Term Paper

of
Financial
Management
on
“Reliance Communication
&
Bharti Airtel”
Submitted To:
Ms. Swati Goyal,
Lecturer, Financial Management,
LSB, LPU, Punjab

Submitted By:
Abul Kalam Khan
Reg. No.:10900284
Roll No.:RR1906A18, Roll No.:R1906
MBA-International Business
kalammksgs@gmail.com
kalamkhan406-2009@lpu.in
 ACKNOWLEDGEMENT

I would like to express my sincere thanks and gratitude to Ms. Swati Goyal, Instructor (Faculty)
of Financial Management, LSB, Lovely Professional University, Phagwara.

I am also thankful to advance technology which provided us wonderful and appreciated like
Internet (Wi-Fi of LPU Campus). I obtained lot of important information from internet.
I am very thankful to my family member, faculty member and my all friends that encourage me
and helped me to complete this Term Paper.
 PREFACE

In my Term Paper I include introduction of the both the given companies, Reliance
Communication and Bharti Airtel, product or services and comparison between both companies
Balance Sheet and Profit and Loss Account. I include in this Term paper comparative table of
balance sheet and profit and loss account of both organization and also the comparative graphs of
both organization. This study help me to know about the current condition of the both
organization.
Index

1: Introduction:

 Reliance Communications

• Company Overview
• Main Subsidiaries
• Offices
• Products & Services
• Subscriber Base

 Bharti Airtel Brands

• Company Overview
• Brands

2: Profit loss account of Reliance Communication:

3: Balance sheet of Reliance Communication:

4: Profit and Loss account of Bharti Airtel:

5: Balance sheet of Bharti Airtel:

6: Comparative Analysis between Reliance Communication and Bharti Airtel Profit and Loss
Account:

7: Comparative Analysis between Reliance Communication and Bharti Airtel Balance Sheet:

8: Graphs related to the Comparative Analysis between Reliance Communication and Bharti
Airtel:

9: References:

10: Bibliography:
Reliance Communications

Reliance Communications, formerly known as Reliance Infocom, along with Reliance Telecom
and Flag Telecom, is part of Reliance Communications Ventures. Reliance Communications
Limited (BSE: 532712) founded by the late Shri Dhirubhai H Ambani (1932-2002) is the flagship
company of the Reliance Anil Dhirubhai Ambani Group. The Reliance Anil Dhirubhai Ambani
Group currently has a net worth in excess of Rs. 64,000 crore (US$ 13.6 billion), cash flows of
Rs. 13,000 crore (US$ 2.8 billion), net profit of Rs. 8,400 crore (US$ 1.8 billion).The Equity
Shares of RCOM are listed on Bombay Stock Exchange Limited and National Stock Exchange
Limited. The Global Depository Receipts and Foreign Currency Convertible Bonds are listed on
Luxembourg Stock Exchange and Singapore Stock Exchange respectively.

Company Overview

Reliance Communications is India's truly integrated telecommunications service provider. The

Company has a customer base of 1050 million including over 2.5 million individual overseas
retail customers. It ranks among the Top 5 Telecom companies in the world by number of
customers in a single country. Reliance Communications corporate clientele includes 2,100
Indian and multinational corporations, and over 800 global, regional and domestic carriers. A
pan-India, next generation, integrated (wireless and wire line), convergent (voice, data and video)
digital network that is capable of supporting best-of-class services spanning the entire
communications value chain, covering over 24,000 towns and 600,000 villages has been
established by Reliance Communications. Reliance Communications owns and operates the next
generation IP enabled connectivity infrastructure, comprising over 190,000 kilometers of fiber
optic cable systems in India, USA, Europe, Middle East and the Asia Pacific region.

Main Subsidiaries

1: Reliance Telecom

In July 2007, the company announced it is buying US-based managed ethernet and application
delivery services company Yipes Enterprise Services for a cash amount of Rs. 1200 crore rupees
(equivalent of USD 300 million). The deal was announced of the overseas acquisition, the
Reliance group has amalgamated the United States-based Flag Telecom for $ 210 million
[roughly Rs 950 crore (Rs 9.50 billion)].

