Airtel entered into a host of

partnerships with the aim to provide a differentiated customer

experience

> Airtel has partnered with Amazon to launch a first-of-its-kind

offer for its postpaid customers. Existing and new postpaid

customers with an Airtel Infinity Plan of H 499 or above can

now get a one year membership of Amazon Prime, worth

H 999 at no additional cost. Airtel also partnered with

Amazon for Amazon’s Fire TV Stick with Voice Remote,

which was launched in India. Customers purchasing

Amazon Fire TV will get free 100 GB high speed data via

Airtel Broadband/Airtel 4G Home Wi-Fi.

> Airtel and Ola (ANI Technologies Pvt. Ltd.) have entered into

a partnership that enables a seamless digital experience

for customers. Airtel Payments Bank will be integrated with

the Ola app to offer payment solutions to Ola’s consumers.

Ola’s digital wallet will be integrated with Airtel to enable

payments for mobile, broadband and direct-to-home bills

through Ola Money.

> Airtel announced a partnership with Facebook to deploy

20,000 hotspots across India, allowing Express Wi-Fi

to reach millions of Indians and provide super-fast and

affordable connectivity.

> Airtel has joined hands with Hotstar and ALT Balaji to bring

their popular original shows and movies onto the Airtel TV

App.

> Airtel announced a strategic partnership with SK Telecom,

Korea’s largest telecommunications company to leverage

the latter’s expertise to build the most advanced telecom

network in India.

> Airtel launched ‘Mera Pehla Smartphone’ initiative wherein

Airtel and Karbonn Mobiles have announced a partnership

to bring an affordable 4G Smartphone to the market. The

Android based 4G smartphone comes with full touch screen

experience, dual SIM slots and access to all popular apps like

YouTube, WhatsApp and Facebook. Airtel further extended a

number of partnerships with Google, HMD Global, Motorola,

Lava Celkon, Intex, Samsung and Itel to bring highly

affordable ‘bundled’ 4G smartphone options to the market.

> Airtel has partnered with OneWeb, Airbus, Delta and

Sprint in a global ‘Seamless Alliance’ to leverage satellite

technology and bring uninterrupted In-Flight connectivity to

mobile users.

> Airtel Payments Bank entered into a strategic partnership

with Hindustan Petroleum Corporation Limited (HPCL), and

enabled all 14,000 HPCL fuel stations across the country

to also act as its banking points. Airtel Payments Bank

customers will also be able to make secure and convenient

digital payments for fuel purchases at all these stations.

Mergers & Acquisitions: Airtel entered into several M&A

transactions to harness operational synergies & scale benefits

from consolidations.

> Airtel’s proposed merger with the Indian unit of Norway’s

Telenor has been approved by DoT. The Department of

Telecommunications has transferred all licenses belonging

to the Indian unit of Norway’s Telenor, along with its liabilities

to Airtel. The transaction will boost the Airtel’s 4G spectrum

holdings, fortify its network capacity and augment its

revenue. The Telenor India acquisition consolidates Airtel’s

market leadership, further strengthens its network portfolio

in key markets and will add to shareholder value.

> Airtel’s proposed merger with the consumer business unit

of Tata Teleservices (Maharashtra) Ltd. (TTML) and Tata

Teleservices Ltd. (TTSL) is under regulatory approvals.

Securities and Exchange Board of India (SEBI) has given

approval for the TTML merger.

Statutory Reports

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> Airtel has completed the proposed acquisition of shares of

Tikona Digital Networks. With the said acquisition, Tikona

has become a wholly owned subsidiary of Airtel. Merger is

subject to other statutory approvals.

> Airtel (through the subsidiary Company) acquired a strategic

stake in Juggernaut Books (‘Juggernaut’), a popular digital

platform to discover and read high quality, affordable books

and to submit amateur writing. This synergizes with Airtel’s

endeavor to build an open content ecosystem and bring

world class digital content to customers.

Successful Divestment/Funding: Airtel (through the subsidiary

company) offloaded H 58,950 Mn stake in Bharti Infratel

primarily to pare debt & issued H 30,000 Mn worth NCDs to

refinance existing debt.

> Bharti Airtel Limited via its wholly owned subsidiary, Nettle

Infrastructure Investments Limited, divested 150 Mn shares

of its subsidiary Bharti Infratel Limited through secondary

share sale in the stock market for a consideration of over

H 58,950 Mn.

> Airtel has issued non-convertible debentures worth up to

H 30,000 Mn on a private placement basis. The proceeds

of the issue will be used for routine treasury activities such

as refinancing of existing debt and spectrum liabilities etc.

Network Expansion & Transformation: Airtel took several

initiatives to remain lean & Agile and provide a world class

network to customers who are on a journey of digital

transformation.

> Airtel has signed an agreement with the Department of

Telecom (DoT) and the Universal Service Obligation Fund

(USOF) in December 2017 for provision of mobile services

in identified uncovered villages and national highways

in the North Eastern States of Assam, Manipur, Mizoram,

Nagaland, Sikkim, Tripura and Arunachal Pradesh. Under

the agreement, Airtel will set up over 2,000 mobile towers

in more than 2,100 villages over the next 18 months.

> Airtel announced the launch of India’s first Telecom Infra

Project (TIP) Community Lab. Airtel is among the early

members of TIP – a global initiative founded by Facebook,

Deutsche Telekom, Intel, Nokia and SK Telecom to create a

new approach for building and deploying telecom network

infrastructure.

> In an Industry first, Airtel announced the deployment

of Massive Multiple-Input Multiple-Output (MIMO) in

partnership with Huawei Telecommunication India. Part of

Airtel’s ongoing network transformation program, Project

Leap, this technology will expand existing network capacity

and enhance user experience. The first round of deployment

has started in Bangalore and Kolkata.

> Airtel launched its VoLTE services in Mumbai, Madhya

Pradesh, Andhra Pradesh, Gujarat, Karnataka, Chennai,

Maharashtra, Goa and Chhattisgarh. Customers can now

enjoy HD quality voice calls and call any mobile, landline

network using Airtel VoLTE, which works over 4G.

> Airtel conducted India’s first 5G network trial in partnership

with Huawei.

Digital Innovations & Customer Delight: Airtel continued its

journey of digital innovations to empower the increasingly

demanding customers & to maintain differentiation in a highly

competitive market.

> Airtel has crossed the 300 mn mobile customer mark in

India during the quarter ending March 31, 2018.

> Airtel launched ‘Project Next’ – a digital innovation program

aimed at transforming customer experience across all of

its services and touch points. This will entail an investment

of upto H 2,000 crores over the next three years to launch

several exciting digital innovations to bring a step change

in the simplicity and interactivity of the Airtel customer

experience. As part of the project, Airtel has launched its

first set of digital innovations which include:

> Next-Gen Airtel Stores which are minimalistic by design

to provide a highly interactive customer experience

including a digital screen, touch screen table top and

entertainment hubs. The first two such stores are

operational in Gurgaon, Haryana.

> New version of the MyAirtel App to enable real time

customer experience. With the new version, bill plan

change, notifications, self-care and many other services

will be enabled with the click of a button.

> Airtel’s postpaid promise (www.airtel.in/postpaid

promise) which will get seamlessly delivered through

the MyAirtel App. As part of the same, Airtel has

introduced ‘data roll-over’ feature which allows

customers to roll over unused data quota to the next

billing cycle. To protect customer smartphones against

accidental / liquid damage and malwares, Airtel has

launched – ‘Airtel Secure’ a one of its kind solution for

smartphones up to two years old.

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

116

> Airtel launched its Online Store to bring a range of

premium devices at affordable down payments and

bundled monthly plans. In a first of its kind digital store,

Airtel has introduced the iPhone 7 at just H 7,777.

> In an Industry first, Airtel launched its *121# digital care

platform for prepaid customers in Hindi and 10 more

regional languages - Punjabi, Marathi, Gujarati, Tamil, Telugu,

Malayalam, Kannada, Bangla, Oriya and Assamese. This

platform allows Airtel’s prepaid customers to get seamless

access to a host of information such as balance amount,

details of last few transactions as well as ongoing offers

without requiring to speak to a customer care executive.

> In an industry first, Airtel Payments Bank launched UPI

enabled digital payments which allows for secure digital

payments to online / offline merchants and instant money

transfers to any bank account in India over smartphones.

Corporate Social Responsibility: Airtel implemented a host of

sustainability initiatives across the organization and remains

fully committed to keep building upon it.

> Airtel released the latest edition of its India Sustainability

Report. Airtel’s India Sustainability Report 2017 outlines its

impact across all stakeholders. Airtel reported over 81%

reduction in CO

emissions per TB in network infrastructure

over the last five years and committed to reduce carbon

footprint by 70% by 2020.

Homes Services

Overview

The Company provides fixed-line telephone and broadband

(DSL) services for homes in 89 cities across India. The company

expanded ‘V-Fiber’ technology for its Homes customers after

it became the first operator to deploy Vectorization in India;

this technology enables the customers to experience internet

speeds of up to 100 Mbps. The Homes business had 2.2 Mn

customers as on March 31, 2018, representing a growth of

2.0% as compared to 2.1 Mn at the end of previous year. DSL

customers now represent 94% of the total Homes customers as

compared to 92.3% in the previous year.

Revenues from Homes services stood at H 25,265 Mn for the

year ended March 31, 2018, as compared to H 27,518 Mn in

the previous year, decrease of 8.2%. EBITDA margin has been

slightly decreased during the year to 46.7% as compared to

47.2% in the previous year. During the year data traffic increased

by 55.6% to 1,340.8 Bn MBs.

Particulars FY 2017-18 FY 2016-17 Y-O-Y

Growth

G Millions G Millions

Gross Revenues 25,265 27,518 -8%

EBIT 4,717 6,868 -31%

Homes Subscribers: (Million)

2.13

1.95

FY 2015-16 FY 2016-17 FY 2017-18

2.17

Key Highlights

Unrivalled Customer Experience

> Airtel introduced an all new superfast Home broadband

plan with speed of up to 300 Mbps over Wi-Fi with free

subscription to Airtel’s OTT apps - Wynk Music and Airtel TV.

> Further enhancing its value proposition for customers,

Airtel introduced ‘Data Rollover’ feature for its home

broadband customers enabling them to carry forward

unused monthly data to the next billing cycle. Customers

can now accumulate up to 1,000 GB data and easily track

their usage and balance data on the My Airtel App.

Digital TV Services

Overview

The company served a customer base of 14.2 Mn on its Direct-

to-Home platform (Airtel digital TV), as on March 31, 2018,

adding 1.4 Mn customers during the year.

The company currently offers both standard and high definition

(HD) digital TV services with 3D capabilities and Dolby surround

sound. The company currently offer a total of 649 channels

including 75 HD channels, 5 international channels and 4

interactive services. Revenues for the year stood at H 37,570 Mn

for the year ended March 31, 2018, as compared to H 34,306

Mn in the previous year, increase of 9.5%. Affordability of HD

set-top boxes, demand for HD channels and upselling efforts led

to ARPU flat at H 231. Operating free cash flow on full year basis

at H 3,949 Mn compared to cash flow of H 3,611 Mn during the

previous year.

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(included in India Mobile) is at H 95,894 Mn in this year, this is

now 15.0% of the total India revenues.

Global Business, the international arm of Airtel Business, offers

an integrated suite of global and local connectivity solutions,

spanning voice and data to the carriers, Telcos, OTTs, large

multinationals and content owners globally.

Airtel’s international infrastructure includes the ownership of

i2i submarine cable system, connecting Chennai to Singapore

and consortium ownership of submarine cable systems like

South East Asia - Middle east - Western Europe - 4 (SWM4), Asia

America Gateway (AAG), India - Middle East - Western Europe

(IMEWE), Unity, Europe India Gateway (EIG) and East Africa

Submarine System (EASSy). Along with these seven owned

subsea cables, Airtel Business has a capacity on 22 other cables

across various geographies.

Its global network runs across 250,000 Rkms with over 1200

customers, covering 50 countries and five continents and 65

Global PoPs (Point of presence). This is further interconnected

to its domestic network in India and direct terrestrial cables to

SAARC countries, Myanmar and China helping accelerate India’s

emergence as a preferred transit hub.

Leveraging the direct presence of Airtel Mobile operations in 16

countries across Asia and Africa, Global Business also offers mobile

solutions (ITFS, signalling hubs, messaging), along with managed

services and SatCom solutions. Global business is also providing

advanced consumers solutions like IOT to global customers.

Particulars FY 2017-18 FY 2016-17 Y-O-Y

Growth

G Millions G Millions

Gross Revenues 1,13,218 1,09,429 3%

EBIT 31,044 22,737 37%

Key Highlights

Digital Transformation & Expansion

> Airtel rolled out a first-of-its-kind dedicated digital platform

for B2B customers (including SMEs and startups) to serve

their growing connectivity, communication and collaboration

requirements. With Airtel’s new digital platform on www.airtel.

in/business/businessinternet small businesses can buy new

communication and collaboration products to enable faster

time to market and enhance ease of doing business.

> Airtel has acquired the Indian leg of Gulf Bridge International

(GBI) India - Middle East - Europe submarine cable with an

aim to consolidate its global network leadership and serve

the exploding data demand in emerging markets like India,

Gulf and Africa.

Particulars FY 2017-18 FY 2016-17 Y-O-Y

Growth

G Millions G Millions

Gross Revenues 37,570 34,306 10%

EBIT 5,306 3,577 48%

DTH Subscriber Base: (Million)

12.8

11.7

FY 2015-16 FY 2016-17 FY 2017-18

14.2

Key Highlights

Divestment: Airtel beefs up its war chests to fight competition.

> Bharti Airtel announced that an ‘affiliate’ of Warbug

Pincus will acquire an equity stake of up to 20% in Bharti

Telemedia Limited – its DTH arm. The transaction is subject

to regulatory and statutory approvals. After this transaction,

Airtel will own 80% equity stake in Bharti Telemedia Limited.

Awards

> Airtel’s Internet TV – India’s first 4K hybrid set-top box,

the Year’ award at the NEXA NDTV Gadget Guru Awards.

B2B Services

Airtel Business

Overview

Airtel Business is India’s leading and most trusted ICT services

provider. Its diverse portfolio of services includes voice, data,

video, network integration, data centre, managed services,

enterprise mobility applications and digital media. Airtel

Business consistently delivers cutting-edge integrated solutions,

superior customer service and unmatched depth / reach to

global markets, to enterprises, governments, carriers, and small

and medium businesses.

Revenues in this segment comprises of: a) Enterprise &

Corporates Fixed Line, Data and Voice businesses; and b) Global

Business which includes wholesale voice and data. Revenue as

per point a) above, together with Enterprise Mobile revenues

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

118

Strategic Alliances

> Airtel entered into a strategic alliance with Symantec

Corp. to serve the growing cyber security requirements of

businesses in India, providing protection and prevention of

online threats. As part of the agreement, Airtel will be the

exclusive Cyber Security Services partner for Symantec

in India, and will distribute Symantec’s enterprise security

software.

Awards

> Airtel Global Business won the ‘Best Wholesale Carrier

(Global) Award’ at the Carriers World Awards’ 2017 held

in London, UK.

Passive tower infrastructure

Overview

A subsidiary of the Company, Bharti Infratel Ltd. (Infratel), is

India’s leading provider of tower and related infrastructure and it

deploys, owns & manages telecom towers and communication

structures, for various mobile operators. It holds 42% equity

interest in Indus towers, a joint venture with Vodafone India and

Aditya Birla Telecom who hold 42% and 16% respectively. The

Company’s consolidated portfolio of 91,451 telecom towers,

which includes 39,523 of its own towers and the balance from its

42% equity interest in Indus Towers, makes it one of the largest

tower infrastructure providers in the country with presence in all

22 telecom circles. The company has been the industry pioneer

in adopting green energy initiatives for its operations. Infratel is

listed on the Indian stock exchanges, NSE and BSE.

Particulars FY 2017-18 FY 2016-17 Y-O-Y

Growth

G Millions G Millions

Gross Revenues 66,284 60,829 9%

EBIT 20,452 17,246 19%

Africa

Overview

Airtel recorded a first full year of profits for its African operations

which was a result of a healthy double digit revenue growth,

strong cost control through its ‘war on waste’ program and asset

monetisation. Airtel is now one of the top operators in Africa; it

holds No.1 position in Zambia, Niger, Madagascar and Malawi

and No.2 position in 7 OpCos including Nigeria & Uganda in

terms of revenue market share. During the year, Airtel Africa B.V.

entered into a Joint Venture with MIC Africa B.V. for its Ghana

operations. With this, the company now operates in 14 countries

on a standalone basis. Consequently, the financial numbers of

Africa have been reinstated to exclude Ghana financials for the

period before sale. The transaction for the acquisition of Tigo

operations in Rwanda has also been closed effective January

31, 2018 and results for the year also include Tigo for 59 days.

The comparable growths have been mentioned as ‘Organic’

below.

Owing to the underlying economic changes in Nigeria, the

company has transitioned from ‘administered’ to ‘market

based’ exchange rate during the year. The currencies across

the continent have remained comparatively stable versus the

US dollar over the last 12 months (exit March 31 rates) except

for CFA (which appreciated by 13%). In terms of the 12-month

average rates, the revenue weighted Y-o-Y currency depreciation

has been 3.5%, mainly caused by depreciation in Ugandan

Shilling by 5% and Rwandan Franc by 7%. To enable comparison

on an underlying basis, all financials up to PBT and all operating

metrics mentioned below are in constant currency rates as on

March 1, 2017 and are adjusted for divestment of operating units

for all the periods i.e. the comparison till PBT has been given below

for 14 countries. PBT as mentioned below excludes any realized/

unrealized derivatives and exchange gain or loss for the period.

As on March 31, 2018, the Company had 89.3 Mn customers in

Africa across 14 countries as compared to 76.7 Mn customers

in previous year, an increase of 16.3%. Its continuous focus on

acquiring quality customers has resulted in lower customer

churn for the year at 4.4% as compared to 4.9% in the previous

year. The total minutes on the network during the year increased

by 18.5% to 159.5 Bn. At the end of the year, 24.9 Mn data

customers accounted for 27.9% of the total customer base as

compared to 22% in the previous year. The total MBs on the

network has significantly increased by 89.9% to 237.6 Bn MBs

from 125.1 Bn MBs in previous year with usage per customer

increasing from 657 MBs to 954 MBs. Overall ARPU in Africa

marginally declined from USD 3.25 to USD 3.14. Total sites in

Africa as on March 31, 2018 were 19,731 of which 13,725 were

3G sites, representing 69.6% of the total sites.

Airtel Africa revenues grew by 4.9% (organic growth of 4.6%) to

USD 3,036 Mn as compared to USD 2,894 Mn in the previous

year. The company’s continued focus on running the operations

efficiently and cost effectively has resulted in EBITDA of USD

1,014 Mn for the year as compared to USD 694 Mn in the

previous year, increase of 46.2% (organic growth of 46.0%).

Consequently EBITDA margin improved significantly by 9.4%

to 33.4% compared to 24.0% in the previous year. EBIT for

the year was at USD 551 Mn as compared to USD 136 Mn in

the previous year. PBT for the full year was at USD 425 Mn as

compared to USD 8 Mn in the previous year. After accounting

for full year capex of USD 421 Mn (PY: USD 412 Mn), operating

free cash flow was USD 593 Mn as compared to USD 282 Mn

in the previous year.

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In H Reported Currency

Particulars FY 2017-18 FY 2016-17 Y-O-Y

Growth

G Millions G Millions

Gross Revenues 2,01,564 2,19,568 -8%

EBIT 35,586 10,189 249%

In USD Constant Currency – 14 Countries

Particulars FY 2017-18 FY 2016-17 Y-O-Y

Growth

G Millions G Millions

Gross Revenues 3,036 2,894 5%

EBIT 551 136 306%

Note: During the current financial year, Bharti Airtel Limited divested 1

operating unit in Africa. Accordingly, the above table has been shown for

remaining 14 countries only.

Wireless Subscribers: Africa (Million)

76.73

70.99

FY 2015-16 FY 2016-17 FY 2017-18

89.26

across 14 Countries

Key Highlights

Mergers, Acquisitions & Joint Ventures

> Tigo acquisition in Rwanda has been approved by the

Rwanda Utilities Regulatory Authority (RURA). Accordingly

the financials have been consolidated in Africa performance

effective January 31, 2018. The business integration is

underway across functions to ensure smooth customer

experience and seamless operations management.

> The transaction between Airtel and Millicom International

Cellular to combine their telecommunication operations in

Ghana has been consummated.

Network Transformation

> Airtel continues to expand its mobile broadband network

in Africa by adding 3,391 broadband base stations during

the quarter – the highest ever in a single quarter. The

quarter saw roll-out of 4G services in 4 countries. Airtel now

provides high speed 4G connectivity in 8 countries across

the continent.

Digital Innovation

> Airtel Kenya and Safaricom Kenya have launched mobile

money interoperability on April 10, 2018. The customers of

the two operators are now able to seamlessly transfer or

receive money across networks for no extra charge.

Awards & Recognition

> Airtel Nigeria won the 2017 Most Outstanding Customer-

centric Telecom Brand Award at the National Marketing

Stakeholders Summit and Brands & Advertising Excellence

Awards.

> Airtel Nigeria adjudged as the Best Company in

Recruitment Strategy during the HR People Magazine

Awards in Lagos.

> Airtel Nigeria won the ‘Service Excellence in

Telecommunication Award’ at the 2017 Commerce

& Industry Awards organized by the Lagos Chamber of

Commerce and Industry.

> Airtel Nigeria won the ‘Payment Innovation Award’ at an

award ceremony organized by Interswitch, Africa’s leading

transaction switching and processing services company.

The award recognizes Airtel’s transformative use of mobile

financial solutions to solve real world customer problems.

> Airtel Ghana won the ‘Best Corporate Social

Responsibility Initiative Award’ at the 2017 African

Carrier Awards. The award recognizes Airtel Ghana’s

educational initiatives like the School Adoption Programme.

> Airtel Kenya won the Humanitarian / Corporate Award

2017, at the Red Cross Volunteer Awards in Nairobi, Kenya.

The awards are held in recognition of exemplary service and

contribution to Red Cross work of alleviating human suffering.

> Airtel Seychelles won the ‘CSR Company of the year’ at

the business awards organized by Seychelles Chambers of

Commerce and Industry.

> Airtel Nigeria, won the prestigious ‘Pitcher Advertiser of

the Year Award’ at the creativity week in recognition of its

creativity and bold attempts to create fresh and inspiring

campaigns.

> The Regulatory Authority for Electronic Communications

and Posts (RAECP) awarded Airtel Chad for its Best quality

of network calls and Internet services in Chad.

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

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Share of Associates / Joint Ventures

A) Robi Axiata Limited

Robi Axiata Limited is a joint venture between Axiata Group Berhad of Malaysia, Bharti Airtel Limited of India and NTT Docomo Inc. of

Japan. Axiata holds 68.7% controlling stake in the entity, Bharti Airtel holds 25% while the remaining 6.3% is held by NTT Docomo.

Robi Axiata Limited is the second largest mobile phone operator of Bangladesh and the first operator to introduce GPRS and 3.5G

services in the country.

Key operational and financial performance

Particulars Unit Quarter ended

Mar-18 Dec-17 Sep-17 Jun-17

Operational Performance

Customer Base 000’s 45,609 42,908 41,211 39,570

Data Customer as % of Customer Base % 57.8 56.6 57.7 56.1

ARPU BDT 118 123 131 132

Financial Highlights (proportionate share of Airtel)

Total Revenues

H Mn

3,153 3,605 3,466 3,310

EBIDTA

H Mn

679 724 770 526

EBIDTA / Total Revenues % 21.5 20.1 22.2 15.9

Net Income

H Mn

(200) (261) (93) 135

Mar-18 financials are as per IFRS 15.

B) Bharti Airtel Ghana Limited

Bharti Airtel Ghana Limited is a joint venture between Bharti Airtel Africa B.V. and MIC Africa B.V. Both the entities effectively hold

49.95% share each in the merged entity.

Key operational and financial performance

Particulars Unit Quarter ended

Mar-18 Dec-17

Operational Performance

Customer Base 000’s 6,113 6,306

Data Customer as % of Customer Base % 58.2 57.6

ARPU BDT 13.2 13.1

Financial Highlights (proportionate share of Airtel)

Total Revenues

H Mn

1,767 1,839

EBIDTA

H Mn

262 291

EBIDTA / Total Revenues % 14.8 15.8

Net Income

H Mn

(241) (373)

South Asia

Overview

The financial numbers of South Asia as mentioned below are not

comparable as the previous year includes demerged Bangladesh

results for part of the year. Also on account of changes in the MTC

rates (Domestic and International) the current figures includes a

portion of old rates as well.

Full year revenue of South Asia was at H 4,045 Mn as compared

to H 11,743 Mn in the previous year. EBITDA for the year was at

H 8 Mn as compared to H 238 Mn in the previous year. EBIT losses

for the year reported at H 1,268 Mn as compared to loss of H 4,018

Mn in the previous year. Capex for the year was H 1,235 Mn as

compared to H 1,830 Mn in the previous year.

Particulars FY 2017-18 FY 2016-17 Y-O-Y

Growth

G Millions G Millions

Gross Revenues 4,045 11,743 -66%

EBIT (1,268) (4,018) 68%

Statutory Reports

Management Discussion and Analysis

121

Integrated Report

006-056

Financial Statements

160-317

Risk & Mitigation Framework

Bharti Airtel (the Company), has thrived globally by building a culture of innovation and high performance. The Company explores new

markets and business models across the world; evolve new ways of customer and stakeholder engagement; enter into new strategic

partnerships; adopt new technologies; and build exponential efficiencies in existing systems. While these initiatives unveil a universe

of possibilities, potential risks and uncertainties arise in a volatile business environment. The distress signals need to be picked up

and addressed with urgency for smooth operations. Therefore, the Company has created a robust risk management framework in

its operating landscape that caters to strategic, legal, financial, operational and climate risks. The Company has a sound practice to

identify key risks across the Group and prioritise relevant action plans for mitigation.

1. Regulatory and Political Uncertainties (Legal & Compliance) Outlook from last year

Stable

Definition

The Company operates in India, Sri Lanka and 14 African

countries. Some of these countries (or regions within countries)

are affected by political instability, civil unrest and other social

tensions. The political systems in a few countries are also fragile,

resulting in regime uncertainties; hence, the risk of arbitrary

action. Such conditions tend to affect the overall business

scenario. In addition regulatory uncertainties and changes, like

escalating spectrum prices, call drops penalties, EMF norms

among others are potential risks being faced by the business.

Mitigating actions:

> As a responsible corporate citizen, the Company engages

proactively with key stakeholders in the countries in which

it operates; and continuously assess the impact of the

changing political scenario. The Company contributes

to the socio-economic growth of the countries in its

area of operation through high-quality services to its

customers, improved connectivity, providing direct and

indirect employment, and contributing to the exchequer.

These activities are covered in detail through its annual

sustainability report. It also maintains cordial relationships

with governments and other stakeholders. The Country

MDs and Circle CEOs carry direct accountability for

maintaining neutral Government relations. Through its

CSR initiatives (Bharti Foundation etc.), it contributes to the

social and economic development of community, especially

in the field of education.

> The Company actively works with industry bodies like Cellular

Operators Association of India (COAI), Confederation of

Indian Industry (CII), and Federation of Indian Chambers of

Commerce & Industry (FICCI) on espousing industry issues

e.g. penalties, right of way, tower sealing amongst others.

> Regulatory team along with legal and networks keeps a

close watch on compliances with regulations and laws

and ensures the operations of the Company are within the

prescribed framework.

Definition:

The Company’s strategy is to focus on growth opportunities

in the emerging and developing markets. These markets are

characterised by low to medium mobile penetration, low internet

penetration and relatively lower per capita incomes, thus offering

more growth potential. However, these markets fall under

countries which are more prone to economic uncertainties,

such as capital controls, inflation, interest rates and currency

fluctuations. Since the company has borrowed in foreign

currencies, and many loans are carrying floating interest terms,

it is exposed to market risks, which might impact its earnings

and cash flow. These countries are also affected by economic

downturns, primarily due to commodity price fluctuations,

reduced financial aid, capital inflows and remittances. Slowing

down of economic growth tends to affect consumer spending

and might cause a slowdown in telecom sector.

Mitigating actions:

> As a global player with presence across 16 countries, the

Company has diversified its risks and opportunities across

markets. Its wide service portfolio including voice, data,

Airtel Money, Digital Services and value added services

helps widen its customer base.

> To mitigate currency risks, it follows a prudent risk

management policy, including hedging mechanisms

to protect the cash flows. No speculative positions are

created; all foreign currency hedges are taken on the back

of operational exposures. A prudent cash management

2. Economic Uncertainties (Operational) Outlook from last year

Stable

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

122

3. Poor quality of networks and information technology including redundancies

and disaster recoveries (Operational)

Outlook from last year

Stable

Definition:

The Company’s operations and assets are spread across

wide geographies. The telecom networks are subject to risks

of technical failures, partner failures, human errors, or wilful

acts or natural disasters. Equipment delays and failures, spare

shortages, energy or fuel shortages, software errors, fibre cuts,

lack of redundancy paths, weak disaster recovery fall-back, and

partner staff absenteeism, among others are few examples of

how network failures happen.

The Company’s IT systems are critical to run the customer-

facing and market-facing operations, besides running internal

systems. In many geographies or states, the quality of IT

connectivity is sometimes erratic or unreliable, which affects the

delivery of services e.g. recharges, customer query, distributor

servicing, customer activation, billing, etc. In several developing

countries, the quality of IT staff is rudimentary, leading to

instances of failures of IT systems and / or delays in recoveries.

The systems landscape is ever changing due to newer versions,

upgrades and ‘patches’ for innovations, price changes, among

others. Hence the dependence on IT staff for turnaround of such

projects is huge.

Mitigating actions:

> The Company has state-of-the-art Network Operations

Centre for both India as well as Africa to monitor real time

network activity and to take proactive and immediate action

to ensure maximum uptime of network.

> Network Planning is increasingly being done in-house, to

ensure that intellectual control on architecture is retained

within the Company. As part of the previously announced

‘Leap Programme’ in India, it continuously seeks to

address issues (congestion, indoor coverage, call drops,

modernisation and upgrade of data speeds, among others)

to ensure better quality of network. Recent efforts also

include transformation of the microwave transmission, fibre

networks, secondary rings / links and submarine cable

networks. The Company consistently eliminates systemic

congestion in the network, and removes causes of technical

failures through a quality improvement programme, as well

as embedding redundancies. Tighter SLAs are reinforced

upon network partners for their delivery. The Company’s

Network Team performance is measured, based on

network stability, customer experience and competitor

benchmarking. The Company follows a conservative

insurance cover policy that provides a value cover, equal to

the replacement values of assets against risks, such as fire,

floods and other natural disasters.

> The Company’s philosophy is to share infrastructure with

other operators, and enter into SLA-based outsourcing

arrangements. We have been proactively seeking sharing

relationships on towers, fibre, VSAT, data centres and

other infrastructure. The disposal of towers in Africa to

independent and well-established tower companies and

long-term lease arrangements with them will ensure

high quality of assets and maintenance on the passive

infrastructure. The Company has put in place redundancy

plans for power outages, fibre cuts, VSAT breakdowns, and

so on, through appropriate backups such as generators,

secondary links, among others. Similar approaches are

deployed for IT hardware and software capacities; and

internal IT architecture teams continuously reassess the

effectiveness of IT systems.

> Information Security is managed by dedicated IT

professionals, given the huge dependency on automated

systems, as well as to ensure that customer privacy is

protected.

policy ensures that surplus cash is up-streamed regularly to

minimise the risks of blockages at times of capital controls.

It has specifically renegotiated many operating expenditure

/ capex Fx contracts in Africa and converted them to local

currency, thereby reducing Fx exposure.

> To mitigate interest rate risks, the Company is further

spreading its debt profile across local and overseas sources

of funds and to create natural hedges. It also enters in

interest rate swaps to reduce the interest rate fluctuation

risk.

> Finally, the Company adopts a pricing strategy that is based

on principles of mark to market, profitability and affordability,

which ensures that the margins are protected at times of

inflation, and market shares at times of market contraction.

Statutory Reports

Management Discussion and Analysis

123

Integrated Report

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Financial Statements

160-317

4. Inadequate Quality of Customer Lifecycle Management (Operational) Outlook from last year

Expanded

Definition:

In a market dominated by prepaid customers, several inefficient

processes have crept in over the years across the industry, in

respect of customer acquisitions. Such practices are resulting in

high rotational churn, high acquisition costs, low lifetime value of

new customers, diversion of focus of sales force on acquisitions,

rather than revenue generation, trade frauds, among others.

Customer mind-sets and habits are shifting rapidly, reflected in

their ever-rising expectations in terms of quality, variety, features

and pricing. The competitive landscape is also changing

dramatically, as operators vie with one another to capture

customer and revenue market shares which is accelerating

customer migration from legacy 2G / 3G networks to high

speed 4G networks.

The Company might see heightened competitive intensity in

its non-wireless businesses on account of irrational pricing

by potential new entrant leading to erosion of revenue &

customers. In mobility business, the Company may face a risk of

deeply discounted Volte feature phone pricing from new entrant.

Mitigating actions:

> Improved customer acquisition process like monitoring

new customer acquisition churn, high acquisition recharge

denominations, direct distribution, trade margins structures

have been introduced. The Company has also been

launching varied bundled offers to provide maximum

benefits to the customers at affordable prices.

> The Company constantly refreshes its ways of working,

especially in customer service, innovation, marketing and

distribution. These are now captured in the Company’s

integrated Customer Lifecycle Management approach,

which ensures that every customer’s behaviour is studied,

classified and segmented. Organisational effectiveness

is enhanced through appropriate design and creation

of leaner and multi-functional teams. Technologies and

tools (business intelligence, scientific pricing models) are

deployed in managing the customer lifecycle.

> For the non-wireless businesses, the Company is focussing

on ring-fencing the existing customers by offering them

annual plans with increased value propositions. Focus lies

on offering differentiated products to customers like higher

speed, content, data roll-over, data borrow etc. The entire

GTM plan has been re-invented to acquire & retain high

value customers across businesses.

> In order to protect its feature phone customers from

churning to competition, the Company is focussed

on upgrading the customers to smart phones at very

low cost. Airtel has launched ‘My First Smart phone’

program which offers smart phones to customers at

an effective cost of a feature phone thereby giving

him more value at same cost. Airtel has tied up with

leading handset manufacturers to offer a bouquet of

smartphones at reduced cost to the customers and

continues to tie-up with various handset manufactures

to provide affordable upgrades to smartphones.

> The Company has also been the preferred network

for high value customers. The Company has strategic

programmes for driving down churn through an

integrated and end-to-end experience through sharp

propositions for high-value customers.

> The Company has made several measures to transform

its telecom networks to improve customer experience

of its subscribers. As part of open network initiative,

Airtel upgraded its current network infrastructure.

> Also its unique portfolio beyond wireless consisting of

Home Broadband, Airtel Business, and DTH TV continue

to grow and deliver significant value to the company.

> The Company is also investing in building its own

digital innovations such Wynk music, Airtel TV and

Wynk Games. Wynk music is now the number 1 music

app in the country. Earlier this year, it also launched

Airtel TV which provides more than 350 live channels

and 8000 movies & TV shows in 14 languages. Airtel

TV is now among the top 3 TV and movie apps.

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

124

5. Non-compliance of subscriber verification norms and KYC regulations

(Operational)

Outlook from last year

Stable

Definition

Regulators are introducing stringent subscriber verification and

KYC guidelines, including biometric verification and quality of

KYC documents.

Mitigating actions:

> The Company has invested significantly in KYC tools,

including biometric scanners to improve the quality of

subscriber activation and documentation processes as per

required legislation. Self-compliance and reinforcing of ‘tone

at the top’ are the key factors which ensure complete control

on our compliances. The Company follows strict guidelines

on quality of partners and IT systems, staff training,

proactive maker-checker controls and internal audits, as

well as robust internal MIS to adhere to compliances.

> The Company, in case of any such identified non-

compliances, takes immediate and necessary actions as

required to remediate the situation. The Company envisages

to abide by both the letter and spirit of the regulation and

on a timely basis communicates to its employees regarding

the necessity to abide by government regulations while

being sensitive towards customers.

6. Increase in cost structures ahead of revenues thereby impacting liquidity

(Operational / Strategic)

Outlook from last year

Stable

Definition:

Across markets, costs structures have been increasing

both from volumes (new sites rollouts, capacity) and/or rate

increases (inflation, Fx impacts, wage hikes, energy etc.). With

the entry of new operator, market pricing has been dampened

putting pressure on margins and cash flows thereby leading

to increased debt leverage. Increased investment in network

to ensure quality of service, continued spends on distribution

and maintaining world class customer service are expected to

remain thereby heightening debt levels.

Mitigating actions:

> The Company has institutionalised the War on Waste

(WOW) Programme, an enterprise-wide cost-reduction

programme. This has been rolled out across all functions,

business units and countries. All functions / business

units / countries are targeting cost reductions and cost

efficiencies. The Company continues to focus on capex

optimisation through various programmes like ICR, tower-

sharing, fibre sharing through IRU or co-build.

> Digitisation and automation with significant programmes

on self-care, paper less acquisition, e-bill penetration, online

recharges, Indoor to outdoor conversion, digital customer

interactions are continuously monitored through our WoW

initiative etc.

> The Company has been progressively maintaining to keep

the debt levels at acceptable levels. To this end it has and

continues to take decisions on inorganic sources of funding

including divestment of Infratel and DTH stakes.

> Inorganic solutions to consolidate operations like Ghana

are also being taken to ensure viable business models are

created in these geographies. Strategic Investment Group

(SIG) has been set up to look at future monetisation of any

strategic investments.

7. Lack of Digitisation and Innovations around Digital Content (Strategic)

Outlook from last year

Stable

Definition

Digitization is reshaping the telecom sector and will be a key

driver for innovation within the Company as companies compete

in a digital ecosystem away from pure connectivity based

environment. Further evolving technologies result in change

in customer value propositions. Digital content and apps have

now become the favourites for mobile customers. Digital Mobile

money technologies, innovative mobile apps, Cloud, M2M, SaaS

and other technology-based VAS products are also evolving.

Such rapid technology evolution may impact the functionality of

existing assets and accelerate obsolescence. Keeping pace with

changing customer expectations is a big agenda for the telecom

sector. Lack of Digitisation of internal business processes may

render the company in-able or lethargic in turn to respond to

Statutory Reports

Management Discussion and Analysis

125

Integrated Report

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Financial Statements

160-317

8. Lack of investment in infrastructure capacity building (Strategic)

Outlook from last year

Stable

Definition:

In order to keep pace with rising data demand of customers

and to ensure competitive parity traffic, telecom companies

will be required to invest heavily in building data capacities

and broadband coverage expansion. Operators are adopting

new strategies to provide unlimited voice and significant data

benefits to customers. Additionally, today’s customers is looking

at seamless mobile internet experience while being technology

agnostic.

Mitigating actions:

> Airtel is expanding its broadband network footprint to stay

abreast with competition and fulfilling customers’ expectation.

As a part of expansion program, the Company will deploy

additional LTE sites with fibre/backhaul readiness and will

expand its coverage by strengthening its LTE FDD footprint in

order to provide seamless connectivity. The surge in volume

will necessitate enhancement of the LTE TDD layer to support

additional traffic in select places of high throughput.

> With the explosion in data, Airtel will significantly step-

up backhaul readiness on its site along with increased

Fiberization and rapidly expand its transmission backbone

and aggregation capacity to cater to the additional data

load.

> With the increase in voice minutes exponentially, the

Company has recently launched VOLTE services offering

HD quality calls along with faster call set up time which

once scaled up will give a significantly better experience to

the customers.

> Technology has been rapidly evolving in Telecom. In the

next few years wide scale commercial deployment of 5G

is expected to start. In such a scenario, the Company is

making its investments future proof and starting to be

ready for 5G network deployment.

customer needs. Rapidly evolving technologies like robotics,

block chain, app automation for internal processes in Customer,

Finance, Supply Chain and HR can render the company slow in

decision making and reacting to new and emerging customer,

vendor, and partner expectations.

