Dear Members,
Your Directors are pleased to present the 28th Board's Report on the
business and operations of Bharti Airtel Limited (Bharti Airtel/ Airtel/ Company) along
with audited financial statements for the financial year ended March 31, 2023.
Company Overview
Bharti Airtel is a global communications solutions provider with more than 500 Mn
customers in 17 countries across South Asia and Africa. It is one of the top three mobile
operators globally with its networks covering more than two billion people. Airtel is
India's largest integrated communications solutions provider and the second largest mobile
operator in Africa. The Company offers a wide array of solutions to its retail customers
including high-speed 4G/5G mobile broadband, Airtel Xstream Fiber offering speeds up to 1
Gbps with convergence across linear and on-demand entertainment, streaming services
spanning music and video, digital payments, and financial services. For enterprise
customers, Airtel provides secure connectivity, cloud and data center services, cyber
security, IoT, Ad Tech and CPaaS (Airtel IQ), among others. The Company also has
investments in tower infrastructure pertaining to telecom operations through its joint
venture entity viz. Indus Towers Limited (Indus'). During FY 2022-23, the Company
acquired an additional stake of 1.46% and accordingly, its shareholding in Indus stood at
47.95% as on March 31, 2023.
Financial Results
In terms of the provisions of the Companies Act, 2013 (Act'), and the SEBI
(Listing Obligations and Disclosure Requirements) Regulations, 2015 (Listing
Regulations'), the Company has prepared its standalone and consolidated financial
statements as per Indian Accounting Standards (Ind AS') for FY 2022-23. The
financial highlights of the Company's operations for FY 2022-23 on standalone and
consolidated basis, are as follows:
Standalone Financial Highlights |
FY 2022-23 |
FY 2021-22 (Restated)# |
Particulars |
Mn |
USD Mn* |
Mn |
USD Mn** |
Gross revenue |
847,201 |
10,541 |
707,950 |
9,521 |
EBITDA before exceptional items |
441,477 |
5,493 |
351,943 |
4,733 |
Cash profit from operations |
318,432 |
3,962 |
231,421 |
3,112 |
Profit/(Loss) before tax |
12,963 |
158 |
(42,557) |
(572) |
Net income/(Loss) |
(896) |
(11) |
(38,637) |
(520) |
#The composite scheme of arrangement between Nettle Infrastructure Investments Limited,
Telesonic Networks Limited and their respective shareholders and the Company, under
Sections 230 to 232 along with other applicable provisions of the Act (Scheme') has
become effective from February 1, 2023 with an appointed date of April 1, 2022.
Consequently, the Audited Standalone Financial Statements have been restated in accordance
with the accounting treatment mentioned in the Scheme.
Consolidated Financial Highlights
|
FY 2022-23 |
|
FY 2021-22 |
|
Particulars |
Mn |
USD Mn* |
Mn |
USD Mn** |
Gross revenue |
1,391,448 |
17,313 |
1,165,469 |
15,673 |
EBITDA before exceptional items |
717,330 |
8,925 |
581,103 |
7,815 |
Cash profit from operations |
553,596 |
6,888 |
423,645 |
5,697 |
|
165,607 |
2,061 |
124,831 |
1,679 |
Net income/(Loss) |
83,459 |
1,038 |
42,549 |
572 |
The financial results and the results of operations, including major developments, have
been further discussed in detail in the Management Discussion and Analysis Report.
Reserves
During the year, the Company has not transferred any amount to General Reserve. As on
March 31, 2023, the Reserves and Surplus comprising General Reserve, Retained Earnings and
Securities Premium Account stood at H790,684 Mn.
Change in the Nature of Business
There was no change in nature of the business of the Company during the financial year
ended on March 31, 2023.
Dividend
In terms of Regulation 43A of the Listing Regulations, the Board of Directors of the
Company had adopted the Dividend Distribution Policy, which sets out the parameters and
circumstances to be considered by the Board in determining the distribution of dividend to
its shareholders and/or the utilization of the retained profits earned by the Company. The
Dividend Distribution Policy is available on the Company's website at
https://assets.airtel.in/teams/simplycms/web/
docs/Dividend-Distribution-Policy-18052022.pdf.
In line with the above policy, your Directors have recommended a final dividend of H4/-
per fully paid-up equity share of face value of H5/- each and a pro-rata final dividend of
H1/- per partly paid-up equity share of face value of H5/- each with paid-up value of
H1.25/- each i.e. 80% of the paid-up value for FY 2022-23. The proposed final dividend
payout will amount to approx. H22,696.20 Mn. The payment of final dividend is subject to
the approval of shareholders at the 28th Annual General Meeting (AGM).
The record date for the purpose of payment of final dividend for the FY 2022-23, will
be Friday, August 11, 2023.
In view of the applicable provisions of Income Tax Act, 1961, dividend paid or
distributed by the Company shall be taxable in the hands of the shareholders. Your Company
shall, accordingly make the payment of the final dividend after deduction of tax at
source.
Transfer of Amount to Investor Education and Protection Fund
Pursuant to Sections 124 and 125 of the Act read with the Investor Education and
Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016 ("IEPF
Rules"), dividend, if not claimed for a period of seven years from the date of
transfer to Unpaid Dividend Account of the Company, is liable to be transferred to IEPF.
Further, all the shares in respect of which dividend has remained unclaimed for seven
consecutive years or more from the date of transfer to Unpaid Dividend Account shall also
be transferred to IEPF Authority. The said requirement does not apply to shares in respect
of which there is a specific order of Court, Tribunal or Statutory Authority, restraining
any transfer of the shares.