2: Reliance Telecom

RTL operates in Madhya Pradesh, West Bengal, Himachal Pradesh, Orissa, Bihar, Assam,
Kolkata and Northeast offering GSM services.[4]
3: Reliance Globalcom

RGL owns the world’s largest private undersea cable system [5] spanning 65,000 kms seamlessly
integrated with Reliance Communications over 110,000 kms of domestic optic fiber provides a
robust Global Service Delivery Platform connecting 40 key business markets in India, the Middle
East, Asia, Europe, and the U.S.

4: Reliance Communications Infrastructure Limited (RCIL)

RCIL provide Internet Data Centre (IDC) services located in Mumbai and Bangalore. RCIL
currently have IDC capacity of 304,000 sq. ft. with the market share close to 60%.

5: Reliance Big TV Limited

Reliance Big TV launched in August 2008 and thereafter acquired 1 million subscribers within
90 days of launch, the fastest ramp-up ever achieved by any DTH operator in the world. Reliance
Big TV offers its 1.7 million customers DVD quality pictures across a bouquet of over 200
channels using the latest, state-of-the-art MPEG 4 technology.

6: Reliance Infratel Limited (RITL)

RITL’s business is to build, own and operate telecommunication towers, optic fiber cable assets
and related assets at designated sites and to provide these passive telecommunication
infrastructure assets on a shared basis to wireless service providers and other communications
service providers under long-term contracts.

Offices

Reliance Communications Limited has its offices in Ahmedabad, Bangalore, Bhopal,

Chandigarh, Chennai, Hyderabad, Jaipur, Kochi, Lucknow, Mumbai, New Delhi, Patna & Pune.

Products & Services

Products & Services promoted by the Group are Prepaid Mobile, Postpaid Mobile, Handsets,
Blackberry, R World, Internet, Home Phone, Global Calling, Data Card, DTH.

Subscriber Base

The Reliance Communication subscriber base according to COAI - Cellular Operators

Association of India is over 105:

GSM
Circle Name Post Paid Prepaid
Andhra Pradesh 6182 1890923
Delhi 19172 2054393
Gujarat 19414 2480642
Kerala 8049 901829
Karnataka 18572 2168131
Maharashtra & Goa 25288 3301389
Mumbai 24884 2083175
Punjab,Haryana & Himachal Pradesh 18630 2717375
Rajasthan 6631 2628940
Tamil Nadu & Andaman 25704 1909641
Not Defined 136636 345658
Uttar Pradesh 9093 6430945
West Bengal 8765 22154
RCOM GSM - Total sub base 29262215

CDMA

Circle Name Post Paid Prepaid Prepaid PCO

Andhra Pradesh 250597 4454341 476990

Delhi 505724 3211875 114702

Gujarat 288480 2992165 115298

Kerala 200796 2054601 125214

Karnataka 236288 3024954 253848

Maharashtra & Goa 295534 3457329 275002

Madhya Pradesh & Orissa 187860 4495163 139575

Mumbai 555120 3223211 166858

Punjab,Haryana & Himachal Pradesh 198497 2569998 92611

Rajasthan 151260 2284651 96704

Tamil Nadu & Andaman 304861 3854839 374900

Uttar Pradesh 270627 7976083 265494

West Bengal,Bihar & Jharkhand 240946 6606050 203919

RCOM CDMA - Total sub base 56592965

Bharti Airtel

Bharti Airtel formerly known as Bharti Tele-Ventures LTD (BTVL) is the largest cellular
service provider in India, with more than 124 million subscribers as of February 2010. With this,
Bharti is now the world's third-largest, single-country mobile operator and sixth-largest integrated
telecom operator. It also offers fixed line services and broadband services. It offers its
TELECOM services under the Airtel brand and is headed by Sunil Bharti Mittal. The company
also provides telephone services and broadband Internet access (DSL) in top 95 cities in India. It
also acts as a carrier for national and international long distance communication services. The
company has a submarine cable landing station at Chennai, which connects the submarine cable
connecting Chennai and Singapore.