Mitigating actions:

For the last 18 months digitization for the customers has been

the prime area of focus, with several digital initiatives being

undertaken. Our own digital channels, ‘myAirtel app’ and ‘Airtel.in’

have seen tremendous growth in customer interaction over the

course of the year, where complete self-care for retail customers

is now available through these digital channels, we have also

started rolling out digital retail stores which also leverage self-

care on ‘myAirtel app’ for resolving customer issues.

> For digital growth, the Company has adopted a platform

centric approach and created new digital platform for

attracting millennials and digitally savvy customers. Our

new online store (www.airtel.in/onlinestore) was recently

launched with very unique offering for the iPhone, with a

complete online journey including real-time credit. In the

coming years the customers will see increased focus on

this as we bring more and more devices on this platform.

Homes platform being created as a digital layer on top to

provide unique quad play proposition.

> The Company is also investing in building its own digital

innovations such ‘Wynk music’, ‘Airtel TV’ and ‘Wynk

Games’. Wynk music is now the number 1 music app in the

country. Earlier this year we also launched Airtel TV which

provides 300 live channels and 6000 movies & TV shows

in 13 languages. Airtel TV is now among the top 5 TV and

movie apps.

> The sales & distribution team of out company is one of

the most digitized operating team in the entire country &

has won several global awards & accolades. This covers

complete digitization from the sales team to feet on street,

distributors, retailers and entire sales and distribution

channel.

> One of the key digital initiatives being run is creating a

digital network. This covers network planning, deployment

(including TOCOs and MS partners), operations and

network quality. In addition the Company also partnered

with SKT for creating network Data Lake and building deep

analytics and intelligence on top of it.

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

126

Definition:

Regulatory developments in India, South Asia and Africa can

pose several challenges to the telecom sector. The telecom

sector is highly taxed with high revenue share-based license

fees and significant spectrum acquisition costs in auctions.

Introduction of GST has proven to be a landmark decision with

wide ranging impact on all businesses. Whilst it has eliminated

the cascading effect of indirect taxes in the erstwhile regime, on

other hand it has increased the compliance burden significantly.

Mitigating actions:

> The Company has always stood for a fair, transparent and non

– discriminatory government policy on telecom regulation. It

has insisted governments of all countries that sustainable

regulatory regimes will lead to a healthy growth of the sector,

leading to higher investments and modernisation, which in

turn benefits the industry and society. The Company stands

for a regime that promotes healthy, competitive pricing

keeping two objectives in mind – customer interests and

health of the sector. As a responsible operator, the company

participates in government consultation and industry

association events, to foster collaboration and knowledge

sharing for best industry policies and practices.

> The Company has undertaken state wise registration of

its operations and has modified its existing IT systems

to deliver reporting in line with necessary compliances.

Necessary operational level changes have been revamped

to accommodate a state level and GST driven mechanism

and processes.

10. Gaps in internal controls (financial and non-financial) (Operational)

Outlook from last year

Stable

Definition:

The Company serves over 412 Mn customers globally with a

monthly average of 164 Bn minutes of voice on network and

402 Bn MBs of data carried on wireless networks located at

more than 185,000 sites. Gaps in internal controls and / or

process compliances not only lead to wastages, frauds and

losses, but can also adversely impact the Airtel brand.

Mitigating actions:

> The Company’s business philosophy is to ensure

compliance with all accounting, legal and regulatory

requirements proactively. Compliance is monitored

meticulously at all stages of operation. Substantial

investments in IT systems and automated workflow

processes help minimise human errors.

> Besides internal audits, the Company also have a process of

self-validation of several checklists and compliances as well

as a ‘maker-checker’ division of duties to identify and rectify

deviations early enough. The Company has also implemented

GRC system (Governance, Risk and Compliance) to embed

systemic controls.

> The Company has Internal Financial Controls and the

Corporate Audit Group has tested such controls. The

Audit Group has asserted that the Company has in place

adequate tools, procedures and policies, ensuring orderly

and efficient conduct of its business, including adherence

to Company’s policies, safeguarding of its assets,

prevention and detection of frauds and errors, accuracy

and completeness of accounting records; and timely

preparation of reliable financial information.

9. Adverse regulatory or fiscal taxation developments including compliance risks

(Legal & Compliance)

Outlook from last year

Diminished

Statutory Reports

Management Discussion and Analysis

127

Integrated Report

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Financial Statements

160-317

Internal Controls

The Company’s philosophy towards internal control is based

on the principle of healthy growth and proactive approach to

risk management. Aligned to this philosophy, the Company has

deployed a robust framework of internal controls that facilitates

efficient conduct of business operations in compliance with

the company policy; fair presentation of our financial results

in a manner that is complete, reliable and understandable;

ensure adherence to regulatory and statutory compliances;

and safeguards investor interest by ensuring the highest level

of governance. The Internal Control framework has been set up

across the company and is followed at the circle and country

level. This framework is assessed periodically and performance

of circles and countries are measured via objective metrics and

defined scorecards.

Accounting hygiene and audit scores are driven centrally

through central financial reporting team and Airtel Centre of

Excellence (ACE), both teams responsible for accuracy of books

of accounts, preparation of financial statements and reporting

the same as per the company’s accounting policies. Regulatory

and legal requirements, accounting standards, and other

pronouncements are evaluated regularly to assess applicability

and impact on financial reporting. The relevant financial

reporting requirements, documented in the Group Accounting

Manuals, are communicated to relevant units and enforced

throughout the Group. This, together with the financial reporting

calendar evidencing the tasks and timelines, forms the basis of

the financial reporting process.

Deloitte Haskins & Sells LLP, the statutory auditors, have done

an independent evaluation of key internal controls over financial

reporting (ICOFR) and expressed an unqualified opinion stating

that the company has, in all material respects, adequate internal

control over financial reporting; and such internal controls over

financial reporting were operating effectively as on March 31,

2018.

The Company has in place an Internal Assurance (IA) function

headed by Group Director - Internal Assurance. EY and ANB

& Co (ANB) are the Assurance Partners of the Company who

conducts financial, compliance and process improvement audits

each year. Audits are categorized into defined assurance tracks

with EY responsible to audit finance, customer and technology

track and ANB responsible to audit legal and regulatory track.

The internal assurance plan for the year is derived from a

bottoms-up risk assessment and directional inputs from the

Audit Committee. The Audit Committee oversees the scope

and coverage of the IA plan, and evaluates the overall results

of these audits during the quarterly Audit Committee meetings.

The Audit Committee also reviews the effectiveness of the

internal control system, and invites functional Directors and

senior management personnel to provide updates on operating

effectiveness and controls, from time to time. An independent

validation was also led by the Internal Assurance function to

assess the effectiveness of Internal Financial Controls (IFC) and

no reportable material weaknesses in the design or operation

were observed.

A CEO and CFO Certificate forming part of the Corporate

Governance Report, confirm the existence and effectiveness

of internal Controls and reiterate their responsibilities to report

deficiencies to the Audit Committee and rectify the same. The

Company’s code of conduct requires compliance with law and

Company policies, and also covers matters such as financial

integrity, avoiding conflicts of interest, workplace behavior,

dealings with external parties and responsibilities to the

community.

The Airtel Centre of Excellence (ACE) based in Gurugram and

Bengaluru, is the captive shared service for financial accounting,

Revenue Assurance, SCM and HR processes. Its global footprint

across 16 countries is bolstered by standardization of all these

processes across the organization with inbuilt embedded

controls. Digitization of ACE is being aimed as a part of the

transformation agenda and includes initiatives like system

based reconciliation, reporting processes with vividly defined

segregation of duties. ERP integration in Africa into an Oracle

Single Instance across all African countries ensures uniformity

and standardization in ERP configurations, chart of accounts,

finance and SCM processes across countries. Quality of financial

reporting and controls continues to show improvement. We

continuously examine our governance practices to enhance

investor trust and improve the Board’s overall effectiveness.

Initiatives such as virtual desktop interface for ultimate data

security, self-validation checks, desktop reviews and regular

physical verification are producing measurable outcomes

through substantial improvement in control scores across

India and Africa. Oracle Governance Risk & Compliance (GRC)

module has been implemented for India and Africa to strengthen

existing controls pertaining to access rights for various ERPs,

ensuring segregation of duties and preventing possibilities of

access conflicts.

Material developments in Human Resources

An overview

The significant role played by our people in sustaining Airtel’s

growth trajectory in turbulent times was encapsulated in our

business strategy of the year, under the theme of ‘Win With

People’. The strong people agenda was constituted around

three pillars of Learn, Lead and Grow. Airtel continued to clinch

accolades including emerging among the Best Employers in

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

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the Business Today - People Strong Survey. With over 370,000

followers on LinkedIn, Airtel has also carved a niche for itself in

the social media space. At the end of March 2018, Bharti Airtel

had 17,263 permanent employees employed in India & South

Asia and 3,530 permanent employees employed in Africa.

India

The first pillar – Learn was envisaged to ensure that each

employee becomes a ‘Master of the Craft’ by achieving higher

levels of functional proficiencies. Airtel launched a host of

marquee functional learning programs such as ‘Sales Mindset

in Changing Times’, training in leadership presence for store

employees, problem solving and design thinking for customer

experience, etc. The idea behind these interventions was to

equip our people to deal with the dynamic market scenario with

greater dexterity. Different mediums of digital learning enabled

our employees to learn on the go. The Company partnered

with Coursera, a global leader in online education and learning

to provide its employees with valuable learning and credentials

from top universities around the globe. To ensure that employees

stay at the forefront of technological innovation, the Company

collaborated with Pluralsight – to provide online video training

courses in the technology space. To further imbibe a strong

learning culture in the organization, it introduced learning in a

gamified format launching more than 30 ‘Airtel 101’ courses,

which are perfect examples of byte-sized learning, delivering

information in nuggets and on the go. The year saw employees

earning more than a lakh certifications on Airtel 101. The agenda

of gamified micro learning was carried forward by introducing an

exciting weekly contest – Fastest Finger First which witnessed

an average participation of 1,000 people. It also initiated a

learning challenge christened Ironman which witnessed 7000

participants clocking in more than 90,000 learning hours. Across

functions, a combined total of more than 27,000 man-days worth

of learning has been recorded. The people at Airtel proved to be

curious learners, with more than 8,000 learners completing over

2000 online courses and clocking in more than 120,000 hours

on iLearn – the Company’s learning management system. It also

continued to build strong teams in emerging domains like IoT,

Product and Data Science.

At Airtel, we believe in creating leaders from within the

organization. The second pillar – Lead was envisaged with the

thought of people managers demonstrating what it is to ‘Lead

Right’ by role modeling all key leadership behaviours. It instituted

two People Leadership Programs, ‘Embark’ for transforming

employees into first time people managers and ‘Ascent’, which

grooms people managers to lead large teams and functions.

The results have been overwhelming with more than 200 of our

people poised and ready to transform into leaders of tomorrow.

The Airtel Leadership Series – a continuation of the Career Fair,

saw industry experts from the external world as well as senior

leaders from the Company talk about the business challenges

and available opportunities. The Company also launched

Insight+, a 360 degree feedback tool available on a mobile

app for people to seek feedback from their stakeholders and

enable them to work on perceived areas of improvement. It also

made career coaching real and actionable for our people and

empowered them to choose their mentors and seek advice on

their career path with Coaching Conversations – a tool available

on our intranet platform.

Grooming and cultivating talent is a focus area around which

the third pillar – Grow was designed to ensure that Airtel and

employees both become ’Future Ready’. Career development

programs for different functions were launched to enable and

prepare its people to take up larger roles with seven such

learning ‘academies’ being institutionalized, an example being

the Retail Leadership Academy. To empower the people to take

charge of their own careers and curate their career paths, we

launched the My Career app on our internal mobile platform

– Hive. The app enables employees to take the next big leap

in their career by exploring suitable roles. The aim of these

initiatives is for the people to be good navigators of their own

career, and even try unconventional paths. These initiatives have

resulted into a strong internal succession pipeline that helps us

to provide people with growth opportunities. It also continued

to focus on attracting dynamic and agile leaders of the future

through its prestigious ‘Young Leader’ and ‘Young Technical

Leader’ campus programs and these vibrant minds continue to

infuse youthful energy and expertise.

To improve employee engagement, the Company launched

“Workplace by Facebook” for all employees, opening the doors

for digital collaboration and communication to all employees,

with over 11,500 accounts being claimed so far. It is also keen

on listening to the voice of its people, and 8200+ employees

have expressed themselves via the Mood-O-Meter App.

The Company continued to strengthen its Diversity Agenda

under the ‘WE’ – Women Empowered platform beginning with

celebrating women achievers across functions and circles with

the ‘We Achieve’ programme. It launched ‘She For Change’ – a

compendium of stories documenting personal narratives of

transformation by our women employees this Women’s Day and

also continued with our ‘WE Lead’ sessions with accomplished

women leaders for the industry.

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Africa

In Africa, Airtel is focusing on building functional skills

within the workforce, specifically in Network & Information

Technology, which is the backbone. It has recognized the

need to build expertise internally, reducing the dependence on

vendor-managed services. To this end, it launched Airtel 101.

Through its interactive learning interface, the app provides an

enjoyable and engaging learning experience for employees. In

addition, Airtel E-Learning platform was revamped to feature

a refreshed catalogue of programs, updated with the most

current online content in a wide range of cross-functional skills.

These e-learning programs are running concurrent to other

classroom based and coaching interventions that are in place

to enhance skills transfer. The Airtel - Tigo merger in Rwanda

was announced and communicated to all employees. To ensure

that the new entity molds itself in the Airtel culture, steps were

taken to build cohesiveness amongst teams. We implemented

a dedicated people focused strategy encompassing all facets of

human resources. In Ghana, we operationalized the formation of

the joint venture with Tigo.

Giving back to the community has always been one of the

key priorities for Airtel in Africa. The “Change Maker awards”

provides a platform to our OpCos to showcase best practices

in CSR and employee participation. This year’s Change Maker

Awards were presented to Kenya, Malawi, Madagascar and

Tanzania. Driven by the vision of HR being a core business

function that lays the road instead of just filling the cracks,

harnessing people energies and talent has been a significant

factor in the business turnaround. As a business critical function,

HR in Africa is keeping pace with the changing workforce trends

of adopting technology and mobility.

At Airtel, our endeavor is to create and groom a rich pool of talent

across verticals to contribute to our vision of building a vibrant,

agile, digital and dynamic organization. As it marches into the

future with optimism and zeal, it hopes to groom its people to

take on bigger challenges with remarkable adroitness and flair.

Outlook

Indian economy is expected to reclaim the fastest growing

economy title in 2018. Strong private consumption and

services are expected to continue to provide fillip to India’s

growth. Government of India’s Digital Drive will focus on digital

technologies and be the biggest driver in improving quality of

education, healthcare and rural sector. The budget proposal to

double the allocation to Digital India initiative is a fine booster

to transform the digital economy. This will provide enormous

opportunity to telecom industry as well and guide telcos to move

to next-gen networks efficiently and effectively. This would also

work on development of the Internet of Things and machine to

machine applications. The high usage of mobile internet during

the year has accelerated digital adoption in India, even in rural

pockets. The digital industry in India has leapfrogged in the past

few years, with the number of smartphone users in the country

estimated at ~400 Mn in 2018, and phones accounting for >70%

of all internet consumption. Increased internet penetration allows

global brands to reach the doorsteps of customers in remote

places, adding to the value of investing in India.

Africa’s economic pulse has accelerated infusing the continent

with a new commercial vibrancy. Telecommunications, banking,

and retailing are flourishing. Sub-Saharan Africa’s telecom

market offers strong revenue growth opportunities in most

markets, with more than 1.0 Bn mobile connections and over

USD 45 Bn in total service revenue forecasted by 2022. The

increased availability of low-cost smartphones and improved

coverage of 3G and 4G networks are helping to drive the

demand for data connectivity and the take-up of digital services

including mobile money which has significantly contributed to

changing the financial inclusion landscape.

With convergence of mobility services, entertainment, banking,

education, role of a smartphone has expanded enormously.

Airtel is the only player with an integrated product portfolio, and

wide geographical presence. Bharti Airtel’s Network leadership

and excellent customer experience delivery will continue to

stimulate Company’s growth against its competitors.

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

130

Report on Corporate Governance

Corporate Governance is more than a set of processes and

compliances at Bharti Airtel Limited. It underlines the role

that we see for ourselves for today, tomorrow and beyond.

The following report on Corporate Governance reflecting ethos

of Bharti Airtel Limited (Bharti Airtel / Airtel / the Company)

and its continuous commitment to ethical business principles

across its operations, lays down the best practices and the

procedures adopted by the Company in line with the Securities

and Exchange Board of India (Listing Obligations and Disclosure

Requirements) Regulations, 2015 (Listing Regulations) and

internationally followed standards of corporate governance.

Governance Philosophy

At Bharti Airtel, Corporate Governance focuses on creating and

sustaining a deep relationship of trust and transparency with

all stakeholders. We follow ethical business standards in all our

operations globally. We consider stakeholders as partners in our

journey forward and we are committed to ensure their wellbeing,

despite business challenges and economic volatilities.

Our governance philosophy reflect our commitment to disclose

timely and accurate information regarding our nancial

and operational performance, as well as our leadership

and governance structure. Over the years, our stakeholder

commitment has enhanced the respect and recall of our

brand nationally and internationally. Our global stature

has enabled us to attract the best talent and resources to

translate our short-term and long-term strategies into a viable

business blueprint.

Our Board of Directors (‘Board’) shapes the long-term vision and

policy approach to steadily elevate the quality of governance

in our organisation. We follow global standards of Corporate

Governance and continuously benchmark ourselves to adopt

the best practices. The objective is to emerge as a market

leader in our industry, nationally and internationally with focus

on creating greater value for all those who have a stake in our

progress directly or indirectly. The Board puts a lot of emphasis

on creating a global talent pool, compliant ethical business

practices and making all our actions consistent with the need

to protect the environment by following green practices and

technologies.

Our Board represents a confluence of experience and

expertise across diverse areas, ranging from global finance,

telecommunication, general management, administrative

services and consulting.

There is a clear demarcation of duties and responsibilities

among the Chairman and Managing Directors & CEOs to ensure

best corporate performance and socio-economic value creation.

Our governance conforms to global standards through

continuous evaluation and benchmarking. The broad tenets

Company follows are:

> Transparent procedures and practices and decisions based

on adequate information.

> Compliance with all relevant laws in letter and spirit.

> High levels of disclosures to disseminate corporate, nancial

and operational information to all stakeholders.

> Policies on tenure of Directors, rotation of Auditors and a

Code of Conduct for Directors and Senior Management.

> Constitution of various Committees for Audit, HR and

Nomination, Risk Management, Corporate Social Responsibility,

Employee Stock Option Plans, Stakeholders’ Relationship etc.

> Complete and timely disclosure of relevant nancial and

operational information to enable the Board to play an

effective role in guiding strategies.

> Meetings of Independent Directors without the presence of

any Non-Independent / Executive Directors and members

from the management to identify areas, where they need more

clarity or information and for open and transparent discussions

and placing these before the Board and management.

> Formal induction schedule and familiarisation programme

for new Board members that enable them to meet

individually with the top management team, customers etc.

> Regularly reviews and establishes effective meeting

practices that encourage active participation and

contribution from all members.

> Independence of Directors in reviewing and approving

corporate strategy, major business plans and activities.

> Well-dened corporate structure that establishes checks,

balances and delegates decision making to appropriate

levels in the organisation though the Board always remains

in effective control of affairs.

Bharti Airtel has always followed the highest principles

and standards of corporate governance and continually

endeavoured to outperform its peers. Bharti Airtel’s global

recognition, among others by Transparency International,

FTI Consulting, Asian Centre for Corporate Governance &

Sustainability, The Institute of Directors (Golden Peacock

Award for excellence in Corporate Governance) and

the Institute of Company Secretaries of India is a grand

acknowledgement of the defined and structured framework

of Corporate Governance embedded in Bharti Airtel’s culture.

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Corporate Governance Rating

CRISIL has assigned to Bharti Airtel its Governance and Value

Creation (GVC) rating, viz. CRISIL GVC Level 1 for Corporate

Governance practices. The rating indicates that Bharti Airtel’s

capability, with respect to Corporate Governance and value

creation for all its stakeholders, is the highest. The Company is

fully cognizant that standards are a constantly upwardly moving

target. Therefore, it always strives to benchmark itself with the

best companies in India and globally and to maintain the highest

ratings for its practices.

Governance Structure

Sustaining a culture of integrity along with high performance

orientation and an adaptive management style in today’s

dynamic business environment needs a robust governance

structure. The Corporate Governance structure of the Company

is multi-tiered, comprising governing / management Boards

at various levels, each of which is interlinked in the following

manner:

> At the apex level is the Board of Directors and various

committees, which collectively direct the highest standards

of Corporate Governance and transparency in the

Company’s functioning. The Board exercises independent

judgment in overseeing management performance on

behalf of the share owners and other stakeholders, and

hence, plays a vital role in the oversight and management of

the Company. The Board is chaired by the Chairman, who is

responsible for the overall strategy development, alliances,

leadership development, international opportunities,

strengthening governance practices and enhancing brand

value and Airtel’s global image and reputation.

> At one level below the Board, strategic co-ordination

and direction is provided by the Airtel Corporate Council

(ACC). The ACC is headed by the Chairman and comprises

the Managing Directors & CEOs and selected senior

management personnel as its members. The key role and

responsibilities of the ACC are provided later in this report.

> The Managing Director & CEO (India & South Asia) is

responsible for strategy deployment and overall business

performance of India and South Asia. He is supported by

the Airtel Management Board (AMB). The Company’s

business in India is structured into six business units (BUs)

i.e. Mobile Services, Homes, Airtel Business, Global Voice &

Data Business, Wynk and Emerging Businesses and Digital

TV Services. While the Mobile Services business is headed

by the MD & CEO (India & South Asia) himself, the other five

businesses are headed by respective CEOs. The Company’s

operations in India are run in 22 Circles, each headed by

Circle CEO or a Chief Operating Officer, each supported by

an Executive Committee. The Sri Lankan operations are

headed by the Country MD, supported by an Executive

Committee.

> The Company’s operations in Africa are guided by

the Managing Director & CEO (Africa) of Bharti Airtel

International (Netherlands) B.V., a subsidiary company.

He is responsible for strategy deployment and overall

business performance. He is supported by the Africa

Executive Committee (Exco). Each of the operations in the

14 countries in Africa are headed by a Country MD, each

supported by an Executive Committee.

> The AMB in India and South Asia, and Exco in Africa provide

support relating to the Company’s business strategy and

also derive operational synergies across business units.

They own and drive company-wide processes, systems,

policies, and also function as role models for leadership

development and as catalysts for imbibing customer

centricity and meritocracy in the Company.

> Airtel’s governance structure thus helps in clearly

determining the responsibilities and entrusted powers

of each of the business entities, enabling them to fulll

those responsibilities in the most effective manner. It

also allows the Company to retain the organisational

DNA, while enabling effective delegation of authority and

empowerment at all levels.

> Airtel Payments Bank is an unlisted subsidiary in which the

Company owns 80.10%, the remaining 19.90% is held by

Kotak Mahindra Bank. The Payment Bank’s operations are

managed by its MD & CEO, under the supervision of an

independent Board.

> The Passive Infrastructure business is deployed, owned

and managed by Bharti Infratel Limited (Infratel), a listed

subsidiary company. Infratel’s operations are managed by

its Managing Director & CEO under the supervision of an

Independent Board. The business transactions between

the Company and Infratel are undertaken on an arms’

length basis, since it provides services to other telecom

operators as well, on a non-discriminatory basis.

Board of Directors

Composition of the Board

The Company’s Board is an optimum mix of Executive, Non-

Executive and Independent Directors, and conforms with the

provisions of the Companies Act, 2013, Listing Regulations,

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

132

FDI guidelines, terms of shareholders’ agreement and other

statutory provisions. The Board comprises eleven members

which includes a Chairman, a Managing Director & CEO (India &

South Asia), three Non-Executive Directors and six Independent

Directors.

Detailed prole of each of the Directors is available on the

Company’s website at www.airtel.com in the ‘Investors’ section.

The Company’s Board members are from diverse backgrounds

with skills and experience in critical areas like technology, global

nance, telecommunication, entrepreneurship, administrative

services, consulting and general management. Many of them

have worked extensively in senior management positions in

global corporations, and others are business leaders of repute

with a deep understanding of the global business environment.

The Board reviews its strength and composition from time to

time to ensure that it remains aligned with the statutory, as well

as business requirements.

As per the Company’s Policy on Nomination, Remuneration

and Board Diversity, selection of a new Board member(s) is

the responsibility of the HR and Nomination Committee, which

is subsequently approved by the Board. All the appointments

are made with unanimous approval. The appointment of such

new Director is subsequently approved by the shareholders at

the Annual General Meeting (AGM). While the shareholders’

representative Directors are proposed by the respective

shareholders, Independent Directors are selected from diverse

academic, professional or technical background depending

upon business needs.

Independent Directors

The Company has a policy on Independent Directors, their

roles, responsibilities and duties are consistent with the

Listing Regulations and Section 149 of the Companies Act,

2013. It sets out the criteria of independence, age limits,

recommended tenure, committee memberships, remuneration

and other related terms of appointment. The policy emphasises

importance of independence. As per the policy:

a) The Independent Director must meet the baseline denition

and criteria on ‘independence’ as set out in Listing

Regulations and Section 149 of the Companies Act, 2013

and other regulations.

b) The Independent Director must not be disqualied from

being appointed as Director in terms of Section 164 and

other applicable provisions of the Companies Act, 2013.

c) The minimum age is 25 years and the maximum is 70

years.

d) The Independent Directors are not to be on the Board of

more than six listed companies. However, pursuant to the

Listing Regulations if the Independent Director is serving as

a Whole-time Director in any listed company then he shall

not serve as an Independent Director in more than three

listed companies.

e) The maximum tenure is two terms of ve years each.

However, the second term is subject to approval by

shareholders by way of special resolution.

The Company has issued letters of appointment to all the

Independent Directors. This letter inter-alia sets out the

roles, functions, duties and responsibilities, details regarding

remuneration, training and development and performance

evaluation process. The detailed terms and conditions of

the appointment of Independent Directors are available on

the Company’s website i.e. http://www.airtel.in/wps/wcm/

connect/2ffaf2d2-d542-44e2-a42a-50225c9245f5/Terms-

and-Conditions-of-Appointment-of-Independent-Director.

pdf?MOD=AJPERES.

At the time of appointment and thereafter at the beginning of

each nancial year, the Independent Directors submit a self-

declaration, conrming their independence and compliance

with various eligibility criteria laid down by the Company among

other disclosures and the Company also ensures that its

Directors meet the above eligibility criteria. All such declarations

are placed before the Board for information.

Lead Independent Director

The Company has for a long time followed the practice of

appointing a Lead Independent Director. Mr. Craig Ehrlich is

currently designated as the Lead Independent Director and his

role and responsibilities, inter-alia, are to:

> Preside over all deliberation sessions of the Independent

Directors.

> Provide objective feedback of the Independent Directors as

a group to the Board on various matters, including agenda

and other matters relating to the Company.

> Undertake such other assignments, as may be requested

by the Board from time to time.

Meeting of Independent Directors

The Independent Directors meet separately at least once

in a quarter, prior to the commencement of Board meeting,

without the presence of any Non-Independent Directors or

representatives of management. They meet to discuss and

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form an independent opinion on the agenda items, various

other Board-related matters, identify areas where they need

clarity or information from management and to annually review

the performance of Non-Independent Directors, the Board as

a whole and the Chairman. The Lead Independent Director

updates the Board about the proceedings of the meeting.

In these meetings, the Independent Directors also engage

with Statutory Auditors, as well as Internal Assurance Partners

at least once a year, to discuss internal audit effectiveness,

control environment, internal financial controls and their general

feedback. The Lead Independent Director updates the Audit

Committee / the Board about the outcome of the meetings and

action, if any, required to be taken by the Company.

During FY 2017-18, the Independent Directors met four times

i.e. on May 09, 2017, July 25, 2017, October 31, 2017 and

January 18, 2018.

Familiarisation programme for Board members

The Company has adopted a well-structured two-day induction

programme for orientation and training of Directors at the time

of their joining so as to provide them with an opportunity to

familiarise themselves with the Company, its management, its

operations and the industry in which the Company operates.

The induction programme includes one-to-one interactive

sessions with the top management team, business and functional

heads among others, and also includes visit to networks centre

to understand the operations and technology. Apart from the

induction programme, the Company periodically presents

updates at the Board/Committee meetings to familiarise the

Directors with the Company’s strategy, business performance,

operations, product offerings, finance, risk management

framework, human resources and other related matters. The

Board members also visit Airtel outlets and meet customers /

other stakeholders for gaining first-hand experience about the

products and services of the Company.

The Board has an active communication channel with the executive

management, which enable Directors to raise queries, seek

clarifications for enabling a good understanding of the Company

and its various operations. Quarterly updates, press releases and

mid-quarter updates are regularly circulated to the Directors to

keep them abreast on significant developments in the Company.

Detailed familiarisation programme for Directors is available

on the Company’s website at http://www.airtel.in/wps/

wcm/connect/ea0152dc-a649-40ae-89d9-b3cec142d249/

Familiarisation+Programme+for+Board+Members.

pdf?MOD=AJPERES&ContentCache=NONE

Board Evaluation

One of the key functions of the Board is to monitor and review the

Board evaluation framework. In compliance with the provisions

of the Companies Act, 2013 and the Listing Regulations, the HR

and Nomination Committee has approved the process, format,

attributes and criteria for the performance evaluation of the

Board, Board Committees and Individual Directors including the

Chairman and MD & CEO (India and South Asia).

The process provides that the performance evaluation shall be

carried out on an annual basis. During the year, the Directors

completed the evaluation process, which included evaluation

of the Board as a whole, Board Committees and individual

Directors including the Chairman and the MD & CEO (India

and South Asia). The evaluation process was facilitated by an

independent consulting firm.

Performance of the Board and Board Committees was evaluated

on various parameters such as structure, composition, quality,

diversity, experience, competencies, performance of specific

duties and obligations, quality of decision-making and overall

Board effectiveness.

Performance of individual Directors was evaluated on

parameters, such as meeting attendance, participation and

contribution, engagement with colleagues on the Board,

responsibility towards stakeholders and independent

judgement. All the directors were subject to peer-evaluation.

The Chairman and the MD & CEO (India & South Asia) were

evaluated on certain additional parameters, such as performance

of the Company, leadership, relationships, communication,

recognition and awards received by the Company.

Some of the performance indicators based on which the

Independent Directors were evaluated include:

> Devotion of sufficient time and attention towards

professional obligations for independent decision making

and for acting in the best interest of the Company.

> Providing strategic guidance to the Company and help

determine important policies with a view to ensure long-

term viability and strength.

> Bringing external expertise and independent judgement

that contributes objectivity in the Board’s deliberation,

particularly on issues of strategy, performance and conflict

management.

All Directors participated in the evaluation process. The results

of evaluation were discussed in the Independent Director’s

meeting, respective Committee meetings and in the Board

Meeting held on April 24, 2018. The Board discussed the

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

134

performance evaluation reports of the board, board committees,

individual directors, Chairman and Managing Directors & CEO

(India and South Asia) and also noted the suggestions / inputs

of independent directors, HR and Nomination Committee and

respective committee Chairman. Recommendations arising

from this entire process were deliberated upon by the Board to

augment its effectiveness and optimize individual strengths of

the Directors.

Board Meeting Schedules and Agenda

The calendar for the Board and Committee meetings, in which

the nancial results would be considered in the ensuing year, as

well as major items of the agenda are xed in advance for the

whole year. The Board Calendar for the financial year 2018-19 has

been disclosed later in the report and has also been uploaded on

the Company’s website. The Board meetings are held within 45

days from the end of the quarter in the manner that it coincides

with the announcement of quarterly results. Time gap between

two consecutive meetings does not exceed 120 days. In case of

necessity, additional Board meetings are called.

The Audit Committee and the HR and Nomination Committee

meetings are generally held on the same dates as Board

meetings. To ensure an immediate update to the Board, the

Chairman of the respective committee briefs the Board about

the proceedings of the respective committee meetings.

The Company Secretary, in consultation with the Chairman,

prepares Board and Committee meeting’s agenda. The detailed

agenda, along with explanatory notes and annexures, as

applicable are sent to the Board and Committee members, at

least a week before the meetings except for the meetings called

at a shorter notice. In special and exceptional circumstances,

additional or supplementary item(s) are permitted to be taken up

as ‘any other item’. Sensitive subject matters are discussed at the

meeting, without written material being circulated in advance.

As a process, prior to each Board meeting, proposals are invited

from Independent Directors for discussion / deliberation at the

meeting(s) and these are included in the meeting’s agenda to

promote objective decision making.

The Board devotes its significant time in evaluation of current

and potential strategic issues and reviews Company’s business

plans, Corporate strategy and risk management issues based

on the markets it operates in and in light of global industry

trends and developments to help achieve its strategic goals.

Global CFO and other Senior Management members are invited

to the Board meetings to present reports on the items being

discussed at the meeting. In addition, the functional heads of

various business segments / functions are also invited at regular

intervals to present updates on their core areas.

Information available to the Board

The Board has complete access to all the relevant information

within the Company and to all the employees of the Company.

The information shared on a regular basis with the Board

specically includes:

> Annual operating plans, capital budgets and updates

therein.

> Quarterly and annual consolidated and standalone results

and nancial statements of the Company and its operating

divisions or business segments.

> Minutes of meetings of the Board and Board Committees,

resolutions passed by circulations, and Board minutes of

the unlisted subsidiary companies.

> Information on recruitment / remuneration of senior officers

just below Board level.

> Material important show cause, demand, prosecution

notices and penalty notices, if any.

> Fatal or serious accidents, dangerous occurrences, material

effluent or pollution problems, if any.

> Any material default in nancial obligations to and by the

Company or substantial non-payment for services provided

by the Company.

> Any issue which involves possible public or product liability

claims of substantial nature, if any.

> Details of any acquisition, joint venture or collaboration

agreement.

> Transactions involving substantial payment towards

goodwill, brand equity or intellectual property.

> Human resource updates and strategies.

> Sale of material nature, of investments, subsidiaries, assets,

which is not in the normal course of business.

> Quarterly treasury reports.

> Quarterly compliance certicates with the ‘Exceptions

Reports’, which includes non-compliance of any regulatory,

statutory nature or listing requirements and shareholders

service.

> Disclosures received from Directors.

> Proposals requiring strategic guidance and approval of the

Board.

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> Related party transactions.

> Regular business updates.

> Update on Corporate Social Responsibility activities.

> Signicant transactions and arrangements by subsidiary companies.

> Report on action taken on last Board meeting decisions.

Number of Board Meetings

During FY 2017-18, the Board met eight times i.e. on May 09, 2017, July 18, 2017, July 25, 2017, October 12, 2017, October 31,

2017, December 19, 2017, January 18, 2018 and March 12, 2018. Requisite information, according to the requirements of Regulation

34 of the Listing Regulations is provided below:

1. The directorships, held by Directors, as mentioned above, do not include the directorships held in foreign body corporates and Bharti Airtel Limited.

2. Committees considered for the purpose are those prescribed under Regulation 26 of the Listing Regulations viz. Audit Committee and Stakeholders’

Relationship Committee of Indian Public Limited companies other than Bharti Airtel Limited. Committee memberships details provided do not include

chairmanship of committees as it has been provided separately.

Name of

Director

Identification

Number

Category Number of other directorships

and committee

memberships and

chairmanships

No. of board

meetings

attended

(total held

during tenure)

Whether

attended

last AGM

Directorships

Committees

Chairman Member

Mr. Sunil Bharti

Mittal

00042491 Chairman 14 Nil Nil 8(8) Ye s

Mr. Gopal Vittal 02291778 Executive

Director

4 Nil 1 7(8) Ye s

Ms. Chua Sock

Koong

00047851 Non-Executive

Director

1 Nil Nil 4(8) Yes

Mr. Rakesh

Bharti Mittal

00042494 Non-Executive

Director

17 Nil Nil 8(8) Yes

Sheikh Faisal

Thani Al-Thani

06675785 Non-Executive

Director

N.A. N.A. N.A. 0(3) No

Mr. Rashed

Fahad Al-Noaimi

07887199 Non-Executive

Director

N.A. N.A. N.A. 0(2) N.A.

Ms. Tan Yong

Choo

02910529 Non-Executive

Director

1 Nil Nil 7(8) Yes

Mr. Ben

Verwaayen

06735687 Independent

Director

Nil Nil Nil 3(8) No

Mr. Craig Ehrlich 02612082 Independent

Director

Nil Nil Nil 2(8) Yes

Mr. D.K. Mittal 00040000 Independent

Director

11 Nil 4 8(8) Ye s

Mr. Manish

Kejriwal

00040055 Independent

Director

4 Nil 2 4(8) No

Mr. Shishir

Priyadarshi

03459204 Independent

Director

1 Nil Nil 5(8) No

Mr. V. K.

Viswanathan

01782934 Independent

Director

8 4 4 8(8) Yes

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

136

(Amount in J)

Name of Director Sitting Fees Salary and

allowances

Performance

linked incentive

Perquisites Commission Total

Executive directors

Mr. Sunil Bharti Mittal -- 201,352,623 90,000,000 10,616,146 -- 301,968,769

Mr. Gopal Vittal -- 78,911,194 47,500,000 35,522 -- 126,446,716

Non-executive directors

Mr. Rakesh Bharti Mittal -- -- -- -- 3,000,000 3,000,000

Mr. Ben Verwaayen 300,000 -- -- -- 14,463,506 14,763,506

Ms. Chua Sock Koong -- -- -- -- 3,910,500 3,910,500

Mr. Craig Ehrlich 200,000 -- -- -- 8,472,750 8,672,750

Mr. D.K. Mittal 1,300,000 -- -- -- 7,080,822 8,380,822

Mr. Manish Kejriwal 400,000 -- -- -- 6,338,356 6,738,356

Ms. Tan Yong Choo -- -- -- -- 3,910,500 3,910,500

Sheikh Faisal Thani Al-Thani -- -- -- -- 1,232,075 1,232,075

Mr. Rashed Fahad Al-Noaimi -- -- -- -- 1,285,644 1,285,644

Mr. Shishir Priyadarshi 500,000 -- -- -- 9,776,250 10,276,250

Mr. V.K. Viswanathan 800,000 -- -- -- 8,000,000 8,800,000

Total 3,500,000 280,263,817 137,500,000 10,651,668 67,470,403 499,385,888

3. One meeting was attended by Mr. Mark Chong Chin Kok, alternate director and one meeting was attended by Mr. Tao Yih Arthur Lang, alternate director.

4. Sheikh Faisal Thani Al-Thani resigned w.e.f. July 25, 2017.

5. Mr. Rashed Fahad Al-Noaimi was appointed as non-executive director w.e.f. July 25, 2017 and resigned w.e.f. November 22, 2017.

6. Except Mr. Sunil Bharti Mittal and Mr. Rakesh Bharti Mittal, who are brothers, none of the Directors are relatives of any other director.

7. As on March 31, 2018, apart from Mr. Gopal Vittal, Managing Director & CEO (India & South Asia) who holds 298,885 equity shares, no other Director of the

Company holds shares in the Company.

Nomination, Remuneration & Board Diversity

In terms of the Listing Regulations and Companies Act, 2013, the Board has approved a Policy on Nomination, Remuneration and

Board Diversity for Directors, KMPs and other Senior Management Personnel and includes the criteria of making payments to non-

executive directors.

The Company’s remuneration policy is directed towards rewarding performance based on a periodic review of the achievements

periodically.

The detailed Nomination, Remuneration and Board Diversity Policy is annexed as Annexure B to the Board’s Report. The Company

affirms that the remuneration paid to the Directors is as per terms laid out in the Nomination, Remuneration and Board Diversity Policy.