In light of the aforesaid provisions, the Company during FY 2022-23 has transferred the
unpaid/ unclaimed dividend amount of H1.25 Mn, pertaining to final dividend for FY
2014-15, to the Investor Education and Protection Fund ("IEPF") established by
the Central Government. The details of unpaid and unclaimed dividend amounts lying with
the Company as on August 12, 2022 (date of last Annual General Meeting) are available on
the Company's website at https://
www.airtel.in/about-bharti/equity/shares/unpaid-dividend.
Further, 25,697 equity shares of the Company, in respect of which dividend has not been
claimed for seven consecutive years or more from the date of transfer to unpaid dividend
account, have also been transferred to the demat account of IEPF Authority during FY
2022-23. The relevant details of equity shares transferred to IEPF are also available on
the Company's website at https://www.airtel.in/about-bharti/
equity/shares/unpaid-dividend.
The shareholders whose unpaid dividend and/or shares have been transferred to IEPF may
reach out to the Company/ Registrar and Transfer Agent, to lodge their claim for refund of
the unpaid dividend/shares (as applicable) out of the IEPF. The process for claiming the
unpaid dividend/shares out of the IEPF, is also available on the Company's website at
https:// www.airtel.in/about-bharti/equity/shares.
Significant Developments
AmalgamationofNettleInfrastructureInvestments Limited (Nettle') and Telesonic
Networks Limited (Telesonic'), wholly-owned subsidiaries with the Company
During FY 2022-23, the Hon'ble National Company Law Tribunal, Chandigarh Bench, vide
its order dated January 16, 2023 ("NCLT order"), sanctioned the composite scheme
of arrangement between Nettle, Telesonic and their respective shareholders and the
Company, under Sections 230 to 232 and other applicable provisions of the Act for
amalgamation of Nettle and Telesonic, wholly-owned subsidiaries with the Company
(Scheme'). The Scheme has become effective from February 1, 2023.
Upon the Scheme becoming effective:
a) 30,000 Rated, Listed, Unsecured, Guaranteed, Redeemable 5.35% Non-Convertible
Debentures of the face value of H1,000,000 each of an aggregate principal amount of
H30,000 Mn (NCDs) and 17,500,
5.35% Listed Commercial papers of H500,000 each (CPs) of an aggregate principal amount
of H 8,750 Mn issued by Telesonic, have been transferred in the name of the Company.
The aforesaid NCDs and CPs were redeemed by the Company on April 28, 2023 and February
7, 2023 respectively. Accordingly, there are no outstanding NCDs and CPs as on the date of
this report.
b) The authorized share capital of Nettle and Telesonic is deemed to be added to the
authorized share capital of the Company. Accordingly, the authorized share capital of the
Company has been increased to H148,730,500,000/- divided into 29,746,080,000 equity shares
of face value of H5/- each and 1,000 preference shares of face value of H100/- each.
Allotment of Securities
During the FY 2022-23, the Company has made the following allotments:
71,176,839 fully paid-up equity shares of face value of H5/- each at an issue price of
H734/- per share (including a premium of H729/- per share) on preferential basis to Google
International LLC on July 14, 2022.
11,930,543 fully paid-up equity shares of face value of H5/- each at the applicable
conversion price pursuant to conversion of foreign currency convertible bonds
(FCCBs') of principal value of USD 86,300,000 in multiple tranches.
Consequent to the aforesaid allotment(s), the paid-up share capital of the Company has
increased to H28,366,032,827.50/- divided into 5,575,134,650 equity shares of face value
of H5/- each fully paid-up and 392,287,662 partly paid-up equity shares of face value of
H5/- each (H1.25 per share paid-up) as on March 31, 2023.
Deposits
The Company did not accept any deposits during the financial year, including from
public and, as such, no amount of principal or interest was outstanding as on the balance
sheet closure date.
Capital Market Ratings
During the year ended March 31, 2023, the Company was rated by two domestic rating
agencies namely CRISIL and India Ratings & Research Private Limited and three
international rating agencies namely Fitch Ratings, Moody's and S&P, which are as
under:
a) CRISIL maintained the long term ratings at CRISIL AA+(Stable) and short-term ratings
maintained at CRISIL A1+. b) India Ratings & Research Private Limited maintained
Short-term ratings at IND A1+. c) Fitch Ratings revised the Outlook to BBB- (Stable). d)
Moody's upgraded the rating to Baa3 (Stable). e) S&P maintained the rating at BBB-
(Stable).
Employee Stock Option Plans
As on March 31, 2023, the Company has two Employee Stock Options (ESOP') schemes
namely Employee Stock Option Scheme 2001' and Employee Stock Option
Scheme
2005' (collectively referred as Schemes'). The ESOP schemes help in
attracting and retaining talent and aligning long-term interest for the organisation. The
HR & Nomination Committee administers and monitors the Company's ESOP schemes. Both
the ESOP schemes are currently administered through Bharti Airtel Employees Welfare Trust
(ESOP Trust), whereby shares held by the ESOP Trust are transferred to employees, upon
exercise of stock options as per the terms of the Schemes.
Pursuant to the provisions of SEBI (Share Based Employee Benefits and Sweat Equity)
Regulations, 2021 (ESOP Regulations'), a disclosure with respect to ESOP Schemes of
the Company as on March 31, 2023, is available on the Company's website at
https://www.airtel.in/about-bharti/ equity/results.