Company Overview:

Globally, Bharti Airtel is the 3rd largest in-country mobile operator by subscriber base, behind
China Mobile and China Unicom. In India, the company has a 24.6% share of the wireless
services market, followed by 17.7% for Reliance Communications and 17.4% for Vodafone
Essar. In January 2010, company announced that Manoj Kohli, Joint Managing Director and
current Chief Executive Officer of Indian and South Asian operations, will become the Chief
Executive Officer of the International Business Group from 1st April 2010. He will be overseeing
Bharti's overseas business. Current Dy. CEO, Sanjay Kapoor, will replace Manoj Kohli and will
be the CEO with effective from 1st April, 2010.

Brands

Airtel

Airtel is a brand of telecommunication services in India, Bangladesh and in Sri Lanka owned and
operated by Bharti Airtel. It is the largest cellular service provider in India in terms of number of
subscribers. Services are offered under the brand name Airtel: Mobile Services (using GSM
Technology), Broadband & Telephone Services (Fixed line, Internet Connectivity (DSL) and
Leased Line), Long Distance Services and Enterprise Services (Telecommunications Consulting
for corporates). It has presence in all 23 circles of the country and covers 71% of the current
population (as of Financial Year 2007). Airtel has also launched 16Mb/s broadband plans in
India, making it the first ISP to do so.

Airtel is facing a lot of flack from its customers, as people have become dissatisfied with its
customer care services. (www.consumercomplaints.in - Indian Consumer Complaints Forum)
Airtel Sri Lanka

In December 2008, Bharti Airtel rolled out third generation services in Sri Lanka in association
with Singapore Telecommunications. SingTel is a major player in the 3G space in Asia. It
operates third generation networks in several markets across Asia. [5]

Airtel's operation in Sri Lanka, known as Airtel Lanka, commenced operations on the 12th of
January 2009.

Airtel in Bangladesh

In January 2010, it was announced that the Bangladesh Telecommunication’s Regulatory

Commission (BTRC) of The People's Republic of Bangladesh had given Bharti Airtel the go
ahead to acquire a 70% stake in the Bangladesh business of Abu Dhabi based Warid Telcom. The
latter had till date invested a total of $600 million, with plans to bring their Bangladesh
investments to the $1 billion mark. Airtel's 70% stake in the company is said to be at a cost of an
initial $300 million. [6]

Touchtel

Until September 18, 2004, Bharti provided fixed-line telephony and broadband services under the
Touchtel brand. Bharti now provides all telecom services including fixed-line services under a
common brand "Airtel".

BlackBerry

On 19 October 2004 Airtel announced the launch of a BlackBerry Wireless Solution in India. The
launch is a result of a tie-up between Bharti Tele-Ventures Limited and Research In Motion
(RIM).

Digital TV
Main article: Airtel Digital TV On 9 October 2008, Airtel joined the DTH bandwagon in India with
Airtel Digital TV, a Direct-to-Home Television service.

iPhone 3G

The Apple iPhone 3G was rolled out in India on 22 August 2008 via Airtel & Vodafone.

Profit loss account of Reliance Communication:

Mar ' 09 Mar ' 08 Mar ' 07 Mar ‘ 06

Income
Operating income 15,086.66 14,792.05 12,756.30 -
Expenses

Material consumed 29.95 15.15 16.48 -

Manufacturing
5,975.57 4,144.21 3,358.34 -
expenses

Personnel expenses 758.36 858.65 684.4 1.11

Selling expenses 2,249.29 1,067.76 1,399.88 -

Administrative
2,323.44 2,532.99 1,784.19 0.55
expenses

Expenses capitalized - - - -

Cost of sales 11,336.61 8,618.76 7,243.29 1.66

Operating profit 3,750.05 6,173.29 5,513.01 -
Other recurring
675.12 28.68 169.61 13.26
income
Adjusted PBDIT 4,425.17 6,201.97 5,682.62 11.59
Financial expenses 1,153.24 870.05 456.55 -
Depreciation 1,933.51 1,843.66 1,836.12 2.74
Other write offs - - - -
Adjusted PBT 1,338.42 3,488.26 3,389.95 8.86
Tax charges 12.56 1,393.66 1,043.38 3.2
Adjusted PAT 1,325.86 2,094.60 2,346.57 5.65

