The man who transformed India’s telecom sector is the Business Icon of the Year; here’s why

Sunil Bharti Mittal has spent a lifetime in telecom, making a mammoth referred to as Bharti Airtel. Now, he’s backing OneWeb for the next trajectory

(Images: Bandeep Singh)

Airtel’s Sunil Bharti Mittal is the Enterprise Icon of the Yr (Photograph: Bandeep Singh)

Sunil Bharti Mittal admits to not being the most effective particular person to steer an organization in peaceable and good occasions. “That’s the reason I depart it to individuals like Gopal [Vittal, MD & CEO, Bharti Airtel] to try this. However when there’s a disaster, you’ll discover me proper within the heart of motion as a result of I can carry numerous stability,” he says. Look again on the progress of Mittal’s telecom enterprise, and also you notice that the Founder and Chairman of Bharti Enterprises has weathered many storms, together with regulatory regimes, cut-price competitors, and quicksands in Africa.

Mittal—whom the jury that determined the BT-PwC India’s Finest CEOs picked because the Enterprise Icon of the Yr—is the one survivor from the mid-Nineteen Nineties when he was one of many pioneers of cell telephony in India. Different pioneers offered out (one to him), huge worldwide names got here and left, and the know-how modified from cumbersome handsets with outrageous name charges to smartphones with dirt-cheap knowledge utilized by everybody. Not a small achievement for a person with no background in telecom.

“ Nobody ever doubted his [Sunil Mittal’s] intentions, functionality, or management expertise…He places in numerous exhausting work ”

Deepak Parekh
Chairman
HDFC Life Insurance coverage and HDFC AMC

Up and Down Begin

When Bharti Airtel went public in 2002, it was the primary from the nascent cell telephony sector to get listed. There was no ‘knowledge’ story; the primary smartphones and right now’s ubiquitous Android working system had been 5 years away. At this time, it’s exhausting to seek out an Indian and not using a cell quantity, a prerequisite to getting linked to authorities welfare schemes.

Bharti Airtel’s inventory tanked to `19 a couple of yr after itemizing from a suggestion value of `45. Other than a big retail base, the corporate’s marquee buyers had been Singapore Telecommunications (Singtel) and Warburg Pincus. Then, Reliance Communications (RCom) launched its cell companies in December 2002 with aggressive tariffs and handsets at a throwaway `500.

Disaster. At Airtel’s Agra conclave in 2003 with 40-odd high officers, the view was that it ought to go all out to combat the problem. Recalling that dialogue, Mittal says he thought in another way because the new entrant “was too robust for a corporation of our measurement to cope with”. However convincing his group was not straightforward. “The very best factor for us is to attend it out. Let’s simply lie on the bottom and let this storm go,” he careworn. Give attention to getting near the shopper by constructing high quality, he stated. “That’s precisely what occurred in 12 months. They began to make errors, and our share value went to Rs 1,100-1,200 in 18 months.”

Hemendra Kothari, Chairman of DSP Funding Managers, one of many bankers to Bharti Airtel’s public providing, remembers: “It was troublesome to market the problem, however Mittal satisfied the buyers. At this time, it’s a very totally different firm with huge scale.” Kothari offers Mittal credit score for bringing in “high-quality buyers” like Singtel and Warburg Pincus. “He has the flexibility to make individuals snug, and that could be a good ability.”

Calling Mittal a “fabulous entrepreneur,” Deepak Parekh, Chairman of HDFC Life Insurance coverage and HDFC AMC, says he additionally has the human contact. Having sat on the Singtel board for six years, Parekh noticed Mittal from shut quarters. “Nobody ever doubted his intentions, functionality, or management expertise. He dared to develop his Africa operations regardless of stiff competitors and caught it out.”  

Pondering In a different way

Mittal, 66, can assume forward and has stored the enterprise on a sound technological footing, typically ditching typical fashions. A living proof is when Airtel entered a strategic partnership with IBM for managed companies. Romal Shetty, CEO of Deloitte South Asia and somebody who has identified Mittal for a very long time, says telecom operators handle all features of their networks. “IBM’s experience in managing IT infrastructure introduced effectivity and cost-effectiveness to Airtel’s operations.” Airtel additionally acquired Ericsson to handle its community infrastructure.

Mittal remembers it was powerful for a cell operator to draw the most effective engineers, who would make a beeline for a Nokia, Ericsson, Siemens, or Motorola. Mittal took time to grasp massive telecom organisations globally, and although he didn’t have the dimensions, it was potential to do it not directly. “Within the cope with IBM, we gave them a share of the income. Their incentive was for us to succeed; over time, revenues went by means of the roof, and so they made rather more cash than a daily contract would have made,” he remembers. Airtel might now deal with its core competencies. “Be it customer support, community enlargement, or innovation, it allowed them to streamline operations and allocate assets extra effectively,” says Shetty.