The members, at their previous AGM held in 2022, had approved the increase in total
number of options of Employee Stock Option Scheme, 2005 by 27,460,136 options. Apart from
this, there were no other material changes in the aforementioned Schemes of the Company
and the ESOP Schemes are in compliance with ESOP Regulations. The certificate from
Chandrasekaran Associates, Company Secretaries, certifying that the schemes are
implemented in accordance with the ESOP Regulations and the resolutions passed by the
members, is available for inspection by the members in electronic mode.
Material changes and commitments affecting the financial position between the end of
financial year and the date of report
There were no material changes and commitments affecting the financial position of the
Company between the end of financial year and the date of this report.
Directors and Key Managerial Personnel
Appointments, Re-appointments, Retirements and Resignations i. Retirement by rotation
and subsequent re-appointment
Pursuant to the provisions of the Act, Mr. Gopal Vittal (DIN: 02291778), Director of
the Company (designated as Managing Director & CEO), will retire by rotation at the
ensuing AGM and being eligible, has offered himself for re-appointment. The Board, on the
recommendation of the HR & Nomination Committee, recommended his re-appointment at the
ensuing AGM.
ii. Appointment and re-appointment of Independent Director
Ms. Kimsuka Narasimhan (DIN: 02102783) will be completing her present term as
Independent Director of the Company on March 29, 2024. On the recommendation of the HR
& Nomination Committee and subject to the approval of the shareholders, the Board has
approved her re-appointment as Independent Director for a further term of five consecutive
years w.e.f. March 30, 2024 upto March 29, 2029.
Ms. Kimsuka Narasimhan fulfils the conditions specified under the Act and the Listing
Regulations and is independent of the management. Accordingly, the Board recommends her
re-appointment, for the approval of the members.
During the FY 2022-23, Mr. Pradeep Kumar Sinha (DIN: 00145126) and Mr. Shyamal
Mukherjee (DIN: 03024803) were appointed as Independent Directors on the Board with effect
from May 18, 2022 to hold office for a term of five consecutive years i.e. upto May 17,
2027. Their appointment was approved by the members in the 27th AGM of the
Company held on August 12, 2022.
In the opinion of the Board, all the directors, including the directors appointed/
re-appointed during the year, possess the requisite qualifications, experience, expertise,
proficiency and hold high standards of integrity.
Brief resume, nature of expertise, disclosure of relationship between directors
inter-se, details of directorships and committee memberships held in other companies of
the directors proposed to be appointed/ re-appointed, along with their shareholding in the
Company, as stipulated under Secretarial Standard 2 and Regulation 36 of the Listing
Regulations, are appended as an Annexure to the Notice of the 28th AGM.
iii. Retirements and resignations of Independent Director(s)
Mr. Shishir Priyadarshi tendered his resignation as Independent Director w.e.f. the
close of business hours on October 31, 2022, to devote time towards new full time
professional responsibilities. He further confirmed that there was no material reason for
his resignation other than the one mentioned above.
Mr. Manish Kejriwal retired from the Board w.e.f. the close of business hours on
September 25, 2022, upon completion of his second term as Independent Director of the
Company.
The Board places on record its sincere appreciation for the valuable contribution made
by Mr. Priyadarshi and Mr. Kejriwal.
Save and except the above, there was no change in the Directors or KMPs of the Company
during the year under review.
Declaration by Independent Directors
Pursuant to Section 149(7) of the Act, the Company has received declarations from all
Independent Directors confirming that they meet the criteria of independence as specified
in Section 149(6) of the Act, as amended, read with Rules framed thereunder and Regulation
16(1)(b) of the Listing Regulations. In terms of Regulation 25(8) of the Listing
Regulations, the Independent Directors have confirmed that they are not aware of any
circumstance or situation which exists or may be reasonably anticipated that could impair
or impact their ability to discharge their duties with an objective independent judgement
and without any external influence and that they are independent of the Management.
The Independent Directors have also confirmed that they have complied with the
Company's Code of Conduct and that they are registered on the databank of Independent
Directors maintained by the Indian Institute of Corporate Affairs. The Directors have
further confirmed that they are not debarred from holding the office of director under any
SEBI order or any other such authority.
The Board of Directors of the Company have taken on record the aforesaid declaration
and confirmation submitted by the Independent Directors.
Board Diversity and Policy on Director's Appointment and Remuneration
The Board of Directors values the significance of diversity and firmly believes that
diversity of background, gender, geography, expertise, knowledge and perspectives, leads
to sharper and balanced decision-making and sustainable development. At Airtel, we
recognize the importance of diversity and inclusion in our boardroom, and we strive to
maintain a diverse composition that reflects the richness of the global community we
serve. The Company has an eminent, high-performing and diverse board comprising
~27% Women Directors.
In terms of the requirement of Section 178 of the Companies Act and Listing
Regulations, the Board of Directors has adopted Policy on Nomination, Remuneration
and Board Diversity' on appointment and remuneration of Directors, Key Managerial
Personnel & Senior Management. The Policy includes, inter-alia, criteria for
appointment of Directors, KMPs, Senior Management Personnel (KMP) and other covered
employees, their remuneration structure and disclosures in relation thereto, total rewards
package for Managing Director & CEO and relevant members of Senior Management which is
linked with sustainability targets and long term performance of the Company. The deferred/
variable remuneration (including Long Term incentive) of KMPs and members of Senior
Management is subject to malus/clawback arrangements.
The policy is available on the Company's website at https://
assets.airtel.in/teams/simplycms/web/docs/BAL-policy-on-nomination-remuneration-and-board-diversity.pdf.