Nonrecurring items 3,473.01 491.85 62.28 -

Other non-cash
3.8 - - -
adjustments

Reported net profit 4,802.67 2,586.45 2,408.85 5.65

Earnigs before
9,102.91 4,881.35 2,414.50 5.65
appropriation
Equity dividend 165.12 154.8 102.23 -

Preference dividend - - - -

Dividend tax 28.06 26.31 17.37 -

Retained earnings 8,909.73 4,700.24 2,294.90 5.65

Balance sheet of Reliance Communication:

Mar ' 09 Mar ' 08 Mar ' 07 Mar ' 06 Mar ' 05
Sources of funds
Owner's fund
Equity share
1,032.01 1,032.01 1,022.31 0.05 0.01
capital

Share application
- - - 611.57 -
money

Preference share
- - - - -
capital
Reserves &
50,658.31 23,808.02 19,503.23 14,783.43 -
surplus

Loan funds

Secured loans 3,000.00 950 5,113.57 - -

Unsecured loans 27,903.61 19,336.43 9,454.27 - -

Total 82,593.93 45,126.46 35,093.38 15,395.04 0.01

Uses of funds
Fixed assets

Gross block 37,941.15 21,576.32 20,625.82 198.09 -

Less : revaluation
- - - - -
reserve

Less :
accumulated 6,533.38 4,688.69 2,527.37 31.85 -
depreciation
Net block 31,407.77 16,887.63 18,098.45 166.24 -
Capital work-in-
3,643.86 7,117.56 2,185.60 - -
progress
Investments 31,364.75 13,844.14 5,434.43 12,074.10 -
Net current assets

Current assets,
25,543.01 18,515.29 20,107.04 3,158.96 0.01
loans & advances

Less : current
liabilities & 9,365.46 11,238.16 10,732.14 4.25 -
provisions
Total net current
16,177.55 7,277.13 9,374.90 3,154.70 0.01
assets
Miscellaneous
expenses not - - - - -
written

Total 82,593.93 45,126.46 35,093.38 15,395.04 0.01

Profit loss account Bharti Airtel:

Mar ' 09 Mar ' 08 Mar ' 07 Mar ' 06 Mar ' 05
Income
Operating income 34,048.32 25,761.11 17,851.61 11,259.12 8,142.44
Expenses

Material consumed 12.41 33.85 22.08 67.4 72.1

Manufacturing
8,627.13 7,339.01 5,017.27 3,299.73 2,365.51
expenses

Personnel expenses 1,397.54 1,297.88 1,076.95 734.2 475.86

Selling expenses 2,210.43 1,842.51 1,126.34 804.15 828.2

Adminstrative
8,608.03 4,588.53 3,351.31 2,315.91 1,403.09
expenses

Expenses capitalised - - - - -

Cost of sales 20,855.54 15,101.78 10,593.96 7,221.40 5,144.77

Operating profit 13,192.78 10,659.34 7,257.65 4,037.72 2,997.67
Other recurring
235.99 266.91 101.7 40.75 18.93
income
Adjusted PBDIT 13,428.77 10,926.24 7,359.35 4,078.47 3,016.61
Financial expenses 434.16 393.43 282.07 236.81 317
Depreciation 3,206.28 3,166.58 2,353.30 1,432.34 1,019.36
Other write offs 178.82 266.07 137.8 127.39 161.34
Adjusted PBT 9,609.50 7,100.16 4,586.17 2,281.93 1,518.90
Tax charges 321.78 632.43 566.79 273.68 353.6
Adjusted PAT 9,287.72 6,467.73 4,019.39 2,008.25 1,165.30

Nonrecurring items -1,497.74 -162.87 3.92 -13.81 -1,726.88

Other non-cash
-46.15 -60.67 9.92 17.64 22.23
adjustments
Reported net profit 7,743.84 6,244.19 4,033.23 2,012.08 -539.35