Directors’ Remuneration

The details of the remuneration of Directors during FY 2017-18 are given below:

The salary and allowance includes the Company’s contribution to the Provident Fund. Liability for gratuity and leave encashment is provided on actuarial

basis for the Company as a whole, the amount pertaining to the Directors is not ascertainable and, therefore, not included.

> The value of the perquisites is calculated as per the provisions of the Income Tax Act, 1961.

> Value of Performance Linked Incentive (PLI) considered above represents incentive which will accrue at 100% performance level for FY 2017-18 and will

get paid basis actual performance parameters in the next financial year. At 100% performance level, the gross remuneration of Mr. Sunil Bharti Mittal was

H 301,968,769 for FY 2017-18 and H 301,442,108 for FY 2016-17 and that of Mr. Gopal Vittal was H 126,446,716 for FY 2017-18 and H 92,884,551 for

FY 2016-17. During the year, Mr. Sunil Bharti Mittal and Mr. Gopal Vittal were paid H 105,000,000 and H 38,131,027 respectively as PLI for previous year

2016-17.

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> During the year, Mr. Gopal Vittal was granted 105,000 and 30,000 stock

options on August 08, 2017 under ESOP Scheme 2005 at an exercise

price of H 5 per Option, with vesting period spread over 3 years and 2

years respectively. The above remuneration of Mr. Gopal Vittal does

not include perquisite value of H 43,286,800 towards the value of Stock

Options exercised during the year.

The options can be converted into equity shares either in full or in

tranches at any time upto seven years from the grant date. The

unexercised vested options can be carried forward throughout the

exercise period. The options which are not exercised will lapse after the

expiry of the exercise period.

No other director has been granted any stock option during the year.

> The Company has entered into contracts with the executive directors

i.e. Mr. Sunil Bharti Mittal dated August 19, 2016 and with Mr. Gopal

Vittal dated July 24, 2017. These are based on the approval of the

shareholders. There are no other contracts with any other director.

> No notice period or severance fee is payable to any director.

> There were no other pecuniary relationships or transactions of Non-

Executive Directors vis-à-vis the Company.

Board Committees

In compliance with the statutory requirements, the Board has

constituted various committees with specic terms of reference

and scope. The objective is to focus effectively on the issues

and ensure expedient resolution of the diverse matters.

The committees operate as the Board’s empowered agents

according to their charter / terms of reference. The Constitution

and charter of the Board Committees are available on the

Company’s website, www.airtel.com, and are also stated herein.

Audit Committee

The Board in their meeting held on January 18, 2018, constituted

separate Risk Management Committee and the nomenclature

of Audit & Risk Management Committee was changed to Audit

Committee. Audit Committee comprises four Directors, three

of whom are independent. The Chairman of the Committee,

Mr. V. K. Viswanathan, Independent Director is a Chartered

Accountant and has sound nancial knowledge, as well as many

years of experience in general management. All members of

the Audit Committee, including the Chairman, have accounting

and nancial management expertise. The composition of the

Audit Committee meets the requirements of Section 177 of the

Companies Act, 2013 and the Listing Regulations.

The Company Secretary is the Secretary to the Committee. The

Managing Director & CEO (India & South Asia), the Managing

Director & CEO (Africa), the Global CFO, the Group Director –

Internal Assurance, the Statutory Auditors, Internal Auditors and

Internal Assurance Partners are permanent invitees.

The Chairman of the Committee was present at the last AGM,

held on July 24, 2017.

Key Responsibilities of the Audit Committee

> Oversee the Company’s financial reporting process and

the disclosure of its financial information, to ensure that the

financial statements are correct, sufficient and credible.

> Consider and recommend to the Board, the appointment

(including filling of a casual vacancy), resignation or

dismissal, remuneration and terms of appointment

(including qualification and experience) of the Statutory

Auditor, Internal Auditors / Chief Internal Auditor, Cost

Auditor and Secretarial Auditor.

> Prior approval of non-audit services that can be provided

by the Statutory Auditors and approval of payment of such

non-audit services.

> Prior approval of all transactions with related party(ies),

subsequent modifications of transactions with related

parties and review of the statement of significant related

party transactions with specific details of the transactions.

> Discussion with the Statutory Auditor before the

commencement of audit about the nature and scope of

the audit to be conducted and post-audit discussion to

ascertain any areas of concern.

> To call for comments of the Auditors about internal control

system, including the observation of the Auditors, review

financial statement before their submission to the Board

and discussion on any related issues with the Internal and

Statutory Auditors and the management of the Company.

> Review, with the Management, the quarterly financial

statements before submission to the Board for approval.

> Review, with the Management, the annual financial

statements and Auditor’s Report thereon before submission

to the Board for approval, with particular reference to:

> Matters required to be included in the Directors’

responsibility statement, included in the Board’s report

in terms of clause (c) of sub-section 3 of Section 134 of

the Companies Act, 2013.

> Changes, if any, in accounting policies and practices

and reasons for the same.

> Major accounting entries involving estimates based on

the exercise of judgment by management.

> Significant adjustments made in the financial

statements arising out of audit findings.

> Compliance with listing and other legal requirements

relating to financial statement.

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

138

> Disclosure of all related party transactions.

> Modified opinion(s) in the draft audit report.

> Review the following information:

> Management Discussion and Analysis of financial

condition and results of operations.

> Management letter / letters of internal control

weaknesses issued by the Statutory Auditors.

> Internal Audit Reports relating to internal control

weaknesses.

> The financial statements, in particular the investments,

if any, made by unlisted subsidiary companies.

> Quarterly compliance certificates confirming

compliance with laws and regulations, including any

exceptions to these compliances.

> Oversee the functioning of the Vigil Mechanism / Whistle

Blower Mechanism.

> Establish the systems for storage, retrieval and display of

books of accounts and other financial records in electronic

format.

> Review the findings of any internal investigation by the

Internal Auditors into matters where there is suspected

fraud or irregularity, or a failure of internal control systems

of a material nature and reporting the matter to the Board.

> Review the reasons for substantial defaults, if any, in the

payment to the depositors, debenture holders, shareholders

(in case of non-payment of declared dividends) and

creditors, if any.

> Approve the appointment, re-appointment and removal

of Company’s Chief Financial Officer after assessing the

qualifications, experience and background, among others,

of the candidate.

> Review the Company’s financial and risk management

policies, implementation of treasury policies, strategies and

status of investor relation activities.

> Ensure that the internal audit function is effective,

adequately resourced, and to review coordination between

Internal and Statutory Auditors.

> Review the state and adequacy of internal controls with

key members of the Management, Statutory Auditors and

Internal Auditors.

> Discuss with the Internal Auditor the coverage, functioning,

frequency and methodology of internal audits as per the

annual audit plan and discuss significant findings and

follow up thereon.

> Review and monitor the Statutory and Internal Auditor’s

independence, performance and effectiveness of audit

process.

> Review and scrutinize the inter-corporate loans and

investments.

> Monitor and review with the Management, the statement of

uses / application of funds raised through an issue (public

issue, right issue and preferential issue, among others), the

statement of funds utilised for purposes, other than those

stated in the offer document / prospectus / notice and the

report submitted by the monitoring agency monitoring the

utilisation of proceeds of a public or right issue, and making

appropriate recommendations to the Board to take up

steps in this matter.

> Valuation of undertakings or assets of the Company,

wherever necessary.

> Appointment of a registered valuer of the Company and

fixation of their terms and conditions.

> Evaluation of internal financial controls.

> Delegate above said functions to Sub-Committees,

whenever required.

> The Audit Committee shall also undertake such other

functions, as may be assigned by the Board of Directors

from time to time, or as may be stipulated under any law,

rule or regulation including the Listing Regulations and the

Companies Act, 2013.

Powers of the Audit Committee

> Investigate any activity within its terms of reference.

> Seek any information that it requires from any employee of

the Company, and all employees are directed to cooperate

with any request made by the Committee.

> Obtain outside legal or independent professional advice.

> Secure attendance of outsiders with relevant expertise.

> Access sufficient resources to carry out its duties.

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Meetings, Attendance and Composition of the Audit

Committee

During FY 2017-18, the Committee met six times i.e. on May 09,

2017, July 25, 2017, October 31, 2017, December 19, 2017,

January 18, 2018 and March 12, 2018.

Beside the Committee meetings as above, the Committee also

holds a conference call before every regular Committee meeting

to discuss routine internal audit issues and other matters. This

provides an opportunity to the Committee to devote more time

on other signicant matters in the regular Committee meeting.

During FY 2017-18, the Committee had met four times through

the conference call i.e. May 02, 2017, July 18, 2017, October 17,

2017 and January 16, 2018.

All recommendations made by the Audit Committee were

accepted by the Board.

The composition and the attendance of members at the

meetings held during FY 2017-18, are given below:

Name Category Number of

meetings

attended

(total held

during

tenure)

Number of

conference

calls attended

(total

conducted

during tenure)

Mr. V. K.

Viswanathan

(Chairman)

Independent

Director

6(6) 4(4)

Mr. Craig

Ehrlich

Independent

Director

2(6) 4(4)

Ms. Tan Yong

Choo

Non-

Executive

Director

5(6) 4(4)

Mr. Dinesh

Kumar Mittal

Independent

Director

6(6) 3(4)

Audit Committee Report for the year ended March

31, 2018

To the Shareholders of Bharti Airtel Limited

The Audit Committee (“Committee”) is pleased to present its

report for the year ended March 31, 2018:

1. The Committee presently comprises four members

of whom three-fourths, including the Chairman are

Independent Directors, as against the requirement of two-

thirds prescribed under Regulation 18 of the Securities and

Exchange Board of India (Listing Obligations and Disclosure

Requirements) Regulations, 2015 and Section 177 of the

Companies Act, 2013.

2. The responsibility for the Company’s internal controls and

nancial reporting processes lies with the Management. The

Statutory Auditors have the responsibility of performing an

independent audit of the Company’s nancial statements

in accordance with the Indian Accounting Standards (Ind-

AS) and issuing a report thereon. The Ombudsperson is

responsible for the Company’s Whistle Blower Mechanism.

3. The Company has in place an Internal Assurance Group (IAG)

headed by a Group Director – Internal Assurance, who acts

as the Chief Internal Auditor in accordance with Section 138

of the Companies Act (the incumbent has resigned effective

March 8, 2018 and the Company is in the process of identifying

a suitable replacement). The Company also has Ernst & Young

LLP and ANB & Co., Chartered Accountants, Mumbai as the

internal assurance partners which carry out the internal audit

basis a detailed internal audit plan which is reviewed each

year in consultation with the IAG and the Audit Committee.

These audits are based on risk based methodology and inter-

alia involve the review of internal controls and governance

processes, adherence to management policies and review

of statutory compliances. Besides the Committee meetings

as above, the Committee also holds a conference call

before every regular Committee meeting to specifically

discuss internal audit issues. This provides an opportunity

to the Committee to devote more time on internal control

& audit issues and make the regular Committee meeting

time available for other matters within its scope. During

FY 2017-18, the Committee met four times through

conference calls i.e. May 02, 2017, July 18, 2017, October

17, 2017 and January 16, 2018. All recommendations

made by the Audit Committee were accepted by the Board.

The Internal Assurance Partners share their findings on an

ongoing basis during the year for corrective action.

4. The Audit Committee oversees the work of Statutory

Auditors, Internal Auditors, IAG, Internal Assurance

Partners and the Ombudsperson. It is also responsible for

overseeing the processes related to the financial reporting

and information dissemination.

5. In this regard, the Audit Committee reports as follows:

I. The Committee has discussed with the Company’s

Internal Auditors (viz. IAG), Internal Assurance Partners

and Statutory Auditors the overall scope and plan

for their respective audits. The Committee has also

discussed the results and eectiveness of the audit,

evaluation of the Company’s internal controls and the

overall quality of nancial reporting.

II. The Management has presented the Company’s

nancial statements to the Committee and armed

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

140

that the Company’s nancial statements have been

drawn in accordance with Ind-AS. Based on its review

and the discussions conducted with the Management

and the Statutory Auditors, the Committee believes

that the Company’s nancial statements are fairly

presented in conformity with applicable accounting

standards in all material aspects. The Committee also

considers that the nancial statements are true and

fair and provide sucient information. The Committee

believes the Company has followed adequate

processes to prepare these financial statements.

III. The Committee has reviewed both abridged

and unabridged versions of the standalone and

consolidated nancial statements for the year ended

March 31, 2018. It has recommended the same for the

Board’s approval.

IV. The Committee has reviewed the internal controls for

ensuring that the Company’s accounts are properly

maintained and that the accounting transactions are

in accordance with prevailing laws and regulations.

In conducting such reviews, the Committee found no

material deficiency or weakness in the Company’s

internal control systems.

V. The Committee reviewed the Company’s internal

financial controls and risk management systems

from time to time. During the year the Company has

constituted a separate Risk Management Committee

which shall focus on risk management including

determination of company’s risk appetite, risk tolerance

and regular risk assessments (risk identification, risk

quantification and risk evaluation) etc.

VI. The Committee reviewed the Ombudsperson’s report

on the functioning of the Whistle Blower Mechanism for

reporting concerns about unethical behaviour, actual

or suspected fraud, or violation of the Company’s Code

of Conduct or ethics policy. The Committee believes

that the Company has an effective Whistle Blower

Mechanism and nobody has been denied access to

this mechanism.

VII. The Committee has reviewed with the Management,

the independence and performance of Deloitte

Haskins & Sells LLP, Chartered Accountants, the

Statutory Auditors of the Company.

VIII. The Committee, along with the Management, reviewed

the performance of the Internal Assurance Partners

viz. Ernst & Young LLP and ANB & Co., Chartered

Accountants, Mumbai during the financial year 2017-

18. The Committee has also reviewed the eligibility and

independence of Ernst & Young LLP and ANB & Co. and

has recommended to the Board the re-appointment

of Ernst & Young LLP and ANB & Co. as the internal

assurance partners.

IX. The Committee has been vested with the adequate

powers to seek support and other resources from

the Company. The Committee has access to the

information and records as well. It also has the authority

to obtain professional advice from external sources, if

required.

X. The Audit Committee monitored and approved all

related party transactions, including any modication

/ amendment in any such transactions.

In conclusion, the Audit Committee is sufficiently satisfied

that it has complied with the responsibilities as outlined in

the Audit Committee’s Charter.

Place: New Delhi V. K. Viswanathan

Date: April 24, 2018 Chairman, Audit Committee

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HR and Nomination Committee

The Committee comprises five Non-Executive Directors, of whom

three members, including, the Chairman of the Committee are

Independent Directors. The composition of the Committee

meets the requirements of Section 178 of the Companies

Act, 2013 and Regulation 19 of the Listing Regulations. The

Company Secretary acts as the Secretary of the Committee.

The Global Chief HR Officer is a permanent invitee to the

Committee meetings. Other Senior Management members are

also invited to the meeting to present reports relating to items

being discussed at the meeting.

Key Responsibilities of the HR and Nomination Committee

HR Related

> Formulation and recommendation to the Board, of a policy

relating to remuneration of Directors, Key Managerial

Personnel* and other employees.

> Determine the compensation (including salaries and

salary adjustments, incentives / benets, bonuses) and

performance targets of the Chairman and of the Managing

Directors & CEO’s.

> In the event of no prot or inadequate prot, to approve the

remuneration payable to managerial persons, taking into

account the Company’s nancial position, industry trend,

appointee’s qualication, experience, past performance,

past remuneration while bringing objectivity in determining

the remuneration package, while striking a balance

between the Company’s interest and shareholders.

> Attraction and retention strategies for employees.

> Review employee development strategies.

> Assess the learning and development needs of the Directors

and recommend learning opportunities, which can be used

by Directors to meet their needs for development.

> Review all human resource related issues, including

succession plan of key personnel.

> The Committee shall also consider any other key issues

/ matters as may be referred by the Board, or as may be

necessary in view of Regulation 19 of the Listing Regulations

or any other statutory provisions.

ESOP Related

> Formulation of ESOP plans and decide on future grants;

> Formulation of terms and conditions on following under the

present ESOP Schemes of the Company with respect to:

> Quantum of options to be granted under ESOP Scheme(s)

per employee and in the aggregate under a plan.

> Performance conditions attached to any ESOP Plan.

> Conditions under which options vested in employees

may lapse in case of termination of employment for

misconduct.

> Exercise period within which the employee should

exercise the option, and that option would lapse on

failure to exercise the option within the exercise period.

> Specied time period within which the employee must

exercise the vested options in the event of termination

or resignation of an employee.

> Right of an employee to exercise all the options vested

in him at one time or at various points of time within the

exercise period.

> Procedure for making a fair and reasonable adjustment

to the number of options and to the exercise price, in

case of rights issues, bonus issues and other corporate

actions.

> Grant, vest and exercise of option in case of employees,

who are on long leave, and the procedure for cashless

exercise of options.

> Any other matter which may be relevant for

administration of ESOP schemes from time to time.

> To frame suitable policies and processes to ensure that there is

no violation of SEBI (Prohibition of Insider Trading) Regulations,

2015 and SEBI (Prohibition of Fraudulent and Unfair Trade

Practices relating to the Securities Market) Regulations, 2003.

> Other key issues as may be referred by the Board.

Nomination Related

> Formulate the criteria / policy for appointment of

Directors, Senior Management**, which shall, inter-alia,

include qualications, positive attributes, diversity and

independence of a Director.

> Review and recommend the structure, size and composition

(including the skills, knowledge, experience and diversity) of

the Board and Board Committees.

> Evaluate the balance of skills, knowledge, experience

and diversity on the Board for description of the role and

capabilities, required for a particular appointment.

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

142

> Identify and recommend to the Board, persons who are

qualied to become Directors and who may be appointed in

Senior Management, including Key Managerial Personnel, in

accordance with the criteria laid down and their removal thereof.

> Recommend the appointment of any Director to executive

or other employment / place of prot in the Company.

> Review succession planning for Executive and Non-

Executive Directors and other Senior Executives, particularly

the Chairman, Managing Directors & CEOs.

> Recommend suitable candidate for the role of Lead

Independent Director.

> Formulation of criteria for evaluation of Independent

Directors and the Board.

> Conduct an annual evaluation of the overall effectiveness

of the Board, the Committees of the Board and the

performance of each Director.

> Review the Terms of Reference of all committees of the

Board, including itself on an annual basis, and recommend

any changes to the Board.

*Key Managerial Personnel’ means: i) the Chief Executive Officer or the

Managing Director or the Manager; ii) the Company Secretary; iii) the Whole-

time Director; iv) the Chief Financial Officer.

**Senior Management’ means personnel of the Company who are members

of its core management team excluding Board of Directors, comprising

all members of the Management one level below the Executive Directors,

including the functional heads.

Meetings, Attendance and Composition of HR and

Nomination Committee

During FY 2017-18, the Committee met four times i.e. May 09,

2017, July 25, 2017, October 31, 2017 and January 18, 2018.

The composition and the attendance of members at the

meetings held during FY 2017-18, are given below:

Name Category Number of meetings

attended (total held

during tenure)

Mr. Ben Verwaayen,

Chairman

Independent

Director

3(4)

Ms. Chua Sock

Koong*

Non-Executive

Director

2(4)

Mr. Manish Kejriwal Independent

Director

4(4)

Name Category Number of meetings

attended (total held

during tenure)

Mr. Rakesh Bharti

Mittal

Non-Executive

Director

4(4)

Mr. Shishir

Priyadarshi

Independent

Director

4(4)

*Two meetings attended by Mark Chong Chin Kok and Tao Yih Arthur Lang,

alternate director(s).

The details relating to remuneration of Directors, as required

under Listing Regulations have been given under a separate

section, viz. ‘Directors Remuneration’ in this Report.

Stakeholders’ Relationship Committee

In compliance with the Regulation 20 of the Listing Regulations,

requirements and provisions of Section 178 of the Companies

Act, 2013, the Company has a Stakeholders’ Relationship

Committee. The Committee comprises four members including

two Independent Directors. Mr. Rakesh Bharti Mittal, Non-

Executive Director is the Chairman of the Committee. The

Company Secretary acts as Secretary to the Committee.

Key Responsibilities of the Stakeholders’ Relationship

Committee

The key responsibilities of the Stakeholders’ Relationship

Committee include the following:

> Formulation of procedures, in line with the statutory

guidelines to ensure speedy disposal of various requests

received from shareholders from time to time.

> Consider and resolve the complaints / grievances of

security holders of the Company, including complaints

related to transfer of shares, non-receipt of balance sheet

and non-receipt of declared dividend.

> Dematerialise or re-materialise the share certicates.

> Approve the transmission of shares or other securities arising

as a result of death of the sole / any of joint shareholder.

> Sub-divide, consolidate and / or replace any share or other

securities certicate(s) of the Company.

> Issue duplicate share / other security(ies) certicate(s) in

lieu of the original share / security(ies) certicate(s) of the

Company.

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> Approve, register and refuse to register transfer /

transmission of shares and other securities.

> To further delegate all or any of the power to any other

employee(s), officer(s), representative(s), consultant(s),

professional(s), or agent(s).

> Oversee & review, all matters connected with the transfer of

securities of the Company.

> Oversee the performance of the Company’s Registrar and

Share Transfer Agent.

> Recommend methods to upgrade the standard of services

to the investors.

> To deal with the Company’s unclaimed / undelivered

shares, as prescribed in the relevant regulation of the

Listing Regulations.

> To do all such acts, deeds and things as may be necessary

in this regard.

The meetings of the Committee are generally held as and when

deemed necessary, to review and ensure that all investor requests

/ grievances are redressed within stipulated time period.

Meetings, Attendance and Composition of Stakeholders’

Relationship Committee

During FY 2017-18, the Committee met seven times i.e. on

May 09, 2017, July 25, 2017, October 31, 2017, November 23,

2017, December 19, 2017, January 18, 2018 and March 12,

2018. The composition and the attendance of members at the

meetings held during FY 2017-18, are given below:

Name Category Number of meetings

attended (total held

during tenure)

Mr. Rakesh Bharti

Mittal, Chairman

Non-Executive

Director

7(7)

Mr. Manish Kejriwal Independent

Director

4(7)

Mr. Gopal Vittal Executive

Director

6(7)

Mr. D.K. Mittal Independent

Director

7(7)

Compliance Officer

Mr. Rohit Krishan Puri, Dy. Company Secretary, acts as the

Compliance Officer of the Company for complying with the

requirements of the Listing Regulations and requirements of

securities laws, including SEBI (Prohibition of Insider Trading)

Regulations, 2015.

Nature of Complaints and Redressal Status

During FY 2017-18, the complaints and queries received by the

Company were general in nature, which include issues relating

to non-receipt of dividend warrants, shares, annual reports and

others, which were resolved to the satisfaction of the shareholders.

Details of the investors’ complaints received during FY 2017-18

are as follows:

Type of complaint Number Redressed Pending

on March

31, 2018

Non-receipt of

securities

0 0 Nil

Non-receipt of

Annual Report

2 2 Nil

Non–receipt of

dividend / dividend

warrants

1 1 Nil

Miscellaneous 1 1 Nil

Total 4 4 Nil

Committee of Directors

To cater to various day-to-day requirements and to facilitate

seamless operations, the Company has formed a functional

Committee known as the Committee of Directors. The

Committee meets as and when deem necessary to cater to the

day to day requirements of the Company.

The Committee comprises four members including two

Independent Directors. Mr. Rakesh Bharti Mittal, Non-Executive

Director is the Chairman of the Committee. The Company

Secretary acts as Secretary to the Committee.

Meetings, Attendance and Composition of Committee of

Directors

During FY 2017-18, the Committee met six times i.e. on May 09,

2017, July 25, 2017, October 31, 2017, January 18, 2018, March 9,

2018 and March 13, 2018. The composition and the attendance of

members at the meetings held during FY 2017-18, are given below:

Name Category Number of meetings

attended (total held

during tenure)

Mr. Rakesh Bharti

Mittal, Chairman

Non-Executive

Director

6(6)

Bharti Airtel Limited

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144

Name Category Number of meetings

attended (total held

during tenure)

Mr. D.K. Mittal Independent

Director

6(6)

Mr. Manish

Kejriwal

Independent

Director

4(6)

Mr. Gopal Vittal Executive

Director

6(6)

Key Responsibilities of the Committee of Directors (within

the limit approved by the Board)

Investment Related

> To grant loans to any body corporate / entity.

> To give guarantee(s) in connection with loan made to any

body corporate / entity.

> To negotiate, nalise, amend, modify, approve and accept

the terms and conditions with respect to aforesaid loans

and / or guarantee(s) from time to time.

> To purchase, sell, acquire, subscribe, transfer or otherwise

deal in the shares / securities of any Company, body

corporate or other entities.

Treasury Related

> To borrow such sum of money, as may be required by

the Company from time to time provided that the money

already borrowed, together with the money to be borrowed

by the Company does not exceed the limits provided under

Section 180 of the Companies Act, 2013 i.e. upto the paid

up capital and free reserve of the Company.

> To create security / charge(s) on all or any of the assets of

the Company for the purpose of securing credit facility(ies)

of the Company.

> To deal in government securities, units of mutual funds,

xed income and money market instruments, xed deposits

and certicate of deposit programme of banks and other

instruments / securities / treasury products of banks &

nancial institutions as per treasury policy of the Company.

> To deal in foreign exchange and nancial derivatives

linked to foreign exchange and interest rates including, but

not limited to foreign exchange spot, forwards, options,

currency swaps and interest rate swaps.

> To open, operate, close, change in authorisation for any

Bank Account, Subsidiary General Ledger (SGL) Account,

Dematerialisation / Depository Account.

> To approve, nalise and authorise the execution of any

deed, document, letter or writing in connection with the

aforesaid activities, including borrowing / credit facilities,

creation of charge.

Allotment of Shares

> Issue and allot shares of the Company in one or more

tranches as per the terms of the ESOP Schemes for the

time being in force or upon conversion of Foreign Currency

Convertible Bonds issued by the Company.

> To seek listing of shares issued as above on one or more

Stock Exchanges in India and all such shares being pari-

passu with the existing equity shares of the Company in all

respects.

> To do all such acts, deeds and things, as may be necessary

and incidental to allotment and listing of shares.

General Authorisations

> To open, shift, merge, close any branch office, circle office.

> To approve for participation into any tender, bid, auction by

the Company.

> To register the Company with any Central / State Government

authorities, Semi-Government authorities, local authorities,

tax authorities including sales tax, service tax, value added

tax authorities, labour law authorities, administrative

authorities, business associations and other bodies.

> To purchase, sell, take on lease / license, transfer or

otherwise deal with any property.

> To apply for and surrender any electricity, power or water

connection.

> To appoint any Merchant Banker, Chartered Accountant,

Advocate, Company Secretary, Engineer, Technician,

Consultants and / or Professionals for undertaking any

assignment for and on behalf of the Company.

> To constitute, reconstitute, modify, dissolve any trust or

association with regard to the administrative matters

or employee related matters and to appoint, reappoint,

remove, replace the trustees or representatives.

> To authorise one or more employee(s), officer(s),

representative(s), consultant(s), professional(s), or agent(s)

jointly or severally to:

> represent the Company before Central Government,

State Governments, Judicial, Quasi-judicial and other

statutory / administrative authorities or any other entity.

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> negotiate, nalise, execute, modify, sign, accept,

and withdraw all deed, agreements, undertakings,

certicates, applications, conrmations, affidavits,

indemnity bonds, surety bonds, and all other

documents and papers.

> affix common seal of the Company.

> enter into, sign, execute and deliver all contracts for

and on behalf of the Company.

> To do all such acts, deeds and things as may be required for

the smooth conduct of the operations of the Company and

which does not require the specic approval of the Board

of the Company or which has specically been delegated

by the Board to any other Committee of the Board or any

officer, employee or agent of the Company.

> To perform such other functions as may be authorised /

delegated by the Board or as might have been authorised

/ delegated to the erstwhile Borrowing Committee,

Investment Committee, Committee of Director or the

Allotment Committee.

> To authorise / delegate any or all of its power to any person,

officer, representative.

Special Committee of Directors (Monetization of

stake in Bharti Infratel Limited)

The Special Committee of Directors (Monetization of stake in

Bharti Infratel Limited) evaluates the proposal for monetization

of stake in Bharti Infratel Limited. The Committee meets as and

when necessary to explore divestment in Bharti Infratel Limited.

The Committee comprises three members including one

independent director. Mr. Rakesh Bharti Mittal, Non-Executive

Director is the Chairman of the Committee. The Company

Secretary acts as Secretary to the Committee.

Meetings, Attendance and Composition of Special

Committee of Directors (Monetization of stake in Bharti

Infratel Limited)

During FY 2017-18, the Committee met one time i.e. on October

31, 2017. The composition and the attendance of members at

the meetings held during the FY 2017-18, are given below:

Name Category Number of meetings

attended (total held

during tenure)

Mr. Rakesh Bharti

Mittal, Chairman

Non-Executive

Director

1(1)

Name Category Number of meetings

attended (total held

during tenure)

Ms. Chua Sock

Koong

Non-Executive

Director

1(1)

Mr. D.K. Mittal Independent

Director

1(1)

Key Responsibilities of the Special Committee of Directors

(Monetization of stake in Bharti Infratel Limited)

> To engage and negotiate with the prospective buyers

including in relation to the terms of sale provided that

the terms shall be subject to the approval of the board of

directors and no agreements shall be approved and or

executed except after the approval of the board of directors.

> To appoint, terminate, reappoint legal advisors, advisors,

consultants, and any other professionals or intermediaries

etc. on such terms and conditions as deemed fit.

> To represent the Company before any prospective buyer

and any regulatory and / or statutory authorities and

departments.

> To delegate all or any of the authorisations conferred as

above to any Officer(s) / Authorized Representative(s) of

the Company.

> To do all such acts, deeds, matters and things as it may in

its absolute discretion, deem necessary, expedient, usual or

proper in furtherance of the above.

Special Committee of Directors (Restructuring of

overseas holding structure)

The Special Committee of Directors (Restructuring of overseas

holding structure) evaluates the proposal for restructuring of

overseas holding structure of the Company. The Committee

meets as and when necessary.

The Committee comprises three members including one

independent director. Mr. Rakesh Bharti Mittal, Non-Executive

Director is the Chairman of the Committee. The Company

Secretary / Deputy Company Secretary acts as Secretary to the

Committee.

Meetings, Attendance and Composition of Special

Committee of Directors (Restructuring of overseas holding

structure)

During the year no meeting of Special Committee of Directors

(Restructuring of overseas holding structure) was convened.

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146

Key Responsibilities of the Special Committee of Directors

(Restructuring of overseas holding structure)

> To evaluate the proposal for restructuring of overseas

holding structure.

> To appoint, terminate, reappoint legal advisors, advisors,

consultants, and any other professionals or intermediaries

etc. on such terms and conditions as deemed fit.

> To represent the Company before any regulatory and / or

statutory authorities and departments.

> To delegate all or any of the authorisations conferred as

above to any Officer(s) / Authorized Representative(s) of

the Company.

> To do all such acts, deeds, matters and things as it may in

its absolute discretion deem necessary, expedient, usual or

proper in furtherance of the above.

Corporate Social Responsibility (CSR) Committee

In compliance with the requirements of the Companies Act,

2013, the Company has constituted the Corporate Social

Responsibility Committee. The Committee evaluates and

recommend the CSR proposals to the Board for approval.

The Committee comprises three members including one

Independent Director. Mr. Rakesh Bharti Mittal, Non-Executive

Director, is the Chairman of the Committee. The Company

Secretary acts as secretary to the Committee.

Key Responsibilities of the CSR Committee

> Formulate, monitor and recommend to the Board CSR

Policy and the activities to be undertaken by the Company.

> Recommend the amount of expenditure to be incurred on

the activities undertaken.

> Review the Company’s performance in the area of CSR.

> Evaluate social impact of the Company’s CSR activities.

> Review the Company’s disclosure of CSR matters including

any annual social responsibility report.

> Review the following, with the Management, before

submission to the Board for approval

> The Business Responsibility (BR) Report

> CSR Report

> Annual Sustainability Report

> Formulate and implement the BR policies in consultation

with the respective stakeholders.

> Establish a monitoring mechanism to ensure that the funds

contributed by the Company are spent by Bharti Foundation,

or any other charitable organisation to which the Company

makes contributions, for the intended purposes only.

> Approve the appointment or re-appointment of Directors

responsible for Business Responsibility.

> Nominate at least one member of the CSR Committee as a

trustee of Bharti Foundation.

> Consider other functions, as dened by the Board, or as

may be stipulated under any law, rule or regulation including

the Listing, Corporate Social Responsibility Voluntary

Guidelines, 2009 and the Companies Act, 2013.

On the recommendation of the CSR Committee, the Board had

on April 29, 2014, approved the Corporate Social Responsibility

(CSR Policy) of the Company. The CSR Policy intends to strive

for economic development that positively impacts the society at

large with minimal resource footprints. The Policy is available on

the Company’s website at www.airtel.com.

Meetings, Attendance and Composition of CSR Committee

During FY 2017-18, the Committee met three times i.e. on May

09, 2017, November 21, 2017 and January 18, 2018. The

composition and the attendance of members at the meetings

held during the FY 2017 -18, are given below:

Name Category Number of meetings

attended (total held

during tenure)

Mr. Rakesh Bharti

Mittal, Chairman

Non-Executive

Director

3(3)

Mr. D.K. Mittal Independent

Director

3(3)

Mr. Gopal Vittal Executive

Director

2(3)

Corporate Social Responsibility Report for the year ended

March 31, 2018

The CSR Report for the year ended March 31, 2018 is annexed

as Annexure D to the Board’s Report.

Risk Management Committee

The Board in its meeting held on January 18, 2018, constituted

separate Risk Management Committee to focus on risk

management including determination of Company’s risk

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appetite, risk tolerance and regular risk assessments (risk

identification, risk quantification and risk evaluation) etc.

The Committee comprises seven members viz. Mr. D. K. Mittal,

Mr. V.K. Viswanathan, Mr. Rakesh Bharti Mittal, Mr. Gopal Vittal,

Mr. Nilanjan Roy, Group Director, Internal Assurance and Mr.

Pankaj Tewari. Mr. D.K. Mittal is the Chairman of the Committee.

The Company Secretary / Dy. Company Secretary acts as

secretary to the Committee.

During the year no Risk Management Committee meeting was

held.

Authority

a) Obtain any legal or independent professional advice

on matters to be deliberated in the Risk Management

Committee.

b) Access sufficient resources to carry out its duties.

Key Responsibilities of the Risk Management Committee

> Formulate and review risk management policy;

> Approve the process for risk identification;

> Assess / Determine risk appetite and monitor risks

(including Cyber Security risk);

> Implement, monitor and review the risk management

framework, risk management plan and related matters;

> Advise the board on risk strategy;

> Foster an appropriate risk culture; and

> Delegate above said authorities to sub-committees,

whenever required.

Airtel Corporate Council (ACC)

Airtel Corporate Council is a non-statutory committee, constituted

by the Board for strategic management and supervision of the

Company’s operations within the approved framework.

The Committee comprises six members. Mr. Sunil Bharti Mittal,

is the Chairman of the Committee. The Company Secretary acts

as secretary to the Committee.

Key Responsibilities of the ACC Committee

> Strategic Management and supervision of Company’s

business; CEO Board Report.

> Formulation of Company’s annual business plan including

objectives and strategies, capex, and investments. Approval

of the variation in the Approved Annual Operating Plan up

to 5% negative deviation.

> Formulation of organisation policies, systems and

processes, concerning the Company’s operations.

> Review and recommend for approval of all items / proposals

relating to restructuring, new line of business, investments,

General Reserved Matters (as referred in Article 125 (ii)

of Articles of Association of the Company) and other

matters, which require the Board’s approval in relation to

the Company and its subsidiaries in India, Africa and SA, as

a shareholder.

> Acquisition, disposal, transfer of any immovable property of

value exceeding any amount in excess of the duly approved

respective DoA’s.

> Formation, modication, withdrawal, implementation

of systems, policies, control manuals and other policy

frameworks for operational efficiency and risk management.

The Committee to agree in advance the specific key

operational efficiency / risk management matters that

business must present at each meeting.

> Approval for contribution to any political party / political

trust within the overall limit set by the Board.

> Business Development transaction related updates/next

steps.

> Financial Restructuring / Treasury Strategy.

> Review and approval of all strategic consulting assignments.

> Change of Company’s brand name, logo, and trade mark.

All brand launches (new or rebranding to be presented to

ACC, prior to formally committing material expenditure).

Powers of ACC in respect of the Subsidiaries and their step

down Subsidiaries (Other than listed subsidiaries)

> Formulation of business plan, including any strategic

initiative, investments, capex, borrowing including

renancing and extension, among others.

> Nomination of the respective subsidiaries nominee on

Board of other companies.

> Entry into / exit from business / major business activities,

in any manner whatsoever, including purchase, sale, lease,

franchise, among others.

With respect to overseas subsidiaries and their step down

subsidiaries, the power of ACC is confined to performing key

shareholder functions.

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148

General Body Meetings

The details of last three Annual General Meetings (AGMs) are as follows:

Financial Year Location Date Time Special Resolutions passed

2016-2017

Air Force

Auditorium,

Subroto Park,

New Delhi -

110010

July 24, 2017 1530 Hrs. (IST) 1. Re-appointment of Mr. Manish Kejriwal as an Independent

Director

2. Amendment in the Employee Stock Option Scheme

2005 of the Company

2015-2016 August 19, 2016 1530 Hrs. (IST) 1. Adoption of new Articles of Association of the Company

2. Alteration of Memorandum of Association of the Company

2014-2015 August 21, 2015 1530 Hrs. (IST) No Special Resolution Passed

Tribunal Convened Meetings

Pursuant to the Order dt. July 28, 2017 by the Hon’ble Special Bench of the National Company Law Tribunal (Tribunal), the meeting

of equity shareholders of the Company was held as per below details:

Location Date Time Special Resolution passed

Sri Sathya Sai International Centre,

Pragati Vihar, Bhisham Pitamah

Marg, Lodhi Road,

New Delhi – 110003

September 19, 2017 0930 Hrs. (IST) Approval of Scheme of amalgamation between

Telenor (India) Communications Private Limited

and the Company

Mr. Sanjay Grover of Sanjay Grover and Associates, Company Secretaries, New Delhi (C.P. No. 3850) was appointed as a Scrutinizer

by the Tribunal for conducting the poll at the Tribunal Convened Meeting of the equity shareholders.

Details of Poll conducted at the Tribunal Convened meeting:

Details of Agenda No. of valid votes Votes cast in favour of

the resolution (no. & %)

Votes cast against the

resolution (no. & %)

Approval of Scheme of amalgamation

between Telenor (India) Communications

Private Limited and the Company

3,729,191,826 3,728,392,180 (99.98%) 799,646 (0.02%)

Postal Ballot

The Board had on March 12, 2018 approved the Notice of Postal Ballot / E-Voting for passing of special resolution for Issue of

unsecured / secured redeemable Non-Convertible Debentures / Bonds by way of Private Placement.

Person Conducting the Postal Ballot Exercise

Mr. Gopal Vittal, Managing Director & CEO (India & South Asia), Mr. Mukesh Bhavnani, Group General Counsel, Mr. Pankaj Tewari,

Company Secretary and Mr. Rohit Krishan Puri, Deputy Company Secretary were appointed as persons responsible for the entire

postal ballot / e-voting process. Mr. Sanjay Grover of Sanjay Grover & Associates, Company Secretaries, New Delhi (C.P. No. 3850) was

appointed as the Scrutinizer for conducting the postal ballot / e-voting process in a fair and transparent manner.

Procedure followed / to be followed

1. In compliance with the Regulation 44 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and

Section 108, 110 and other applicable provisions of the Companies Act, 2013, read with the rules made thereunder, the Company

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has provided electronic voting facility to all its members, to

enable them to cast their votes electronically. The Company

engaged the services of Karvy Computershare Pvt. Ltd.

(Karvy) for the purpose of providing e-voting facility. The

members has the option to vote either by physical ballot or

e-voting.

2. The Company has dispatched the postal ballot notice dated

March 12, 2018 containing draft resolutions together

with the explanatory statements, postal ballot forms and

self-addressed envelopes to the members whose names

appeared in the register of members / list of beneficiaries

as on cut-off date i.e. Friday, March 30, 2018. The Company

has also published a notice in the newspaper declaring the

details of completion of dispatch on April 10, 2018 and

April 11, 2018 and other requirements as mandated under

the Act and applicable rules.