Annual Board Evaluation
The Board works with HR & Nomination Committee and lays down a structured framework
process, format, attributes, criteria and questionnaires for the performance
evaluation of the Board, its Committees and individual directors including the Chairman
and MD & CEO, keeping in view the Board priorities and best practices. The evaluation
process at Bharti Airtel is facilitated online by a leading independent consulting firm.
A detailed disclosure on the framework of Board Evaluation including outcome and action
plan has been provided in the Report on Corporate Governance, which forms a part of the
Integrated Report.
Familiarization Programme for Board members
The Company has adopted a well-structured induction programme for orientation and
training of Directors at the time of their joining so as to provide them with an
opportunity to familiarize themselves with the Company, Board, its management, its
operations including its products and services, business model, values and Company's
culture and the industry in which the Company operates.
A detailed note on the familiarization programme adopted by the Company for orientation
and training of the Directors, is provided in the Report on Corporate Governance which
forms a part of the Integrated Report.
Board Committees and Meetings of the Board and Board Committees
In compliance with the statutory requirements, the Company has constituted mandatory
Committees viz. Audit Committee, Environmental, Social and Governance (ESG) Committee, HR
& Nomination Committee, Corporate Social Responsibility Committee, Risk Management
Committee and Stakeholders' Relationship Committee.
Apart from the above Committees, the Company has also established operating Committees
viz. Committee of Directors and Airtel Corporate Council. Additionally, other special
committees have been constituted for special purposes/ transactions.
During the year under review, all the recommendations made by the Committees of the
Board, including the Audit Committee, were accepted by the Board.
The Board of Directors met five times during the previous year. A detailed update on
the Board, its composition, governance of committees including detailed charters, terms
and reference of various Board Committees, number of Board and Committee meetings held
during FY 2022-23 and attendance of the Directors thereat, is provided in the Report on
Corporate Governance, which forms part of the Integrated Report.
Subsidiary, Associate and Joint Venture Companies
As on March 31, 2023, your Company has 138 subsidiaries, 9 associates and 7 joint
ventures.
During the year under review, the following became subsidiaries of the Company: Airtel
Congo Telesonic Holdings (UK) Limited, Airtel DRC Telesonic Holdings (UK) Limited, Airtel
Gabon Telesonic Holdings (UK) Limited, Airtel Kenya Telesonic Holdings (UK) Limited,
Airtel Madagascar Telesonic Holdings (UK) Limited, Airtel (M) Telesonic Holdings (UK)
Limited (formerly known as Airtel Malawi Telesonic Holdings (UK) Limited), Airtel Niger
Telesonic Holdings (UK) Limited,
Airtel Nigeria Telesonic Holdings (UK) Limited, Airtel Rwanda Telesonic Holdings (UK)
Limited, Airtel Seychelles Telesonic Holdings (UK) Limited, Airtel Tanzania Telesonic
Holdings (UK) Limited, Airtel Uganda Telesonic Holdings (UK) Limited, Airtel Zambia
Telesonic Holdings (UK) Limited, Airtel Tchad Telesonic Holdings (UK) Limited, Airtel (M)
Telesonic Limited, Airtel Kenya Telesonic Limited, Airtel Nigeria Telesonic Limited,
Airtel Rwanda Telesonic Limited, Airtel Telesonic Uganda Limited, Airtel Zambia Telesonic
Limited, Airtel (Seychelles) Telesonic Limited, Airtel Mobile Commerce Tanzania B.V.,
Nxtra Africa Data Holdings Limited (formerly known as Airtel Africa Data Center Holdings
Limited), Nxtra Nigeria Data Holdings (UK) Limited (formerly known as Airtel Nigeria Data
Center Holdings (UK) Limited), Nxtra Kenya Data Holdings (UK) Limited (formerly known as
Airtel Kenya Data Center Holdings (UK) Limited), Nxtra DRC Data Holdings (UK) Limited
(formerly known as Airtel DRC Data Center Holdings (UK) Limited), Nxtra Gabon Data
Holdings (UK) Limited (formerly known as Airtel Gabon Data Center Holdings (UK) Limited),
Nxtra Congo Data Holdings (UK) Limited (formerly known as Airtel Congo Data Center
Holdings (UK) Limited), Airtel Congo RDC Telesonic S.A.U. and Nxtra Africa Data (Nigeria)
Limited.
During the year under review, Mawezi RDC S.A. became joint venture of the Company.
During the year, Telesonic and Nettle ceased to be the wholly owned subsidiaries of the
Company and Aban Green Power Private Limited ceased to be the associate company.
Pursuant to Section 129(3) of the Act, read with Rule 5 of Companies (Accounts) Rules,
2014, a statement containing salient features of financial statements of subsidiary,
associate and joint venture companies in prescribed form AOC-1, is annexed to the
consolidated financial statements of the Company which forms part of this Integrated
Report. The said statement also provides the details of performance and financial position
of each subsidiary, associate and joint venture and their contribution to the overall
performance of the Company.
In terms of the requirement of Section 136 of the Act, the financial statements of each
of the subsidiary company are available on the Company's website at https://www.airtel.in/
about-bharti/equity/results/annual-results and the same will also be available
electronically for inspection by the members during the AGM.
The audited financial statements of each subsidiary, associate and joint venture
company are available for inspection at the Company's registered office. The physical
copies of annual financial statements of the subsidiary, associate and joint venture
companies will also be made available to the members of the Company upon request.
The Policy for determining material subsidiaries of the Company is also provided on the
Company's website at https://s3-ap-southeast-1.amazonaws.com/bsy/iportal/
images/Policy-for-determining-Material-Subsidiaries-1_3C3
DACCD6AC67BF355A2231C3D434D64.pdf.
