Case Study Of Ipo In Airtel

Please see Exhibit 1 and Exhibit 2 MCI’s external needs will keep increasing over the next few years as the operating margins would shrink because of higher competition & higher access charges. In order to increase its market share, MCI would need to continue investing huge capitals in its network. As per exhibit 9 of the case, it is anticipated that MCI will

India is one country which is developing rapidly at the moment along with China (Lal and Clement, 2005). The political, economic, social, cultural, technological and legal climate in India is extremely suitable for international entrepreneurs since business prospects in a country are heavily dependent on the above mentioned parameters. Since India is the second most heavily populated country in the world, British telecommunication company, Vodafone has enormous business opportunities in India. Mobile phone usage in India is increasing rapidly in recent times (Press Information Bureau: Government of India, 2010). A substantial portion of Indian

Apart from vast network expansions, especial emphasis has given for introducing latest technologies and new services like I-NET, INTERNET, ISDN (INTEGRETED SERVICES DIGITAL NETWORK), IN entered in mobile communication. BSNL has all the new services send technological advantages, which are available with any well, developed Telecom network anywhere else in the country.

Is clear that AT&T is one of the few suppliers of telephony, given to them high supplier power. This condition gives them the ability, among others, to charging higher prices, limiting quality or services, and more importantly in this scenario, shifting cost to industry participants, meaning that is more profitable for them bring the accounts in-house, and this is possible given the high supplier power. The buyer power, on the other hand, is low, customers doesn’t have the power to force company down prices. In this case with AT&T taking control of their selling could down prices for the customers removing any chance of increment buyer power. The threat of substitute products or services and the threat of new entrants in this case was managed by AT&T, first, eliminating three party contractors and given the possibility directly AT&T to know and lure customers in order to increase not only their competitive advantage, but also, their competitive intelligence. Having direct communication with their customers enables AT&T to develop new strategies, products and services and avoid new entrants in their business. Also given the rivalry among existing competitors in this industry, AT&T found the possibility to interact with

They have likewise conveyed information transfers to the most distant corners of the earth, including parts of Africa and South America where there's no current wireline infrastructure, and have made nearby markets much more aggressive in the United States. As for small telecom industry to build infrastructure the company have to spend lot and this could be risk if the company cannot hold the market properly. So study of economic scale is beneficiary if the company know how to study the market.

From the table below, we can see that the investors started selling the shares after the very first day which might be due to a very high return on investment (109.44%), and also they started dumping the shares even more after the first day because they were pessimistic about the growth of the company’s share price.

A projected investment gap in telecommunications may leave these challenges unresolved. An estimated US$35.4 billion will be invested in the country until 2040; however, actual investment needs are forecasted at US$ 43.6 million during the same period, which determines a gap of US$ 8.2 billion. Deploying newer technology and modern infrastructure to rural/remote areas requires substantial investments that private-sector players are unwilling to undertake given the unfavorable trade-off between risk and return. Declining mobile average revenue per user (ARPU), which denotes the depth of the telecom market, is expected to continue and exacerbate sluggish growth in the increasingly saturated mobile phone segment. Along with the weakening of traditional operator business models due to IP substitution, these trends are likely to limit the impact of both subscription and revenue growth opportunities for ICT players, and widen the country’s digital gap.

This paper reviews the principal theories that have been proposed to explain IPO underpricing and discusses the empirical evidence. Theories of underpricing can be grouped under four broad headings: asymmetric information, institutional, control, and behavioral. The key parties to an IPO transaction are the issuing firm, the bank under- writing and marketing the deal, and the new investors.

Pursue growth opportunities in total communications by targeting mobile data use, broadband and enterprise services.

3G in developing markets with 95% populace scope in focused on urban regions in India

In India, the company's product offerings include 2G, 3G and 4G wireless services, mobile commerce, fixed line services, high speed DSL

Conclusion: We find that the Bharti Infratel IPO was a fairly successful IPO. The timing of the IPO was slightly early and the company could raise more funds in early 2013. This has been compensated by Bharti Infratel’s additional capital raising activities. Fair price of the IPO ranged between INR 232 and INR 268 based on our valuation. The IPO was subscribed at INR 210 due to tepid response among retail investors. Overall the IPO was oversubscribed 1.3 times and has generated handsome returns for its shareholders since list date. The company has outperformed other companies which were listed during the time. Bharti Infratel has maintained steady growth since the IPO with its EBIT growing at a 5 year CAGR of 20% and top line growth at par with industry. RoE and RoCE have improved to 13% and 21% respectively showing a phenomenal improvement in operational

India, which is home to at least 3,100 start-ups, is ranked fifth globally in terms of the combined size of the start-up industry. However the important downside is that Dallal Street or Indian Stock markets are not the well-liked location for the startups, rather foreign locations such as Singapore and Hong Kong are fast becoming a most popular location for raising funds. So, SEBI has come up with ‘Alternate Capital Raising Platform’ for startups to prevent this outflow.

The ability to get large customer base or no of customers increases due to ubiquitous nature of 4G

There is a relationship between the customer’s choice of telecom operator and the company’s call rates.