Traders, too, have been a cheerful lot. Warburg Pincus made a return of 5.5x. In accordance with Vishal Mahadevia, the corporate’s MD & Head of Asia Non-public Fairness, Mittal had the foresight to make early know-how adoption calls and construct a cutting-edge community nationwide. “The Bharti Group, below Sunil’s management, has distinguished itself by all the time being shopper first and creating modern choices. Most significantly, he has handled his companions (together with us) effectively, with a singular deal with company governance and enterprise constructing.”

“ It [the Airtel IPO] was troublesome to market… however Mittal satisfied the buyers. At this time, it’s a very totally different firm with huge scale ”

Hemendra Kothari
Chairman
DSP Funding Managers

Making the Model 

At this time, Airtel has robust fairness and recall, however that has not been straightforward. The model title was considered in just a fortnight. The logic was easy—air is telecom, and it sounded good. “We went forward with it; right now, it’s one of the crucial famend manufacturers,” Mittal says.

Then, there was the not-so-small subject of constructing a community throughout India. How did Airtel grow to be a pan-India operation from its base of a one-circle operation in Delhi? With a smile, Mittal says Airtel’s risk-taking capability was higher when the corporate was small. “At this time, there are numerous committees, and I look again at what we went by means of with some disbelief,” he says. One instance: when the fourth operator licences had been up for bidding in mid-2001, Airtel needed to determine whether or not to bid for Kolkata or purchase incumbent Spice Cell. Spice Cell’s Dilip Modi was within the Airtel workplace late one night and determined to shut the deal that night time. “We wrapped it up early within the morning earlier than going dwelling,” says Mittal. Buyouts adopted in different areas. “By 2002-03, we began to ratchet up our presence. There have been 12-13 cell rollouts and one other 5 or 6 from fastened traces aside from home and worldwide long-distance and satellite tv for pc nodes. Issues acquired fairly powerful since RCom got here from nowhere,” remembers Mittal. Surviving that storm was an even bigger miracle than the launch of Jio in 2016.

What Lies Forward?

Airtel started eyeing Africa in 2008 and tried to purchase South Africa’s MTN Group, however that deal fell by means of. In 2010, Airtel acquired Kuwait’s Zain Group, which had operations in 15 nations in Africa. The $10.7-billion acquisition, accomplished in 2013, gave Mittal an enormous footprint, however Zain’s operations had been steeped in losses. Mittal knew how one can cease the bleeding, and it’s worthwhile now.

At this time, Airtel is on the forefront of the digital financial system, says Deloitte’s Shetty. As 5G know-how takes root, Airtel is in every single place: from manufacturing, mobility, and logistics to healthcare and IoT. It already has over 31 million 5G telephones on its community, and Shetty sees a CAGR of 43.8% for India’s 5G market over 2023-31, to $178 billion.

Then, there’s OneWeb, a community of over 600 small satellites for communications, which Mittal calls the final frontier. About 2 billion individuals dwell in “darkish radio areas” the place there isn’t a sign as a result of it doesn’t pay to arrange towers there. However this darkish space can be an enormous marketplace for satellite tv for pc broadband, which Shetty says can develop 36% yearly to succeed in $1.9 billion by the last decade’s finish.

Satellite tv for pc-based telephony companies return to the late Nineteen Nineties when the Iridium satellite tv for pc community made voice calls potential from anywhere on Earth. However Iridium sank below the price of the satellites. At this time, the world is watching OneWeb, which has put these communication satellites in orbit. “Simply think about them circling the globe in 12 planes at 25,000 km an hour and masking each sq. inch of land, water, and earth. That’s actually highly effective,” Mittal says enthusiastically. He believes the brand new service will complement cell telephony, not substitute it.

Mittal builds the belief of individuals round him. Parekh says individuals persist with him for years. “He places in numerous exhausting work.” Parekh remembers how Mittal reached out to him for somebody to chair the audit committee. “I gave him two or three names, and he requested me, ‘Who would I take?’” Parekh advised V.Ok. Vishwanathan, then with Bosch. “‘When you have really useful somebody, it should be the best selection,’ Mittal stated,” he remembers, including that success has not gone to his head. 

Success to Mittal means changing into extra accountable. “Now, there are numerous stakeholders. Because the organisation’s founder, you are feeling a bit heavier on the shoulders. I’d let that be assessed by individuals who cope with me or work with me, although I personally really feel that I stay roughly in the identical orbit,” he says.

Successful in an business the place Airtel was given little or no probability is an effective feeling. “It was good to win in opposition to a really formidable drive, and had I been in an business with out this type of highs and lows, the enjoyment of success wouldn’t have been on the identical degree,” he says. For sure, Mittal is one other spherical of success.