Auditors and Auditors Report Statutory Auditors
In terms of the provisions of Section 139 of the Act, Deloitte Haskins & Sells LLP
(Deloitte') were re-appointed as the Statutory Auditors by the shareholders in the
27th AGM held on August 12, 2022, for a period of five years i.e. till the
conclusion of 32nd AGM. The said re-appointment of Deloitte was duly recommended by the
Audit Committee and Board of Directors after considering Deloitte's expertise, competence
and experience in statutory audit, advisory services, due diligence etc. of various
multinational and large companies particularly telecom sector companies.
Deloitte Haskins & Sells LLP have confirmed that they are not disqualified from
continuing as Statutory Auditors of the Company and satisfy the independence criteria in
terms of the applicable provisions of the Act and Code of Ethics issued by the Institute
of Chartered Accountants of India.
The Board has duly examined the Statutory Auditors' Report to the financial statements,
which is self-explanatory. The clarifications, wherever necessary, have been included in
the Notes to financial statements section of the Integrated Report.
As regards the comments under para i(a) of the Annexure B to the Independent Auditors'
Report regarding updation of quantitative and situation details relating to certain fixed
assets, the Company as per the program of physical verification of fixed assets to cover
all the items over a period of three years, conducted physical verification of fixed
assets during the quarter ended March 31, 2023. The Company is in the process of updating
quantitative and situation details relating to certain fixed assets which were identified
during the physical verification exercise. This same is expected to be completed by
December 2023.
As regards the comments under para i(b) of the Annexure B to the Independent Auditors'
Report regarding no physical verification of customer premises equipment, bandwidth and
certain assets due to their nature or location; the customer premises equipment are
located at subscriber's premises and physical check of the equipment is generally not
possible.
As regards the comments under para i(c) of the Annexure B to the Independent Auditors'
Report regarding transfer of title deed in the name of the Company, the ownership of these
properties is transferred and vested in the name of the Company through merger scheme. The
Company is in the process of getting the title deeds transferred in name of the Company.
As regards to the comments under para ix(d) of the Annexure B to the Independent
Auditors' Report regarding fund raised on short term basis used for long term purpose, the
Company has used such funds as bridge financing and is able to generate sufficient funds
from long term sources to meet the working capital requirement.
Further, during the year under review, the auditors have not reported any fraud under
Section 143(12) of the Act, and therefore, no details are required to be disclosed under
Section 134(3)(ca) of the Act.
Internal Auditors and Internal Assurance Partners
The Company has in place a robust Internal Assurance Group (IAG), which is led by the
Chief Internal Auditor and ably supported by reputed independent firms i.e. Ernst &
Young LLP, Chartered Accountants and ANB & Co., Chartered Accountants as the Internal
Assurance Partners.
The audits are based on an internal audit plan, which is derived from a bottoms-up risk
assessment and directional inputs from the Audit Committee in consultation with the IAG.
The Audit Committee oversees the scope and coverage of the audit plan and evaluates the
overall results of these audits during the quarterly Audit Committee meetings. These audit
are based on risk based methodology and, inter-alia, involve the review of internal
controls and governance processes, adherence to management policies and review of
statutory compliances. The Internal Assurance Partners share their findings on an ongoing
basis for corrective action.
The work of Internal Assurance Partners is coordinated by the internal team led by
Chief Internal Auditor. The combination of internal team and expertise of reputed
independent professional firms ensures independence as well as effective value addition
and protection.
The Board, on the recommendation of the Audit Committee, has re-appointed Ernst &
Young LLP, Chartered Accountants and ANB & Co. Chartered Accountants as the Internal
Assurance Partners for FY 2023-24.
Cost Records
The Company has maintained the cost records as prescribed by the Central Government
under Section 148(1) of the Act .
Cost Auditors
The Board, on the recommendation of the Audit Committee had appointed Sanjay Gupta
& Associates, Cost Accountants, as Cost Auditors, for the financial year ending March
31, 2023. The Cost Auditors will submit their report for FY 2022-23 within the timeframe
prescribed under the Act.
Cost Audit report for the FY 2021-22 did not contain any qualification, reservation,
disclaimer or adverse remark.
In accordance with the provisions of Section 148 of the Act read with the Companies
(Audit and Auditors) Rules, 2014, the remuneration payable to the Cost Auditors has to be
ratified by the shareholders. Accordingly, the Board recommends the same for approval by
shareholders at the ensuing AGM.
The Board, on the recommendation of Audit Committee, has re-appointed Sanjay Gupta
& Associates, Cost Accountants, as Cost Auditors of the Company for FY 2023-24.
Secretarial Auditors
Pursuant to the provisions of Section 204 of the Act and rules made there under, the
Board of Directors had appointed Chandrasekaran Associates, Company Secretaries, as
Secretarial Auditors for the financial year ended March 31, 2023. The Secretarial Auditor
has submitted their report, confirming, inter-alia, compliance by the Company of all the
provisions of applicable corporate laws and does not contain any qualification,
reservation, disclaimer or adverse remark.
The Secretarial Audit Report is annexed as Annexure A of this Report.
The Board, on the recommendation of Audit Committee, has re-appointed Chandrasekaran
Associates, Company Secretaries as Secretarial Auditors of the Company for FY 2023-24.
Sustainability Journey
The Board continues to have a sharp focus on Environmental, Social and Governance (ESG)
agenda to ensure long-term value creation for all stakeholders through sustainable
business practices.
