Bharti m-cap thrice that of MTNL's

By SiliconIndia   |   Monday, 29 March 2004, 08:00 Hrs
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MUMBAI: The market capitalisation of Bharti Tele-Ventures’ has overtaken public sector major, MTNL thanks to strong growth in cellular subscriber numbers and rising investor interest, reports Economic Times.

Bharti’s market cap was less than that of MTNL, just a year ago but it is now more than three times that of the public sector major. Bharti is now the eighth largest listed stock with a market cap of about Rs 26,000 crore, close to majors such as State Bank of India, Infosys and Wipro.

MTNL, though continues to lead Bharti in absolute financial numbers. For FY ¬Ď03, MTNL¬ís total revenues were Rs 6,022 crore, about twice that of Bharti¬ís at Rs 3,050 crore. MTNL also recorded Rs 897 crore of net profit in the last financial year, Bharti had made a loss of Rs 134 crore. The turning point for Bharti was in the quarter ended March ¬Ď03, when it made a profit for the first time, amounting to Rs 26 crore. FY ¬Ď04 will be the first year of profitability for the company.

So what is the reason behind the positive investor sentiment in Bharti’s favour? Bharti’s sales doubled in FY’03, while MTNL’s sales, however, fell 6%. The contrast is largely due to the fact that Bharti’s principal business is mobile telephony, where MTNL has made no headway. MTNL continues to be in fixed line telephony, a market which could be shrinking now. Bharti’s market share in mobile telephony is around 20%, in sharp contrast to MTNL’s 1% market share. In the total telecom space, Bharti has about 8% market share, about 1% greater than that of MTNL’s.

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