Download - 30802977 Bharti Zain Deal
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7/28/2019 30802977 Bharti Zain Deal
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Group-7
SWOT Analysis ofBharti Airtel-Zain
Deal
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Strength
Largest Telecom Player In India
Strong Financials
Strategic Alliance with other stake holders,including Nokia, SingTel & Sony Ericson
Pan-India Presence
EPS is accretive, total subscriber base of 140million in INDIA.
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Strength
ARPU in Africa ranges from $3 to $10, whichcompares favourably with India, where AirtelARPU is $5(Rs 230)
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Weakness
Outsourcing of core systems
Integration pain likely to remain for about 12 to18 months
The African assets of Zain reported a loss of $35million in 2008
In the first months of 2009,it has seen a 17 %drop in net profit.
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Weakness
According to Zains Q3 presentation, 47% to50% of all revenue comes from non-Africansources.
Bharti paying a 55 % premium for zain Ebitta, incomparison with Bhartis own valuation.
Nigeria is not profitable and reported a loss of$88mn on revenue of $986 mn, as of sept ,09
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Opportunities
Tie ups for the customer application
Strong presence in the emerging markets.
Match box Strategy scale of Penetration.
Current tele density of 30.6% in Africa is stilllow considering other developing countries and
opportunity of a new brand to bring a market.
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Threats
o Intense competition & shortage of bandwidth
oFalling ARPU
oFor a set of assets that are not positive at thispoint, analysts maintain that Bharti have toabsorb it from its profitable India operations..