The ESG Committee of the Company provides strategic guidance on ESG Targets and
strategy. It keeps an oversight on implementation of adopted ESG priorities and ensures
they are aligned with best industry standards. The Committee reviews and approves ESG
Targets, strategy, monitors performance of the Company and provides guidance on ESG
improvement areas, ratings etc. and keeps an oversight over material ESG risks (including
climate change risk), opportunities, mitigation strategies and provides strategic
guidance.
At Airtel, we are committed to digitally connect the entire nation and roll out 5G on
pan-India basis by March 2024. As of now, our network (with 759,310 BTS installed) covers
95.7% of the population in 7,913 Census towns as well as 795,126 Non-Census towns and
villages.
Airtel, in all its capacity supports the agenda to limit global temperature increase to
less than 1.5?C, as outlined in the Paris Accords. To achieve this, we have adopted
Science Based Targets to reduce emissions by 50.2% from our own operations and 42% in our
value chain.
During the year, the Company continued to prioritise Greening the Network and building
Climate Resilience. Out of the total electricity consumed in our data centers, 33% comes
from renewable sources. Our 5G Towers will generate 85% lesser carbon emissions for every
GB compared to what 4G Towers would consume. The company continues to focus on safety,
employee well-being and improving diversity.
We continue to ramp up our 5G roll out and expect to connect all major towns and key
villages by the end of this year. The Company has joined the WEF initiative alliance of
the CEO Climate Leaders of India. This alliance enables to serve with a higher-level
platform for business leaders to step India's climate action and green transition efforts
and is committed to enable 4G Net Adds to enable digital inclusion.
During the year, our ESG initiatives were recognised by multiple forums, which is
detailed at Page 35 of this Integrated Report.
Corporate Social Responsibility
Airtel is committed to long-term sustainable value creation by aligning its social
activities with its business objectives. Giving back to the very community that helps our
business thrive and sustain, has been our priority since inception. As a good corporate
citizen, we have been actively undertaking community development and nation building
initiatives towards creation of a prosperous society by collaborating with diverse
stakeholders. We believe in pursuing wider socio-economic and cultural objectives and have
always endeavoured to not just meet, but try and exceed the expectations of the
communities in which we operate.
Airtel has been an early adopter of CSR initiatives. Bharti Foundation, the
philanthropic arm of Bharti Enterprises, was established in the year 2000, with the
objective of transforming the lives of children and youth to help them achieve their
potential by proactively implementing and supporting programs for quality education and
skill development. Bharti Foundation is a key partner for undertaking development programs
for Airtel and its subsidiaries/ joint ventures. It acts as an institutionalized body
towards uplifting communities by supporting holistic education programs, with an enhanced
focus on digital inclusion.
In terms of applicable provisions of Section 135 of the Companies Act, 2013, the
Company was not obligated to contribute towards CSR activities during the FY 2022-23.
However, the Company has made voluntary CSR contribution of H6.48 Mn during the financial
year 2022-23. Additionally, the Company has also contributed H14.70 Mn to various other
charitable institutions.
The direct subsidiaries of the Company have contributed H225 Mn and associates / joint
venture entities have contributed H976.80 Mn (totalling to H1,201.80 Mn) towards various
CSR activities, which is in addition to the voluntary CSR contribution of the Company
under Section 135 of Companies Act, 2013.
The above voluntary contribution reflects the Company's commitment to pursue
socio-economic and cultural objectives for benefit of the society at large.
A detailed update on the CSR initiatives of the Company is provided in the Corporate
Social Responsibility Report, which forms part of this Integrated Report.
The CSR Committee is in place in terms of Section 135 of the Companies Act, 2013. The
details of CSR Committee including composition, terms of reference etc. are provided in
the Report on Corporate Governance, which forms part of this Integrated Report. The CSR
Committee has formulated and recommended to the Board, a CSR Policy outlining, inter-alia,
CSR philosophy of the Company. The said policy is available on the Company's website at
https://assets.airtel.in/teams/ simplycms/web/docs/Bharti_Airtel-Updated_CSR_Policy_
June2021.pdf
The annual report on Corporate Social Responsibility u/s 135 of the Companies Act, 2013
is annexed as Annexure B to this Report.
Integrated Reporting
The Company continues with its integrated reporting journey in the current Fiscal Year,
aligning with its philosophy of being a highly transparent and responsible corporate
citizen. Our 6th Integrated Report is guided by the principles of International
Integrated Reporting Framework developed by the International Integrated Reporting Council
(now consolidated into IFRS Foundation) and reflects the key actions taken by the Company
towards long-term sustainability and stakeholder value creation. The Board acknowledges
its responsibility for the integrity of the report and the information contained therein.
Business Responsibility & Sustainability Report
Pursuant to Regulation 34(2)(f) of the Listing Regulations, the Business Responsibility
and Sustainability Report ('BRSR') on initiatives taken from an environmental, social and
governance perspective, in the prescribed format is available as a separate section of
this Integrated Report and is also available on the Company's website at www.airtel.in.
Management Discussion and Analysis Report
Pursuant to Regulation 34 of the Listing Regulations, the Management Discussion and
Analysis Report for the year under review, is presented in a separate section forming part
of this Integrated Report.
Corporate Governance Report
A detailed Report on Corporate Governance, pursuant to the requirements of Regulation
34 of the Listing Regulations, forms part of this Integrated Report. A certificate from
Deloitte Haskins & Sells LLP, Chartered Accountants, the Statutory Auditors of the
Company, confirming compliance of conditions of Corporate Governance during FY 2022-23, as
stipulated under the Listing Regulations, is annexed as Annexure C of this Report.