3. Members desiring to exercise their votes by physical

postal ballot forms are requested to return the forms duly

completed and signed, to the Scrutinizer on or before the

close of business hours on Wednesday, May 09, 2018.

The members who opts for the e-voting can vote during

Tuesday, April 10, 2018 from 09:00 a.m. and Wednesday,

May 09, 2018 till 05:00 p.m. (both days inclusive).

4. The Scrutinizer will submit his report, after the completion

of scrutiny.

5. The results of the postal ballot will be announced by the

Chairman or any other director authorised by him on Friday,

May 11, 2018. The last date specified for receipt of duly

completed Postal Ballot Forms and closure of e-voting i.e.

May 09, 2018, will be taken as the date of passing the

resolution.

6. The result of the postal ballot along with the scrutinizer’s report

will be displayed at the registered office of the Company,

hosted at the Company’s website at www.airtel.com and

on the website of Karvy i.e. https://evoting.karvy.com and

will be communicated to the Stock Exchanges where the

Company’s shares are listed.

Apart from the above announcement of results, there is no

immediate proposal for passing any other special resolution

through Postal Ballot on or before ensuing Annual General

Meeting.

Code of Conduct

In compliance with Regulation 17 of the Listing Regulations

and the Companies Act, 2013, the Company has framed

and adopted a Code of Conduct for all Directors and Senior

Management personnel. The code is available on the Company’s

website www.airtel.com. The Code is applicable to all Board

members and Senior Management personnel who directly

report to the Chairman, the Managing Director & CEO (India &

South Asia). The Code is circulated to all Board members and

Senior Management Personnel and its compliance is affirmed

by them annually.

Besides, the Company also procures a quarterly conrmation

of material financial and commercial transactions entered into

by Senior Management personnel with the Company that may

have a potential conflict of interest.

A declaration signed by the Managing Director & CEO (India &

South Asia), regarding affirmation of the compliance with the

Code of Conduct by Board Members and Senior Management

for the financial year ended March 31, 2018, is annexed as

Annexure A to this report.

Along with the Code of Conduct for the Board members and

Senior Management, the Company has also laid down a Code of

Conduct for its employees. As a process, an annual conrmation

is also sought from all employees. All employees are expected

to conrm compliance to the Code annually. Regular training

programmes / self-certifications are conducted across locations

to explain and reiterate the importance of adherence to the code.

Disclosures and Policies

Disclosure on Materially Signicant Related Party

Transactions that may have potential conflict with the

interest of Company at large

All transactions entered into with related parties as defined

under the Companies Act, 2013 and the Listing Regulations

during the financial year were in the ordinary course of business

and on an arm’s length basis and do not attract the provisions of

Section 188 of the Companies Act, 2013.

None of the transactions with any of the related parties

were in conict with the interest of the Company rather, they

synchronise and synergise with the Company’s operations.

Attention of members is drawn to the disclosure of transactions

with the related parties set out in Note No. 34 of the Standalone

Financial Statements, forming part of the Annual Report.

The required statements / disclosures, with respect to the related

party transactions, are placed before the Audit Committee and to

the Board of Directors, on quarterly basis in terms of Regulation

23(3) of the Listing Regulations and other applicable laws for

approval / information. Prior omnibus approval is obtained for

Related Party Transactions which are of repetitive in nature.

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150

The Company’s major related party transactions are generally

with its subsidiaries and associates. These transactions are

entered into based on consideration of various business

exigencies, such as synergy in operations, sectoral specialisation,

liquidity and capital resource of subsidiary and associates and

all such transactions are on an arm’s length basis.

The Board of Directors has formulated a Policy on dealing

with Related Party Transactions pursuant to the provisions

of the Companies Act, 2013 and the Listing Regulations. The

Policy intends to ensure that proper reporting, approval and

disclosure processes are in place for all transactions between

the Company and related parties. The Policy is posted on the

website of the Company at http://www.airtel.in/wps/wcm/

connect/36a5305d-f0ba-490c-9eff-152ef6811917/BAL-

Policy-on-Related-Party-Transactions.pdf?MOD=AJPERES.

Disclosure on Risk Management

The Company has established an Enterprise-wide Risk

Management (ERM) framework to optimally identify and

manage risks, as well as to address operational, strategic and

regulatory risks. In line with the Company’s commitment to

deliver sustainable value, this framework aims to provide an

integrated and organised approach to evaluate and manage

risks. Risk assessment monitoring is included in the Company’s

annual Internal Audit programme and reviewed by the Audit

Committee / Risk Management Committee at regular intervals.

In compliance with Regulation 17 and 21 of the Listing

Regulations, the Board of Directors has formulated a Risk

Management Policy for framing, implementing and monitoring

the risk management plan for the Company.

The Board is periodically updated on the key risks, steps and

processes initiated for reducing and, if feasible, eliminating

various risks. Business risk evaluation and management is an

ongoing process within the Company.

Detailed update on risk management framework has been

covered under the risk section, forming a part of the Management

Discussion and Analysis.

Details of Non-compliance with regard to Capital Markets

during the last three years

There have been no instances of non-compliances by the

Company and no penalties and / or strictures have been imposed

by Stock Exchanges or SEBI or any statutory authority on any

matter related to capital markets during the last three years.

Insider Trading

In compliance with the SEBI regulation on prevention of insider

trading, the Company has established systems and procedures

to prohibit insider trading activity and has formulated a code on

insider trading for designated persons, who may have access to

the Company’s price sensitive information. The Code lays down

procedures to be followed and disclosures to be made, while

trading in the Company’s shares.

The Company follows highest standards of transparency and

fairness in dealing with all stakeholders and ensures that no

insider shall use his or her position with or without knowledge

of the Company to gain personal benefit or to provide benefit to

any third party.

Ombudsperson Policy / Whistle Blower Policy

Bharti Airtel has adopted an Ombudsperson Policy (includes

Whistle Blower Policy). It outlines the method and process for

stakeholders to voice genuine concerns about unethical conduct

that may be in breach with the employees’ Code of Conduct.

The policy aims to ensure that genuine complainants are able

to raise their concerns in full condence, without any fear of

retaliation or victimisation. The Policy also allows for anonymous

reporting of complaints. The Ombudsperson administers the

entire formal process from reviewing and investigating concerns

raised, undertaking all appropriate actions for resolution thereof

and regular monitoring of ombuds process to strengthen its

effectiveness and adequacy. Instances of serious misconduct dealt

with by the Ombudsperson are reported to the Audit Committee.

All employees of the Company as well as vendors / partners and

any person that has a grievance (excluding standard customer

complaints) has full access to the Ombudsperson through phones,

emails or even meetings in person. During the year under review,

no employee was denied access to the Audit Committee.

Auditors’ Certificate on Corporate Governance

As required under Regulation 34 of the Listing Regulations, the

auditors’ certificate on Corporate Governance is annexed as

Annexure I to the Board’s Report.

CEO and CFO Certication

The certicate required under Regulation 17(8) of the Listing

Regulations, duly signed by the CEO and CFO of the Company

was placed before the Board. The same is provided as Annexure

B to this report.

Subsidiary Companies

The Company monitors performance of subsidiary Companies,

inter-alia, by the following means:

> Financial Statements, in particular investments made by

unlisted subsidiary companies, are reviewed quarterly by

the Audit Committee.

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> Minutes of the Board Meetings of unlisted subsidiary

companies are regularly placed before the Board.

> A statement containing significant transactions and

arrangements entered into by unlisted subsidiary

companies is placed before the Board.

Bharti Infratel Limited, the Company’s material Indian subsidiary,

is listed on Stock Exchanges and therefore, the Company is not

required to nominate a Director on the Board of Bharti Infratel

Limited.

The Board of Directors have formulated a Policy for determining

material subsidiaries pursuant to the provisions of the Listing

Regulations. The same is posted on the Company’s website at

http://www.airtel.in/wps/wcm/connect/7e99add6-9401-4ab3-

899a-07572390a956/BAL-Policy-for-determining-Material-

Subsidiaries.pdf?MOD=AJPERES.

Compliance with the Mandatory Requirements of the

Listing Regulations

The Board of Directors periodically review the compliance of

all applicable laws. The Company has complied with all the

mandatory requirements of the Code of Corporate Governance

as specified in Regulations 17 to 27 and clauses (b) to (i) of sub

regulation (2) of Regulation 46 of the Listing Regulations. It has

obtained a certicate arming the compliances from Deloitte

Haskins & Sells LLP, Chartered Accountants, the Company’s

Statutory Auditors and the same is attached to the Board’s

Report.

Details of Compliances with the Non-mandatory Requirements

of Regulation 27 of the Listing Regulations.

In addition to the mandatory requirements, the Company

has also adopted the following non-mandatory requirements

Regulation 27(1) of the Listing Regulations:

(i) Shareholders’ Rights

The Company has a policy of announcement of the audited

quarterly results. The results, as approved by the Board

of Directors (or Committee thereof) are rst submitted to

Stock Exchanges within 30 minutes under Regulation 30

of the Listing Regulations of the approval of the results.

Once taken on record by the Stock Exchanges, the same

are disseminated in the media through press release. The

quarterly financial results are published in newspapers and

uploaded on Company’s website www.airtel.com.

On the next day of the announcement of the quarterly

results, an earnings call is organised, where the management

responds to the queries of the investors / analysts. These

calls are webcast live and transcripts posted on the

website. In addition, discussion with the management team

is webcast and also aired on the electronic media.

(ii) Audit Qualifications

Company’s financial statements are unqualified.

(iii) Separate posts of Chairman and CEO

The positions of the Chairman of the Board and the

Managing Director & Chief Executive Officer of the

Company are held by separate individuals.

(iv) Reporting of Internal Auditor / Internal Assurance

Partners

The Internal Auditors / Internal Assurance Partners directly

reports to the Audit Committee.

Green Initiatives by MCA

In compliance with the provisions of Section 20 of the

Companies Act, 2013 and as a continuing endeavour towards

the ‘Go Green’ initiative, the Company proposes to send all

correspondence / communications through email to those

shareholders who have registered their email id with their

depository participants / Company’s registrar and share

transfer agent. In case the shareholders desire to receive a

printed copy of such communications, they send a requisition to

the Company. The Company forthwith sends a printed copy of

the communication to the shareholder.

Bharti Airtel Limited

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152

Status of Dividend Declared

Status of the dividend declared by the Company is as under:

Amount in J Millions

Financial Year Rate of Dividend per

equity share of J 5 each

Total Pay-out Amount Paid to

the shareholders

Amount un-paid to

the shareholders

2017-18 (Interim)

H 2.84

11,352.62 11,351.68 0.94

2016-17

H 1

3,997.40 3,991.24 6.16

2015-16

H 1.36

5,436.46 5,427.88 8.59

2014-15

H 2.22

8,874.23 8,860.86 13.37

2014-15 (Interim Dividend)

H 1.63

6,515.76 6,505.78 9.99

2013-14

H 1.80

7,195.32 7,184.27 11.05

2012-13

H 1

3,797.53 3,791.06 6.47

2011-12

H 1

3,797.53 3,790.80 6.73

2010-11

H 1

3,797.53 3,791.16 6.37

The Company constantly endeavours to reduce the unpaid dividend amount. The shareholders, who have not claimed their dividend

for the above nancial years are requested to contact the Company or its Share Transfer Agent.

Equity Shares in the Suspense Account

In terms of Regulation 34 of the Listing Regulations, the details of the equity shares lying in the suspense accounts, which were issued

in physical form, are as follows:

Particulars Number of

Shareholders

Number of

equity shares

Number of shareholders and aggregate number of shares as transferred to the Unclaimed

Suspense Account outstanding as on April 01, 2017

7 19

Number of shareholders who approached the Company for transfer of shares and shares

transferred from suspense account during the year

6 18

Aggregate Number of shareholders and the outstanding shares in the suspense account

lying as on March 31, 2018

1 1

The voting rights on the share(s) in the suspense account as on March 31, 2018 shall remain frozen till the rightful owners of such

share(s) claim the share(s) .

Means of Communication

Quarterly Results: The Company’s Quarterly Audited Results are published in prominent daily newspapers, viz. Mint (English daily)

and Hindustan (vernacular newspaper) and are also uploaded on the Company’s website www.airtel.com.

News releases, presentations: Official news releases and official media releases are sent to Stock Exchanges and uploaded on the

Company’s website www.airtel.com.

Earning Calls & Presentations to Institutional Investors / Analysts: The Company organises an earnings call with analysts and

investors on the next day of announcement of results, which is also broadcast live on the Company’s website. The transcript of the

earnings call is posted on the website soon after. Any specic presentation made to the analysts / others is also uploaded on the

Company’s website www.airtel.com.

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NSE Electronic Application Processing System (NEAPS)/ BSE Corporate Compliance & Listing Centre: The NEAPS/ BSE’s

Listing Centre is a web-based application designed for corporates. All periodical compliance fillings, like shareholding pattern,

Corporate Governance Report, media releases and other material information is also filed electronically on the designated portals.

Website: Upto date nancial results, annual reports, shareholding patterns, ocial news releases, nancial analysis reports, latest

presentation made to the institutional investors and other general information about the Company are available on the website

www.airtel.com.

Shareholders Satisfaction Survey: In our constant endeavour to strengthen the shareholder service standards, a Shareholders

Satisfaction Survey is conducted through a Shareholders Feedback Form uploaded on the Company’s website www.airtel.com under

‘Investors’ section. Accordingly, members may provide their valuable feedback.

Since the time of listing of shares, Bharti Airtel adopted a practise of releasing a quarterly report, which contains nancial and

operating highlights, key industry and Company developments, results of operations, stock market highlights non-GAAP information,

ratio analysis, summarised nancial statements and so on. The quarterly reports are posted on the Company’s website and are also

submitted to the Stock Exchanges, where the Company’s shares are listed.

General Shareholders’ Information

Annual General Meeting

Date : August 08, 2018

Day : Wednesday

Time : 3.30 p.m.

Venue : Air Force Auditorium,

Subroto Park, New Delhi – 110 010

Financial Calendar

(Tentative Schedule, subject to change)

Financial year : April 1 to March 31

Results for the quarter ending:

June 30, 2018 : July 26, 2018, (Thursday)

September 30, 2018 : October 25, 2018, (Thursday)

December 31, 2018 : January 17, 2019, (Thursday)

March 31, 2019 : April 23, 2019 (Tuesday)

Book Closure

Saturday, August 04, 2018 to Wednesday, August 08, 2018 (both days inclusive).

Final Dividend

H 2.50 per equity share of H 5/- each (i.e. 50.00% on the face value of the shares).

Dividend Pay-out Date

On or after August 08, 2018 (within the statutory time limit of 30 days i.e. up to September 07, 2018), subject to the approval of the

shareholders.

Bharti Airtel Limited

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Equity Shares Listing, Stock Code and Listing Fee Payment

Name and address of the Stock Exchange Scrip code Status of fee paid

for FY 2018-19

National Stock Exchange of India Limited

Exchange Plaza, C-1 Block G

Bandra Kurla Complex, Bandra, Mumbai – 400001

BHARTIARTL Paid

BSE Limited

Phiroze Jeejeebhoy Towers Dalal Street, Mumbai – 400001

532454 Paid

Debentures Listing and Listing Fee Payment

Name and address of the Stock Exchange Scrip code Status of fee paid

for FY 2018-19

National Stock Exchange of India Limited

Exchange Plaza, C-1 Block G

Bandra Kurla Complex, Bandra, Mumbai – 400001

BAL20

Paid

BAL21

Stock Market Data for the Period April 01, 2017 to March 31, 2018

Month

BSE NSE

High Low Volume (Nos.) High Low Volume (Nos.)

April 2017 361.35 333.25 47,26,962 361.95 332.75 5,93,38,264

May 2017 381.50 336.95 75,03,227 381.60 336.50 12,36,20,920

June 2017 386.45 361.00 66,39,494 386.35 360.60 6,89,74,184

July 2017 431.00 373.35 97,05,730 431.60 373.35 8,60,41,584

August 2017 438.00 403.70 24,99,266 438.15 403.75 5,45,08,784

September 2017 430.15 370.00 24,80,960 430.45 371.00 7,91,81,681

October 2017 519.35 373.10 95,34,448 519.35 373.15 19,70,62,070

November 2017 565.00 480.00 47,50,82,156 564.80 481.15 22,93,86,228

December 2017 547.20 477.00 1,97,91,369 547.50 476.85 13,20,10,586

January 2018 542.25 422.20 5,39,81,181 542.50 435.05 18,66,10,123

February 2018 449.15 403.00 63,51,520 449.40 403.20 14,22,48,998

March 2018 436.70 391.10 92,19,414 436.60 391.25 11,54,58,421

Source: www.bseindia.com Source: www.nseindia.com

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Bharti Airtel Share Prices Vs. BSE Sensex Bharti Airtel Share Price Vs. NSE Nifty

Registrar and Transfer Agent

All the work related to share registry, both in physical and electronic form, is handled by the Company’s Registrar and Transfer Agent

at the address mentioned in the communication addresses section.

Share Transfer System

As much as 99.86% of the Company’s equity shares are in electronic format. These shares can be transferred through the depositories

without the Company’s involvement.

Transfer of shares in physical form is processed within 15 days from the date of receipt, provided the documents are complete in all

respects. All transfers are rst processed by the Transfer Agent and are submitted thereafter to the Company, for approval. The Transfer

Agent has been authorised to transfer minor shareholding up to 50 shares per instrument without the Company’s involvement.

Pursuant to Regulation 40(9) of the Listing Regulations, the Company obtain certificates from a practicing Company Secretary on a

half-yearly basis to the effect that all the transfers are completed within the statutory stipulated period. A copy of the certificates so

received is submitted to both Stock Exchanges, where the shares of the Company are listed.

Distribution of Shareholding

By number of shares held as on March 31, 2018

Sl.

no.

Category

(by no. of shares)

No. of shareholders % to holders No. of shares % of shares

1 1 – 5000 194,871 97.43 15,671,641 0.40%

2 5001 – 10000 2,013 1.01 3,049,839 0.07%

3 10001 – 20000 1,016 0.51 2,968,767 0.07 %

4 20001 – 30000 390 0.19 1,944,855 0.05%

5 30001 – 40000 193 0.09 1,366,884 0.03%

6 40001 – 50000 121 0.06 1,123,232 0.03%

7 50001 – 100000 279 0.14 3,995,395 0.10%

8 100001 – above 1,132 0.57 3,967,279,489 99.25%

Total 2,00,015 100 % 3,997,400,102 100%

160

150

140

130

120

110

100

Apr-17

May-17

Jun-17

Bharti Airtel Share Price BSE Sensex

Jul-17

Aug-17

Sep-17

Oct-17

Nov-17

Dec-17

Jan-18

Feb-18

Mar-18

160

150

140

130

120

110

100

Apr-17

May-17

Jun-17

Bharti Airtel Share Price NSE Nifty

Jul-17

Aug-17

Sep-17

Oct-17

Nov-17

Dec-17

Jan-18

Feb-18

Mar-18

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

156

By category of holders as on March 31, 2018

no.

Category No. of shares %age of holding

I Promoter and Promoter Group

(i)

Indian promoters 2,002,818,452 50.10

(ii) Foreign promoters 680,963,103 17.04

Total Promoters shareholding 2,683,781,555 67.14

II Public Shareholding

(A) Institutional Investors

(i) Mutual Funds and Unit Trust of India 264,178,731 6.60

(ii) Financial institutions and Banks 3,108,671 0.08

(iii) Insurance companies 227,466,498 5.70

(iv) Foreign Institutional Investors 1,262,459 0.03

(v) Others - Foreign Portfolio Investors 736,191,176 18.42

(B) Others

(i) Bodies Corporate (Indian) 24,101,590 0.60

(ii) Bodies Corporate (Foreign) 2,532,710 0.06

(iii) Trusts 8,717,006 0.22

(iv) NRIs / OCBs / Foreign Nationals / QFI 2,315,817 0.06

(v) Resident Individuals 36,868,027 0.92

(vi) Indian Public & Others 6,875,862 0.17

Total Public Shareholding 1,313,618,547 32.67

Total Shareholding 3,997,400,102 100

Dematerialisation of Shares and Liquidity

The Company’s shares are compulsorily traded in dematerialised form and are available for trading with both the depositories i.e.

National Securities Depository Limited (NSDL) and Central Depository Services (India) Limited (CDSL). The shareholders can hold

the Company’s shares with any of the depository participants, registered with these depositories. ISIN for the Company’s shares is

INE397D01024.

The Company’s equity shares are frequently traded at the BSE Limited and the National Stock Exchange of India Limited.

Outstanding GDRs / ADRs / Warrants or any Convertible instruments, conversion date and likely impact

on equity

The Company does not have any outstanding GDRs / ADRs / Warrants or any convertible instruments as on date.

Disclosure of commodity price risks and commodity hedging activities

The Company follows prudent Board approved risk management policies. A detailed note on commodity price risks and commodity

hedging activities is given in Management Discussion and Analysis forming part of Annual Report.

Plant Locations

Being a service provider company, Bharti Airtel has no plant locations. The Company’s Circle Oce addresses are provided at the end

of the Annual Report.

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Communication Addresses

Contact Email Address

For Corporate

Governance and

Other Secretarial

related matters

Mr. Pankaj Tewari

Sr. VP & Company

Secretary

Mr. Rohit Krishan Puri

Dy. Company Secretary &

Compliance Officer

compliance.ocer@bharti.

Bharti Airtel Limited

Bharti Crescent, 1, Nelson Mandela Road,

Vasant Kunj, Phase – II, New Delhi

110 070

Telephone no. +91 011-46666100

Fax no. +91 11 46666137

Website: www.airtel.com

For queries relating

to Financial

Statements

Ms. Komal Sharan

Head - Investor Relations

[email protected]

For Corporate

Communication

related matters

Mr. Raza Khan

Head - Group Corporate

Communications

corporate.

[email protected]

Registrar & Transfer

Agent

Karvy Computershare

Pvt. Ltd.

einward.ris@karvy.com Karvy Selenium Tower B, Plot number 31 & 32,

Gachibowli, Financial District, Nanakramguda,

Hyderabad – 500032

Telephone no. +91 040-67162222

Fax No. 040-23001153

Website: www.karvy.com

Debentures Trustee Chief Financial Ocer

Axis Trustee Services

Limited

debenturetrustee@

axistrustee.com

Ground Floor, Axis House

Wadia International Centre, Pandurang

Budhkar Marg, Worli, Mumbai-400 025

Telephone No. +91 022-62260050/54

Fax No. 022-43253000

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

158

Annexure A

Annexure B

Declaration

Chief Executive Officer (CEO) / Chief Financial Officer (CFO) certification

I hereby confirm that the Company has received from all the members of the Board and Senior Management, for the financial year

ended March 31, 2018, a confirmation that they are in compliance with the Company’s Code of Conduct.

For Bharti Airtel Limited

Date: April 24, 2018 Gopal Vittal

Place: New Delhi Managing Director & CEO (India & South Asia)

We, Gopal Vittal, Managing Director & CEO (India & South Asia) and Nilanjan Roy, Global Chief Financial Officer of Bharti Airtel Limited,

to the best of our knowledge and belief hereby certify that:

(a) We have reviewed financial statements and the cash flow statement for the year ended March 31, 2018 and that to the best of

our knowledge and belief :

(i) these statements do not contain any materially untrue statement or omit any material fact or contain statements that might

be misleading;

(ii) these statements together present a true and fair view of the Company’s affairs and are in compliance with existing

accounting standards, applicable laws and regulations.

(b) There are, to the best of our knowledge and belief, no transactions entered into by the Company during the year which are

fraudulent, illegal or violative of the Company’s code of conduct.

(c) We accept responsibility for establishing and maintaining internal controls for financial reporting and that we have evaluated the

effectiveness of internal control systems of the company pertaining to financial reporting and we have disclosed to the Auditors

and the Audit Committee, deficiencies in the design or operation of such internal controls, if any, of which we are aware and the

steps we have taken or propose to take to rectify these deficiencies.

(d) We have indicated to the auditors and the Audit Committee:

(i) significant changes in internal control over financial reporting during the year;

(ii) significant changes in accounting policies during the year and that the same have been disclosed in the notes to the financial

statements; and

(iii) instances of significant fraud of which we have become aware and the involvement therein, if any, of the management or an

employee having a significant role in the company’s internal control system over financial reporting.

Place: New Delhi Nilanjan Roy Gopal Vittal

Date: April 24, 2018 Global Chief Financial Officer Managing Director & CEO

(India & South Asia)

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Independent Auditor’s Report

To the members of

BHARTI AIRTEL LIMITED

Report on the Standalone Financial Statements

We have audited the accompanying Standalone Financial

Statements of BHARTI AIRTEL LIMITED (“the Company”),

which comprise the Standalone Balance Sheet as at March 31,

2018, the Standalone Statement of Profit and Loss (including

Other Comprehensive Income), the Standalone Statement of

Cash Flows and the Standalone Statement of Changes in Equity

for the year ended on that date and a summary of the significant

accounting policies and other explanatory information

(hereinafter referred to as “Standalone Financial Statements”).

Management’s Responsibility for the Standalone

Financial Statements

The Company’s Board of Directors is responsible for the matters

stated in Section 134(5) of the Companies Act,2013 (“the Act”)

with respect to the preparation of these Standalone Financial

Statements that give a true and fair view of the financial position,

financial performance including other comprehensive income,

cash flows and changes in equity of the Company in accordance

with the Indian Accounting Standards (Ind AS) prescribed under

section 133 of the Companies Act,2013 read with the Companies

(Indian Accounting Standards) Rules, 2015, as amended, and

other accounting principles generally accepted in India.

This responsibility also includes maintenance of adequate

accounting records in accordance with the provisions of the Act

for safeguarding the assets of the Company and for preventing

and detecting frauds and other irregularities; selection and

application of appropriate accounting policies; making

judgments and estimates that are reasonable and prudent; and

design, implementation and maintenance of adequate internal

financial controls, that were operating effectively for ensuring

the accuracy and completeness of the accounting records,

relevant to the preparation and presentation of the Standalone

Financial Statements that give a true and fair view and are free

from material misstatement, whether due to fraud or error.

Auditor’s Responsibility

Our responsibility is to express an opinion on these Standalone

Financial Statements based on our audit.

In conducting our audit, we have taken into account the

provisions of the Act, the accounting and auditing standards

and matters which are required to be included in the audit report

under the provisions of the Act and the Rules made thereunder

and the Order issued under section 143(11) of the Act.

We conducted our audit of the Standalone Financial Statements

in accordance with the Standards on Auditing specified under

Section 143(10) of the Act. Those Standards require that we

comply with ethical requirements and plan and perform the audit

to obtain reasonable assurance about whether the Standalone

Financial Statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence

about the amounts and the disclosures in the Standalone

Financial Statements. The procedures selected depend on the

auditor’s judgment, including the assessment of the risks of

material misstatement of the Standalone Financial Statements,

whether due to fraud or error. In making those risk assessments,

the auditor considers internal financial control relevant to the

Company’s preparation of the Standalone Financial Statements

that give a true and fair view in order to design audit procedures

that are appropriate in the circumstances. An audit also includes

evaluating the appropriateness of the accounting policies used

and the reasonableness of the accounting estimates made by

the Company’s Board of Directors, as well as evaluating the

overall presentation of the Standalone Financial Statements.

We believe that the audit evidence obtained by us is sufficient

and appropriate to provide a basis for our audit opinion on the

Standalone Financial Statements.

Opinion

In our opinion and to the best of our information and according to

the explanations given to us, the aforesaid Standalone Financial

Statements give the information required by the Act in the

manner so required and give a true and fair view in conformity

with the Ind AS and other accounting principles generally

accepted in India, of the state of affairs of the Company as at

March 31, 2018, its profit, total comprehensive income, changes

in equity and its cash flows for the year ended on that date.

Emphasis of Matter

We draw attention to Note 23(i)(f)(v) to the Standalone Financial

Statements which describes the uncertainties related to the

legal outcome of Department of Telecommunications demand

with respect to one time spectrum charges.

Our opinion is not modified in respect of this matter.

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Financial Statements

Independent Auditor’s Report

Other Matter

The comparative financial information of the Company for the

year ended March 31, 2017 prepared in accordance with Ind

AS included in these Standalone Financial Statements have

been audited by the predecessor auditor. The report of the

predecessor auditor on comparative financial statements for

the year ended and as at March 31, 2017 dated May 9, 2017

expressed an unqualified opinion. Our opinion is not modified in

respect of this matter.

Report on Other Legal and Regulatory

Requirements

1. As required by Section 143(3) of the Act, based on our

audit we report that:

a) We have sought and obtained all the information and

explanations which to the best of our knowledge and

belief were necessary for the purposes of our audit.

b) In our opinion, proper books of account as required

by law have been kept by the Company so far as it

appears from our examination of those books.

c) The Standalone Balance Sheet, the Standalone

Statement of Profit and Loss including Other

Comprehensive Income, the Standalone Statement of

Cash Flows and Standalone Statement of Changes in

Equity dealt with by this Report are in agreement with

the books of account.

d) In our opinion, the aforesaid standalone financial

statements comply with the Indian Accounting

Standards prescribed under section 133 of the Act.

e) On the basis of the written representations received

from the directors of the Company as on 31st March,

2018 taken on record by the Board of Directors, none

of the directors is disqualified as on 31st March, 2018

from being appointed as a director in terms of Section

164(2) of the Act.

f) With respect to the adequacy of the internal financial

controls over financial reporting of the Company and

the operating effectiveness of such controls, refer

to our separate Report in “Annexure A”. Our report

expresses an unmodified opinion on the adequacy

and operating effectiveness of the Company’s internal

financial controls over financial reporting.

g) With respect to the other matters to be included in

the Auditor’s Report in accordance with Rule 11 of

the Companies (Audit and Auditors) Rules, 2014, as

amended, in our opinion and to the best of our information

and according to the explanations given to us:

i. The Company has disclosed the impact of pending

litigations on its financial position in its standalone

financial statements.

ii. The Company has made provision, as required

under the applicable law or accounting standards,

for material foreseeable losses, if any, on long-term

contracts including derivative contracts.

iii. There has been no delay in transferring amounts,

required to be transferred, to the Investor

Education and Protection Fund by the Company.

2. As required by the Companies (Auditor’s Report) Order,

2016 (“the Order”) issued by the Central Government in

terms of Section 143(11) of the Act, we give in “Annexure

B” a statement on the matters specified in paragraphs 3

and 4 of the Order.

For DELOITTE HASKINS & SELLS LLP

Chartered Accountants

(Firm’s Registration No. 117366W/W-100018)

Hemant M. Joshi

Partner

(Membership No. 38019)

Place: New Delhi

Date: April 24, 2018

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

162

We have audited the internal financial controls over financial

reporting of Bharti Airtel Limited (“the Company”) as of March

31, 2018 in conjunction with our audit of the Standalone

Financial Statements of the Company for the year ended on

that date.

Management’s Responsibility for Internal Financial

Controls

The Company’s management is responsible for establishing

and maintaining internal financial controls based on the internal

control over financial reporting criteria established by the

Company considering the essential components of internal

control stated in the Guidance Note on Audit of Internal Financial

Controls Over Financial Reporting issued by the Institute of

Chartered Accountants of India. These responsibilities include

the design, implementation and maintenance of adequate

internal financial controls that were operating effectively for

ensuring the orderly and efficient conduct of its business,

including adherence to Company’s policies, the safeguarding of

its assets, the prevention and detection of frauds and errors, the

accuracy and completeness of the accounting records, and the

timely preparation of reliable financial information, as required

under the Companies Act, 2013.

Auditor’s Responsibility

Our responsibility is to express an opinion on the Company’s

internal financial controls over financial reporting based on our

audit. We conducted our audit in accordance with the Guidance

Note on Audit of Internal Financial Controls Over Financial

Reporting (the “Guidance Note”) issued by the Institute of

Chartered Accountants of India and the Standards on Auditing

prescribed under Section 143(10) of the Companies Act, 2013,

to the extent applicable to an audit of internal financial controls.

Those Standards and the Guidance Note require that we comply

with ethical requirements and plan and perform the audit to

obtain reasonable assurance about whether adequate internal

financial controls over financial reporting was established

and maintained and if such controls operated effectively in all

material respects.

Our audit involves performing procedures to obtain audit

evidence about the adequacy of the internal financial

controls system over financial reporting and their operating

Annexure “A” to the

Independent Auditor’s Report

(Referred to in paragraph 1 (f) under ‘Report on Other Legal and Regulatory Requirements’ section of our

report of even date)

Report on the Internal Financial Controls Over Financial Reporting under Clause (i) of Sub-section 3 of Section 143 of the

Companies Act, 2013 (“the Act”)

effectiveness. Our audit of internal financial controls over

financial reporting included obtaining an understanding of

internal financial controls over financial reporting, assessing the

risk that a material weakness exists, and testing and evaluating

the design and operating effectiveness of internal control based

on the assessed risk. The procedures selected depend on the

auditor’s judgement, including the assessment of the risks of

material misstatement of the financial statements, whether due

to fraud or error.

We believe that the audit evidence we have obtained is sufficient

and appropriate to provide a basis for our audit opinion on the

Company’s internal financial controls system over financial

reporting.

Meaning of Internal Financial Controls Over

Financial Reporting

A company’s internal financial control over financial reporting is

a process designed to provide reasonable assurance regarding

the reliability of financial reporting and the preparation of

financial statements for external purposes in accordance with

generally accepted accounting principles. A company’s internal

financial control over financial reporting includes those policies

and procedures that (1) pertain to the maintenance of records

that, in reasonable detail, accurately and fairly reflect the

transactions and dispositions of the assets of the company; (2)

provide reasonable assurance that transactions are recorded

as necessary to permit preparation of financial statements in

accordance with generally accepted accounting principles, and

that receipts and expenditures of the company are being made

only in accordance with authorisations of management and

directors of the company; and (3) provide reasonable assurance

regarding prevention or timely detection of unauthorised

acquisition, use, or disposition of the company’s assets that

could have a material effect on the financial statements.

Inherent Limitations of Internal Financial Controls

Over Financial Reporting

Because of the inherent limitations of internal financial controls

over financial reporting, including the possibility of collusion

or improper management override of controls, material

misstatements due to error or fraud may occur and not be

detected. Also, projections of any evaluation of the internal

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Financial Statements

Annexure “A” to the Independent Auditor’s Report

financial controls over financial reporting to future periods are

subject to the risk that the internal financial control over financial

reporting may become inadequate because of changes in

conditions, or that the degree of compliance with the policies or

procedures may deteriorate.

Opinion

In our opinion, to the best of our information and according to

the explanations given to us the Company has, in all material

respects, an adequate internal financial controls system over

financial reporting and such internal financial controls over

financial reporting were operating effectively as at March 31,

2018 , based on the criteria for internal control over financial

reporting established by the Company considering the essential

components of internal control stated in the Guidance Note on

Audit of Internal Financial Controls Over Financial Reporting

issued by the Institute of Chartered Accountants of India.

For DELOITTE HASKINS & SELLS LLP

Chartered Accountants

(Firm‘s Registration No.117366W/W-100018)

Hemant M. Joshi

Partner

(Membership No. 38019)

Place: New Delhi

Date: April 24, 2018

Bharti Airtel Limited

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164

Annexure “B” to the

Independent Auditor’s Report

(Referred to in paragraph 2 under ‘Report on Other Legal and Regulatory Requirements’ section of our

report of even date)

i. In respect of its fixed assets:

a) The Company has maintained proper records showing

full particulars with respect to most of its fixed assets,

and is in the process of updating quantitative and

situation details with respect to certain fixed assets in

the records maintained by the Company.

b) The Company has a program of verification of fixed

assets to cover all the items in a phased manner

over a period of three years which, in our opinion, is

reasonable having regard to the size of the Company

and the nature of its assets. Pursuant to the program,

certain fixed assets were physically verified by the

Management during the year. According to the

information and explanations given to us, no material

discrepancies were noticed on such verification.

c) According to the information and explanations given

to us, the records examined by us and based on

examination of property tax receipts, utility bills, lease

agreement for land on which building is constructed,

registered sale deed / transfer deed / conveyance deed

or court orders approving schemes of arrangements /

amalgamations provided to us, we report that, the title

in respect of self-constructed buildings and the title

deeds, comprising all the immovable properties of land

and buildings which are freehold, are held in the name

of the Company as at the balance sheet date.

In respect of immovable properties that have been

taken on lease and disclosed as property, plant and

equipment in the financial statements, based on

our examination of the lease agreements or court

orders approving the schemes of arrangement or

amalgamations, we report that the lease agreements

are in the name of the Company, where the Company

is the lessee in the agreement.

ii. As explained to us, the inventories, except for those lying

with the third parties, were physically verified during the

year by the Management at reasonable intervals and no

material discrepancies were noticed on physical verification.

iii. According to information and explanation given to us, the

Company has not granted any loans, secured or unsecured,

to companies, firms, Limited Liability Partnerships or other

parties covered in the register maintained under section

189 of the Companies Act, 2013.

iv. In our opinion and according to the information and

explanations given to us, there are no loans, investments,

guarantees, and securities granted in respect of which

provisions of Section 185 and 186 of the Companies Act,

2013 are applicable.

v. According to the information and explanations given to us,

the Company has not accepted deposits during the year

and does not have any unclaimed deposits as at March 31,

2018 and therefore, the provisions of the clause 3 (v) of the

Order are not applicable.

vi. The maintenance of cost records has been specified by the

Central Government under section 148(1) of the Companies

Act, 2013. We have broadly reviewed the cost records

maintained by the Company pursuant to the Companies

(Cost Records and Audit) Rules, 2014, as amended

prescribed by the Central Government under sub-section

(1) of Section 148 of the Companies Act, 2013, and are of

the opinion that, prima facie, the prescribed cost records

have been made and maintained. We have, however, not

made a detailed examination of the cost records with a view

to determine whether they are accurate or complete.

vii. According to the information and explanations given to us,

in respect of statutory dues:

(a) The Company is regular in depositing undisputed

statutory dues, including Provident Fund, Employees’

State Insurance, Income-tax, Sales Tax, Service Tax,

Goods and Services Tax, Customs Duty, Value Added

Tax, cess and other material statutory dues applicable

to it to the appropriate authorities. As explained to

us, the provisions relating to duty of excise are not

applicable to the Company.