Earnigs before
19,541.05 11,778.12 5,489.61 1,225.65 -538.55
appropriation
Equity dividend 379.65 - - - -

Preference dividend - - - - -

Dividend tax 64.52 - - - -

Retained earnings 19,096.89 11,778.12 5,489.61 1,225.65 -538.55

Balance sheet Bharti Airtel:

Mar ' 09 Mar ' 08 Mar ' 07 Mar ' 06 Mar ' 05
Sources of funds
Owner's fund
Equity share
1,898.24 1,897.91 1,895.93 1,893.88 1,853.37
capital
Share
application 116.22 57.63 30 12.13 2.72
money
Preference share
- - - - -
capital
Reserves &
25,627.38 18,283.82 9,515.21 5,437.42 2,675.38
surplus

Loan funds

Secured loans 51.73 52.42 266.45 2,863.37 3,959.88

Unsecured loans 7,661.92 6,517.92 5,044.36 1,932.92 1,034.41

Total 35,355.48 26,809.71 16,751.95 12,139.72 9,525.76

Uses of funds

Fixed assets
Gross block 37,266.70 28,115.65 26,509.93 17,951.74 13,240.63
Less :
revaluation 2.13 2.13 2.13 2.13 2.13
reserve
Less :
accumulated 12,253.34 9,085.00 7,204.30 4,944.86 3,475.64
depreciation

Net block 25,011.23 19,028.52 19,303.51 13,004.75 9,762.86

Capital work-in-
2,566.67 2,751.08 2,375.82 2,341.25 994.46
progress
Investments 11,777.76 10,952.85 705.82 719.7 931.9

Net current assets

Current assets,
loans & 10,466.63 8,439.38 5,406.81 3,338.88 2,486.31
advances

Less : current
liabilities & 14,466.89 14,362.33 11,042.67 7,272.80 4,708.12
provisions

Total net current

-4,000.26 -5,922.95 -5,635.86 -3,933.92 -2,221.80
assets

Miscellaneous
expenses not 0.09 0.2 2.66 7.94 58.35
written

Total 35,355.48 26,809.71 16,751.95 12,139.72 9,525.76

Comparative Analysis between Reliance Communication and Bharti Airtel Profit and Loss
Account:

Mar ' Mar ' Chang Chang

Change Mar ' 08 Mar ' 08 Change
09 09 e in % e in %
Income
Operating 15,086.6 34,048.3 18,961.6 14,792.0 25,761.1 10,969.0
125.68 74.16
income 6 2 6 5 1 6

Expenses
Material
29.95 12.41 -17.54 -58.56 15.15 33.85 18.70 123.43
consumed

Manufacturi
5,975.57 8,627.13 2,651.56 44.37 4,144.21 7,339.01 3,194.80 77.09
ng expenses

Personnel
758.36 1,397.54 639.18 84.28 858.65 1,297.88 439.23 51.15
expenses

Selling
2,249.29 2,210.43 -38.86 -1.73 1,067.76 1,842.51 774.75 72.56
expenses

Adminstrativ
2,323.44 8,608.03 6,284.59 270.49 2,532.99 4,588.53 2,055.54 81.15
e expenses

11,336.6 20,855.5 15,101.7

Cost of sales 9,518.93 83.97 8,618.76 6,483.02 75.22
1 4 8
Operating 13,192.7 10,659.3
3,750.05 9,442.73 251.80 6,173.29 4,486.05 72.67
profit 8 4
Other
recurring 675.12 235.99 -439.13 -65.04 28.68 266.91 238.23 830.65
income
Adjusted 13,428.7 10,926.2
4,425.17 9,003.60 203.46 6,201.97 4,724.27 76.17
PBDIT 7 4

Financial
1,153.24 434.16 -719.08 -62.35 870.05 393.43 -476.62 -54.78
expenses

Depreciation 1,933.51 3,206.28 1,272.77 65.83 1,843.66 3,166.58 1,322.92 71.76

Other write #DIV/0 #DIV/0

0 178.82 178.82 0 266.07 266.07
offs ! !