Risk Management
Risk management is embedded in Bharti Airtel's operating framework. The Company
believes that risk resilience is the key to achieve long term sustainable growth. To this
effect, there is a robust framework in place to identify key risks across the group and
prioritise relevant action plans to mitigate these risks.
To have a sharper focus, the Company has constituted a Risk Management Committee to
focus on risk management including determination of Company's risk appetite, risk
tolerance, regular risk assessments and risk mitigation strategies (risk identification,
risk quantification and risk evaluation) etc.
The Chief Risk Officer is responsible for assisting the Risk Management Committee on an
independent basis with a complete review of the risk assessments and associated management
action plans.
The Risk Management Framework is reviewed periodically by the Risk Management
Committee, which includes discussing the management's submissions on risks, prioritising
key risks and approving mitigation plans.
The Company has duly approved Enterprise-wide Risk Management Framework. The objective
of this framework is to have a well-defined approach towards risk and lays down broad
guidelines for timely identification, assessment and prioritisation of risks affecting the
Company in the short term and in the foreseeable future. The framework suggests developing
a response action for the key risks identified, so as to make sure that the risks are
adequately addressed or mitigated.
Operationally, risk is being managed at the top level by the Management Boards in India
and South Asia and at the operating level by Executive Committees of Circles in India and
operating companies in the international operations.
Detailed update on risk management framework has been covered under the risk section,
forming a part of the Integrated Report. At present, in the opinion of the Board of
Directors, there are no risks which may threaten the existence of the Company.
Internal Financial Controls and their Adequacy
The Company has established a robust framework for internal financial controls. It has
in place adequate controls, procedures and policies, ensuring orderly and efficient
conduct of its business, including adherence to the Company's policies, safeguarding of
its assets, prevention and detection of frauds and errors, accuracy and completeness of
accounting records and timely preparation of reliable financial information.
Your Board periodically reviews the internal processes, systems and the internal
financial controls and accordingly, the Directors' Responsibility Statement contains a
confirmation as regards adequacy of the internal financial controls. Assurance on the
effectiveness of Internal Financial Controls is obtained through management reviews,
self-assessment, continuous monitoring by functional heads as well as testing of the
internal financial control systems during the course of audits. We believe that these
systems provide reasonable assurance that our internal financial controls are designed
adequately and are operating as intended.
Compliance Management
The Company has a structured and digitised compliance framework based on a
comprehensive inventory, which are regularly monitored and updated basis the changing
requirements of law. Proactive automated alerts are sent to compliance owners to ensure
compliance within stipulated timelines.
The compliance owners certify the compliance status which is reviewed by compliance
approvers and a consolidated dashboard is presented to the respective Business Leaders and
the Managing Director & CEO. A certificate of compliance with all applicable laws and
regulations along with the summary of material litigations and mitigation plan, if any, is
placed before the Audit Committee and Board of Directors on a quarterly basis.
Additionally, the Company has centralised automated tool in place viz. Notice Management
System to regularly monitor and update the regulatory notices.
Compliance requirements are independently reviewed during periodic internal audits.
Other Statutory Disclosures Vigil Mechanism
The Company has adopted a Vigil Mechanism/Whistle Blower Policy which forms part of
Code of Conduct of the Company. It outlines the method and process for stakeholders to
voice their genuine concerns about unethical conduct that may be actual or threatened
breach with the Company's Code of Conduct. The Policy is available on the Company's
website at https://assets.airtel.in/teams/simplycms/web/docs/Code-of-Conduct-2022.pdf.
A brief note on the highlights of the Whistle Blower Policy and compliance with Code of
Conduct, is also provided in the Report on Corporate Governance, which forms part of this
Integrated Report.
Prevention of Sexual Harassment at Workplace
In compliance with Sexual Harassment of Women at Workplace (Prevention, Prohibition and
Redressal) Act, 2013 (POSH Act, 2013), the Company has adopted a policy which is in
compliance with the provisions of the POSH Act, 2013 and constituted an Internal
Complaints Committee for providing a redressal mechanism pertaining to sexual harassment
of employees at workplace and any such incident can be reported to the Internal Complaints
Committee. Details regarding the policy, including the details of the complaints received
and disposed off, are provided in the Report on Corporate Governance and Business
Responsibility & Sustainability Report, which form part of this Integrated Report.
Annual Return
In terms of Section 92(3) read with Section 134(3(a) of the Act and rules thereto, the
Annual Return of the Company in Form MGT 7 for the financial year ended on March
31, 2023 is available on the Company's website at https://www.
airtel.in/about-bharti/equity/results. The Annual Return will be electronically submitted
to the Registrar of Companies within the timelines prescribed under the Act.
Significant and Material Orders
During the FY 2022-23, there were no significant and material orders passed by the
regulators or courts or tribunals impacting the going concern status and the Company's
operations in the future.
Proceeding under Insolvency and Bankruptcy Code, 2016
There were no proceedings, either filed by the Company or against the Company, pending
under the Insolvency and Bankruptcy Code, 2016 as amended, before the National Company Law
Tribunal or other Courts as on March 31, 2023.
Particulars of Loans, Guarantees and Investments
In compliance with the provisions of the Act and Listing Regulations, the Company
extends financial assistance in the form of investment, loan, guarantee etc. to its
subsidiaries, from time to time in order to meet their business requirements. Further, the
Company or any of its subsidiary has not extended any financial assistance to promoter or
promoter group entities which has been written off during last 3 years.