(b) There were no undisputed amounts payable in respect

of Provident Fund, Employees’ State Insurance,

Income-tax, Sales Tax, Value Added Tax, Service Tax,

Goods and Services Tax, Customs Duty, cess and other

material statutory dues in arrears as at March 31, 2018

for a period of more than six months from the date they

became payable.

which have not been deposited on account of any

dispute. Details of dues of Income-tax, Sales Tax, Value

Added Tax, Service Tax and Customs Duty which have

not been deposited as on March 31, 2018 on account

of disputes are given below:

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Financial Statements

Annexure “B” to the Independent Auditor’s Report

Name of the Statutes Nature of

the Dues

Amount Disputed

(in J Million)

Period to Which

the amount Relates

Forum where the dispute is

pending

Andhra Pradesh VAT Act,

2005

Sales Tax 87 2004-13 Tribunal

Andhra Pradesh VAT Act,

2005

Sales Tax 52 2013-15 Deputy Commissioner (Appeals)

Bihar VAT Act, 2005 Sales Tax 0* 2015-16 Assistant Commissioner

Bihar VAT Act, 2005 Sales Tax 2 2006-07 Commercial Tax Officer

Bihar VAT Act, 2005 Sales Tax 1 2016-17 Deputy Commissioner

Bihar VAT Act, 2005 Sales Tax 22 2015-17 Joint Commissioner (Appeal)

Bihar VAT Act, 2005 Sales Tax 139 2005-15 Tribunal

Chhattisgarh VAT Act, 2003 Sales Tax 0* 2006-07 Assistant Commissioner

Delhi VAT Act, 2004 Sales Tax 6 2011-14 Assistant Commissioner

The Gujarat VAT Act, 2003 Sales Tax 1 2005-07 Assistant Commissioner

The Karnataka VAT Act, 2003 Sales Tax 291 2005-06 Assistant Commissioner

The Karnataka VAT Act, 2003 Sales Tax 0* 2012-13 Deputy Commissioner

The Karnataka VAT Act, 2003 Sales Tax 2 2016-17 Joint Commissioner (Appeal)

The Kerala VAT Act, 2003 Sales Tax 1 2005-17 Commercial Tax Officer

The Kerala VAT Act, 2003 Sales Tax 0* 2016-17 Intelligence Officer Ernakulum

Kerala Sales Tax Act Sales Tax 0* 2005-11 Commercial tax Officer

Kerala Sales Tax Act Sales Tax 16 2005-10 Deputy Commissioner, Appeal

Kerala Sales Tax Act Sales Tax 0* 2008-10 Intelligence Officer Squad

Kerala Sales Tax Act Sales Tax 1 2002-05 Tribunal

The Kerala VAT Act, 2003 Sales Tax 71 2006-07 High Court of Kerala

The Kerala VAT Act, 2003 Sales Tax 44 2007-12 Asst. Commissioner, Spl Circle III,

Ernakulam

The Kerala VAT Act, 2003 Sales Tax 0* 2015-16 Intelligence Inspector, Squad No. I,

Tellichery

The Kerala VAT Act, 2003 Sales Tax 0* 2015-16 Intelligence Inspector, Squad No. 3,

Ernakulam

The Madhya Pradesh VAT Act,

2002

Sales Tax 7 2008-10,2012-13 Tribunal

The Madhya Pradesh VAT Act,

2002

Sales Tax 0* 2004-08 Commercial Tax Officer

The Madhya Pradesh VAT Act,

2002

Sales Tax 1 2008-10 Deputy Commissioner

The Madhya Pradesh VAT Act,

2002

Sales Tax 22 1997-04 Deputy Commissioner, Appeal

The Madhya Pradesh VAT Act,

2002

Sales Tax 0* 2005-06 Assistant Commissioner

The Maharashtra VAT Act,

2002

Sales Tax 0* 2003-04 Joint Commissioner, Appeal

Punjab VAT Act, 2005 Sales Tax 1 2009-17 Deputy Excise and Taxation

Commissioner

Punjab VAT Act, 2005 Sales Tax 30 2003-04 High Court

Punjab VAT Act, 2005 Sales Tax 1 2002-03 Jt. Director( Enforcement)

Punjab VAT Act, 2005 Sales Tax 1 2008-10 Tribunal

Rajasthan VAT Act, 2003 Sales Tax 2 2015-16 Commercial Tax Officer

The Tamil Nadu VAT Act,

2003

Sales Tax 0* 2010-11 Deputy Commissioner

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

166

Name of the Statutes Nature of

the Dues

Amount Disputed

(in J Million)

Period to Which

the amount Relates

Forum where the dispute is

pending

The Uttar Pradesh VAT Act,

2008

Sales Tax 11 2005-13 Assessing officer

The Uttar Pradesh VAT Act,

2008

Sales Tax 21 2002-05 Assistant Commissioner

The Uttar Pradesh VAT Act,

2008

Sales Tax 0* 2017-18 Commercial Tax Officer

The Uttar Pradesh VAT Act,

2008

Sales Tax 1 2007-08 Joint Commissioner

The Uttar Pradesh VAT Act,

2008

Sales Tax 6 2008-10 High court

The Uttar Pradesh VAT Act,

2008

Sales Tax 2 2003-10 Joint Commissioner, Appeal

The Uttar Pradesh VAT Act,

2008

Sales Tax 9 2005-13 Tribunal

The Uttar Pradesh VAT Act,

2008

Sales Tax 1 2015-16 Additional Commissioner

The Uttar Pradesh VAT Act,

2008

Sales Tax 9 2003-17 Deputy Commissioner

The West Bengal VAT Act,

2003

Sales Tax 0* 1996-97 The Deputy Commissioner of

Commercial Taxes

The West Bengal VAT Act,

2003

Sales Tax 0* 1995-98 Commercial Tax Officer

The West Bengal VAT Act,

2003

Sales Tax 9 2005-06 Revision Board

The West Bengal VAT Act,

2003

Sales Tax 3 1997-12 Tribunal

Sub Total (A)

877

Finance Act, 1994 (Service

tax provisions )

Service Tax 278 1995-08 Supreme Court

Finance Act, 1994 (Service

tax provisions )

Service Tax 7 2002-07 High court

Finance Act, 1994 (Service

tax provisions )

Service Tax 7,226 1995-16 Tribunal

Finance Act, 1994 (Service

tax provisions )

Service Tax 571 1999-13 Commissioner of Service Tax

Sub Total (B)

8,082

Custom Act, 1962 Custom Act 4,128 2001-05 Supreme Court

Custom Act, 1962 Custom Act 755 2003-15 Tribunal

Sub Total (C)

4,883

Income Tax Act, 1961 Income Tax 128 2001-03, 2004-08 Supreme Court

Income Tax Act, 1961 Income Tax 10,519 1996-97, 2003-10 High Court

Income Tax Act, 1961 Income Tax 24,338 1995-2015 Income Tax Appellate Tribunal

Income Tax Act, 1961 Income Tax 607 1998-2015 Commissioner of Income Tax

(Appeals)

Income Tax Act, 1961 Income Tax 638 1996-97; 2004-17 Assessing Officer

Sub Total (D)

36,230

Grand Total(A+B+C+D):

50,071

The above mentioned figures represent the total disputed cases without any assessment of Probable, Possible and Remote, as done in case of Contingent

Liabilities. Of the above cases, total amount deposited in respect of Sales Tax is 327 Mn, Service Tax is 472 Mn, Income Tax is 10,968 Mn and Custom Duty

is 2,141 Mn.

* Amount less than million are appearing as ‘0’.

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Financial Statements

Annexure “B” to the Independent Auditor’s Report

viii. In our opinion and according to the information and

explanations given to us, the Company has not defaulted

in the repayment of loans or borrowings to financial

institutions, banks and government and dues to debenture

holders.

ix. During the current year, the Company has not raised

moneys by way of initial public offer or further public offer

(including debt instruments). In our opinion and according

to the information and explanations given to us, the term

loans have been applied by the Company during the year

for the purposes for which they were raised, other than

temporary deployment pending application of proceeds.

x. To the best of our knowledge and according to the

information and explanations given to us, no fraud by the

Company and no material fraud on the Company by its

officers or employees has been noticed or reported during

the year.

xi. In our opinion and according to the information and

explanations given to us, the Company has paid / provided

managerial remuneration in accordance with the requisite

approvals mandated by the provisions of Section 197

read with Schedule V to the Companies Act, 2013, except

that the commission of H 67.64 million to non-executive

directors is in excess by H 33.12 million, basis the lower

limits approved by the Shareholders of the Company. As

informed, the Company would be seeking Shareholders’

approval for the said excess amount at the ensuing Annual

General Meeting.

xii. The Company is not a Nidhi Company and hence reporting

under clause 3 (xii) of the Order is not applicable.

xiii. In our opinion and according to the information and

explanations given to us the Company is in compliance with

Section 177 and 188 of the Companies Act, 2013, where

applicable, for all transactions with the related parties and

the details of related party transactions have been disclosed

in the financial statements etc. as required by the applicable

accounting standards.

xiv. During the year the Company has not made any preferential

allotment or private placement of shares or fully or partly

convertible debentures and hence reporting under clause

3 (xiv) of the Order is not applicable to the Company.

xv. In our opinion and according to the information and

explanations given to us, during the year the Company has

not entered into any non-cash transactions with its directors

or directors of its holding company, directors of subsidiary

company or directors of associate company or persons

connected with them and hence provisions of section 192

of the Companies Act, 2013 are not applicable.

xvi. The Company is not required to be registered under section

45-IA of the Reserve Bank of India Act, 1934.

For DELOITTE HASKINS & SELLS LLP

Chartered Accountants

(Firm’s Registration No. 117366W/W-100018)

Hemant M. Joshi

Partner

(Membership No. 38019)

Place: New Delhi

Date: April 24, 2018

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

168

Balance Sheet As at 31st March 2018

(All amounts are in millions of Indian Rupees)

Notes As of

31 March 2018

As of

31 March 2017

Assets

Non-current assets

Property, plant and equipment 6 476,911 381,176

Capital work-in-progress 6 27,387 11,818

Intangible assets 7 749,183 734,052

Intangible assets under development 7 28,040 84,184

Investment in subsidiaries and joint ventures 8 481,219 459,538

Financial assets

- Investments 8 63 52

- Derivative instruments 9 80 213

- Loans and security deposits 10 10,290 10,389

- Others 11 260 556

Income tax assets 19,595 16,164

Deferred tax assets 12 14,244 8,808

Other non-current assets 13 27,142 42,596

1,834,414 1,749,546

Current assets

Inventories 63 39

Financial assets

- Derivative instruments 9 195 634

- Trade receivables 14 43,196 32,118

- Cash and cash equivalents 15 4,626 1,087

- Other bank balances 15 825 647

- Loans 10 72,496 72,081

- Others 11 11,837 13,200

Other current assets 13 81,721 33,295

Assets-held-for-sale 5 - 13,729

214,959 166,830

Total assets 2,049,373 1,916,376

Equity and liabilities

Equity

Share capital 16 19,987 19,987

Other equity 1,008,622 992,086

1,028,609 1,012,073

Non-current liabilities

Financial liabilities

- Borrowings 18 544,681 503,421

- Derivative instruments 9 124 186

- Others 19 19,354 21,881

Deferred revenue 18,371 18,321

Provisions 20 1,830 2,330

584,360 546,139

Current liabilities

Financial liabilities

- Borrowings 18 80,680 65,478

- Current maturities of long-term borrowings 18 28,797 32,048

- Derivative instruments 9 228 1,662

- Trade payables 22 176,990 149,698

- Others 19 92,529 62,149

Deferred revenue 30,242 30,311

Provisions 20 1,262 1,291

Current tax liabilities 2,447 3,885

Other current liabilities 21 23,229 11,642

436,404 358,164

Total liabilities 1,020,764 904,303

Total equity and liabilities 2,049,373 1,916,376

The accompanying notes form an integral part of these standalone financial statements.

As per our report of even date For and on behalf of the Board of Directors of Bharti Airtel Limited

For Deloitte Haskins & Sells LLP

Chartered Accountants

(Firm’s Registration No: 117366W / W-100018)

Hemant M. Joshi Sunil Bharti Mittal Gopal Vittal

Partner Chairman Managing Director & CEO

Membership No: 38019 DIN: 00042491 (India and South Asia)

DIN: 02291778

Place: New Delhi Nilanjan Roy Pankaj Tewari

Date: April 24, 2018 Global Chief Financial Officer Company Secretary

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Statutory Reports

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169

Financial Statements

Balance Sheet / Statement of Prot and Loss

Statement of Profit and Loss for the year ended 31st March 2018

(All amounts are in millions of Indian millions Rupees; except per share data)

Notes For the year ended

31 March 2018

For the year ended

31 March 2017

Income

Revenue from operations 24 536,630 622,763

Other income 2,356 1,843

538,986 624,606

Expenses

Network operating expenses 25 139,512 145,360

Access charges 78,944 80,505

License fee / spectrum charges (revenue share) 55,630 69,416

Employee benefits expense 26 17,209 17,385

Sales and Marketing expenses 27 30,519 32,320

Other expenses 28 36,171 38,524

357,985 383,510

Profit from operating activities before depreciation, amortisation

and exceptional items 181,001 241,096

Depreciation and amortisation 29 130,486 122,034

Finance costs 30 59,107 52,546

Finance income 30 (8,417) (23,421)

Non-operating expenses 596 2,324

(Loss) /profit before exceptional items and tax (771) 87,613

Exceptional items 31 6,041 172,708

Loss before tax (6,812) (85,095)

Tax expense / (credit)

Current tax 12 (2,204) (45)

Deferred tax 12 (5,400) 14,206

Profit / (loss) for the year 792 (99,256)

Other comprehensive income ('OCI')

Items not to be reclassified to profit or loss :

- Re-measurement gains / (losses) on defined benefit plans 26 87 (36)

- Tax (charge) / credit 12 (30) 11

Other comprehensive income / (loss) for the year 57 (25)

Total comprehensive income / (loss) for the year 849 (99,281)

Earnings per share (Face value : J5 each) (In Rupees)

Basic and Diluted 32 0.20 (24.84)

The accompanying notes form an integral part of these standalone financial statements.

As per our report of even date For and on behalf of the Board of Directors of Bharti Airtel Limited

For Deloitte Haskins & Sells LLP

Chartered Accountants

(Firm’s Registration No: 117366W / W-100018)

Hemant M. Joshi Sunil Bharti Mittal Gopal Vittal

Partner Chairman Managing Director & CEO

Membership No: 38019 DIN: 00042491 (India and South Asia)

DIN: 02291778

Place: New Delhi Nilanjan Roy Pankaj Tewari

Date: April 24, 2018 Global Chief Financial Officer Company Secretary

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

170

(All amounts are in millions of Indian millions Rupees; except per share data)

Share capital Other equity - Reserves and Surplus

Total

equity

No of shares

(in ‘000)

Amount Securities

premium

account

Retained

earnings

General

reserve

Business

restructuring

reserve

Debenture

redemption

reserve

Share - based

payment

reserve

Capital

reserve

Total

As of April 1, 2016 3,997,400 19,987 106,650 934,735 27,030 16,313 - 3,825 8,751 1,097,304 1,117,291

Loss for the year - - - (99,256) - - - - - (99,256) (99,256)

Other comprehensive loss - - - (25) - - - - - (25) (25)

Total comprehensive loss - - - (99,281) - - - - - (99,281) (99,281)

Transaction with owners of equity

Employee share-based payment expense - - - - - - - 298 - 298 298

Exercise of share options - - - - - - - (144) - (144) (144)

Dividend paid (including tax) - - - (5,456) - - - - (5,456) (5,456)

Merger of subsidiary - - 530 (720) (445) - - - - (635) (635)

As of Marchch 31, 2017 3,997,400 19,987 107,180 829,278 26,585 16,313 - 3,979 8,751 992,086 1,012,073

Profit for the year - - - 792 - - - - - 792 792

Other comprehensive income - - - 57 - - - - - 57 57

Total comprehensive profit - - - 849 - - - - - 849 849

Transaction with owners of equity

Employee share-based payment expense - - - - - - - 337 - 337 337

Exercise of share options - - - - 3,510 - (3,646) - (136) (136)

Creation of debenture redemption reserve - - - - (7,500) - 7,500 - - - -

Dividend paid (including tax) - - - (15,350) - - - - - (15,350) (15,350)

Common control transactions* - - - 30,836 - - 30,836 30,836

As of March 31, 2018 3,997,400 19,987 107,180 845,613 22,595 16,313 7,500 670 8,751 1,008,622 1,028,609

*This includes gains of H2,335 due to regulatory changes in the funding arrangements as to previous year transactions

The accompanying notes form an integral part of these standalone financial statements.

As per our report of even date For and on behalf of the Board of Directors of Bharti Airtel Limited

For Deloitte Haskins & Sells LLP

Chartered Accountants

(Firm’s Registration No: 117366W / W-100018)

Hemant M. Joshi Sunil Bharti Mittal Gopal Vittal

Partner Chairman Managing Director & CEO

Membership No: 38019 DIN: 00042491 (India and South Asia)

DIN: 02291778

Place: New Delhi Nilanjan Roy Pankaj Tewari

Date: April 24, 2018 Global Chief Financial Officer Company Secretary

Standalone Statement of Changes in Equity

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Financial Statements

Statement of Changes in Equity / Statement of Cash Flows

Standalone Statement of Cash Flows

(All amounts are in millions of Indian Rupees)

For the year ended

31 March 2018

For the year ended

31 March 2017

Cash flows from operating activities

Loss before tax (6,812) (85,095)

Adjustments for:

Depreciation and amortisation 130,486 122,034

Finance costs 59,107 52,546

Finance income (8,417) (23,421)

Exceptional items 5,688 152,405

Employee share-based payment expenses 337 298

Other non-cash items 8,351 8,143

Operating cash flow before changes in working capital 188,740 226,910

Changes in working capital

Trade receivables (19,814) (7,500)

Trade payables 14,546 24,929

Inventories (24) 14

Provisions (95) 180

Other financial and non-financial liabilities 8,413 2,388

Other financial and non-financial assets (29,819) (20,827)

Net cash generated from operations before tax 161,947 226,094

Income tax paid (2,404) (14,439)

Net cash generated from operating activities (a) 159,543 211,655

Cash flows from investing activities

Purchase of property, plant and equipment (193,180) (156,143)

Proceeds from sale of property, plant and equipment 4,886 3,053

Purchase of intangible assets (28,855) (170,135)

Payment towards Spectrum - Deferred payment liability * (9,909) (9,804)

Net proceeds from current investments 35 47

Proceeds from buyback of share by subsidiary - 12,350

Proceeds from sale of investment of subsidiaries 65,933 146,223

Investment in subsidiaries (41,814) (74,283)

Loan given to subsidiaries (72,135) (98,797)

Loan repayment by subsidiaries 71,512 82,288

Dividend received 4,200 16,511

Interest received 4,911 5,858

Net cash used in investing activities (b) (194,416) (242,832)

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

172

Standalone Statement of Cash Flows

(All amounts are in millions of Indian Rupees)

For the year ended

31 March 2018

For the year ended

31 March 2017

Cash flows from financing activities

Proceeds from borrowings 149,422 140,419

Repayment of borrowings (57,313) (122,391)

Net proceeds / repayment of short-term borrowings (33,794) 32,832

Interest and other finance charges paid (4,291) (10,850)

Proceeds from exercise of share options 3 3

Dividend paid (including tax) (15,350) (5,456)

Net cash generated from financing activities (c) 38,677 34,557

Net increase in cash and cash equivalents during the year (a+b+c) 3,804 3,380

Add : Cash and cash equivalents as at the beginning of the year 822 (2,558)

Cash and cash equivalents as at the end of the year (refer Note 15) 4,626 822

The accompanying notes form an integral part of these standalone financial statements.

As per our report of even date For and on behalf of the Board of Directors of Bharti Airtel Limited

For Deloitte Haskins & Sells LLP

Chartered Accountants

(Firm’s Registration No: 117366W / W-100018)

Hemant M. Joshi Sunil Bharti Mittal Gopal Vittal

Partner Chairman Managing Director & CEO

Membership No: 38019 DIN: 00042491 (India and South Asia)

DIN: 02291778

Place: New Delhi Nilanjan Roy Pankaj Tewari

Date: April 24, 2018 Global Chief Financial Officer Company Secretary

*Cash flows towards spectrum acquisitions are based on the timing of payouts to DOT (viz. upfront / deferred)

Notes to Standalone Financial Statements

(All amounts are in millions of Indian Rupees – H; unless stated otherwise)

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Statutory Reports

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Financial Statements

Notes to Standalone Financial Statements

173

1. Corporate information

Bharti Airtel Limited (‘the Company’) is domiciled and incorporated in India as a limited liability company with its shares being

listed on the National Stock Exchange and the Bombay Stock Exchange. The registered office of the Company is situated at

Bharti Crescent, 1, Nelson Mandela Road, Vasant Kunj, Phase – II, New Delhi – 110070.

The Company is principally engaged in provision of telecommunication services in India. The details as to the services provided

by the Company are further provided in note 33. For details as to the group entities, refer note 34.

2. Summary of significant accounting policies

2.1 Basis of preparation

These standalone financial statements (‘financial statements’) have been prepared to comply in all material respects with

the Indian Accounting Standard (‘Ind AS’) as notified by the Ministry of Corporate Affairs (‘MCA’) under section 133 of the

Companies Act, 2013 (‘Act’), read together with Rule 3 of the Companies (Indian Accounting Standards) Rules, 2015 (as

amended from time to time) and other relevant provisions of the Act.

The financial statements are authorised for issue by the Company’s Board of Directors on April 24, 2018.

The financial statements are based on the classification provisions contained in Ind AS 1, ‘Presentation of Financial

Statements’ and division II of schedule III of the Companies Act 2013. Further, for the purpose of clarity, various items are

aggregated in the statement of profit and loss and balance sheet. Nonetheless, these items are dis-aggregated separately in

the notes to the financial statements, where applicable or required.

All the amounts included in the financial statements are reported in millions of Indian Rupees (‘Rupees’ or ‘H’) and are rounded

to the nearest million, except per share data and unless stated otherwise. Further, amounts which are less than a million are

appearing as ‘0’.

The preparation of the said financial statements requires the use of certain critical accounting estimates and judgements.

It also requires the management to exercise judgement in the process of applying the Company’s accounting policies.

The areas where estimates are significant to the financial statements, or areas involving a higher degree of judgement or

complexity, are disclosed in note 3.

The accounting policies, as set out in the following paragraphs of this note, have been consistently applied, by the Company,

to all the periods presented in the said financial statements. Further, previous year figures have been re-grouped, wherever

necessary to conform to current year’s classification.

2.2 Basis of measurement

The financial statements have been prepared on the accrual and going concern basis, and the historical cost convention

except where the Ind AS requires a different accounting treatment. The principal variations from the historical cost convention

relate to financial instruments classified as fair value through profit or loss and liability for cash-settled awards (refer note

2.16) - which are measured at fair value.

Fair value measurement

Fair value is the price at the measurement date, at which an asset can be sold or paid to transfer a liability, in an orderly

transaction between market participants. The Company’s accounting policies require, measurement of certain financial /

non-financial assets and liabilities at fair values (either on a recurring or non-recurring basis). Also, the fair values of financial

instruments measured at amortised cost are required to be disclosed in the said financial statements.

The Company is required to classify the fair valuation method of the financial / non-financial assets and liabilities, either

measured or disclosed at fair value in the financial statements, using a three level fair-value-hierarchy (which reflects the

significance of inputs used in the measurement). Accordingly, the Company uses valuation techniques that are appropriate

in the circumstances and for which sufficient data are available to measure fair value, maximising the use of relevant

observable inputs and minimising the use of unobservable inputs.

Notes to Standalone Financial Statements

(All amounts are in millions of Indian Rupees – H; unless stated otherwise)

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

174

The three levels of the fair-value-hierarchy are described below:

Level 1: Quoted (unadjusted) prices for identical assets or liabilities in active markets

Level 2: Significant inputs to the fair value measurement are directly or indirectly observable

Level 3: Significant inputs to the fair value measurement are unobservable.

2.3 Foreign currency transactions

The financial statements are presented in Indian Rupees which is the functional and presentation currency of the Company.

Transactions in foreign currencies are initially recorded in the relevant functional currency at the rates prevailing at the date

of the transaction.

Monetary assets and liabilities denominated in foreign currencies are translated into the functional currency at the closing

exchange rate prevailing as at the reporting date with the resulting foreign exchange differences, on subsequent re-

statement / settlement, recognised in the statement of profit and loss within finance costs / finance income. Non-monetary

assets and liabilities denominated in foreign currencies are translated into the functional currency using the exchange rate

prevalent, at the date of initial recognition (in case they are measured at historical cost) or at the date when the fair value is

determined (in case they are measured at fair value) – the resulting foreign exchange difference, on subsequent re-statement /

settlement, recognised in the statement of profit and loss, except to the extent that it relates to items recognised in the other

comprehensive income or directly in equity.

The equity items denominated in foreign currencies are translated at historical cost.

2.4 Current versus non-current classification

The Company presents assets and liabilities in the balance sheet based on current / non-current classification.

Deferred tax assets and liabilities, and all assets and liabilities which are not current (as discussed in the below paragraphs)

are classified as non-current assets and liabilities.

An asset is classified as current when it is expected to be realised or intended to be sold or consumed in normal operating

cycle, held primarily for the purpose of trading, expected to be realised within twelve months after the reporting period, or

cash or cash equivalent unless restricted from being exchanged or used to settle a liability for at least twelve months after

the reporting period.

A liability is classified as current when it is expected to be settled in normal operating cycle, it is held primarily for the purpose

of trading, it is due to be settled within twelve months after the reporting period, or there is no unconditional right to defer the

settlement of the liability for at least twelve months after the reporting period.

Separated embedded derivatives are classified basis the host contract.

2.5 Common control transactions

Business Combinations arising from transfers of interest in entities that are under the common control, are accounted at

historical cost. The difference between any consideration paid /received and the aggregate historical carrying amounts of

assets and liabilities of the interest acquired / disposed is recorded in retained earnings.

2.6 Property, plant and equipment (‘PPE’)

An item is recognised as an asset, if and only if, it is probable that the future economic benefits associated with the item

will flow to the Company and its cost can be measured reliably. PPE are initially recognised at cost. The initial cost of PPE

comprises its purchase price (including non-refundable duties and taxes but excluding any trade discounts and rebates),

assets retirement obligations (refer note 2.17 (b)) and any directly attributable cost of bringing the asset to its working

condition and location for its intended use.

Subsequent to initial recognition, PPE are stated at cost less accumulated depreciation and any impairment losses. When

significant parts of PPE are required to be replaced at regular intervals, the Company recognises such parts as separate

component of assets. When an item of PPE is replaced, then its carrying amount is de-recognised from the balance sheet

and cost of the new item of PPE is recognised. Further, in case the replaced part was not being depreciated separately, the

cost of the replacement is used as an indication to determine the cost of the replaced part at the time it was acquired.

Notes to Standalone Financial Statements

(All amounts are in millions of Indian Rupees – H; unless stated otherwise)

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The expenditures that are incurred after the item of PPE has been put to use, such as repairs and maintenance, are normally

charged to the statement of profit and loss in the period in which such costs are incurred. However, in situations where the

said expenditure can be measured reliably, and is probable that future economic benefits associated with it will flow to the

Company, it is included in the asset’s carrying value or as a separate asset, as appropriate.

Depreciation on PPE is computed using the straight-line method over the estimated useful lives. Freehold land is not

depreciated as it has an unlimited useful life. The Company has established the estimated range of useful lives of different

categories of PPE as follows:

Categories Years

Leasehold land Period of lease

Building 20

Building on leased land 20

Leasehold improvements Period of lease or 10 years, whichever is less

Plant and Equipment

Network Equipment (including passive infrastructure) 3 - 20

Computer 3

Office equipment 2 - 5

Furniture and fixtures 5

Vehicles 5

The useful lives, residual values and depreciation method of PPE are reviewed, and adjusted appropriately, at-least as at

each financial year so as to ensure that the method and period of depreciation are consistent with the expected pattern

of economic benefits from these assets. The effect of any change in the estimated useful lives, residual values and / or

depreciation method are accounted prospectively, and accordingly the depreciation is calculated over the PPE’s remaining

revised useful life. The cost and the accumulated depreciation for PPE sold, scrapped, retired or otherwise disposed off are

de-recognised from the balance sheet and the resulting gains / (losses) are included in the statement of profit and loss within

other expenses / other income.

The management basis its past experience and technical assessment has estimated the useful life, which is at variance with

the life prescribed in Part C of Schedule II of the Companies Act, 2013 and has accordingly, depreciated the assets over such

useful life.

The cost of capital work-in-progress (CWIP) is presented separately in the balance sheet.

2.7 Intangible assets

Identifiable intangible assets are recognised when the Company controls the asset, it is probable that future economic

benefits attributed to the asset will flow to the Company and the cost of the asset can be measured reliably.

The intangible assets are initially recognised at cost. These assets having finite useful life are carried at cost less accumulated

amortisation and any impairment losses. Amortisation is computed using the straight-line method over the expected useful

life of intangible assets.

The Company has established the estimated useful lives of different categories of intangible assets as follows:

a. Softwares

Softwares are amortised over the period of license, generally not exceeding three years.

b. Bandwidth

Bandwidth is amortised over the period of the agreement.

c. Licenses (including spectrum)

Acquired licenses and spectrum are amortised commencing from the date when the related network is available for

intended use in the relevant jurisdiction. The useful lives range from two to twenty years.

The revenue-share based fee on licenses / spectrum is charged to the statement of profit and loss in the period such

cost is incurred.

Notes to Standalone Financial Statements

(All amounts are in millions of Indian Rupees – H; unless stated otherwise)

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d. Other acquired intangible assets

Other acquired intangible assets include the following:

Rights acquired for unlimited license access: Over the period of the agreement which ranges upto five years.

Customer base: Over the estimated life of such relationships.

Non-compete fee: Over the period of the agreement which ranges upto five years.

The useful lives and amortisation method are reviewed, and adjusted appropriately, at least at each financial year end so

as to ensure that the method and period of amortisation are consistent with the expected pattern of economic benefits

from these assets. The effect of any change in the estimated useful lives and / or amortisation method is accounted

prospectively, and accordingly the amortisation is calculated over the remaining revised useful life.

Further, the cost of intangible assets under development includes the amount of spectrum allotted to the Company

and related costs (including borrowing costs that are directly attributable to the acquisition or construction of qualifying

assets (refer note 7)), if any, for which services are yet to be rolled out and are presented separately in the balance sheet.

2.8 Impairment of non-financial assets

PPE, intangible assets and Intangible assets under development

PPE (including CWIP) and intangible assets with definite lives, are reviewed for impairment, whenever events or changes in

circumstances indicate that their carrying values may not be recoverable. Intangible assets under development is tested for

impairment, at-least annually and whenever circumstances indicate that it may be impaired.

For the purpose of impairment testing, the recoverable amount (that is, higher of the fair value less costs to sell and the

value-in-use) is determined on an individual asset basis, unless the asset does not generate cash flows that are largely

independent of those from other assets, in which case the recoverable amount is determined at the CGU level to which

the said asset belongs. If such individual assets or CGU are considered to be impaired, the impairment to be recognised in

the statement of profit and loss is measured by the amount by which the carrying value of the asset / CGU exceeds their

estimated recoverable amount and allocated on pro-rata basis.

Reversal of impairment losses

Impairment losses are reversed in the statement of profit and loss and the carrying value is increased to its revised recoverable

amount provided that this amount does not exceed the carrying value that would have been determined had no impairment

loss been recognised for the said asset / CGU in previous years.

2.9 Financial instruments

a. Recognition, classification and presentation

The financial instruments are recognised in the balance sheet when the Company becomes a party to the contractual

provisions of the financial instrument.

The Company determines the classification of its financial instruments at initial recognition.

The Company recognises its investment in subsidiaries, joint ventures and associates at cost less any impairment losses.

The said investments are tested for impairment, at-least annually and whenever circumstances indicate that their carring

values may exceed the recoverable amount (viz. higher of the fair value less costs to sell and the value-in-use).

The Company classifies its financial assets in the following categories: a) those to be measured subsequently at fair

value through profit or loss, and b) those to be measured at amortised cost. The classification depends on the entity’s

business model for managing the financial assets and the contractual terms of the cash flows.

The Company has classified all the non-derivative financial liabilities as measured at amortised cost.

The entire hybrid contract, financial assets with embedded derivatives, are considered in their entirety for determining

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the contractual terms of the cash flow and accordingly the embedded derivatives are not separated. However, derivatives

embedded in non-financial instrument / financial liabilities (measured at amortised cost) host contracts are classified as

separate derivatives if their economic characteristics and risks are not closely related to those of the host contracts.

Financial assets and liabilities arising from different transactions are off-set against each other and the resultant net amount

is presented in the balance sheet, if and only when, the Company currently has a legally enforceable right to set-off the related

recognised amounts and intends either to settle on a net basis or to realise the assets and settle the liabilities simultaneously.

b. Measurement – Non-derivative financial instruments

I. Initial measurement

At initial recognition, the Company measures the non-derivative financial instruments (except off-market financial

guarantee) at its fair value plus, in the case of a financial asset not at fair value through profit or loss, transaction costs.

Otherwise transaction costs are expensed in the statement of profit and loss. Any off market financial guarantees,

issued in relation to obligations of subsidiaries, are initially recognised at fair value (as part of the cost of the investment

in the subsidiary).

II. Subsequent measurement - financial assets

The subsequent measurement of the non-derivative financial assets depends on their classification as follows:

i. Financial assets measured at amortised cost

Assets that are held for collection of contractual cash flows where those cash flows represent solely payments

of principal and interest are measured at amortised cost using the effective-interest rate (‘EIR’) method (if

the impact of discounting / any transaction costs is significant). Interest income from these financial assets is

included in finance income.

ii. Financial assets at fair value through profit or loss (‘FVTPL’)

All financial assets that do not meet the criteria for amortised cost are measured at FVTPL. Interest (basis EIR

method) and dividend income from financial assets at FVTPL is recognised in the statement of profit and loss

within finance income / finance costs separately from the other gains / losses arising from changes in the fair

value.

Impairment

The Company assesses on a forward looking basis the expected credit losses associated with its assets carried

at amortised cost. The impairment methodology applied depends on whether there has been a significant

increase in credit risk since initial recognition. If credit risk has not increased significantly, twelve month,

expected credit loss (ECL) is used to provide for impairment loss, otherwise lifetime ECL is used.

However, only in case of trade receivables, the Company applies the simplified approach which requires

expected lifetime losses to be recognised from initial recognition of the receivables.

III. Subsequent measurement - financial liabilities

Any off-market financial guarantees are amortised over the life of the guarantee and are measured at each reporting

date at the higher of (i) the remaining unamortised balance of the amount at initial recognition and (ii) the best

estimate of expenditure required to settle the obligation at the end of the reporting period. Other financial liabilities

are subsequently measured at amortised cost using the EIR method (if the impact of discounting / any transaction

costs is significant).

c. Measurement – derivative financial instruments

Derivative financial instruments, including separated embedded derivatives are classified as financial instruments at fair

value through profit or loss - Held for trading. Such derivative financial instruments are initially recognised at fair value.

They are subsequently measured at their fair value, with changes in fair value being recognised in the statement of profit

and loss within finance income / finance costs.

Notes to Standalone Financial Statements

(All amounts are in millions of Indian Rupees – H; unless stated otherwise)

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d. Derecognition

The financial liabilities are de-recognised from the balance sheet when the under-lying obligations are extinguished,

discharged, lapsed, cancelled, expires or legally released. The financial assets are de-recognised from the balance sheet

when the rights to receive cash flows from the financial assets have expired, or have been transferred and the Company

has transferred substantially all risks and rewards of ownership. The difference in the carrying amount is recognised in

the statement of profit and loss.

2.10 Leases

The determination of whether an arrangement is a lease is based on whether fulfillment of the arrangement is dependent on

the use of a specific asset and the arrangement conveys a right to use the asset, even if that right is not explicitly specified

in an arrangement.

Leases where the lessor transfers substantially all the risks and rewards of ownership of the leased asset are classified as

finance lease and other leases are classified as operating lease.

Operating lease receipts / payments are recognised as an income / expense on a straight-line basis over the lease term

unless the lease payments increase in line with expected general inflation.

a. Company as a lessee

Assets acquired under finance leases are capitalised at the lease inception at lower of the fair value of the leased asset

and the present value of the minimum lease payments. Lease payments are apportioned between finance charges

(recognised in the statement of profit and loss) and reduction of the lease liability so as to achieve a constant periodic

rate of interest on the remaining balance of the liability for each period.

b. Company as a lessor

Assets leased to others under finance lease are recognised as receivables at an amount equal to the net investment

in the leased assets. Finance lease income is aloocated to periods so as to reflect a constant rate of return on the net

investment outstanding in respect of the finance lease.

Initial direct costs incurred in negotiating an operating lease are added to the carrying amount of the leased asset and

recognised in statement of profit and loss on a stratght-line basis over the lease term.

The Company enters into ‘Indefeasible right to use’ (‘IRU’) arrangement wherein the assets are given on lease over the

substantial part of the asset life. However, the title to the assets and significant risk associated with the operation and

maintenance of these assets remains with the Company. Hence, such arrangements are recognised as operating lease.

The contracted price is recognised as revenue during the tenure of the agreement. Unearned IRU revenue received in

advance is presented as deferred revenue within liabilities in the balance sheet.

2.11 Taxes

The income tax expense comprises of current and deferred income tax. Income tax is recognised in the statement of profit

and loss, except to the extent that it relates to items recognised in the other comprehensive income or directly in equity, in

which case the related income tax is also recognised accordingly.

a. Current tax

The current tax is calculated on the basis of the tax rates, laws and regulations, which have been enacted or substantively

enacted as at the reporting date. The payment made in excess / (shortfall) of the Company’s income tax obligation for

the period are recognised in the balance sheet under non-current assets as income tax assets / under current liabilities

as current tax liabilities.

Any interest, related to accrued liabilities for potential tax assessments are not included in Income tax charge or (credit),

but are rather recognised within finance costs.

b. Deferred tax

Deferred tax is recognised, using the liability method, on temporary differences arising between the tax bases of assets

and liabilities and their carrying values in the financial statements. However, deferred tax are not recognised if it arises

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(All amounts are in millions of Indian Rupees – H; unless stated otherwise)

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from initial recognition of an asset or liability in a transaction other than a business combination that at the time of the

transaction affects neither accounting nor taxable profit or loss.

Deferred tax assets are recognised only to the extent that it is probable that future taxable profit will be available against

which the temporary differences can be utilised.

The unrecognised deferred tax assets / carrying amount of deferred tax assets are reviewed at each reporting date for

recoverability and adjusted appropriately.

Deferred tax is determined using tax rates (and laws) that have been enacted or substantively enacted by the reporting

date and are expected to apply when the related deferred income tax asset is realised or the deferred income tax liability

is settled.

Income tax assets and liabilities are off-set against each other and the resultant net amount is presented in the balance

sheet, if and only when, (a) the Company currently has a legally enforceable right to set-off the current income tax assets

and liabilities, and (b) when it relate to income tax levied by the same taxation authority and where there is an intention

to settle the current income tax balances on net basis.

2.12 Inventories

Inventories are stated at the lower of cost (determined using the first-in-first-out method) and net realisable value. The

costs comprise its purchase price and any directly attributable cost of bringing to its present location and condition. Net

realisable value is the estimated selling price in the ordinary course of business, less the estimated costs of completion and

the estimated variable costs necessary to make the sale.

2.13 Cash and cash equivalents

Cash and cash equivalents include cash in hand, bank balances and any deposits with original maturities of three months or

less (that are readily convertible to known amounts of cash and cash equivalents and subject to an insignificant risk of changes

in value). However, for the purpose of the statement of cash flows, in addition to above items, any bank overdrafts / cash credits

that are integral part of the Company’s cash management, are also included as a component of cash and cash equivalents.

2.14 Non-current assets held for sale

Non-current assets are classified as assets-held-for-sale when their carrying amount is to be recovered principally through

a sale transaction and a sale is considered highly probable. The sale is considered highly probable only when the asset is

available for immediate sale in its present condition, it is unlikely that the sale will be withdrawn and sale is expected within

one year from the date of the classification. Assets classified as held for sale are stated at the lower of carrying amount and

fair value less costs to sell.

Assets classified as held for sale are presented separately in the balance sheet.

Loss is recognised for any initial or subsequent write-down of the asset to fair value less costs to sell. A gain is recognised for any

subsequent increases in fair value less costs to sell of an asset, but not in excess of any cumulative loss previously recognised.

2.15 Share capital / securities premium account

Ordinary shares are classified as Equity when the Company has an un-conditional right to avoid delivery of cash or another

financial asset, that is, when the dividend and repayment of capital are at the sole and absolute discretion of the Company

and there is no contractual obligation whatsoever to that effect.

2.16 Employee benefits

The Company’s employee benefits mainly include wages, salaries, bonuses, defined contribution to plans, defined benefit

plans, compensated absences, deferred compensation and share-based payments. The employee benefits are recognised

in the year in which the associated services are rendered by the Company employees.

a. Defined contribution plans

The contributions to defined contribution plans are recognised in profit or loss as and when the services are rendered

by employees. The Company has no further obligations under these plans beyond its periodic contributions.

Notes to Standalone Financial Statements

(All amounts are in millions of Indian Rupees – H; unless stated otherwise)

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b. Defined benefit plans

In accordance with the local laws and regulations, all the employees in India are entitled for the Gratuity plan. The said

plan requires a lump-sum payment to eligible employees (meeting the required vesting service condition) at retirement

or termination of employment, based on a pre-defined formula.