Adjusted
1,338.42 9,609.50 8,271.08 617.97 3,488.26 7,100.16 3,611.90 103.54
PBT
 2,461.9
Tax charges 12.56 321.78 309.22 1,393.66 632.43 -761.23 -54.62
4

Adjusted
1,325.86 9,287.72 7,961.86 600.51 2,094.60 6,467.73 4,373.13 208.78
PAT
Non
- -
recurring 3,473.01 -143.13 491.85 -162.87 -654.72 -133.11
1,497.74 4,970.75
items

Other non -
#DIV/0
cash 3.8 -46.15 -49.95 1,314.4 0 -60.67 -60.67
!
adjustments 7

Reported net
4,802.67 7,743.84 2,941.17 61.24 2,586.45 6,244.19 3,657.74 141.42
profit

Earnigs
before 19,541.0 10,438.1 11,778.1
9,102.91 114.67 4,881.35 6,896.77 141.29
appropriatio 5 4 2
n

Equity
165.12 379.65 214.53 129.92 154.8 0 -154.80 -100.00
dividend

Dividend tax 28.06 64.52 36.46 129.94 26.31 0 -26.31 -100.00

Retained 19,096.8 10,187.1 11,778.1

8,909.73 114.34 4,700.24 7,077.88 150.59
earnings 9 6 2

Analysis

In this table I just take only two current years for comparison between the both companies. If we
take a one by one transaction of the Profit and Loss Account Manufacturing Expenses, Personal
Expenses, Selling Expenses, Administrative Expenses of Bharti Airtel are more than the reliance
Communication, but Operating Profit of the Bharti Airtel is more than the Reliance
Communication and also the PBT (Profit before Tax) and PAT (Profit after Tax) are more than the
Reliance Communication. It shows the capability of Bharti Airtel how they are able to earn more
profit than the other company. Also the Retained Earnings of the Bharti Airtel is more then two
times than the Reliance Communication.
Comparative Analysis between Reliance Communication and Bharti Airtel Balance Sheet:

Change Change
Mar ' 09 Mar ' 09 Change Mar ' 08 Mar ' 08 Change
in % in %
Sources of funds

Owner's fund

Equity share
1,032.01 1,898.24 866.23 83.94 1,032.01 1,897.91 865.90 83.90
capital

Share
application 0 116.22 116.22 #DIV/0! 0 57.63 57.63 #DIV/0!
money

Preference
0 0 0.00 #DIV/0! 0 0 0.00 #DIV/0!
share capital

-
Reserves & 50,658.3 25,627.3 23,808.0 18,283.8
25,030.9 -49.41 -5,524.20 -23.20
surplus 1 8 2 2
3

Loan funds

Secured loans 3,000.00 51.73 -2,948.27 -98.28 950 52.42 -897.58 -94.48

- -
Unsecured 27,903.6 19,336.4
7,661.92 20,241.6 -72.54 6,517.92 12,818.5 -66.29
loans 1 3
9 1
- -
82,593.9 35,355.4 45,126.4 26,809.7
Total 47,238.4 -57.19 18,316.7 -40.59
3 8 6 1
5 5

Uses of funds

Fixed assets
 37,941.1 37,266.7 21,576.3 28,115.6
Gross block -674.45 -1.78 6,539.33 30.31
5 0 2 5

Less :
revaluation 0 2.13 2.13 #DIV/0! 0 2.13 2.13 #DIV/0!
reserve

Less :
12,253.3
accumulated 6,533.38 5,719.96 87.55 4,688.69 9,085.00 4,396.31 93.76
4
depreciation

31,407.7 25,011.2 16,887.6 19,028.5

Net block -6,396.54 -20.37 2,140.89 12.68
7 3 3 2

Capital work-
3,643.86 2,566.67 -1,077.19 -29.56 7,117.56 2,751.08 -4,366.48 -61.35
in-progress

