With only “two-and-a-half players” left in the highly competitive domestic telecom sector, the future of battle hardened Bharti Airtel looks good now, its Chairman Sunil Mittal said on Thursday.
Speaking at a CII event, Mittal noted that the company has been through many ups and downs, including regulatory challenges and market competition, and is now better placed in the market.
“The balance sheet is healthy, it’s strong. And we are now down to two-and-a-half players for a country the size of India so the future looks good now. Now will there be one more crisis?… who knows but this company has become very very strong and battle hardened,” Mittal noted.
Noting that some of the salient features have been relentless focus on customer needs and customer satisfaction, he said, “we have been very hard on ourselves. I am the biggest critic of my own company”.
Recalling the challenging period, he said that it has turned out to be a delightful story at the end but there were moments in the journey of Airtel, when the question was not if but when the company will collapse.
“We had an existential crisis, stock was listed a few months back at Rs 45, it was brought down to knees at Rs 19. Cash was running out, revenues were not building fast enough and we had taken a big bite of going all India,” Mittal said.
“So the ship was clearly creaking, every limit was moving and it looked like things could go wrong. And that is where you know one is reminded that if you have the right strategy in place, if you have the right technology in place that will give you the right platform to win,” Mittal said.
In that difficult period from 2002-2003, Mittal said he managed to keep the team motivated.
“I said if I can become the lightning rod of the organisation, take all the pain and burn myself and keep the organisation insulated, I think we will be able to win this big war that was going on. And the fact is from that time, the Rs 19 stock went to Rs 1,200 in a matter of 18 months,” he stated.
According to him, the situation again became challenging in 2008-09 when 12 new licences were given. “All the big players came in, both foreign and Indian, from Docomo to Telenor, everybody came in and again the market went through a huge cycle but we were better prepared”.
Loss in the Supreme Court in 2005-06 and changes in spectrum auction norms were the other major incidents which impacted the company’s balance, Mittal said.
“I wish we had lost this case in 2005-06, just because we won the case he never paid the money and finally when we lost in the Supreme Court, it came back to haunt us all the way back. So it was a back-breaking one,” he said.
The events led to raising of funds through stake sales in the company.
“Balance sheet had become stressed and there was a time, I said you will have to dilute ourselves… this company needs to survive. Well how do I care whether I own 40 per cent or 26 per cent? Let’s just go and raise capital,” Mittal said.
Elaborating on the market situation, Mittal said the last three years have been “unbelievably relentless”.
“India, in large measure, has done exceedingly well because most of the companies have been able to move their supply chain and have been able to step up their production when required… So we have done remarkably well, I would say in every segment of our industry. That’s why India today is looking like a place where businesses are still thriving,” he said.
However, he noted that big companies have been able to deal with the challenges very well but medium to lower end businesses have definitely suffered.
He said that despite few issues, if there’s any country that is well poised and positioned to deal with the tectonic shifts, it is India.
According to him, earlier, ‘the eagle hovered over India and landed in China and Vietnam’, and therefore India ‘missed the bus’.
The current government’s zeal of promoting Aatmanirbharta, Digital India and other initiatives has now put India in a sweet spot, especially when it comes to the manufacturing sector, he said.
He also said that adoption of technology and dealing with innovation and disruption are relatively difficult in larger organisations, since the success of Facebook, Whatsapp other e-commerce companies have significantly changed the whole ecosystem.
To keep up with the changing times, existing businesses must adopt a futuristic outlook, taking into consideration changes in consumer behaviour, market dynamics and other factors, he added.
Given this outlook, the Bharti group is also adapting to changes and its newer businesses that are seeing success, include Airtel banks, other apps by the company like Wink and cloud services to MSMEs.
He also observed that solid partnerships play a key role in building success stories and companies that do not embrace change are bound to suffer.
Technologies of the future would offer immense possibilities that are embedded in the upcoming products like metaverse, robotics, drone management, 5D virtual realities etc, he added.
Speaking about building successful enterprises, Mittal mentioned that it is important to realise that one size does not fit all.
Identifying what works for a particular organisation and matching it with partners and thereafter nourishing those principles have proven to work out well, he added.