The Company provides for the liability towards the said plans on the basis of actuarial valuation carried out quarterly as

at the reporting date, by an independent qualified actuary using the projected-unit-credit method.

The obligation towards the said benefits is recognised in the balance sheet, at the present value of the defined benefit

obligations. The present value of the said obligation is determined by discounting the estimated future cash outflows,

using interest rates of government bonds.

The interest expenses are calculated by applying the above mentioned discount rate to defined benefits obligations. The

interest expenses on the net defined benefit liability is recognised in the statement of profit and loss. However, the related

re-measurements of the net defined benefit liability are recognised directly in the other comprehensive income in the

period in which they arise. The said re-measurements comprise of actuarial gains and losses (arising from experience

adjustments and changes in actuarial assumptions). Re-measurements are not re-classified to the statement of profit and

loss in any of the subsequent periods.

c. Other long-term employee benefits

The employees of the Company are entitled to compensated absences as well as other long-term benefits. Compensated

absences benefit comprises of encashment and availment of leave balances that were earned by the employees over

the period of past employment.

The Company provides for the liability towards the said benefit on the basis of actuarial valuation carried out quarterly

as at the reporting date, by an independent qualified actuary using the projected-unit-credit method. The related re-

measurements are recognised in the statement of profit and loss in the period in which they arise.

d. Share-based payments

The Company operates equity-settled and cash-settled, employee share-based compensation plans, under which the

Company receives services from employees as consideration for stock options either towards shares of the Company /

cash settled units.

In case of equity-settled awards, the fair value is recognised as an expense in the statement of profit and loss within

employee benefits as employee share-based payment expenses, with a corresponding increase in share-based payment

reserve (a component of equity).

However, in case of cash-settled awards, the credit is recognised as a liability within other non-financial liabilities.

Subsequently, at each reporting period, until the liability is settled, and at the date of settlement, liability is re-measured

at fair value through statement of profit and loss.

The total amount so expensed is determined by reference to the grant date fair value of the stock options granted, which

includes the impact of any market performance conditions and non-vesting conditions but excludes the impact of any

service and non-market performance vesting conditions. However, the non-market performance vesting and service

conditions are considered in the assumption as to the number of options that are expected to vest. The forfeitures are

estimated at the time of grant and reduce the said expense rateably over the vesting period.

The expense so determined is recognised over the requisite vesting period, which is the period over which all of the

speciﬁed vesting conditions are to be satisfied. As at each reporting date, the Company revises its estimates of the

number of options that are expected to vest, if required.

It recognises the impact of any revision to original estimates in the period of change. Accordingly, no expense is

recognised for awards that do not ultimately vest, except for which vesting is conditional upon a market performance /

non-vesting condition. These are treated as vesting irrespective of whether or not the market / non-vesting condition is

satisfied, provided that service conditions and all other non-market performance are satisfied.

Notes to Standalone Financial Statements

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Where the terms of an award are modified, in addition to the expense pertaining to the original award, an incremental

expense is recognised for any modification that results in additional fair value, or is otherwise beneficial to the employee

as measured at the date of modification.

Where an equity-settled award is cancelled (including due to non-vesting conditions not being met), it is treated as if it

is vested thereon, and any un-recognised expense for the award is recognised immediately.

2.17 Provisions

a. General

Provisions are recognised when the Company has a present obligation (legal or constructive) as a result of a past event,

it is probable that an outflow of resources will be required to settle the said obligation, and the amounts of the said

obligation can be reliably estimated.

Provisions are measured at the present value of the expenditures expected to be required to settle the relevant obligation,

using a pre-tax rate that reflects current market assessments of the time value of money (if the impact of discounting

is significant) and the risks specific to the obligation. The increase in the provision due to un-winding of discount over

passage of time is recognised within finance costs.

b. Asset retirement obligation (‘ARO’)

ARO are recognised for those operating lease arrangements where the Company has an obligation at the end of the

lease period to restore the leased premises in a condition similar to inception of lease. ARO are provided at the present

value of expected costs to settle the obligation and are recognised as part of the cost of that particular asset. The

estimated future costs of decommissioning are reviewed annually and any changes in the estimated future costs or in

the discount rate applied are adjusted from the cost of the asset.

2.18 Contingencies

A disclosure for a contingent liability is made when there is a possible obligation or a present obligation that may, but

probably will not, require an outflow of resources. When there is a possible obligation or a present obligation in respect of

which the likelihood of outflow of resources is remote, no provision or disclosure is made.

2.19 Revenue recognition

Revenue is recognised when it is probable that the entity will receive the economic benefits associated with the transaction

and the related revenue can be measured reliably. Revenue is recognised at the fair value of the consideration received or

receivable, which is generally the transaction price, net of any taxes / duties, discounts and process waivers.

In order to determine if it is acting as a principal or as an agent, the Company assesses whether it has exposure to the

significant risks and rewards associated with the sale of goods or the rendering of services.

a. Service revenues

Service revenues mainly pertain to usage, subscription and activation charges for voice, data, messaging and value

added services. It also includes revenue towards interconnection/roaming charges for usage of the Company’s network

by other operators for voice, data, messaging and signalling services.

Usage charges are recognised based on actual usage. Subscription charges are recognised over the estimated

customer relationship period or subscription pack validity period, whichever is lower. Customer onboarding revenue and

associated cost is recognised upfront. Activation revenue and related activation costs are amortised over the estimated

customer relationship period. However, any excess of activation costs over activation revenue are expensed as incurred.

The billing / collection in excess of revenue recognised is presented as deferred revenue in the balance sheet whereas

unbilled revenue is recognised under other current financial assets.

Revenues from long distance operations comprise of voice services and bandwidth services (including installation),

which are recognised on provision of services and over the period of arrangement respectively.

Notes to Standalone Financial Statements

(All amounts are in millions of Indian Rupees – H; unless stated otherwise)

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b. Multiple element arrangements

The Company has entered into certain multiple-element revenue arrangements which involve the delivery or performance

of multiple products, services or rights to use assets. At the inception of the arrangement, all the deliverables therein

are evaluated to determine whether they represent separately identifiable component basis it is perceived from the

customer perspective to have value on standalone basis.

Total consideration related to the multiple element arrangements is allocated among the different components based

on their relative fair values (i.e., ratio of the fair value of each element to the aggregated fair value of the bundled

deliverables).

c. Equipment sales

Equipment sales mainly pertain to sale of telecommunication equipment and related accessories. Such transactions

are recognised when the significant risks and rewards of ownership are transferred to the customer. However, in case of

equipment sale forming part of multiple-element revenue arrangements which is not separately identifiable component,

revenue is recognised over the customer relationship period.

d. Capacity swaps

The exchange of network capacity is recognised at fair value unless the transaction lacks commercial substance or the

fair value of neither the capacity received nor the capacity given is reliably measurable.

e. Interest income

The interest income is recognised using the EIR method. For further details, refer note 2.9.

f. Dividend income

Dividend income is recognised when the Company’s right to receive the payment is established.

2.20 Borrowing costs

Borrowing costs consist of interest and other ancillary costs that the Company incurs in connection with the borrowing

of funds. The borrowing costs directly attributable to the acquisition or construction of any asset that takes a substantial

period of time to get ready for its intended use or sale are capitalised. All the other borrowing costs are recognised in the

statement of profit and loss within finance costs of the period in which they are incurred.

2.21 Exceptional items

Exceptional items refer to items of income or expense within the statement of profit and loss from ordinary activities which

are non-recurring and are of such size, nature or incidence that their separate disclosure is considered necessary to explain

the performance of the Company.

2.22 Non-operating expense

Non-operating expense comprises regulatory levies applicable to finance income.

2.23 Dividends paid

Dividend to shareholders is recognised as a liability and deducted from equity, in the year in which the dividends are approved

by the shareholders. However, interim dividends declared by the Board of directors, which does not need shareholders’

approval, are recognised as a liability and deducted from retained earnings, in the year in which the dividends are so declared.

2.24 Earnings per share (‘EPS’)

The Company presents the Basic and Diluted EPS data.

Basic EPS is computed by dividing the profit for the period attributable to the shareholders of the Company by the weighted

average number of shares outstanding during the period.

Notes to Standalone Financial Statements

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Diluted EPS is computed by adjusting, the profit for the year attributable to the shareholders and the weighted average

number of shares considered for deriving Basic EPS, for the effects of all the shares that could have been issued upon

conversion of all dilutive potential shares. The dilutive potential shares are adjusted for the proceeds receivable had the

shares been actually issued at fair value. Further, the dilutive potential shares are deemed converted as at beginning of the

period, unless issued at a later date during the period.

3. Critical accounting estimates, assumptions and judgements

The estimates and judgements used in the preparation of the said financial statements are continuously evaluated by the

Company, and are based on historical experience and various other assumptions and factors (including expectations of future

events), that the Company believes to be reasonable under the existing circumstances. The said estimates and judgements

are based on the facts and events, that existed as at the reporting date, or that occurred after that date but provide additional

evidence about conditions existing as at the reporting date.

Although the Company regularly assesses these estimates, actual results could differ materially from these estimates - even if the

assumptions under-lying such estimates were reasonable when made, if these results differ from historical experience or other

assumptions do not turn out to be substantially accurate. The changes in estimates are recognised in the financial statements in

the year in which they become known.

3.1 Critical accounting estimates and assumptions

The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying values of assets

and liabilities within the next financial year are discussed below.

a. Impairment reviews

PPE (including CWIP) and intangible assets with definite lives, are reviewed for impairment, whenever events or

changes in circumstances indicate that their carrying values may not be recoverable. Similarly, intangible assets under

development is tested for impairment, at-least annually and whenever circumstances indicate that it may be impaired.

For details as to the impairment policy, refer note 2.8. Accordingly the Company has performed impairment reviews for

the above assets. However, the said reviews did not result in any impairment charge.

In calculating the value in use, the Company is required to make significant judgements, estimates and assumptions

inter-alia concerning the growth in EBITDA, long-term growth rates and discount rates to reflect the risks involved.

The Company operates in developing market and in such market, the plan for shorter duration is not indicative of

the long-term future performance. Considering this and the consistent use of such robust ten year information for

management reporting purpose, the Company uses ten year plans for the purpose of impairment testing.

b. Taxes

Deferred tax assets are recognised for the unused tax losses and minimum alternative tax credits for which there is

probability of utilisation against the taxable profit. Significant management judgement is required to determine the

amount of deferred tax assets that can be recognised, based upon the likely timing and the level of future taxable profits,

future tax planning strategies and recent business performances and developments.

c. Property, plant and equipment

Refer note 2.6 and 6 for the estimated useful life and carrying value of property, plant and equipment respectively.

During the year ended March 31, 2017, the Company had reassessed useful life of certain categories of network

assets due to technological developments and accordingly had revised the estimate of its useful life in respect of those

assets. Out of those assets, the additional depreciation charge of H2,920 on assets for which the revised useful life had

expired by March 31, 2016 had been recognised and disclosed as ‘exceptional income / (expenses), net’ and additional

depreciation charge of H6,276 for other assets has been recognised within ‘Depreciation and amortisation’. The impact

of above change on the depreciation charge for the future years after March 31, 2018 is as follows:

31 March,

2019

31 March,

2020

Future Period

till end of life

Impact on future depreciation charge (2,646) (1,109) 15,715

Notes to Standalone Financial Statements

(All amounts are in millions of Indian Rupees – H; unless stated otherwise)

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

184

d. Allowance for impairment of trade receivables

The expected credit loss is mainly based on the ageing of the receivable balances and historical experience. The

receivables are assessed on an individual basis or grouped into homogeneous groups and assessed for impairment

collectively, depending on their significance. Moreover, trade receivables are written off on a case-to-case basis if deemed

not to be collectible on the assessment of the underlying facts and circumstances

e. Contingent liability

Refer note 23 for details of contingent liability.

4. Standards issued but not effective until the date of authorisation for issuance of the said financial

statements

The new significant standards, amendments to Standards that are issued but not yet effective until the date of authorisation

for issuance of the said financial statements are discussed below. The Company has not early adopted these amendments and

intends to adopt when they become effective.

Ind AS 115, ‘Revenue from Contracts with Customers’

In March 2018, MCA has notified the Ind AS 115, Revenue from Contract with Customers. As a consequence of issuance of Ind

AS 115, relevant paragraphs have been inserted / amended in various other standards.

The Standard establishes a new five-step model that will apply to revenue arising from contracts with customers. Under this

standard, revenue is recognised at an amount that reflects the consideration to which an entity expects to be entitled in exchange

for transferring goods or services to a customer. The principles in Ind AS 115 provide a more structured approach to measuring

and recognising revenue. The new revenue standard is applicable to all entities and will supersede all current revenue recognition

requirements under Ind AS. The effective date of Ind AS 115 is annual periods beginning on or after April 1, 2018. The Company

does not expect that the adoption of the said standard and related amendments will have any significant impact on the financial

statements per se.

5. Significant transactions / new developments

(i) During the year ended March 31, 2018, the Company has transferred its 100% equity stake in Bharti Airtel (Hong Kong)

Limited and 37.03% equity stake in Bharti Airtel (UK) Limited to Bharti International (Singapore) Pte. Limited (‘BISPL’),

an indirect subsidiary of the Company against a consideration of H429 and H1,806 respectively and 44% stake in Bharti

Telemedia Limited, a subsidiary of the Company to Nettle Infrastructure Investments Limited, another subsidiary of the

Company, against a consideration of H47,632. Accordingly the excess of cost of investments over the proceeds amounting

to H28,498 has been recognised in other equity.

(ii) During the year ended March 31, 2018, the Company has increased its equity investment in Indo Teleports Limited from

95% to 100% for a consideration of H23.

(iii) During the year ended March 31, 2018, an understanding for demerger of consumer mobile businesses of Tata Teleservices

Limited and Tata Teleservices Maharashtra Limited into the Company was entered into. Further, the board of directors

have approved the scheme(s) of arrangement under section 230 to section 232 of the Companies Act, 2013 for the said

demerger. The said transaction is subject to requisite regulatory approvals.

(iv) During the year ended March 31, 2018, the Board of Directors approved a scheme of arrangement, under section 230

to section 232 of the Companies Act, 2013, for the transfer of the optical fiber cable business to the Telesonic Networks

Limited, a wholly owned subsidiary of the Company. The said transaction is subject to requisite regulatory approvals.

(v) During the year ended March 31, 2018, the Company has completed the acquisition of 100% equity stake and compulsorily

convertible debentures of Tikona Digital Networks Pvt Ltd (‘TDNPL’) as all necessary closing conditions have been fulfilled

and filed an application under section 230 to section 232 of the Companies Act, 2013 before the Delhi bench of the National

Company Law Tribunal for the merger of TDNPL with the Company.

Notes to Standalone Financial Statements

(All amounts are in millions of Indian Rupees – H; unless stated otherwise)

Integrated Report

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Statutory Reports

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Financial Statements

Notes to Standalone Financial Statements

185

(vi) During the year ended March 31, 2017, the Company had entered into an agreement to sell the investment in subsidiaries

Bharti Airtel International (Netherlands) B.V. (‘BAIN’), Bharti International (Singapore) Pte Ltd (‘BISPL’) and Bharti Airtel

International (Mauritius) Limited (‘BAIML’) to its wholly owned subsidiary Network i2i Limited. However, sale of investment in

BISPL is subject to certain customary closing conditions, hence had not consummated. The same was classified as assets-

held-for-sale. Accordingly, the excess of cost of investment over sales consideration, amounting to H118,582 and H14,906

pertaining to BAIN / BAIML and BISPL respectively was recognised as loss under exceptional items.

Further, during the year ended March 31, 2018, the transaction of BISPL stake transfer to Network i2i has been consummated.

(vii) During the year ended March 31, 2017, the Company had entered into a scheme of amalgamation for the merger of Telenor

(India) Communication Private Limited with the Company. The said transaction is subject to requisite regulatory approvals

and other closing conditions.

(viii) During the year ended March 31, 2017, Bharti Telemedia Limited, a subsidiary of the Company, had allotted 475 Mn shares

to the Company against a consideration of H4,750.

(ix) During the year ended March 31, 2017, the Company had sold 400 Mn shares in BIL, against a consideration aggregating

to H130,000 and accordingly the excess of cost of investment over the proceeds (net of associated costs, taxes and

regulatory levies) amounting to H25,375 was recognised as loss under exceptional items. Subsequent to the transaction, the

shareholding of the Company in BIL had reduced to 50.3%.

(x) During the year ended March 31, 2017, Bharti Infratel Limited (‘BIL’), a subsidiary of the Company had bought back approx.

47.05 Mn shares against a consideration of H425 per share. Out of which the Company had tendered approx. 29.10 Mn

shares and received the consideration of H12,368 and accordingly, the excess of proceeds (net of associated costs, taxes

and levies) over the cost of investment amounting to H1,687 was recognised as gain and disclosed as other income.

(xi) During the year ended March 31, 2017, the Company acquired rights to use spectrum in the 1800 MHz band for six circles

against a consideration of H46,530 from Videocon Telecommunications Limited.

(xii) During the year ended March 31, 2017, the Company acquired rights to use spectrum in the 2300 MHz band for seven

circles against a consideration of H34,840 from Aircel Limited and its subsidiaries Dishnet Wireless Limited.

(xiii)

During the year ended March 31, 2017, the Company was allotted 155.60 MHz spectrum across 1800 / 2100 / 2300 MHz.

Consequently, the Company had paid amount of H67,764 upfront and opted the deferred payment option for H66,764.

(xiv)

During the year ended March 31, 2017, the Company had acquired 100% equity stake of Augere Wireless Broadband India

Private Limited (‘AWBPL’). Further, with effect from February 15, 2017, AWBPL had merged with the Company through the

scheme of arrangement under Sections 391 to 394 of the Companies Act, 1956. Accordingly, AWBPL had ceased to exist

and had merged with the Company. Accordingly entire assets (mainly spectrum amounting to H899), liabilities and the

differential value of equity in the books of AWBPL; have been recognised by the Company as the date of the transaction at

same carrying values as in the books of AWBPL. The difference of H445 between the share capital and the carrying values of

investment in AWBPL in the books of the Company had been adjusted with general reserve.

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

186

Notes to Standalone Financial Statements

(All amounts are in millions of Indian Rupees – ‘H.’; unless stated otherwise)

6. Property, plant and equipment (‘PPE’)

The following table presents the reconciliation of changes in the carrying value of PPE for the year ended March 31, 2018 and 2017:

H in millions

Leasehold

improvement

Building Land Plant and

equipment

Furniture

& fixture

Vehicles Office

equipment

Computer Total

Gross carrying value

As of April 1, 2016 4,674 6,381 1,766 722,156 1,714 293 4,250 22,792 764,026

Additions / capitalisation 221 29 44 147,104 98 34 531 3,039 151,100

Acquisition through business combinations^ - - - 489 - - - - 489

Disposals / adjustments (1) (64) - (15,384) (13) (46) (52) 173 (15,387)

As of March 31, 2017 4,894 6,346 1,810 854,365 1,799 281 4,729 26,004 900,228

Balance as of April 1, 2017 4,894 6,346 1,810 854,365 1,799 281 4,729 26,004 900,228

Additions / capitalisation 242 46 66 172,815 209 40 315 7,252 180,985

Disposals / adjustments (12) (29) (22) (22,652) (14) (22) (38) (61) (22,850)

As of March 31, 2018 5,124 6,363 1,854 1,004,528 1,994 299 5,006 33,195 1,058,363

Accumulated depreciation

As of April 1, 2016 3,624 2,463 42 420,196 1,430 234 2,898 20,466 451,353

Charge* 393 309 3 76,174 116 20 593 1,727 79,335

Disposals / adjustments (3) (26) - (11,784) (4) (30) (46) 257 (11,636)

As of March 31, 2017 4,014 2,746 45 484,586 1,542 224 3,445 22,450 519,052

Balance as of April 1, 2017 4,014 2,746 45 484,586 1,542 224 3,445 22,450 519,052

Charge* 286 248 4 77,148 124 21 565 2,843 81,239

Disposals / adjustments (6) (9) (9) (18,732) (11) (13) (22) (37) (18,839)

As of March 31, 2018 4,294 2,985 40 543,002 1,655 232 3,988 25,256 581,452

Net carrying value

As of March 31, 2017 880 3,600 1,765 369,779 257 57 1,284 3,554 381,176

As of March 31, 2018 830 3,378 1,814 461,526 339 67 1,018 7,939 476,911

* It includes exceptional item of H1,176 and H1,672 for the year ended March 31, 2018 and 2017 with respect to plant and equipment (refer note 31 (i) a and (ii) a,b,c

^ Refer note 5 (xiv)

Refer note 23(ii)(a) for assets given on operating lease.

The carrying value of capital work-in-progress as at March 31, 2018 and 2017 is H27,387 and H11,818, respectively, mainly pertains to plant and equipment.

Notes to Standalone Financial Statements

(All amounts are in millions of Indian Rupees – H; unless stated otherwise)

Integrated Report

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Financial Statements

Notes to Standalone Financial Statements

187

The following table summarises the detail of the significant assets taken on finance lease:

H in millions

As of

31 March, 2018

As of

31 March, 2017

Leasehold land

Grossing carrying Value 411 411

Accumulated depreciation 51 46

Net carrying value 360 365

7. Intangible assets

The following table presents the reconciliation of changes in the carrying value of intangible assets for the year ended March 31, 2018

and 2017:

Software Bandwidth

Licenses

(including

spectrum) Others Total

Gross carrying value

As of April 1, 2016 13,814 25,811 650,864 2,172 692,661

Additions / capitalisation 2,657 2,687 160,346 5,366 171,056

Acquisition through business combinations - - 899 - 899

Disposals / adjustments (138) (85) (8) - (231)

As of March 31, 2017 16,333 28,413 812,101 7,538 864,385

Balance as of April 1, 2017 16,333 28,413 812,101 7,538 864,385

Additions / capitalisation 3,472 2,960 59,122 - 65,554

Disposals / adjustments (21) (962) - - (983)

As of March 31, 2018 19,784 30,411 871,223 7,538 928,956

Accumulated amortisation

As of April 1, 2016 10,132 10,667 64,413 867 86,079

Charge 2,502 1,863 38,249 1,757 44,371

Disposals / adjustments (138) 28 (7) - (117)

As of March 31, 2017 12,496 12,558 102,655 2,624 130,333

Balance as of April 1, 2017 12,496 12,558 102,655 2,624 130,333

Charge 2,567 1,505 44,393 1,958 50,423

Disposals / adjustments (21) (962) - - (983)

As of March 31, 2018 15,042 13,101 147,048 4,582 179,773

Net carrying value

As of March 31, 2017 3,837 15,855 709,446 4,914 734,052

As of March 31, 2018 4, 742 17,310 724,175 2,956 749,183

^ Refer note 5(xiv)

Weighted average remaining amortisation period of licenses as of March 31, 2018 and March 31, 2017 is 16.03 and 16.85 years

respectively.

The carrying value of intangible assets under development as at March 31, 2018 and March 31, 2017 is H28,040 and H84,184

respectively, which pertains to spectrum.

During the year ended March 31, 2018 and 2017 the Company has capitalised borrowing cost of H2,992 and H2,748 respectively.

Notes to Standalone Financial Statements

(All amounts are in millions of Indian Rupees – H; unless stated otherwise)

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

188

8. Investments

Detail of investments in subsidiaries, joint ventures and other investments are as below:

Detail of significant investments in subsidiaries are as below:

31 March, 2018 31 March, 2017

S. No. Name of the Subsidiaries

Place of

incorporation Principal activities % of shareholding

1 Bharti Hexacom Limited India Telecomunication Services 70.00 70.00

2 Bharti Infratel Limited India Infrastucture sharing services 50.30 50.30

3 Bharti Telemedia Limited India Direct To Home services 51.00 95.00

4 Airtel Payment Bank Limited India Mobile Commerce services 80.10 80.10

5 Network i2i Limited Mauritius Submarine Cable System 100.00 100.00

6 Bharti Internatinal (Singapore) Pte. Ltd Singapore Telecommunication services - 100.00

7 Bharti Digital Networks Private

Limited

(formerly known as Tikona

Digital Networks Limited)

India Telecommunication services 100.00 -

As of

31 March, 2018

As of

31 March, 2017

Investment in Subsidiaries

Bharti Hexacom Limited : 175,000,000 equity shares of H10 each 5,718 5,718

Bharti Airtel Services Limited : 100,000 equity shares of H10 each 1 1

Bharti Airtel (USA) Limited : 300 equity shares of USD .0001 each 1,997 1,997

Bharti Airtel (UK) Limited : Nil equity shares of GBP 1 each

(March 31, 2017 -123,663 equity shares of GBP 1 each) - 1,777

Bharti Airtel (Hongkong) Limited : Nil equity shares of HKD 1 each

(March 31, 2017 - 4,959,480 equity shares of HKD 1 each) - 454

Network i2i Limited : 1,267,427.896 equity shares of USD 1 each

(March 31, 2017 - 817,427,896 equity shares of USD 1 each) 87,909 58,750

Bharti Infratel Limited: 930,898,728 equity shares of H10 each* 341,111 341,111

Bharti Telemedia Limited : 260,202,000 equity shares of H10 each

(March 31, 2017 - 484,689,995 equity shares of H10 each) 22,183 41,320

Bharti Airtel Lanka (Private) Limited : 50,200,221,771 equity shares of SLR 10 each

(March 31, 2017 - 27,146,471,771 equity shares of SLR 10 each)-net of provision 4,527 -

Airtel Payments Bank Limited : 805,025,128 equity shares of H10 each

(March 31, 2017 - 796,499,995 equity shares of H10 each) 8,050 7,965

Bharti Airtel International (Netherlands) B.V. : 1 equity shares of EURO 1 each 0 0

Telesonic Networks Limited : 89,230,796 equity shares of H10 each 91 91

Nxtra Data Limited : 5,050,000 equity shares of H10 each 309 309

Indo Teleports Limited : 22,999,000 equity shares of H10 each

(March 31, 2017 - 21,850,000 equity shares of H10 each) 308 -

Wynk Limited : 50,000 equity shares of H10 each 1 1

Nettle Infrastructure Investments Limited : 45,000 equity shares of H10 each 0 0

Bharti Digital Networks Private Limited (formerly known as Tikona Digital Networks Ltd) :

2,103,023 equity share of H10 each (March 31, 2017 - Nil equity share of H10 each) 8,970 -

Investment in Subsidiaries (A) 481,175 459,494

Investment in joint Ventures

Bridge Mobile PTE Limited : 800,000 equity shares of USD 1 each 34 34

Firefly Networks Limited : 1,000,000 equity shares of H10 each 10 10

Investment in Ventures (B)

44 44

Investment in subsidiarise and joint venture (A+B) 481,219 459,538

Other Investments (FVTPL)

Equity instruments 61 50

National Savings Certificates 2 2

63 52

Aggregate book value of unquoted investments

140,171 118,479

Aggregate book value of quoted investments

341,111 341,111

Aggregate market value of quoted investments**

313,015 302,961

** All the above investments are unquoted except Bharti Infratel Limited.

*Refer Note 5 (vi)

Notes to Standalone Financial Statements

(All amounts are in millions of Indian Rupees – H; unless stated otherwise)

Integrated Report

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Statutory Reports

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Financial Statements

Notes to Standalone Financial Statements

189

9. Derivative financial instruments

The details of derivative financial instruments are as follows:-

As of

31 March, 2018

As of

31 March, 2017

Assets

Currency swaps, forward and option contracts 195 187

Interest swaps 80 106

Embedded derivatives - 554

275 847

Liabilities

Currency swaps, forward and option contracts 352 1,848

352 1,848

Non-current derivative financial assets 80 213

Current derivative financial assets 195 634

Non-current derivative financial liabilities (124) (186)

Current derivative financial liabilities (228) (1,662)

(77) (1,001)

Unsecured, considered good

As of

31 March, 2018

As of

31 March, 2017

Non - Current

Loan to related parties (refer note 34) 692 623

Security deposits* 9,598 9,766

10,290 10,389

Current

Loans to related parties (refer note 34) 72,496 72,081

As of

31 March, 2018

As of

31 March, 2017

Finance lease receivable 65 172

Rent Equalisation 55 49

Others 140 335

260 556

10. Loans and security deposits

*Security deposits primarily include deposits given towards rented premises, cell sites and interconnect ports.

11. Financial assets – others

Non-current

As of

31 March, 2018

As of

31 March, 2017

Unbilled revenue 11,160 12,576

Claims recoverable 474 451

Interest accrued on investments 25 24

Finance lease receivable 178 149

11,837 13,200

Current

Notes to Standalone Financial Statements

(All amounts are in millions of Indian Rupees – H; unless stated otherwise)

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

190

For the year ended

31 March, 2018

For the year ended

31 March, 2017

Current Income tax

For the Year 29 95

Adjustments for prior periods (2,233) (140)

(2,204) (45)

Deferred tax

Origination and reversal of temporary differences (4,737) 17,455

Effect of change in tax rate 425 -

Adjustments for prior periods (1,088) (3,249)

(5,400) 14,206

Income tax (credit)/expense (7,604) 14,161

For the year ended

31 March, 2018

For the year ended

31 March, 2017

Loss before tax (6,812) (85,095)

Enacted tax rates in India 34.61% 34.61%

Tax expense @ 34.608% (2,358) (29,450)

Effect of:

Tax holiday (251) (144)

Effect of changes in tax rate 425 -

Adjustments in respect to previous years (3,321) (3,389)

Tax for which no credit is allowed 472 469

(Income) / expense not (taxable) / deductible (net) (2,600) 46,380

Others 29 295

Income tax (credit) / expense (7,604) 14,161

As of

31 March, 2018

As of

31 March, 2017

Deferred tax asset / (liability)

Provision for impairment of debtors / advances 13,669 10,520

Carry forward losses 20,301 1,575

Employee benefits 1,073 1,044

Minimum alternate tax ('MAT') credit 57,429 57,429

Lease rent equalisation 6,608 6,478

Fair valuation of financial instruments and exchange differences 6,647 5,791

Depreciation / amortisation on PPE / intangible assets (92,961) (76,574)

Rates and taxes 1,431 1,527

Others 47 1,018

Net deferred tax asset 14,244 8,808

12. Income taxes

The major components of Income Tax (Credit)/expense are:

The reconciliation between the amount computed by applying the statutory income tax rate to the (loss) / profit before tax and

income tax (credit) / expense in summarised below:

The analysis of deferred tax assets / (liabilities) is as follow:

Notes to Standalone Financial Statements

(All amounts are in millions of Indian Rupees – H; unless stated otherwise)

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Financial Statements

Notes to Standalone Financial Statements

191

For the year ended

31 March, 2018

For the year ended

31 March, 2017

Deferred tax income / (expense)

Provision for impairment of debtors / advances 3,149 2,542

Carry forward losses 18,726 1,575

Employee benefits 58 204

MAT credit (68) 1,218

Lease rent equalisation 130 289

Fair valuation of financial instruments and exchange differences 857 926

Depreciation / amortisation on PPE / intangible assets (16,387) (22,498)

Rates and taxes (96) 1,527

Others (969) 11

Net deferred tax income / (expense) 5,400 (14,206)

For the year ended

31 March, 2018

For the year ended

31 March, 2017

Opening balance 8,808 23,070

Tax (credit)/expense recognised in profit or loss 5,400 (14,206)

Tax (credit)/expense recognised in OCI (30) 11

Others 66 (67)

Closing balance 14,244 8,808

As of

31 March, 2018

As of

31 March, 2017

Advances (net)

24,404 25,749

Prepaid expense 1,156 1,328

Taxes recoverable - 14,139

Capital advances 600 1,033

Others* 982 347

27,142 42,596

Deferred tax assets are recognised to the extent that it is probable that taxable profit will be available against which the deductible

temporary differences and carry forward of losses/credits (including capital losses) can be utilised. Accordingly, the company has not

recognised deferred tax assets in respect of carry forward of capital tax losses/credits of H330,358 Mn and H317,344 Mn as of March

31, 2018 and March 31, 2017, respectively as it is not probable that capital taxable profits will be available in future.

Above balance of capital tax losses as of March 31, 2018 and March 31, 2017 expires unutilised as follows:

#Advances represent payments made to various Government authorities under protest and are disclosed net of provision (refer note 20).

*It mainly includes advances given to Bharti Airtel Welfare Trust.

The movement in deferred tax assets/(liabilities) during the year is as follows:

13. Other non-financial assets

Non-current

Expiry date

As of

31 March, 2018

As of

31 March, 2017

Above five years 330,358 317,344

Notes to Standalone Financial Statements

(All amounts are in millions of Indian Rupees – H; unless stated otherwise)

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

192

As of

31 March, 2018

As of

31 March, 2017

Unsecured

Considered good* 43,196 32,118

Considered doubtful 33,590 25,530

Less: Provision for doubtful receivables (33,590) (25,530)

43,196 32,118

As of

31 March, 2018

As of

31 March, 2017

Balances with banks

- On current accounts 2,491 1,030

- Bank deposits with original maturity of 3 month or less 2,000 -

Cheques on hand 66 6

Cash on hand 69 51

4,626 1,087

As of

31 March, 2018

As of

31 March, 2017

Earmaked bank balances - unpaid dividend 70 50

Term deposits with bank 105 -

Margin money deposits* 675 621

850 671

Interest accured but not due (refer note 11) (25) (24)

825 647

For the year ended

31 March, 2018

For the year ended

31 March, 2017

Opening balance

25,530 18,181

Additions 8,773 7,678

Write off (net of recovery) (713) (329)

33,590 25,530

14. Trade receivables

*It includes amount due from related parties (refer note 34).

Refer note 35 (iv) for credit risk

The movement in allowances for doubtful debts is as follows:

15. Cash and bank balance

Cash and cash equivalents (‘C&CE’)

Other bank balances

Taxes recoverable primarily pertains to goods & service tax (‘GST’), customs duty, excise duty, service tax and sales tax.

Advances to suppliers are disclosed net of provision of H1,683 and H1,092 as of March 31, 2018 and March 31, 2017 respectively.

As of

31 March, 2018

As of

31 March, 2017

Taxes recoverable 65,218 20,404

Advances to suppliers (net) 12,200 9,579

Prepaid expenses 2,365 1,960

Others* 1,938 1,352

81,721 33,295

Current

* It mainly includes security deposits given towards rented premises, cell sites, interconnect ports and other miscellaneous deposits.

Notes to Standalone Financial Statements

(All amounts are in millions of Indian Rupees – H; unless stated otherwise)

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Financial Statements

Notes to Standalone Financial Statements

193

As of 31 March, 2018 As of 31 March, 2017

No. of

shares ‘000

% holding No. of

shares ‘000

% holding

Equity shares of J5/- each fully paid up

Bharti Telecome Limited 2,002,818 50.10% 1,871,987 45.48%

Pastel Limited 591,319 14.79% 591,319 14.79%

Indian Continent Investment Limited 81,151 2.03% 265,861 6.65%

LIC of India Child Fortune Plus Balanced Fund 150,181 3.76% 211,832 5.30%

Three Pillar Pte Limited - - 199,870 5.00%

As of 31 March, 2018 As of 31 March, 2017

Shares’000 Amount Shares’000 Amount

Opening balance

1,345 367 1,882 524

Purchased during the year 906 424 - -

Excercise during the year (532) (149) (537) (157)

1,719 642 1,345 367

a. Terms / rights attached to equity shares

The Company has only one class of equity shares having par value of H5/- per share. Each holder of equity shares is entitled to cast

one vote per share.

b. Details of shareholders (as per the register of shareholders) holding more than 5% share in the Company

As of

31 March, 2018

As of

31 March, 2017

C & CE as per balance sheet 4,626 1,087

Bank overdraft (refer note 18) - (265)

4,626 822

For the purpose of statement cash flows, C&CE comprise of following:-

*Margin money deposits represents amount given as collateral for legal cases and / or bank guarantees for disputed matters.

As of

31 March, 2018

As of

31 March, 2017

Authorised shares

5,500,000,000 (March 31, 2017 - 5,500,000,000) equity Shares of H5/- each

27,500 27,500

Issued, Subscribed and fully paid-up shares

3,997,400,102 equity shares of H5/- each

19,987 19,987

16. Share capital

c. Shares held by Bharti Airtel Welfare Trust against employee share-based payment plans (face value : J5 each)

Notes to Standalone Financial Statements

(All amounts are in millions of Indian Rupees – H; unless stated otherwise)

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

194

17. Reserve and surplus

a) Retained earnings: Retained earnings represent the amount of accumulated earnings of the Company, and re-measurement

differences on defined benefit plans and gains / (losses) on common control transactions and any transfer from general reserve.

b) General reserve: The Company has transferred a portion of its profit before declaring dividend in respective prior years to

general reserve, as stipulated under the erstwhile Companies Act 1956. Mandatory transfer to general reserve is not required

under the Companies Act 2013 (‘Act’).

Further, on exercise of the stock options, the difference between the consideration (i.e. the exercise price and the related

amount of share-based payment reserve) and the cost (viz. related amount of loan provided to Bharti Airtel Welfare Trust) of the

corresponding stock options, is transferred to general reserve.

The difference between the share capital and the carrying values of the investment pursuant to the scheme of arrangement

under sections 391 to 394 of the Companies Act, 1956 with respect to the amalgamation of Augere Wireless Broadband Private

Limited has been recognised in general reserve.

c) Business restructuring reserve: It represents mainly the excess of the fair values over the original book values of the assets

transferred to one of its subsidiary Bharti Infratel Limited pursuant to the scheme of arrangement under sections 391 to 394 of

the Companies Act, 1956.

d) Debenture redemption reserve: Pursuant to the provisions of the Act, the Company is required to create debenture redemption

reserve out of the profits and is to be utilised for the purpose of redemption of debentures. On redemption of the debentures, the

related amount of this reserve gets transferred to retained earnings.

e) Capital reserve: It mainly includes capital reserve acquired pursuant to the scheme of arrangement under sections 391 to 394

of the Companies Act, 1956 with respect to the amalgamation (pooling of interest) of Airtel Broadband Services Private Limited.

Note: In absence of any specific provision under Ind AS with respect to court schemes, and the fact that the court schemes are

part of the law, accounting prescribed therein will continue to prevail.

The proposed dividend being subject to approval at respective annual general meeting, accordingly no corresponding liability has

been recognised in the respective financial year.

*However against this, the Company has availed credit of J3,125 and H1,087 during the year ended March 31, 2018 and March 31, 2017 respectively, on

account of dividend distribution tax on dividend received from subsidiary companies.

Dividend

As of

31 March, 2018

As of

31 March, 2017

A Declared and paid during the year

Interim dividend for 2017-18 : H2.84 per share

(including dividend distribution tax @ 20.36% of H2,311)*

13,664 -

Final dividend for 2016-17 : H1.00 per share

(including dividend distribution tax @ 20.36% of H814)*

4,811 -

Final dividend for 2015-16 : H1.36 per share

(including dividend distribution tax @ 20.36% of H1,107)*

- 6,543

18,475 6,543

B Proposed dividend

Final dividend for 2017-18: H2.50 per share (2016-17 : H1.00 per share)

9,993 3,997

Dividend distribution tax @ 20.56% (2016-17 @ 20.36%) 2,034 814

12,027 4,811

Notes to Standalone Financial Statements

(All amounts are in millions of Indian Rupees – H; unless stated otherwise)

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Notes to Standalone Financial Statements

195

As of

31 March, 2018

As of

31 March, 2017

Secured

Vehicle loans* 29 31

29 31

Less: Current portion (A) (15) (15)

14 16

Unsecured

Term loans 45,587 32,584

Non-convertible debentures** 30,069 -

Non-convertible bonds 65,413 64,082

Deferred payment liabilities *** 455,602 439,205

Finance lease obligations 391 2,097

597,062 537,968

Less : Interest accured but not due (refer note 19) (23,613) (2,530)

Less: Current portion (B) (28,782) (32,033)

544,667 503,405

544,681 503,421

Current maturities of long-term borrowings (A+B) 28,797 32,048

As of

31 March, 2018

As of

31 March, 2017

Unsecured

Term loans 51,654 50,676

Commercial papers 29,094 14,820

Bank over draft - 265

80,748 65,761

Less: Interest accured but not due (refer note 19) (68) (283)

80,680 65,478

18. Borrowings

Non-current

*These loans are secured by hypothecation of the vehicles.