-
31,364.7 11,777.7 13,844.1 10,952.8
Investments 19,586.9 -62.45 -2,891.29 -20.88
5 6 4 5
9

Net current assets

Current - -
25,543.0 10,466.6 18,515.2
assets, loans 15,076.3 -59.02 8,439.38 10,075.9 -54.42
1 3 9
& advances 8 1

Less : current
14,466.8 11,238.1 14,362.3
liabilities & 9,365.46 5,101.43 54.47 3,124.17 27.80
9 6 3
provisions

- -
Total net 16,177.5
-4,000.26 20,177.8 -124.73 7,277.13 -5,922.95 13,200.0 -181.39
current assets 5
1 8

Miscellaneou
s expenses 0 0.09 0.09 #DIV/0! 0 0.2 0.20 #DIV/0!
not written
 - -
82,593.9 35,355.4 45,126.4 26,809.7
Total 47,238.4 -57.19 18,316.7 -40.59
3 8 6 1
5 5

Analysis

In this table I just take only two current years for comparison between the both companies. If we
take a one by one transaction of the Balance Sheet, Equity Share Capital of the Bharti Airtel is
Rs.866.23 (2009) and Rs.865.90 (2008) more than Reliance Communication but Reserve and
Surplus of Reliance Communication is more than the Bharti Airtel in both the year, it can be the
reason of future security or safe guard for the future uncertainty. The Total Loan of the Reliance
Communication more than the Bharti Airtel, so it shows the dependency of the Reliance
Communication is more on the External Resources than the Bharti Airtel. It means Reliance has
more liability than the Bharti Airtel. In other hand the use of fund of Reliance Communication is
more the Bharti Airtel, it is approx. three times more, but return is not satisfactory. And also the
current asset of Reliance Communication is more than the double of the Bharti Airtel.

Graphs related to the Comparative Analysis between Reliance Communication and Bharti
Airtel:

During the year 2005 to 2009, both company’s market share price goes down but in this case
Bharti Airtel has a good market position in comparison to the Reliance, because according to the
current information from the stock market (05/05/10) the current price of the Bharti Airtel share
in the market is Rs.296.30 (shows profit) and Reliance Communication share price is Rs.160.15
(shows loss).
During the year 2006 to 2008 there was no dividend paid by the Bharti Airtel, but in 2009 Bharti
Airtel paid Rs.379.65 crore dividend to the shareholder for maximizing the wealth and for
retaining the interest of shareholder in the organization. In case of Reliance Communication in
year 2006 there was no dividend but in the year 2007 to 2009 they give consequently Rs.102.23,
Rs.154.8, and Rs.165.12 also retain interest in the organization and wealth maximization.

From the year 2007 to 2009 Reliance Communication raising the investments in the market for
growth prospective but response or return not satisfactory because as we know the market
condition of Reliance is in share market is not up to the mark. And Bharti Airtel also start
investment from 2007 to 2009 but result is satisfactory and off course the market condition of the
Bharti Airtel is good.
This graph shows the period of company’s foundation to till 2009 Reliance Communication
raised approx. Rs.1000.00 crore equity share capital but in case of Bharti Airtel this figure is
almost double, it’s approx. Rs.1900.00 crore. So it shows the stability in the market of the
company and strong position in the market and also helps the organization to make a strong faith
between the consumer or customer as well as in the investor and build the goodwill of the
company.

From the year 2006 to 2007 the PAT (Profit after Tax) of the Reliance Communication was very
satisfactory but from the year 2007 to 2009 the PAT (Profit after Tax) of Reliance
Communication continuously decreasing but here again Bharti Airtel has a Gold Hand because
they continuously increases their PAT (Profit after Tax) and again they have strong position in the
market in comparison to the Reliance Communication.
References and Bibliography:

1: http://en.wikipedia.org/wiki/Reliance_Communications

2: http://money.rediff.com/companies/reliance-communications-ltd/15200050/profit-and-loss

3: http://en.wikipedia.org/wiki/Bharti_Airtel

4: http://money.rediff.com/companies/bharti-airtel-ltd/15200022/balance-sheet