Particulars of loans, guarantees and investments form part of Note no. 9, 22 and 7
respectively to the standalone financial statements provided in this Integrated Report.
The Company is in the business of providing telecom services (wireless
telecommunications activities) and accordingly is covered under the definition of
infrastructure facilities' in terms of Section 186 read with Schedule VI of the Act.
Related Party Transactions
The Company has a well-defined and structured governance process for related party
transactions undertaken by the Company. The related party transactions are undertaken
after review and certification by leading Independent global valuation/ accounting firms
confirming that the proposed pricing mechanism for a particular transaction meets the
arm's length criteria. In certain cases, the external valuers from the said leading
Independent global valuation/ accounting firm(s) also present the valuation report to the
Audit Committee. The Audit Committee considers the certifications of leading Independent
global valuation/ accounting firm and conducts a review before granting approval to any
related party transaction. A detailed note on the procedure adopted by the Company in
dealing with contracts and arrangements with related parties is provided in the Report on
Corporate Governance, which forms part of this Integrated Report.
During the FY 2022-23, the Company had entered into material related party transaction
with Indus Towers Limited (Joint Venture Company) and necessary disclosure in form AOC-2
in this regard is given in Annexure D of this Report. Further, all
arrangements/transactions entered into by the Company with its related parties during the
year under review, were in the ordinary course of business and on an arm's length
compliant terms.
In compliance with the requirement of Listing Regulations, names of related parties and
details of transactions with them have been included in Note 34 to the financial
statements provided in this Integrated Report.
The Policy on the Related Party Transactions is available on the Company's website at
https://assets.airtel.in/teams/ simplycms/web/docs/RPT_Policy.pdf.
Energy Conservation, Technology Absorption and Foreign Exchange Earnings and Outgo
The details of energy conservation, technology absorption and foreign exchange earnings
and outgo as required under Section134(3) of the Act read with the Rule 8 of the Companies
(Accounts) Rules, 2014 is annexed as Annexure E of this Report.
Particulars of Employees
Disclosures relating to remuneration of Directors u/s 197(12) of the Act read with Rule
5(1) of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is
annexed as Annexure F of this Report.
Particulars of employee remuneration, as required under Section 197 (12) of the Act and
read with Rule 5(2) and Rule 5(3) of the Companies (Appointment and Remuneration of
Managerial Personnel) Rules, 2014 forms part of this Integrated Report. In terms of the
provisions of the first proviso to Section 136(1) of the Act, the Integrated Report is
being sent to the shareholders, excluding the aforementioned information. The information
will be available on the Company's website at https://www.airtel.in/about-bharti/
equity/results and will also be available for inspection at the registered office of the
Company on all working days (Monday to Friday) between 11.00 a.m. and 1.00 p.m. upto the
date of AGM and a copy of the same will also be available electronically for inspection by
the members during the AGM. Any member interested in obtaining such information may write
to the Company Secretary of the Company.
Directors' Responsibility Statement
Pursuant to Section 134 of the Act, the Directors, to the best of their knowledge and
belief, confirm that:
a) in preparation of the annual accounts, the applicable accounting standards had been
followed, along with proper explanation relating to material departures;
b) the Directors had selected such accounting policies and applied them consistently
and made judgements and estimates that are reasonable and prudent, so as to give a true
and fair view of the state of affairs of the Company at the end of the financial year and
of the profit and loss of the Company for that period;
c) the Directors had taken proper and sufficient care for the maintenance of adequate
accounting records in accordance with the provisions of this Act for safeguarding the
assets of the Company and for preventing and detecting fraud and other irregularities; d)
the Directors had prepared the annual accounts on a going concern basis;
e) the Directors, had laid down internal financial controls to be followed by the
Company and that such internal financial controls are adequate and were operating
effectively;
f) the Directors had devised proper systems to ensure compliance with the provisions of
all applicable laws and that such systems were adequate and operating effectively.
Key initiatives with respect to stakeholder relationship, customer relationship,
environment, sustainability, health, safety and welfare of employees
The key initiatives taken by the Company with respect to stakeholder relationship,
customer relationship, environment, sustainability, health and safety are provided
separately under various Capitals and Business Responsibility and Sustainability Report,
as a part of the Integrated Report. The Environment, Health and Safety Policy and Human
Rights Policy are available on the website of the Company at https://
www.airtel.in/sustainability-file/embedding-sustainability.
Compliance of Secretarial Standards
Pursuant to the provisions of Section 118 of the Act, during FY 2022-23 the Company has
complied with the applicable provisions of the Secretarial Standards (SS-1 and SS-2)
relating to Meetings of the Board of Directors' and General Meetings' issued
by the Institute of Company Secretaries of India and notified by Ministry of Corporate
Affairs.
Acknowledgements
The Board wishes to place on record their appreciation to the Department of
Telecommunications (DoT'), the Central Government and State Governments in India,
Government of Bangladesh and Governments in the 14 countries in Africa, Company's bankers
and business associates, for the assistance, co-operation and encouragement extended to
the Company.
The Directors also extend their deep appreciation to the employees for their continuing
support and unstinting efforts in ensuring an excellent all-round operational performance.
The Directors would like to thank Bharti Telecom Limited, Singapore Telecommunications
Ltd. and other shareholders for their support and contribution. We look forward to their
continued support in future.
|
For and on behalf of the Board |
|
Sunil Bharti Mittal |
Date: May 16, 2023 |
Chairman |
Place: New Delhi |
DIN: 00042491 |
|