**During the year ended March 31, 2018, the Company has issued 30,000 listed, unsecured, rated, redeemable, Non - Convertible Debentures (‘NCDs’), Series

I and series II of face value of H10 Lakhs each, at par aggregating to H30,000 on private placement basis, carrying interest rates 8.25% p.a. and 8.35% p.a.

(payable annually) and principal repayable in year 2020 and 2021, respectively.

*** During the year ended March 31, 2018, the Government of India has provided one time option to elect higher number of annual instalments prospectively

(upto a maximum of 16 instalments) towards the repayment of spectrum liability viz-a-viz currently allowed 10 instalments. Accordingly, the Company has

exercised the option, increasing the remaining number of instalments by 6 annual instalments for all its existing deferred payment liabilities.

18.1 Analysis of borrowings

The details given below are gross of debt origination cost.

Current

Notes to Standalone Financial Statements

(All amounts are in millions of Indian Rupees – H; unless stated otherwise)

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

196

18.1.1 Repayment terms of borrowings

The table below summarises the maturity profile of the Company’s borrowings based on contractual undiscounted payments.

As of

31 March, 2018

As of

31 March, 2017

Unsecured* 150,071 172,646

18.1.2 Interest rate and currency of borrowings

Weighted

average rate

of interest

Total

borrowings

Floating

rate

borrowing

Fixed rate

borrowing

INR 9.46% 564,407 71,600 492,807

USD 3.93% 91,055 26,226 64,829

March 31, 2018 655,462 97,826 557,636

INR 9.60% 502,918 46,765 456,153

USD 3.58% 101,021 36,555 64,466

March 31, 2017 603,939 83,320 520,619

18.1.3 Unused lines of credit *

The below table provides the details of un-drawn credit facilities that are available to the Company.

* Excludes non-fund based facilities.

As of March 31, 2018

Interest rate

(range)

Frequency of

installments

Number of

installments

outstanding per

facility (range)*

Within

one year

Between

one and

two years

Between

two and

five years

Over five

years

Vehicle loans 7.95% - 9.50% Monthly 6 - 33 15 11 3

Term loans 2.56%-3.20% Half yearly 11 - 14 4,290 4,359 13,078 4,499

7.70% - 7.95% One time 1 51,600 - - -

8.40% Quarterly 15 - 5,336 14,664 -

Commercial papers 8.05% One time 1 29,094 - - -

Non-convertible bonds 4.38% One time 1 - - - 64,829

Non-convertible debentures 8.25% - 8.35% One time 1 - - 30,000 -

Deferred payment liabilities 9.30% - 10.00% Annual 13 - 16 24,511 12,217 51,543 345,023

Finance lease obligations 10.25% Monthly / Annual 8 - 21 / 2 253 134 4 -

109,763 22,057 109,292 414,351

As of March 31, 2017

Interest rate

(range)

Frequency of

installments

Number of

installments

outstanding per

facility (range)*

Within

one year

Between

one and

two years

Between

two and

five years

Over five

years

Vehicle loans 9.25% - 9.48% Monthly 2 - 35 15 12 5 -

Term loans 1.45% - 2.57% Half yearly 1 -16 6,055 4,850 13,013 8,744

0.63% One time 1 - 1 3,891 - - -

6.35% - 7.95% One time 1 - 1 46,538 - - -

Commercial papers 6.35% One time 1 14,820 - - -

Non-convertible bonds 4.38% One time 1 - - - 64,466

Deferred payment liabilities 9.30 - 10.00% Annual 7 - 10 26,814 35,991 78,331 298,032

Finance lease obligations 10.25% Monthly / Annual 7 - 25 / 3 934 977 186 -

Bank Overdraft 7.60% - 8.15% On demand N/A 265 - - -

99,332 41,830 91,535 371,242

*The instalments amount due are equal / equated per se.

Notes to Standalone Financial Statements

(All amounts are in millions of Indian Rupees – H; unless stated otherwise)

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197

As of

31 March, 2018

As of

31 March, 2017

Lease rent equalisation 19,288 19,541

Others 66 2,340

19,354 21,881

19. Financial liabilities - others

Non-current

Current

As of

31 March, 2018

As of

31 March, 2017

Payables against capital expenditures 53,197 44,304

Interest accrued but not due 23,681 2,812

Security deposit* 3,284 2,538

Employee payables 2,034 2,290

Payable against business / asset acquisitions@ 9,739 9,179

Others# 594 1,026

92,529 62,149

*It includes deposits received from subscriber / channel partners which are repayable on disconnection after adjusting the outstanding amount thereby, if any.

@It includes payable to Qualcomm Asia Pacific Pte. Limited of H4,104 towards purchase of balance equity shares upon satisfaction of certain conditions as

per the share purchase agreement for acquisition and other acquisitions during the year.

#It mainly includes non-interest bearing advance received from customers / international operators and liability towards cash settled employee share based plan.

20. Provisions

Non-current

As of

31 March, 2018

As of

31 March, 2017

Assets retirement obligations 410 921

Gratuity 1,344 1,329

Other employee benefit plans 76 80

1,830 2,330

As of

31 March, 2018

As of

31 March, 2017

Opening Balance 921 921

Net (reversal) / additions (362) 22

Net interest costs (149) (22)

410 921

As of

31 March, 2018

As of

31 March, 2017

Gratuity 513 498

Other employee benefit plans 749 793

1,262 1,291

Current

The movement of provision towards asset retirement obligation is as below:

Refer note 26 for movement of provision towards various employee benefits.

Notes to Standalone Financial Statements

(All amounts are in millions of Indian Rupees – H; unless stated otherwise)

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

198

The movement of provision towards subjudice matters is as below:

As of

31 March, 2018

As of

31 March, 2017

Opening Balance 94,820 75,196

Net additions 21,248 19,624

116,068 94,820

The said provision has been disclosed under:

As of

31 March, 2018

As of

31 March, 2017

Other non-financial assets - non - current (refer note 13) 45,539 40,985

Other non-financial liabilities - Current (refer note 21) 683 674

Trade payables (refer note 22) 69,846 53,161

116,068 94,820

The said provisions pertain to payable / paid under protest for spectrum usage charges / licence fees (trade payable / other non-

financial assets) and payable for certain levies (other non-financial liabilities).

21. Other non-financial liabilities

As of

31 March, 2018

As of

31 March, 2017

Current

Taxes payable 23,200 11,501

Others 29 141

23,229 11,642

Taxes payable mainly pertains to GST, service tax, sales tax and other taxes payable and provision towards sub judice matters (refer note 20).

22. Trade payables

As of

31 March, 2018

As of

31 March, 2017

Due to Micro and Small enterprises 16 10

Trade payables* 176,974 149,688

176,990 149,698

* It includes amount due to to related parties (refer note 34) and provision towards sub judice matters (refer note 20).

Micro, small & medium enterprises development act, 2006 (‘MSMED’) disclosure

The dues to micro and small enterprises as required under MSMED Act, 2006, based on the information available with the Company,

is given below:

Sr No. For the year ended

31 March, 2018

For the year ended

31 March, 2017

Principal amount and the interest due thereon [H Nil (March 31, 2017 – HNil)]

remaining unpaid to any supplier as at the end of each accounting year 16 10

Amount of interest paid by the buyer in terms of section 16 of the MSMED Act,

2006, along with the amounts of the payment made to the supplier beyond the

appointed day during each accounting year 140 96

Amount of interest due and payable for the period of delay in making payment

(which have been paid but beyond the appointed day during the year) but

without adding the interest specified under MSMED Act, 2006 - -

Amount of interest accrued and remaining unpaid at the end of each accounting year

0 0

Amount of further interest remaining due and payable even in the succeeding

years, until such date when the interest dues as above are actually paid to the

small enterprise for the purpose of disallowance as a deductible expenditure

under section 23 of the MSMED Act, 2006 - -

Notes to Standalone Financial Statements

(All amounts are in millions of Indian Rupees – H; unless stated otherwise)

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Notes to Standalone Financial Statements

199

As of

31 March, 2018

As of

31 March, 2017

(i) Taxes, duties and other demands (under adjudication / appeal / dispute)

-Sales Tax and Service Tax 8,738 11,245

-Income Tax 9,951 12,527

-Customs Duty 4,883 4,317

-Entry Tax 6,010 5,509

-Stamp Duty 404 404

-Municipal Taxes 121 121

-Department of Telecom ('DoT') demands 40,344 36,540

-Other miscellaneous demands 1,385 962

(ii) Claims under legal cases including arbitration matters

-Access charges / Port charges 10,021 8,733

-Others 599 599

82,456 80,957

23 Contingent liabilities and commitments

(i) Contingent liabilities

Claims against the Company not acknowledged as debt:

Further, refer note f(iv), f(v) and f(vi) below for other DoT matter.

The category wise detail of the contingent liability has been given below:-

a) Sales and Service Tax

The claims for sales tax comprised of cases relating to the appropriateness of declarations made by the Company under

relevant sales tax legislations which were primarily procedural in nature and the applicable sales tax on disposals of certain

property and equipment items. Pending final decisions, the Company has deposited amounts under protest with statutory

authorities for certain cases.

The service tax demands relate to cenvat claimed on tower and related material, levy of service tax on SIM cards and

employee talk time, cenvat credit disallowed for procedural lapses and usage in excess of 20% limit.

b) Income Tax demand

Income tax demands mainly include the appeals filed by the Company before various appellate authorities against the

disallowance by income tax authorities of certain expenses being claimed and non-deduction of tax at source with respect

to pre-paid dealers / distributor’s margin.

c) Access charges / Port charges

(i) Despite the interconnect usage charges (‘IUC’) rates being governed by the Regulations issued by Telecom Regulatory

Authority of India (‘TRAI’); BSNL had raised a demand for IUC at the rates contrary to the regulations issued by TRAI in

2009. Accordingly, the Company filed a petition against the demand with the TDSAT which allowed payments by the

Company based on the existing regulations. The matter was then challenged by BSNL and is currently pending with the

Hon’ble Supreme Court.

(ii) The Hon’ble TDSAT allowed BSNL to recover distance based carriage charges. The private telecom operators have

jointly filed an appeal against the said order and the matter is currently pending before the Hon’ble Supreme Court.

(iii) BSNL challenged before TDSAT the port charges reduction contemplated by the regulations issued by TRAI in 2007

which passed its judgment in favour of BSNL. The said judgment has been challenged by the private operators in

Hon’ble Supreme Court. Pending disposal of the said appeal, in the interim, private operators were allowed to continue

paying BSNL as per the revised rates i.e. TRAI regulation issued in 2007, subject to the bank guarantee being provided

for the disputed amount. The rates were further reduced by TRAI in 2012 which was challenged by BSNL before the

Notes to Standalone Financial Statements

(All amounts are in millions of Indian Rupees – H; unless stated otherwise)

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

200

Hon’ble Delhi High Court. The Hon’ble Delhi High Court, in the interim, without staying the rate revision, directed the

private operators to secure the difference between TRAI regulation of 2007 and 2012 rates by way of bank guarantee

pending final disposal of appeal.

d) Customs Duty

The custom authorities, in some states, demanded custom duty for the imports of special software on the ground that this

would form part of the hardware on which it was pre-loaded at the time of import. The view of the Company is that such

imports should not be subject to any custom duty as it is operating software exempt from any custom duty. In response to the

application filed by the Company, the Hon’ble Central Excise and Service Tax Appellate Tribunal (‘CESTAT’) has passed an order

in favour of the custom authorities. The Company has filed an appeal with Hon’ble Supreme Court against the CESTAT order.

e) Entry Tax

In certain states, an entry tax is levied on receipt of material from outside the state. This position has been challenged by

the Company in the respective states, on the grounds that the specific entry tax is ultra vires the Constitution. Classification

issues has also been raised, whereby, in view of the Company, the material proposed to be taxed is not covered under the

specific category.

During the year ended March 31, 2017, the Hon’ble Supreme Court of India upheld the constitutional validity of entry tax

levied by few States. However, Supreme Court did not conclude certain aspects such as present levies in each State is

discriminatory in nature or not, leaving them open to be decided by regular benches of the Courts. Pending disposition by

the regular benches, the Company has decided to maintain status-quo on its position and hence continues to disclose it as

contingent liability.

f) DoT demands

(i) Demand for license fees pertaining to computation of Adjusted Gross Revenue (‘AGR’) and the interest thereon, due

to difference in its interpretation. The definition of AGR is sub-judice and under dispute since 2005 before the TDSAT.

TDSAT had pronounced its judgment in 2015, quashed all demands raised by DoT and directed DoT to rework the

demands basis the principles enunciated in its judgment. Subsequently, the Union of India (‘UOI’) and the Company

along with various other operators have filed appeals / cross appeals before the Hon’ble Supreme Court of India against

the TDSAT judgment. In 2016, all the appeals were tagged together and Hon’ble Supreme Court has permitted DOT to

raise demands with a direction not to enforce any demand till the final adjudication of the matter by Hon’ble Supreme

Court. Accordingly, DoT has raised the demand basis special audit done by DoT and Comptroller and Auditor General of

India. The contingent liability includes such demand and interest thereto (excluding certain contentious matters, penalty

and interest thereto) for the financial year for which demands have been received by the Company.

(ii) Demands for the contentious matters in respect of subscriber verification norms and regulations including validity of

certain documents allowed as proof of address / identity.

(iii) Penalty for alleged failure to meet certain procedural requirements for EMF radiation self-certification compliance.

The matters stated above are being contested by the Company and based on legal advice, the Company believes that

it has complied with all license related regulations and does not expect any financial impact due to these matters.

In addition to the amounts disclosed in the table above, the contingent liability on DOT matters includes the following:

(iv) Post the Hon’ble Supreme Court judgment in 2011, on components of AGR for computation of license fee, based on

the legal advice, the Company believes that the foreign exchange gain should not be included in AGR for computation

of license fee thereon. Further as per TDSAT judgement in 2015, foreign exchange fluctuation does not have any

bearing on the license fees. Accordingly, the license fee on foreign exchange gain has not been provided in the financial

statements. Also, due to ambiguity of interpretation of ‘foreign exchange differences’, the license fee impact on such

exchange differences is not quantifiable. The matter is currently pending adjudication by Hon’ble Supreme Court.

(v) On January 8, 2013, DoT issued a demand on the Company for H51,353 towards levy of one time spectrum charge.

The demand includes a retrospective charge of H8,940 for holding GSM Spectrum beyond 6.2 MHz for the period from

July 1, 2008 to December 31, 2012 and also a prospective charge of H42,413 for GSM spectrum held beyond 4.4 MHz

for the period from January 1, 2013, till the expiry of the initial terms of the respective licenses.

Notes to Standalone Financial Statements

(All amounts are in millions of Indian Rupees – H; unless stated otherwise)

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Notes to Standalone Financial Statements

201

In the opinion of the Company, inter-alia, the above demand amounts to alteration of financial terms of the licenses

issued in the past. Based on a petition filed by the Company, the Hon’ble High Court of Bombay, vide its order dated

January 28, 2013, has directed the DoT to respond and not to take any coercive action until the next date of hearing.

The DoT has filed its reply and the matter is currently pending with the Hon’ble High Court of Bombay. The Company,

based on independent legal opinions, till date has not given any effect to the above demand.

(vi) DoT had issued notices to the Company (as well as other telecom service providers) to stop provision of services (under

3G Intra Circle Roaming (‘ICR’) arrangements) in the service areas where such service providers had not been allocated

3G Spectrum and levied a financial penalty of H3,500 on the Company. The Company contested the notices in response

to which TDSAT in 2014 held 3G ICR arrangements to be competent and compliant with the licensing conditions and

quashed the notice imposing penalty. The DoT has challenged the order of TDSAT before the Hon’ble Supreme Court

which is yet to be listed for hearing.

Guarantees:

Guarantees outstanding as of March 31, 2018 and March 31, 2017 amounting to H123,796 and H123,614 respectively have

been issued by banks and financial institutions on behalf of the Company. These guarantees include certain financial bank

guarantees which have been given for subjudice matters/compliance with licensing requirements, the amount with respect

to these have been disclosed under capital commitments, contingencies and liabilities, as applicable, in compliance with the

applicable accounting standards.

(ii) Commitments

Capital commitments

The Company has contractual commitments towards capital expenditure (net of related advances) of H105,618 and H69,623 as

of March 31, 2018 and March 31, 2017 respectively.

Lease commitments

a) Operating lease

The future minimum lease payments (‘FMLP’) obligations are as follows:-

As of

31 March, 2018

As of

31 March, 2017

Not later than one year 77,510 72,725

later than one year but not later than five years 273,717 277,273

Later than five years 58,971 90,895

410,198 440,893

Lease rentals (including lease equalisation adjustment) 66,386 70,638

The above lease arrangements are mainly pertaining to passive infrastructure. Certain of these lease agreements have

escalation clause upto 25% and includes option of renewal from 1 to 15 years.

As lessor

(i) The Company has entered into non–cancellable lease arrangements to provide dark fiber on indefeasible right of use

(‘IRU’) basis. Due to the nature of the transaction, it is not possible to compute gross carrying amount, depreciation for

the year and accumulated depreciation of the asset given on operating lease as of March 31, 2018 and accordingly, the

related disclosures are not provided.

As Lessee

Notes to Standalone Financial Statements

(All amounts are in millions of Indian Rupees – H; unless stated otherwise)

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

202

(ii) The FMLP receivables against assets (other than above IRU assets) are as follows:

As Lessor

As of

31 March, 2018

As of

31 March, 2017

Not later than one year 208 221

Later than one year but not later than five year 984 929

Lather than five years 114 430

1,306 1,580

b) Finance lease

As lessee

Finance lease obligation of the Company as of March 31, 2018 is as follows:-

Future minimum

lease payments Interest Present value

Not later than one year 282 29 253

Later than one year but not later than five years 148 10 138

430 39 391

Future minimum

lease payments Interest Present value

Not later than one year 1,044 111 933

Later than one year but not later than five years 1,387 223 1,164

2,431 334 2,097

Finance lease obligation of the Company as of March 31, 2017 is as follows:

The above lease arrangements are mainly pertaining to various items of plant and equipment.

As lessor

The future minimum lease payments receivable of the Company as of March 31, 2018 is as follows:-

Future minimum

lease payments Interest Present value

Not later than one year 176 16 160

Later than one year but not later than five years 89 6 83

265 22 243

The future minimum lease payments receivable of the Company as of March 31, 2017 is as follows:-

Future minimum

lease payments Interest Present value

Not later than one year 133 25 107

Later than one year but not later than five years 189 17 172

322 42 279

The above lease arrangements are mainly pertaining to various network equipments.

The above lease arrangements are mainly pertaining to premises given to group companies.

Notes to Standalone Financial Statements

(All amounts are in millions of Indian Rupees – H; unless stated otherwise)

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Notes to Standalone Financial Statements

203

24. Revenue from operations

25. Network operating expenses

26. Employee benefits expense

26.1 Share-based payment plans

The following table provides an overview of all existing share option plans of the Company:

For the year ended

31 March, 2018

For the year ended

31 March, 2017

Service revenue 536,287 622,637

Sale of product 343 126

536,630 622,763

For the year ended

31 March, 2018

For the year ended

31 March, 2017

Passive infrastructure charges 64,410 68,451

Power and fuel 45,647 45,526

Repare and maintenance 16,227 21,240

Internet, bandwidth and leasedline charges 7,061 4,834

Others* 6,167 5,309

139,512 145,360

For the year ended

31 March, 2018

For the year ended

31 March, 2017

Salaries and bonus 14,844 14,731

Contribution to provident and other funds 668 672

Staff welfare expenses 542 611

Define benefit plan / other long-term benefits 448 557

Share base payment expense

Equity-settled plans 337 298

Cash-settled plans 12 157

Others* 358 359

17,209 17,385

*It includes charges towards managed services, installation, insurance and security.

*It includes recruitment expenses and training expenses.

Scheme Plan

Vesting period

(years)

Contractual term

(years)

Equity settled Plans

Scheme I 2006 Plan 1 - 5 7

Scheme 2005 2008 Plan & Annual

Grant Plan (AGP)

1 - 3 7

Scheme 2005 Performance Share Plan (PSP)

2009 Plan

3 - 4 7

Scheme 2005 Special ESOP & Restricted

Share Units (RSU) Plan

1 - 5 7

Scheme 2005 Long Term Incentive (LTI) Plans 1 - 3 7

Cash settled Plans

Performance Unit Plan (PUP) PUP 2013 - PUP 2015 1 - 4 3-5

The stock options vesting are subject to service and certain performance conditions mainly pertaining to certain financial parameters.

Notes to Standalone Financial Statements

(All amounts are in millions of Indian Rupees – H; unless stated otherwise)

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

204

The movement in the number of stock options and the related weighted average exercise prices are as follows:

For the year ended March 31, 2018 For the year ended March 31, 2017

Number of

share options

(‘000)

Weighted

average

exercise price

(J)

Number of

share options

(‘000)

Weighted

average

exercise price

(J)

2006 Plan

Outstanding at beginning of year 205 5.00 305 5.00

Granted - - - -

Exercised (90) 5.00 (100) 5.00

Forfeited / expired - - - -

Outstanding at end of year 115 5.00 205 5.00

Exercisable at end of year 2 5.00 36 5.00

2008 Plan & AGP

Outstanding at beginning of year - - 639 402.50

Granted - - - -

Exercised - - - -

Forfeited / expired - - (639) 402.50

Outstanding at end of year - - - -

Exercisable at end of year - - - -

PSP 2009 Plan

Outstanding at beginning of year 6 5.00 53 5.00

Granted - - - -

Exercised (3) 5.00 (37) 5.00

Forfeited / expired (3) 5.00 (10) 5.00

Outstanding at end of year - - 6 5.00

Exercisable at end of year - - 5 5.00

Special ESOP & RSU Plan

Outstanding at beginning of year 34 5.00 126 5.00

Granted - - - -

Exercised (33) 5.00 (91) 5.00

Forfeited / expired (1) 5.00 (1) 5.00

Outstanding at end of year - - 34 5.00

Exercisable at end of year - - 34 5.00

LTI Plans

Outstanding at beginning of year 2,002 5.00 1,709 5.00

Granted 1,571 - 820 -

Exercised (406) 5.00 (308) 5.00

Forfeited / expired (189) 5.00 (219) 5.00

Outstanding at end of year 2,978 5.00 2,002 5.00

Exercisable at end of year 567 5.00 358 5.00

Performance Unit Plans

Outstanding at beginning of year 1,401 - 3,118 -

Granted (0) - 9 -

Exercised (966) - (1,257) -

Forfeited / expired (37) - (469) -

Outstanding at end of year 398 - 1,401 -

Exercisable at end of year - - - -

Notes to Standalone Financial Statements

(All amounts are in millions of Indian Rupees – H; unless stated otherwise)

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The details of weighted average remaining contractual life, weighted average fair value and weighted average share price for the

options are as follows:

Weighted average

For the year ended

31 March, 2018

For the year ended

31 March, 2017

Remaining contractual life for the options outstanding as of (years) 0.35 to 6.37 0.10 to 5.65

Fair value for the options granted during the year ended (H)

338.54 to 409.76 338.50 to 379.25

Share price for the options exrcised during the year ended (H)

367.14 to 457.41

296.90 to 466.38

For the year ended

31 March, 2018

For the year ended

31 March, 2017

Risk free interest rates 6.3% to 6.78% 5.79% to 6.86%

Expected life 10 to 60 months 4 to 60 months

Volatility 25.91% to 30.16% 27.08% to 27.59%

Dividend yield 0.24% to 0.25% 0.39% to 0.63%

Wtd average excercise price (H)

0-5 0-5

The carrying value of cash settled plans liability is H66 and H141 as of March 31, 2018 and March 31, 2017, respectively.

The fair value of options is measured using Black-Scholes valuation model. The key inputs used in the measurement of the grant date

fair valuation of equity settled plans and fair value of cash settled plans are given in the table below:

The expected life of the stock options is based on the Company’s expectations and is not necessarily indicative of exercise patterns

that may actually occur. The expected volatility reflects the assumption that the historical volatility over a period similar to the expected

life of the options is indicative of future trends, which may not necessarily be the actual outcome. Further, the expected volatility is

based on the weighted average volatility of the comparable benchmark companies.

26.2 Employee benefits

The details of significant employee benefits are as follows:

For the year ended 31 March, 2018

For the year ended 31 March, 2017

Gratuity

Compensated

absences Gratuity

Compensated

absences

Obligation

Balance as at beginning of the year 1827 789 1668 730

Current service cost 244 138 256 150

Interest cost 135 58 133 58

Benefits paid (241) (106) (273) (113)

Transfers (21) (3) 7 4

Remeasurements (87) (127) 36 (40)

Present value of obligation 1,857 749 1,827 789

Current portion

513 749 498 789

Non-current portion

1,344 - 1,329 -

The expected contribution for the year ended March 31, 2018 and 2017 for gratuity plan is H391 and H389 respectively.

Amount recognised in other comprehensive income

For the year ended

31 March, 2018

For the year ended

31 March, 2017

Experience (gains) / losses (15) 15

Losses / (gains) from change in demographic assumptions 15 (20)

(Gains) / losses from change in financial assumptions (87) 41

Remeasurements on liability (87) 36

Notes to Standalone Financial Statements

(All amounts are in millions of Indian Rupees – H; unless stated otherwise)

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

206

Due to its defined benefit plans, the Company is exposed to the following significant risks:

Changes in bond yields - A decrease in bond yields will increase plan liability.

Salary risk - The present value of the defined benefit plans liability is calculated by reference to the future salaries of the plan

participants. As such, an increase in the salary of the plan participants will increase the plan’s liability.

The financial (per annum rates) and demographic assumptions used to determine defined benefit obligations are as follows:

As of

31 March, 2018

As of

31 March, 2017

Discount rate 7.85% 7.40%

Rate of return on plan assets N.A. N.A.

Rate of salary increase 9.00% 10.00%

Rate of attrition 20% to 24% 21% to 29%

Retirement age 58 58

Sensitivity analysis

The Company regularly assesses these assumptions with the projected long-term plans and prevalent industry standards.

The impact of sensitivity due to changes in the significant actuarial assumptions on the defined benefits obligations is given in the

table below:

As of 31 March, 2018

As of 31 March, 2017

Change in

assumption Gratuity

Compensated

absences Gratuity

Compensated

absences

Discount Rate +1% (61) (32) (59) (33)

-1% 67 34 64 36

Salary Growth Rate +1% 65 34 62 (33)

-1% (61) (32) (59) 36

The above sensitivity analysis is determined based on a method that extrapolates the impact on the net defined benefits obligations,

as a result of reasonable possible changes in the significant actuarial assumptions. Further, the above sensitivity analysis is based on

a reasonably possible change in a particular under-lying actuarial assumption, while assuming all other assumptions to be constant.

In practice, this is unlikely to occur, and changes in some of the assumptions may be correlated.

The table below summarises the maturity profile and duration of the gratuity liability:

As of

31 March, 2018

As of

31 March, 2017

Within one year 513 498

Within one - three years 535 569

within three - five years 318 327

Above five Years 489 433

Weighted average duration (in years) 3.82 3.42

For the year ended

31 March, 2018

For the year ended

31 March, 2017

Sales commission and distribution 22,211 21,957

Advertisement and marketing 5,787 7,200

Business and promotion 1,516 1,706

Other ancillary expenses 1,005 1,457

30,519 32,320

27. Sales and marketing expenses

Notes to Standalone Financial Statements

(All amounts are in millions of Indian Rupees – H; unless stated otherwise)

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28. Other expenses

For the year ended

31 March, 2018

For the year ended

31 March, 2017

Content costs 5,698 5,934

Customer care expenses 4,668 3,540

IT expenses 3,764 4,754

Collection and recovery expenses 3,690 3,955

Legal and professional fees^ 2,653 3,171

Provision for doubtful debts 8,060 7,349

Travelling and conveyance 888 1,084

Bad debts written off 713 329

Cost of good sold 277 58

Charity and donation* 528 1,146

Others# 5,232 7,204

36,171 38,524

For the year ended

31 March, 2018

For the year ended

31 March, 2017

- Audit fee* 66 76

- Reimbursement of expenses 5 6

- Other services* 13 9

84 91

For the year ended

31 March, 2018

For the year ended

31 March, 2017

Depreciation 80,063 77,663

Amortisation 50,423 44,371

130,486 122,034

* As per the requirements of section 135 of the Companies Act, 2013, the Company was required to spend an amount of H2,145 and H2,079 for the year ended

March 31, 2018 and 2017 on corporate social responsibility expenditure. During the year ended March 31, 2018 and 2017, the Company has spent in cash

an amount of H245 and H56 towards education and sanitation respectively. Further, amount paid to Prudent Electoral Trust (formerly known as Satya Electoral

Trust) for political purpose amounting to H250 and H170 during the year ended March 31, 2018 and 2017 respectively.

# It includes rent, printing and stationary, security, rent and communication expenses etc.

^ Details of Auditor’s remuneration which included in legal and professional fees:

29. Depreciation and amortisation

30. Finance costs and income

For the year ended

31 March, 2018

For the year ended

31 March, 2017

Finance costs

Interest expense 47,553 42,902

Net loss on derivative financial instruments 1,959 2,244

Other finance charges* 9,595 7,400

59,107 52,546

Finance income

Dividend income 4,200 16,511

Interest income 3,360 1,731

Net gain on FVTPL investments 35 1,725

Net exchange gain 822 3,454

8,417 23,421

*It includes bank charges, trade finance charges, charges relating to derivative instruments and interest charges towards sub judice matters.

* Excluding service tax / goods and service tax

Notes to Standalone Financial Statements

(All amounts are in millions of Indian Rupees – H; unless stated otherwise)

Bharti Airtel Limited

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208

31. Exceptional items

Exceptional items comprise of the following:

(i) For the year ended March 31, 2018:

a. Charge of H1,572 towards operating costs on network re-farming and up-gradation program

b. Provision of H720 towards one major delinquent receivable balance

c. Charge of H3,749 mainly due to levies and taxes pertaining to internal restructuring

(ii) For the year ended March 31, 2017:

a. Charge of H2,396 towards operating costs (including accelerated depreciation) on network re-farming and up-gradation

program

b. Charge of H2,920 resulting from reassessment of the useful life of certain categories of network assets of the Company

due to technological advancements

c. Net charge aggregating to H7,506 pertaining to regulatory levies related assessment / provisions, settlement of tax

related contingent liability and reconciliation of balances

d. Loss of H159,886 pertains to internal restructuring and divestment

Tax expense includes:

(a) Tax benefit of H2,129 and H5,864 for the year ended March 31, 2018 and 2017 respectively, on above exceptional items

(b) Tax benefit of Nil and H1,892 for the year ended March 31, 2018 and 2017 respectively, on account of re-assessment of

tax provisions for previous periods

32. Earnings per share (‘EPS’)

The details used in computation of basic and diluted EPS:

As of

31 March, 2018

As of

31 March, 2017

Weighted average Shares outstanding (‘000) for basic / diluted EPS 3,997,400 3,997,400

Profit / (loss) for the year 792 (99,256)

Notes to Standalone Financial Statements

(All amounts are in millions of Indian Rupees – H; unless stated otherwise)

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33. Segment reporting

The Company’s operating segments are organised and managed separately through the respective business managers, according

to the nature of products and services provided with each segment representing a strategic business unit. These business units are

reviewed by the Chairman of the Company (Chief Operating Decision Maker - ‘CODM’).

The amounts reported to CODM are based on the accounting principles used in the preparation of financial statements as per Ind AS.

Segment’s performance is evaluated based on segment revenue and segment result viz. profit or loss from operating activities before

exceptional items and tax. Accordingly, finance costs / income, non – operating expenses and exceptional items are not allocated to

individual segment.

Inter-segment pricing and terms are reviewed and changed by the management to reflect changes in market conditions and changes

to such terms are reflected in the period in which the changes occur. Inter-segment revenues are eliminated upon consolidation of

segments and reflected in the ‘Eliminations’ column.

Segment assets / liabilities comprise assets / liabilities directly managed by each segment. Segment assets primarily includes

receivables, property, plant and equipment, capital work-in-progress, intangibles assets, intangible assets under development, non-

current investments, inventories and cash and cash equivalents. Segment liabilities primarily includes operating liabilities. Segment

capital expenditure comprises of additions to PPE, CWIP, intangible assets, intangible assets under development, and capital advances.

The reporting segments of the Company are as below:

Mobile Services: These services cover voice and data telecom services provided through wireless technology (2G / 3G / 4G) in India.

This includes the captive national long distance networks which primarily provide connectivity to the mobile services business in India.

This also includes intra-city fibre networks.

Airtel Business: These services cover end-to-end telecom solutions being provided to large Indian and global corporations by serving

as a single point of contact for all telecommunication needs across data and voice (domestic as well as international long distance),

network integration and managed services.

Homes Services: These services cover voice and data communications through fixed-line network and broadband technology.

Unallocated: Unallocated items include expenses / results, assets and liabilities of corporate headquarters of the Company, non-

current investment, current taxes, deferred taxes, borrowings and certain financial assets and liabilities, not allocated to the operating

segments.

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

210

Notes to Standalone Financial Statements

(All amounts are in millions of Indian Rupees – ‘H.’; unless stated otherwise)

Summary of the segmental information for the year ended and as of March 31, 2018 is as follows:

Particulars Mobile Services Airtel Business Homes Services Unallocated Eliminations Total

Revenue from external customers 420,208 91,899 24,523 - - 536,630

Inter-segment revenue 20,947 8,655 177 - (29,779) -

Total revenues 441,155 100,554 24,700 - (29,779) 536,630

Segment results 21,563 26,193 4,398 (1,639) - 50,515

Less:

Finance costs 59,107

Finance income (8,417)

Non-operating expenses 596

Exceptional items 6,041

Profit before tax (6,812)

Other segment items

Capital expenditure 188,011 7,474 10,210 6,481 (7,457) 204,719

Depreciation and amortisation 121,385 10,041 6,939 12 (7,891) 130,486

As of March 31, 2018

Segment assets* 1,356,580 101,826 43,059 617,272 (69,364) 2,049,373

Segment liabilities* 303,670 38,625 20,276 727,557 (69,364) 1,020,764

* Effective April 1, 2017, individual segments exclude inter-segment balances and allocated borrowings. This has no impact on total assets and liabilities.

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Notes to Standalone Financial Statements

(All amounts are in millions of Indian Rupees – ‘H.’; unless stated otherwise)

Summary of the segmental information for the year ended and as of March 31, 2017 is as follows:

Particulars Mobile Services Airtel Business Homes Services Unallocated Eliminations Total

Revenue from external customers 505,670 90,421 26,672 - - 622,763

Inter-segment revenue 21,075 7,979 198 - (29,252) -

Total revenue 526,745 98,400 26,870 - (29,252) 622,763

Segment result 94,680 19,469 6,331 (1,418) - 119,062

Less:

Finance costs 52,546

Finance income (23,421)

Non-operating expense 2,324

Exceptional items 172,708

Loss before tax

(85,095)

Other segment items

Capital expenditure 362,700 14,058 19,286 1,633 (20,862) 376,815

Depreciation and amortisation 113,230 9,737 5,951 12 (6,896) 122,034

As of March 31, 2017

Segment assets 1,541,193 233,317 296,014 625,502 (779,650) 1,916,376

Segment liabilities 736,333 151,419 231,935 564,266 (779,650) 904,303

Notes to Standalone Financial Statements

(All amounts are in millions of Indian Rupees – H; unless stated otherwise)

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

212

Geographical information*:

(a) Revenue from external customers:

For the year ended

31 March, 2018

For the year ended

31 March, 2017

India 492,486 575,319

Others 44,144 47,444

536,630 622,763

For the year ended

31 March, 2018

For the year ended

31 March, 2017

India 1,269,732 1,198,282

Others 12,389 13,981

1,282,121 1,212,263

(b) Non-current assets:

*Basis location of the customers / assets

Non-current assets for this purpose consist of PPE, CWIP, intangible assets, intangible assets under development and capital advances.

34 Related party disclosures

i. Subsidiaries

- Indian

Airtel Payments Bank Limited

Bharti Airtel Services Limited

Bharti Hexacom Limited

Bharti Infratel Limited

Bharti Telemedia Limited

Indo Teleports Limited

Nxtra Data Limited

Wynk Limited

Smartx Services Limited

Telesonic Networks Limited

Nettle Infrastructure Investments Limited

Bharti Digital Networks Private Limited (formerly known as Tikona Digital Networks Private Limited,subsidiary w.e.f August 24,

2017)

- Foreign

Africa Towers N.V.

Africa Towers Services Limited ##

Airtel (Seychelles) Limited

Airtel Congo (RDC) S.A.

Airtel Congo S.A.

Airtel DTH Services Nigeria Limited #

Airtel Gabon S.A.

Airtel Ghana Limited (ceased to be subsidiary w.e.f. October 12, 2017)

Airtel Madagascar S.A.

Airtel Malawi Limited

Airtel Mobile Commerce (Ghana) Limited (ceased to be subsidiary w.e.f. October 12, 2017)

Airtel Mobile Commerce (Kenya) Limited

Airtel Mobile Commerce (Seychelles) Limited

Notes to Standalone Financial Statements

(All amounts are in millions of Indian Rupees – H; unless stated otherwise)

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Airtel Mobile Commerce (Tanzania) Limited

Airtel Mobile Commerce B.V.

Airtel Mobile Commerce Holdings B.V.

Airtel Mobile Commerce Nigeria Limited (incorporated w.e.f August 31, 2017)

Airtel Mobile Commerce Limited, Malawi

Airtel Mobile Commerce Madagascar S.A.

Airtel Mobile Commerce Rwanda Limited

Airtel Mobile Commerce Tchad S.a.r.l.

Airtel Mobile Commerce Uganda Limited

Airtel Mobile Commerce Zambia Limited

Airtel Money (RDC) S.A.

Airtel Money Niger S.A.

Airtel Money S.A. (Gabon)

Airtel Money Transfer Limited

Airtel Money Tanzania Limited

Airtel Networks Kenya Limited

Airtel Networks Limited

Airtel Networks Zambia Plc

Airtel Rwanda Limited

Airtel Tanzania Public Limited (formerly known as Airtel Tanzania Limited)

Airtel Tchad S.A.

Airtel Uganda Limited

Bangladesh Infratel Networks Limited #

Bharti Airtel (France) SAS

Bharti Airtel (Hong Kong) Limited

Bharti Airtel (Japan) Private Limited

Bharti Airtel (UK) Limited

Bharti Airtel (USA) Limited

Bharti Airtel Africa B.V.

Bharti Airtel Burkina Faso Holdings B.V.

Bharti Airtel Chad Holdings B.V.

Bharti Airtel Congo Holdings B.V.

Bharti Airtel Developers Forum Limited

Bharti Airtel DTH Holdings B.V.#

Bharti Airtel Gabon Holdings B.V.

Bharti Airtel Ghana Holdings B.V. (ceased to be subsidiary w.e.f. October 12, 2017)

Bharti Airtel International (Mauritius) Limited

Bharti Airtel International (Mauritius) Investment Limited ( incorporated on March 26, 2018)

Bharti Airtel International (Netherlands) B.V.

Bharti Airtel Kenya B.V.

Bharti Airtel Kenya Holdings B.V.

Bharti Airtel Lanka (Private) Limited

Bharti Infratel Lanka (Private) Limited #

Bharti Airtel Madagascar Holdings B.V.

Bharti Airtel Malawi Holdings B.V.

Bharti Airtel Mali Holdings B.V.

Bharti Airtel Niger Holdings B.V.

Bharti Airtel Nigeria B.V.

Bharti Airtel Nigeria Holdings B.V. #

Bharti Airtel Nigeria Holdings II B.V.

Bharti Airtel RDC Holdings B.V.

Bharti Airtel Rwanda Holdings Limited

Bharti Airtel Services B.V.

Bharti Airtel Tanzania B.V.

Bharti Airtel Uganda Holdings B.V.

Notes to Standalone Financial Statements

(All amounts are in millions of Indian Rupees – H; unless stated otherwise)

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214

Bharti Airtel Zambia Holdings B.V.

