Gopal Vittal, the new CEO of Airtel India, has proved himself right for the top job — selected by billionaire Sunil Mittal — in the first three months at the helm of the telecom giant.
Gopal Vittal, who worked with consumer goods major Hindustan Lever earlier, replaced Sanjay Kapoor, who is likely to announce his own venture. Sanjay announced his resignation from Bharti Airtel, India’s #1 telecom service provider, in January 2013. ( Airtel CEO Sanjay Kapoor steps down )
There are two strong indications from Airtel quarterly result about the success of Gopal Vittal, who wants to improve revenue than spending on Capex.
Airtel’s Q1 FY 2014 revenue contribution from wireless business from India rose to 52 percent from 49 percent in FY 2013.
EBITDA contribution from Airtel’s India wireless business increased to 57 percent in Q1 FY 2014 from 54 percent in FY 2013. This is considered as strong signs of revival of Bharti Airtel which needs to improve profit growth.
Look at Airtel’s 3G achievement under Gopal Vittal. ( Airtel’s new challenges under India CEO Gopal Vittal )
He spent considerable time with SingTel, which owns around 30 percent stake in Airtel, in Singapore and Australia before taking over as the India CEO. His strategies towards a 2G/3G driven data growth at Airtel is paying back significantly. Gopal Vittal was instrumental in introducing Re 1 video content to Indian mobile users. Airtel’s marketing campaign supported the data growth in India — especially rural telecom markets.
Airtel’s 3G and 2G data user base increased to 46.6 million in the first quarter of FY 2014 from 43.5 million in the fourth quarter of FY 2013 and 41.5 million in the third quarter of FY 2013 and 40.6 million in the second quarter of FY 2013.
But non-voice contribution to mobile revenue in India declined to 17.3 percent from 17.4 percent.
Gopal Vittal achieved this substantial growth despite spending less in Capex in infrastructure. Airtel Capex (capital expenditure) decreased 34 percent to $411 million in the first quarter of fiscal 2014 from $624 million in the same period last fiscal. On quarter-on-quarter basis, Airtel Capex decreased 32 percent.