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Airtel Expects $5-Bn Revenue From Africa by May 2013

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India's leading telecom operator Bharti Airtel on Wednesday said it expects to touch revenues of $5 billion (about Rs 24,000 crore) from its Africa operations by May 2013.

"We are extremely satisfied with our African acquisition ...there was an expectation I had given that by May 2013, we will achieve $5 billion revenue and $2 billion EBITDA (Earnings Before Interest, Taxes, Depreciation, Amortisation) and we are on track for that target," Bharti Airtel CEO (International) and Joint MD Manoj Kohli told PTI at Libreville in Gabon.

Last year, in the largest telecom takeover by an Indian firm, Bharti had acquired Kuwait-based Zain Telecom's African business for $10.70 billion (about Rs 48,000 crore).

The closure of the deal implied that Bharti had received all the approvals from the governments and regulators of each of these 16 nations.

During 2010-11, Airtel's Africa operations reported a net loss of Rs 480 crore, while revenues stood at Rs 13,083 crore.

On acquiring top position in the continent, Kohli said MTN is very competitive but "we are digging our heels and are trying to get our foundation, network customer services right.

If foundation is right, leadership is not far away".

Currently, MTN holds top position in the African market.

"We have to bring in our business model, all our business partners like Nokia, Ericcson, Huwaei and many others," Kohli said.

To another query, he said the company's tower business would be ready in the next few months.

"Our first objective is to build our own tower company which is in the process. In next few months, we will have our tower company ready, registered, all the staffing completed and all the legal approvals etc being done...and that is moving quite well," he added.

He said that the new tower company will improve its cost efficiency "because as you build (tower company), share tower, the fuel cost comes down, cost of tower comes down. So definitely we are looking at cost efficiency".

Kohli said there are no plans to have any joint venture for the tower company.

On the performance of the company, he said there is growth in customers in the last one year and "we have added a couple of percentage points of revenue market share which really proves that customer is liking our brand".

On the scope for increasing tariffs in the African market, Kohli said there are opportunities to increase the rates in some places.

On investment plans he said, this year the company would invest between USD 1-1.2 billion.

On its Africa business, Kohli said, "Africa has been very satisfying. This is the last frontier of the global markets, specifically telecom market, and I think Bharti entry has not only been right but also will see in the next 5-10 years".

He added that the African market is under-penetrated and there are some places where there is only 25-30 per cent penetration.

The market has 1 billion population with an average age of just 18 and clearly, it needs voice, communications, wireless broadband, Kohli said.


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business telecom bharti airtel africa manoj kohli