Bharti International (Singapore) Pte. Ltd

Celtel (Mauritius) Holdings Limited

Celtel Niger S.A.

Channel Sea Management Company (Mauritius) Limited

Congo RDC Towers S.A.

Gabon Towers S.A. ##

Indian Ocean Telecom Limited

Madagascar Towers S.A.

Malawi Towers Limited

Mobile Commerce Congo S.A.

Montana International

MSI-Celtel Nigeria Limited #

Network i2i Limited

Partnership Investment S.a.r.l.

Société Malgache de Téléphone Cellulaire S.A.

Tanzania Towers Limited

Towers Support Nigeria Limited #

Zap Trust Company Nigeria Limited #

Tigo Rwanda Limited ( w.e.f January 31, 2018)

ii. Ultimate controlling entity (w.e.f. November 3, 2017)*

Bharti Enterprises (Holding) Private Limited. It is held by private trusts of Bharti family with Mr. Sunil Mittal’s family trust effectively

controlling the same company

iii. Entities having control over the Company (w.e.f. November 3, 2017)*

-Indian

Bharti Telecom Limited

*Significant influence until November 2, 2017

iv. Entities having significant influence over the Company

- Foreign

Singapore Telecommunications Limited

Pastel Limited

v. Associates

- Indian

Seynse Technologies Private Limited

Juggernaut Books Private Limited (acquired on November 29, 2017)

- Foreign

Seychelles Cable Systems Company Limited

Robi Axiata Limited

vi. Joint Ventures

- Indian

Indus Towers Limited

FireFly Networks Limited

- Foreign

Bridge Mobile Pte Limited

Bharti Airtel Ghana Holdings B.V (w.e.f October 12, 2017)

Notes to Standalone Financial Statements

(All amounts are in millions of Indian Rupees – H; unless stated otherwise)

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Airtel Ghana Limited (w.e.f October 12, 2017)

Airtel Mobile Commerce (Ghana) Limited (w.e.f October 12, 2017)

Milicom Ghana Company Limited (w.e.f October 12, 2017)

Mobile Financial Services Limited (w.e.f October 12, 2017)

vii. Other entities with whom transactions have taken place during the reporting periods

a. Fellow companies (subsidiaries / joint ventures / associates other than that of the Company)

Subsidiaries

- Indian

Bharti Enterprises Limited

Cedar Support Services Limited

Bharti Insurance Holding Private Limited

Bharti Axa General Insurance Company Limited

Bharti Axa Life Insurance Company Limited

Associates

- Indian

Bharti Life Ventures Private Limited

Bharti General Private Limited

b. Others related parties *

Entities where Key Management Personnel and their relatives exercise significant influence

- Indian

Bharti Foundation

Bharti Airtel Employees Welfare Trust

Hike Private Limited (formerly known as Hike Limited)

Others

- Indian

Brightstar Telecommunication India Limited

Bharti Realty Holdings Limited

Bharti Realty Limited

Deber Technologies Private Limited

Hike Messenger Limited

Centum Learning Limited

Fieldfresh Foods Private Limited

Indian Continent Investment Limited

Jersey Airtel Limited

Nile Tech Limited

Bharti Support Services Private Limited (formerly known as Atrium Restaurants India Private Limited)

Bharti Land Limited

Centum Work skills India Limited

Oak Infrastructure Developers Limited

Gourmet Investments Private Limited

* ‘Other related parties’ though not ‘Related Parties’ as per the definition under Ind AS 24, ‘Related party disclosures’, have been

included by way of a voluntary disclosure, following the best corporate governance practices.

viii. Key Management Personnel (‘KMP’)

Sunil Bharti Mittal

Gopal Vittal

# Liquidated during the financial year 2017-18

## Under liquidation.

Bharti Airtel Limited

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216

Notes to Standalone Financial Statements

(All amounts are in millions of Indian Rupees – ‘H.’; unless stated otherwise)

# Other related parties / fellow companies

* It includes loan converted into equity investments.

For the year ended March 31, 2018 For the year ended March 31, 2017

Subsidiaries Joint

ventures

Associates Entitys having

significant

influence

ORP / FC# Subsidiaries Joint

ventures

Associates Entitys having

significant

influence

ORP / FC#

Purchase of fixed assets / bandwidth 4,951 - - - 2,476 4,119 - - - 2,705

Sale of fixed assets / IRU given 1,237 - - - - 799 - - - -

Investments* 42,912 - - - - 85,425 - - - -

Sale of investments 47,632 - - - - 96,809 - - - -

Rendering of services 30,643 37 2 993 296 22,680 49 3 1,383 285

Receiving of services 56,019 38,142 50 - 3,263 48,818 40,423 12 211 2,729

Fund transferred / expenses incurred on

behalf of others

2,451 8 - - - 2,647 11 - - 0

Donation - - - - 202 - - - - 921

Loans given 71,993 3 - - 273 98,566 - - - -

Repayment of loans given 71,512 - - - - 91,562 - - - 156

Reimbursement of energy expenses 13,680 25,317 - - - 13,742 24,614 - - -

Guarantees and collaterals given 24,767 - - - - - - - - -

Dividend paid - - - 9,809 501 - - - 3,255 364

Dividend income 4,200 - - - - 16,512 - - - -

The summary of significant transactions with the above mentioned parties is as follows:

Notes to Standalone Financial Statements

(All amounts are in millions of Indian Rupees – H; unless stated otherwise)

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The significant related party transactions are summarized below:

For the year ended

31 March, 2018

For the year ended

31 March, 2017

(i) Rendering of services

Subsidiaries

Bharti Hexacom Limited 17,414 9,802

Bharti Airtel (UK) Ltd. 9,559 9,597

(ii) Receiving of services

Subsidiaries

Bharti Hexacom Limited 8,709 4,526

Bharti Infratel Limited 20,404 20,543

Bharti Airtel (UK) Limited 11,481 9,366

Telesonic Networks Limited 3,781 4,408

Joint venture

Indus Towers Limited 38,046 40,369

(iii) Reimbursement of energy expenses

Subsidiary

Bharti Infratel Limited 13,680 13,742

Joint Venture

Indus Towers Limited 25,317 24,614

(iv) Fund transferred / expenses incurred on behalf of others

Subsidiary

Bharti Hexacom Limited 1,292 1,458

(v) Loans given

Subsidiaries

Bharti Telemedia Limited - 23,357

Nettle Infrastructure Investments Limited 50,604 68,140

Tikona Digital Networks Private Limited 10,538 -

Bharti Airtel (Services) Limited 5,658 3,292

(vi) Repayment of loans given

Subsidiaries

Bharti Telemedia Limited - 42,563

Bharti Airtel International (netherlands) B.V. - 33,788

Bharti International (Singapore) Pte Limited* - 9,357

Bharti Airtel (Services) Limited 4,883 3,034

Nettel Infrastructure Investments Limited 62,087 -

* loan conversion into equity

(vii) Purchase of investments

Subsidiaries

Bharti Airtel International (Mauritius) Limited - 14,620

Network i2i Limited 29,159 50,825

(viii) Sale of investment

Subsidiaries

Bharti Telemedia Ltd. 47,632 -

Nettle Infrastructure Investments Limited - 68,060

(ix) Dividend income

Subsidiaries

Bharti Hexacom Limited 476 1,348

Bharti Infratel Limited 3,724 15,164

(x) Dividend paid

Entities having control over the Company/entities having significant

influence over the Company

Bharti Telecom Limited 7,506 2,451

Pastel Limited 2,271 804

(xi) Guarantees and collaterals given

Subsidiary

Network i2i Limited 24,767 -

Notes to Standalone Financial Statements

(All amounts are in millions of Indian Rupees – H; unless stated otherwise)

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The outstanding balances of the above mentioned related parties are as follows:

Subsidiaries Joint ventures Associates

Entitys having

significant influence ORP / FC#

As of March 31, 2018

Trade payables (10,108) (10,353) (22) 0 (194)

Trade receivables 1,592 0 0 31 77

Loans (including accrued interest) 73,180 8 0 0 625

Security deposit 2,606 3,746 0 0 944

Guarantees and collaterals given

(including performance guarantees) 729,881 - - - -

As of March 31, 2017

Trade payables (5,342) (10,563) (10) (223) (410)

Trade receivables 748 1 0 0 69

Loans (including accrued interest) 72,699 5 0 0 352

Security deposit 2,602 3,717 0 0 931

Guarantees and collaterals given

(including performance guarantees) 709,615 - - - -

Outstanding balances at period end are un-secured and settlement occurs in cash.

KMP are those persons having authority and responsibility for planning, directing and controlling the activities of the Company, directly

or indirectly, including any director, whether executive or otherwise. Remuneration to key management personnel were as follows:

For the year ended

31 March, 2018

For the year ended

31 March, 2017

Short-term employee benefits 263 250

Performance linked incentive (‘PLI’)# 138 118

Post-employment benefit 28 26

Share-based payment 62 62

491 456

# Value of PLI considered above represents incentive at 100% performance level. However, same will be paid on the basis of actual performance parameters

in next year. Additional provision of H21 and H28 has been recorded in the books towards PLI for the year ended March 31, 2018 and March 31, 2017

respectively. During the year ended March 31, 2018 and 2017, PLI of H143 and H116 respectively, pertaining to previous year has been paid.

As the liabilities for the gratuity and compensated absences are provided on an actuarial basis, and calculated for the Company as

a whole rather than each of the individual employees, the said liabilities pertaining specifically to KMP are not known and hence, not

included in the above table.

In addition to above, H1,122 thousand and H313 thousand have been paid as dividend to key management personnel during the year

ended March 31, 2018 and March 31, 2017 respectively.

The Company has agreed to ensure appropriate financial support only if and to the extent required by its subsidiaries (namely, Bharti

Airtel Services Limited, Bharti Telemedia Limited, Airtel Payments Bank Limited, Bharti Teleports Limited, Bharti Airtel Lanka (Private)

Limited and Bharti Airtel International (Netherlands) B.V. including its subsidiaries).

# Other related parties / fellow companies

Notes to Standalone Financial Statements

(All amounts are in millions of Indian Rupees – H; unless stated otherwise)

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March 31, 2018 March 31, 2017

Name of the Company

Outstanding

balance

Maximum amount

outstanding

during the year

Outstanding

balance

Maximum amount

outstanding

during the year

Subsidiaries

Bharti Telemedia Limited - - - 21,033

Bharti International (Netherlands) B. V. - - - 34,797

Bharti Teleports Limited 692 730 623 623

Bharti International (Singapore) Pte Limited - - - 9,476

Nxtra Data Limited 3,941 4,323 3,160 3,270

Bharti Airtel Services limited 1,320 1,717 545 811

Wynk Limited 33 525 231 321

Augere Wireless Broadband India Private Limited - - - 997

Nettle Infrastructure Investment Limited 56,657 68,140 68,140 68,140

Bharti Digital Networks Private Limited (formerly

known as Tikona Digital Networks Private Limited)

10,538 10,538 - -

Joint Venture

FireFly Networks Limited 8 8 5 5

73,189 85,981 72,704 139,473

The details of loans and advances as required by schedule V of SEBI (listing obligation and disclosure requirement Regulation, 2015

are given in the table below.

35. Financial and capital risk

1. Financial risk

The business activities of the Company expose it to a variety of financial risks, namely market risks (that is, foreign exchange

risk, interest rate risk and price risk), credit risk and liquidity risk. The Company’s risk management strategies focus on the un-

predictability of these elements and seek to minimise the potential adverse effects on its financial performance. Further, the

Company uses certain derivative financial instruments to mitigate some of these risk exposures (as discussed below in this note).

The financial risk management for the Company is driven by the Company’s senior management (‘CSM’), in close co-ordination

with the operating entities and internal / external experts subject to necessary supervision. The Company does not undertake any

speculative transactions either through derivatives or otherwise. The CSM are accountable to the Board of Directors and Audit

Committee. They ensure that the Company’s financial risk-taking activities are governed by appropriate financial risk governance

frame work, policies and procedures. The BoD of the respective operating entities periodically reviews the exposures to financial

risks, and the measures taken for risk mitigation and the results thereof.

(i) Foreign currency risk

Foreign exchange risk arises on all recognised monetary assets and liabilities, and any highly probable forecasted transactions,

which are denominated in a currency other than the functional currency of the Company. The Company has foreign currency

trade payables, receivables and borrowings. However, foreign exchange exposure mainly arises from borrowings and trade

payables denominated in foreign currencies.

The foreign exchange risk management policy of the Company requires it to manage the foreign exchange risk by transacting

as far as possible in the functional currency. Moreover, the Company monitors the movements in currencies in which the

borrowings / capex vendors are payable and manage any related foreign exchange risk, which inter-alia include entering into

foreign exchange derivative contracts - as considered appropriate and whenever necessary. For further details as to foreign

currency borrowings, refer note 18. Further, for the details as to the fair value of various outstanding derivative financial

instruments, refer note 36.

Notes to Standalone Financial Statements

(All amounts are in millions of Indian Rupees – H; unless stated otherwise)

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

220

Change in currency

exchange rate

Effect on profit before tax Effect on equity (OCI)

For the year ended March 31, 2018

US Dollars +5% (5,013) -

-5% 5,013 -

Others +5% 15 -

-5% (15) -

For the year ended March 31, 2017

US Dollars +5% (5,244) -

-5% 5,244 -

Others +5% (2) -

-5% 2 -

The sensitivity disclosed in the above table is mainly attributable to, in case of to foreign exchange gains / (losses) on

translation of USD denominated borrowings, derivative financial instruments, trade payables, and trade receivables.

The above sensitivity analysis is based on a reasonably possible change in the under-lying foreign currency against the

respective functional currency while assuming all other variables to be constant.

Based on the movements in the foreign exchange rates historically and the prevailing market conditions as at the reporting

date, the Company’s management has concluded that the above mentioned rates used for sensitivity are reasonable

benchmarks.

(ii) Interest rate risk

As the Company does not have exposure to any floating-interest bearing assets, or any significant long-term fixed-interest

bearing assets, its interest income and related cash inflows are not affected by changes in market interest rates. Consequently,

the Company’s interest rate risk arises mainly from borrowings.

Borrowings

Borrowings with floating and fixed interest rates expose the Company to cash flow and fair value interest rate risk respectively.

However, the short-term borrowings of the Company do not have a significant fair value or cash flow interest rate risk due to

their short tenure. Accordingly, the components of the debt portfolio are determined by the CSM in a manner which enables

the Company to achieve an optimum debt-mix basis its overall objectives and future market expectations.

The Company monitors the interest rate movement and manages the interest rate risk based on its risk management

policies, which inter-alia include entering into interest swaps contracts - as considered appropriate and whenever necessary.

Foreign currency sensitivity

The impact of foreign exchange sensitivity on profit for the year and other comprehensive income is given in the table below:

Notes to Standalone Financial Statements

(All amounts are in millions of Indian Rupees – H; unless stated otherwise)

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Interest rate sensitivity of borrowings

The impact of the interest rate sensitivity on profit before tax is given in the table below:

Interest rate sensitivity

Increase /

decrease

(basis points)

Effect on profit

before tax

For the year ended March 31, 2018

INR - borrowings +100 (716)

-100 716

US Dollar - borrowings

+25 (66)

-25 66

For the year ended March 31, 2017

INR - borrowings +100 (468)

-100 468

US Dollar - borrowings

+25 (57)

-25 57

The sensitivity disclosed in the above table is attributable to floating-interest rate borrowings and the interest swaps.

The above sensitivity analysis is based on a reasonably possible change in the under-lying interest rate of the Company’s

borrowings in INR, USD (being the significant currencies in which it has borrowed funds), while assuming all other variables

(in particular foreign currency rates) to be constant.

Based on the movements in the interest rates historically and the prevailing market conditions as at the reporting date, the

Company’s management has concluded that the above mentioned rates used for sensitivity are reasonable benchmarks.

(iii) Price risk

The Company invests its surplus funds in various mutual funds (debt fund, equity fund, liquid schemes and income funds etc.),

short term debt funds, government securities and fixed deposits. In order to manage its price risk arising from investments,

the Company diversifies its portfolio in accordance with the limits set by the risk management policies.

(iv) Credit risk

Credit risk refers to the risk of default on its obligation by the counter-party, the risk of deterioration of credit-worthiness of

the counter-party as well as concentration risks of financial assets, and thereby exposing the Company to potential financial

losses.

The Company is exposed to credit risk mainly with respect to trade receivables, investment in bank deposits / debt securities

/ mutual funds and derivative financial instruments.

Trade receivables

The Trade receivables of the Company are typically non-interest bearing un-secured and derived from sales made to a large

number of independent customers. As the customer base is widely distributed both economically and geographically, there

is no concentration of credit risk.

As there is no independent credit rating of the customers available with the Company, the management reviews the credit-

worthiness of its customers based on their financial position, past experience and other factors. The credit risk related to the

trade receivables is managed / mitigated by each business unit, basis the Company’s established policy and procedures, by

setting appropriate payment terms and credit period, and by setting and monitoring internal limits on exposure to individual

customers. The credit period provided by the Company to its customers generally ranges from 14-30 days except Airtel

business segment wherein it ranges from 7-90 days.

Notes to Standalone Financial Statements

(All amounts are in millions of Indian Rupees – H; unless stated otherwise)

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

222

The Company uses a provision matrix to measure the expected credit loss of trade receivables, which comprise a very large

numbers of small balances. Refer note 14 for details on the impairment of trade receivables. Based on the industry practices

and the business environment in which the entity operates, management considers that the trade receivables are credit

impaired if the payments are more than 90 days past due.

The ageing analysis of trade receivables as of the reporting date is as follows:

Neither past

due nor

impaired

Past due but not impaired Total

Less than 30

days

30 to 60 days 60 to 90 days Above 90 days

March 31, 2018

18,320 14,119 5,207 4,052 1,498

43,196

March 31, 2017

15,997 8,624 3,970 3,203 324

32,118

The Company performs on-going credit evaluations of its customers’ financial condition and monitors the credit-worthiness

of its customers to which it grants credit in its ordinary course of business. The gross carrying amount of a financial asset is

written off (either partially or in full) to the extent that there is no realistic prospect of recovery. This is generally the case when

the Company determines that the debtor does not have assets or sources of income that could generate sufficient cash flows

to repay the amount due. Where the financial asset has been written-off, the Company continues to engage in enforcement

activity to attempt to recover the receivable due. Where recoveries are made, these are recognised in profit and loss.

Financial instruments and cash deposits

The Company’s treasury, in accordance with the board approved policy, maintains its cash and cash equivalents, deposits

and investment in mutual funds and enters into derivative financial instruments - with banks, financial and other institutions,

having good reputation and past track record, and high credit rating. Similarly, counter-parties of the Company’s other

receivables carry either no or very minimal credit risk. Further, the Company reviews the credit-worthiness of the counter-

parties (on the basis of its ratings, credit spreads and financial strength) of all the above assets on an on-going basis, and if

required, takes necessary mitigation measures.

(v) Liquidity risk

Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they become due. Accordingly,

as a prudent liquidity risk management measure, the Company closely monitors its liquidity position and deploys a robust

cash management system. It maintains adequate sources of financing including bilateral loans, debt, and overdraft from both

domestic and international banks at an optimised cost. It also enjoys strong access to domestic and international capital

markets across debt and equity.

Moreover, the Company’s senior management regularly monitors the rolling forecasts of the entities’ liquidity reserve

(comprising of the amount of available un-drawn credit facilities and Cash and cash equivalents) and the related requirements,

to ensure they have sufficient cash on an on-going basis to meet operational needs while maintaining sufficient headroom

at all times on its available un-drawn committed credit facilities, so that there is no breach of borrowing limits or relevant

covenants on any of its borrowings. For details as to the Borrowings, refer note 18.

Based on past performance and current expectations, the Company believes that the Cash and cash equivalents, cash

generated from operations and available un-drawn credit facilities, will satisfy its working capital needs, capital expenditure,

investment requirements, commitments and other liquidity requirements associated with its existing operations, through at

least the next twelve months.

Notes to Standalone Financial Statements

(All amounts are in millions of Indian Rupees – H; unless stated otherwise)

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The table below summarises the maturity profile of the Company’s financial liabilities based on contractual undiscounted

payments:-

As of March 31, 2018

Carrying

amount

Demand

Less than

6 months

6 to 12

months

1 to 2

years

> 2

years

Total

Interest bearing borrowings*# 677,839 0 111,946 55,395 72,856 910,420

1,150,617

Other financial liabilities* 88,202 3,284 65,564 - - 19,354

88,202

Trade payables# 176,990 - 176,990 - - -

176,990

Financial liabilities (excluding derivatives) 943,031 3,284 354,500 55,395 72,856 929,774 1,415,809

Derivative assets 275 - 152 43 80 -

275

Derivative liabilities (352) - (83) (145) (107) (17)

(352)

Net derivatives (77) - 69 (102) (27) (17) (77)

As of March 31, 2017

Carrying

amount

Demand

Less than

6 months

6 to 12

months

1 to 2

years

> 2

years

Total

Interest bearing borrowings*# 600,947 265 72,941 31,725 70,808 732,139

907,878

Other financial liabilities* 84,030 2,538 51,724 5,075 - 21,881

81,218

Trade payables# 149,698 - 149,698 - - -

149,698

Financial liabilities (excluding derivatives) 834,675 2,803 274,363 36,800 70,808 754,020 1,138,794

Derivative assets 847 - 536 98 44 169

847

Derivative liabilities (1,848) - (1,319) (343) (58) (128)

(1,848)

Net derivatives (1,001) - (783) (245) (14) 41 (1,001)

* It includes contractual interest payment based on interest rate prevailing at the end of the reporting period after adjustment for the impact of

interest swaps, over the tenor of the borrowings.

# Interest accrued but not due has been included in interest bearing borrowings and excluded from other financial liabilities.

The Company from time to time in its usual course of business guarantees certain indebtedness of its subsidiaries.

Accordingly, as of March 31, 2018 and March 31, 2017 Company has issued corporate guarantee for debt / advance

aaggregating to H353,114 and H340,855, respectively. The outflow in respect of these guarantees arises only on any default/

non-performance of the subsidiary with respect to the guaranteed debt / advance and substantial amount of such loans are

due for payment after two years from the reporting date.

(vi) Reconciliation of liabilities whose cash flow movements are disclosed as part of financing activities in the statement

of cash flows:

Balance Sheet caption Statement of cash

flows line item

April

1, 2017

Cash

flows

Interest

expense

Foreign

exchange

movement

Others March

31, 2018

Borrowings* Proceeds / repayments

of borrowings (Including

Short term)

160,783 58,315 - 298 1,077 220,473

Interest accrued but not due

/ derivative instruments

Interest and other finance

charges paid

3,813 (4,291) 34,204 - (9,968) 23,758

* It does not include deferred payment liabilities, finance lease obligation and bank overdraft.

Notes to Standalone Financial Statements

(All amounts are in millions of Indian Rupees – H; unless stated otherwise)

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

224

As of

31 March, 2018

As of

31 March, 2017

Borrowing 654,158 600,947

Less: Cash and cash equivalents 4,626 1,087

Less: Term deposits with bank 105 -

Net debt 649,427 599,860

Equity 1,028,609 1,012,073

Total capital 1,028,609 1,012,073

Capital and Net debt 1,678,036 1,611,933

Gearing Ratio 38.7% 37.2%

36. Fair value of financial assets and liabilities

The category wise details as to the carrying value and fair value of the Company’s financial instruments are as follows:

The Company monitors capital using a gearing ratio calculated as below:

2. Capital risk

The Company’s objective while managing capital is to safeguard its ability to continue as a going concern (so that it is enabled to

provide returns and create value for its shareholders, and benefits for other stakeholders), support business stability and growth,

ensure adherence to the covenants and restrictions imposed by lenders and / or relevant laws and regulations, and maintain an

optimal and efficient capital structure so as to reduce the cost of capital. However, the key objective of the Company’s capital

management is to, ensure that it maintains a stable capital structure with the focus on total equity, uphold investor; creditor and

customer confidence, and ensure future development of its business activities. In order to maintain or adjust the capital structure,

the Company may issue new shares, declare dividends, return capital to shareholders, etc.

The Company manages its capital structure and makes adjustments to it, in light of changes in economic conditions or its

business requirements.

Level Carrying Value as of Fair Value as of

March

31, 2018

March

31, 2017

March

31, 2018

March

31, 2017

Financial Assets

FVTPL

Derivatives

- Currency swaps, forward and option contracts Level 2 195 187 195 187

- Interest rate swaps Level 2 80 106 80 106

- Embedded derivatives Level 2 - 554 - 554

Investments Level 2 63 52 63 52

Amortised cost

Loans and security deposits Level 2 82,786 82,470 82,786 82,470

Trade receivables Level 2 43,196 32,118 43,196 32,118

Cash and cash equivalents Level 1 4,626 1,087 4,626 1,087

Other bank balances Level 1 825 647 825 647

Other financial assets Level 2 12,097 13,756 12,097 13,756

143,868 130,977 143,868 130,977

Financial Liabilities

FVTPL

Derivatives

- Currency swaps, forward and option contracts Level 2 352 1,848 352 1,848

Amortised cost

Borrowings- fixed rate Level 1 94,423 64,082 92,984 65,008

Borrowings- fixed rate Level 2 433,714 454,750 473,800 488,848

Borrowings- floating rate Level 2 126,021 82,115 126,021 82,115

Trade payables Level 2 176,990 149,698 176,990 149,698

Other financial liabilities Level 2 111,883 84,030 111,883 84,030

943,383 836,523 982,030 871,547

Notes to Standalone Financial Statements

(All amounts are in millions of Indian Rupees – H; unless stated otherwise)

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The following methods / assumptions were used to estimate the fair values:

i. The carrying value of trade receivables, trade payables, short-term borrowings, floating-rate long-term borrowings, other current

financial assets and liabilities approximate their fair value mainly due to the short-term maturities of these instruments being

subject to floating-rates.

ii. Fair value of quoted financial instruments is based on quoted market price at the reporting date.

iii. The fair value of other long-term borrowings and non-current financial assets / liabilities is estimated by discounting future cash

flows using current rates applicable to instruments with similar terms, currency, credit risk and remaining maturities.

iv. The fair values of derivatives are estimated by using pricing models, wherein the inputs to those models are based on readily

observable market parameters. The valuation models used by the Company reflect the contractual terms of the derivatives

(including the period to maturity), and market-based parameters such as interest rates, foreign exchange rates, volatility etc.

These models do not contain a high level of subjectivity as the valuation techniques used do not require significant judgement

and inputs thereto are readily observable.

During the year ended March 31, 2018 and March 31, 2017, there were no transfers between Level 1 and Level 2 fair value

measurements. None of the financial assets and financial liabilities are in Level 3.

The following table describes the key inputs used in the valuation (basis discounted cash flow technique) of the Level 2 financial

assets / liabilities as of March 31, 2018 and March 31, 2017:

Financial assets / liabilities Inputs used

Derivatives

- Currency swaps, forward and option contracts Forward currency exchange rates, interest rates

- Interest swaps Prevailing / forward interest rates in market, interest rates

- Embedded derivatives Forward currency exchange rates, interest rates

- Investments Prevailing interest rates in market, interest rates

- Other financial assets / Other fixed rate borrowings / Other

financial liabilities

Prevailing interest rates in market, future payouts, interest rates

37 Other matters

(i) In 1996, the Company had obtained the permission from DoT to operate its Punjab license through one of its wholly owned

subsidiary. However DoT cancelled the permission to operate in April, 1996 and subsequently reinstated in March, 1998.

Accordingly, for the period from April 1996 to March, 1998 (‘blackout period’) the license fee was disputed and not paid by the

Company.

Subsequently, basis the demand from DoT in 2001, the Company paid the disputed license fee of H4,856 for blackout period under

protest. Consequently, the license was restored subject to arbitrator’s adjudication on the dispute. The arbitrator adjudicated the

matter in favour of DoT, which was challenged by the Company before Hon’ble Delhi High Court. In 2012, Hon’ble Delhi High

Court passed an order setting aside the arbitrator’s award, which was challenged by DoT and is pending before its division bench.

Meanwhile, the Company had filed a writ petition for recovery of the disputed license fee and interest thereto. However, the single

bench, despite taking the view that the Company is entitled to refund, dismissed the writ petition on the ground that the case

is still pending with the larger bench. The Company therefore has filed appeal against the said order with division bench and is

currently pending. DoT had also filed an appeal against the single judge order. Both these appeals are tagged together and are

listed for final hearing. The Hon’ble court has directed both the parties to file comprehensive written submission.

(ii) TRAI vide Telecom Interconnect Usages Charges Regulation (Eleventh Amendment) 2015 has reduced the IUC charges for

mobile termination charges to 14 paisa from 20 paisa and abolished the fixed-line termination charges. The Company has

challenged the said Regulation before the Hon’ble Delhi High Court and the matter is currently pending.

Bharti Airtel Limited

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226

Consolidated

Financial Statements

227

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Independent Auditor’s Report

TO THE MEMBERS OF

BHARTI AIRTEL LIMITED

Report on the Consolidated Financial Statements

We have audited the accompanying Consolidated Financial

Statements of BHARTI AIRTEL LIMITED (“the Company”) and

its subsidiaries (the Company and its subsidiaries together

referred to as “the Group”),which includes the Group’s share of

profit/loss in its associates and joint ventures, which comprise

the Consolidated Balance Sheet as at March 31, 2018, the

Consolidated Statement of Profit and Loss (including Other

Comprehensive Income), the Consolidated Statement of Cash

Flows and the Consolidated Statement of Changes in Equity

for the year ended on that date and a summary of significant

accounting policies and other explanatory notes (hereinafter

referred to as “Consolidated Financial Statements”).

Management’s Responsibility for the Consolidated

Financial Statements

The Company’s Board of Directors is responsible for the

preparation of these Consolidated Financial Statements

in terms of the requirements of the Companies Act, 2013

(hereinafter referred to as “the Act”) that give a true and

fair view of the consolidated financial position, consolidated

financial performance including other comprehensive income,

consolidated cash flows and consolidated changes in equity

of the Group including its Associates and Joint ventures in

accordance with the Indian Accounting Standards (Ind AS)

prescribed under section133 of the Companies Act, 2013, read

with the Companies (Indian Accounting Standards) Rules, 2015,

as amended and other accounting principles generally accepted

in India.

The respective Board of Directors of the companies included

in the Group and of its associates and joint ventures are

responsible for maintenance of adequate accounting records in

accordance with the provisions of the Act for safeguarding the

assets of the Group and its associates and joint ventures and

for preventing and detecting frauds and other irregularities; the

selection and application of appropriate accounting policies;

making judgments and estimates that are reasonable and

prudent; and the design, implementation and maintenance

of adequate internal financial controls, that were operating

effectively for ensuring the accuracy and completeness of the

accounting records, relevant to the preparation and presentation

of the Consolidated Financial Statements that give a true and

fair view and are free from material misstatement, whether

due to fraud or error, which have been used for the purpose of

the consolidated financial statements by the directors of the

company, as aforesaid.

Auditor’s Responsibility

Our responsibility is to express an opinion on these Consolidated

Financial Statements based on our audit.

In conducting our audit, we have taken into account the

provisions of the Act ,the accounting and auditing standards

and matters which are required to be included in the audit report

under the provisions of the Act and the Rules made thereunder.

We conducted our audit in accordance with the Standards on

Auditing specified under Section 143(10) of the Act. Those

Standards require that we comply with ethical requirements

and plan and perform the audit to obtain reasonable assurance

about whether the Consolidated Financial Statements are free

from material misstatement.

An audit involves performing procedures to obtain audit evidence

about the amounts and the disclosures in the Consolidated

Financial Statements. The procedures selected depend on the

auditor’s judgment, including the assessment of the risks of

material misstatement of the Consolidated Financial Statements,

whether due to fraud or error. In making those risk assessments,

the auditor considers internal financial control relevant to the

Company’s preparation of the Consolidated Financial Statements

that give a true and fair view in order to design audit procedures

that are appropriate in the circumstances. An audit also includes

evaluating the appropriateness of the accounting policies used

and the reasonableness of the accounting estimates made by

the Company’s Board of Directors, as well as evaluating the

overall presentation of the Consolidated Financial Statements.

We believe that the audit evidence obtained by us and the

audit evidence obtained by the other auditor in terms of their

report referred to in Other Matters paragraph below, is sufficient

and appropriate to provide a basis for our audit opinion on the

Consolidated Financial Statements.

Opinion

In our opinion and to the best of our information and according

to the explanations given to us, and based on the consideration

of report of the other auditor on separate financial statements

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

228

of the joint venture referred to below in the Other Matters

paragraph, the aforesaid Consolidated Financial Statements give

the information required by the Act in the manner so required

and give a true and fair view in conformity with the Ind AS and

other accounting principles generally accepted in India, of the

consolidated state of affairs of the Group, its associates and

joint ventures as at March 31, 2018, their consolidated profit,

consolidated total comprehensive income, their consolidated

cash flows and consolidated changes in equity for the year

ended on that date.

Emphasis of Matter

We draw attention to Note 24(i)(f)(v) to the Consolidated

Financial Statements which describes the uncertainties related

to the legal outcome of Department of Telecommunications

demand with respect to one time spectrum charges.

Our opinion is not modified in respect of this matter.

Other Matters

i. The Consolidated Financial Statements include the Group’s

share of profit of H11,816 Million and total comprehensive

income of H11,817 Million for the year ended March

31, 2018, as considered in the Consolidated Financial

Statements, in respect of Indus Towers Limited ( joint

venture), whose financial statements have not been audited

by us. These financial statements have been audited by

the other auditor whose report has been furnished to us

by the management and our opinion on the Consolidated

Financial Statements, in so far as it relates to the amounts

and disclosures included in respect of this joint venture is

based solely on the report of the other auditor. Our opinion

on the statement is not modified in respect of the above

matter with respect to our reliance on the work done and

the report of the other auditor.

ii. The comparative financial information of the Group, its

associates and joint ventures for the year ended and as

at March 31, 2017 prepared in accordance with Ind AS

included in these Consolidated Financial Statements have

been audited by the predecessor auditor. The report of the

predecessor auditor on comparative financial statements

for the year ended and as at March 31, 2017 dated May 9,

2017 expressed an unqualified opinion. Our opinion is not

modified in respect of this matter.

Report on Other Legal and Regulatory

Requirements

As required by Section 143(3) of the Act, based on our audit and

on the consideration of the report of other auditor on separate

financial statements of joint venture company incorporated in

India, referred in the Other Matter paragraph above we report, to

the extent applicable, that:

a) We have sought and obtained all the information and

explanations which to the best of our knowledge and

belief were necessary for the purposes of our audit of the

aforesaid consolidated financial statements.

b) In our opinion, proper books of account as required by

law relating to preparation of the aforesaid consolidated

financial statements have been kept so far as it appears

from our examination of those books, returns and the

reports of the other auditors.

c) The Consolidated Balance Sheet, the Consolidated

Statement of Profit and Loss (including Other

Comprehensive Income), the Consolidated Cash Flow

Statement and Consolidated Statement of Changes in

Equity dealt with by this Report are in agreement with the

books of account maintained for the purpose of preparation

of the consolidated financial statements.

d) In our opinion, the aforesaid consolidated financial

statements comply with the Indian Accounting Standards

prescribed under Section 133 of the Act.

e) On the basis of the written representations received from

the directors of the Company as on 31st March, 2018

taken on record by the Board of Directors of the Company

and the reports of the statutory auditors of its subsidiary

companies, associate companies and joint venture

companies incorporated in India, none of the directors of

the Group companies, its associate companies and joint

venture companies incorporated in India is disqualified as

on 31st March 2018 from being appointed as a director in

terms of Section 164 (2) of the Act.

f) With respect to the adequacy of the internal financial

controls over financial reporting and the operating

effectiveness of such controls, refer to our separate Report

in “Annexure A”, which is based on the auditors’ reports of

the Company, subsidiary companies, associate companies

229

Integrated Report

006-056

Statutory Reports

057-159

Financial Statements

Independent Auditor’s Report

and joint venture companies incorporated in India. Our

report expresses an unmodified opinion on the adequacy

and operating effectiveness of internal financial controls

over financial reporting of those companies.

g) With respect to the other matters to be included in

the Auditor’s Report in accordance with Rule 11 of the

Companies (Audit and Auditor’s) Rules, 2014, as amended,

in our opinion and to the best of our information and

according to the explanations given to us:

i. The consolidated financial statements disclose the

impact of pending litigations on the consolidated financial

position of the Group, its associates and joint ventures.

ii. Provision has been made in the consolidated financial

statements, as required under the applicable law or

accounting standards, for material foreseeable losses, if

any, on long-term contracts including derivative contracts.

iii. There has been no delay in transferring amounts

required to be transferred, to the Investor Education

and Protection Fund by the Company, its subsidiary

companies, associate companies and joint venture

companies incorporated in India.

For DELOITTE HASKINS & SELLS LLP

Chartered Accountants

(Firm’s Registration No. 117366W/W-100018)

Hemant M. Joshi

Partner

(Membership No. 38019)

Place: New Delhi

Date: April 24, 2018

Bharti Airtel Limited

Integrated Report and Annual Accounts 2017-18

230

Annexure “A” to the

Independent Auditor’s Report

(Referred to in paragraph (f) under ‘Report on Other Legal and Regulatory Requirements’ section of our

report of even date)

Report on the Internal Financial Controls Over Financial Reporting under Clause (i) of Sub-section 3 of Section 143 of the

Companies Act, 2013 (“the Act”)

In conjunction with our audit of the consolidated financial

statements of the Company as of and for the year ended March

31, 2018, we have audited the internal financial controls over

financial reporting of Bharti Airtel Limited (“the Company”) and

its subsidiary companies, its associates companies and joint

venture companies, which are companies incorporated in India,

as of that date.

Management’s Responsibility for Internal Financial

Controls

The respective Board of Directors of the Company , its

subsidiary companies, its associate companies and joint

venture companies, which are companies incorporated in

India, are responsible for establishing and maintaining internal

financial controls based on the internal control over financial

reporting criteria established by the respective Companies

considering the essential components of internal control stated

in the Guidance Note on Audit of Internal Financial Controls

Over Financial Reporting issued by the Institute of Chartered

Accountants of India. These responsibilities include the design,

implementation and maintenance of adequate internal financial

controls that were operating effectively for ensuring the orderly

and efficient conduct of its business, including adherence to the

respective company’s policies, the safeguarding of its assets,

the prevention and detection of frauds and errors, the accuracy

and completeness of the accounting records, and the timely

preparation of reliable financial information, as required under

the Companies Act, 2013.

Auditor’s Responsibility

Our responsibility is to express an opinion on the internal

financial controls over financial reporting of the Company, its

subsidiary companies, its associate companies and its joint

venture companies, which are companies incorporated in India,

based on our audit. We conducted our audit in accordance with

the Guidance Note on Audit of Internal Financial Controls Over

Financial Reporting (the “Guidance Note”) issued by the Institute

of Chartered Accountants of India and the Standards on Auditing,

prescribed under Section 143(10) of the Companies Act, 2013,

to the extent applicable to an audit of internal financial controls.

Those Standards and the Guidance Note require that we comply

with ethical requirements and plan and perform the audit to

obtain reasonable assurance about whether adequate internal

financial controls over financial reporting was established

and maintained and if such controls operated effectively in all

material respects.

Our audit involves performing procedures to obtain audit

evidence about the adequacy of the internal financial controls

system over financial reporting and their operating effectiveness.

Our audit of internal financial controls over financial reporting

included obtaining an understanding of internal financial controls

over financial reporting, assessing the risk that a material

weakness exists, and testing and evaluating the design and

operating effectiveness of internal control based on the assessed

risk. The procedures selected depend on the auditor’s judgement,

including the assessment of the risks of material misstatement of

the financial statements, whether due to fraud or error.

We believe that the audit evidence we have obtained and the

audit evidence obtained by the auditor of the joint venture

company which is company incorporated in India, in terms of

their report referred to in the Other Matters paragraph below,

is sufficient and appropriate to provide a basis for our audit

opinion on the internal financial controls system over financial

reporting of the Company, its subsidiary companies, its

associate companies and its joint venture companies, which are