A load of crap from an idle brain

After losing out on MTN and pocketing Warid of Bangladesh, it looks like Bharti Airtel is on a tearing hurry.  As the world’s fastest growing telecom market, India becomes more and more competitive with more than 10 service providers already, Bharti is looking to spread the eggs across other markets.

Bharti Airtel is in $10.7 billion talks with Zain to buy most of the Kuwaiti telecom’s cellular assets in Africa — the Indian firm’s third attempt to gain a foothold in the region.

The deal, if clinched, would be India’s biggest overseas acquisition since Tata Steel’s $12 billion purchase of European steel maker Corus in 2007.

Mobile subscriber additions are running at a monthly average of about 15 million in India, making it the world’s fastest-growing wireless market. The rapid pace has attracted new foreign operators such as Telenor and Sistema, making competition more intense.

Call charges have fallen sharply, to as low as a fraction of a US cent per minute, squeezing margins and clouding earnings growth potential.

Bharti reported its slowest profit growth in more than three years for the December quarter, and average revenue per user (ARPU) — a key operational gauge — fell 29 per cent to 230 rupees ($5). The market is also showing early signs of saturation, with penetration reaching about 45 per cent.

To beat the slowdown, Bharti has been scouting overseas, with a focus on high growth-potential emerging markets. After failing to get a deal with South Africa’s MTN Group, the company has set up a new unit to drive overseas expansion. It also agreed last month to acquire control of Bangladesh’s Warid Telecom.

Africa is attractive for Bharti as the mobile user base is low there, with just over a third of the population having a mobile.

Zain’s 15 African operations included in the deal have a combined user base of about 42 million, and the operator is No.1 in 10 markets, ranking second in another four, according to brokerage reports. ARPU in these operations ranges from $3 to $25, with 10 of the 15 having higher ARPU than Bharti.

Rest of the article here

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The world’s fastest growing telecom market, India is getting too hot and competitive for the biggest player Bharti Airtel to handle.  After its aborted attempt to buy South Africa’s MTN which fell through due to regulatory issues, Bharti is now looking in the neighbourhood for an acquisition.

In a shift of strategy, Bharti Airtel, the country’s largest telecom operator, is close to acquiring a 70% stake in Bangladesh’s fourth largest mobile operator, Warid Telecom, for close to $900 million.

The deal, likely to be sealed mid-January, comes three months after Bharti failed to secure a deal with South Africa’s MTN to become the world’s fourth largest mobile firm by subscribers.

Post-deal, management control of Warid Telecom would pass on to Bharti and Bangladeshi media reports say Bharti has submitted an investment plan of $300 million.

Bharti’s costly acquisition plan is an indication of how the stakes have risen in the telecom sector in the sub-continent; the offer is almost three times the $350 million DoCoMo paid in 2008 to buy a 30% stake in Aktel or TM International, the third ranked operator in Bangladesh.

Rest of the article here

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New entrants in the market, a vicious price war, plunging stock prices of telecom companies, and now the Indian telecom subscribers have touched 500 million. We are indeed living in interesting times.

Amidst the raging tariff war leading to telecom stocks getting hammered on the bourses, the country s total subscriber base crossed the 500-million mark in September, 15 month ahead of the targeted schedule of December, 2010.

According to figures released by the Telecom Regulatory Authority of India on Wednesday total telecom subscribers in the country increased to 509.03 million at the end of September from 494.07 million in August, registering a growth rate of 3.03%. With this tele-density has increased to 43.50% with wireless tele-density at 40.31. India is the second-biggest market for wireless services, lagging only China which has more than 600 million users, and is the fastest-growing market in the world.

Mobile opearators led by Bharti Airtel, Vodafone-Essar and Tata Teleservices have been wooing the customers with innovative tariff packages in a market where call rates are already ruling at the rock bottom and is the main driver of the growth. New tariff plans such as per-second billing introduced by most of the operators are likely to see huge subscriber addition in the coming months.

News source: Yahoo

Pictures source: Vivek Mishra & IANS

The new year has not been off to a great start, at least blogging wise for me.  For some strange reason, iam not even checking my blog, visiting any other blogs or even commenting on them. Contrary to the economic conditions worldwide, am swamped with work.  On my way back home, am so tired that i hardly can open a book and read.

The songs in my Creative Zen play in my head as i doze off.  Fortunately, i haven’t missed out on my bus stop.  Eitherway, the bus interchange is quite close to my home and even if i don’t wake up, the driver will kick me out once the bus reaches the interchange.

Before i could realise, the 4 day weekend passed by.  Did nothing constructive. Just lazed around at home and watched 6 movies.  Some of them i have updated at the Movies page.

I have almost stopped reading the newspapers thoroughly.  With layoffs to the emergence of Talibans in Mangalore, the Thuggerays in Bombay to the incessant coverage of Manmohan Singh’s health conditions, its getting routine and boring.  With so much of bad news around, i hardly need any more in the papers to feel more glum.  So, i have made it a point to no longer read any news in detail that sounds negative.

The only positive thing that happened is that South Africa beat the hell out of the Aussies both in the test and one-dayers.  Pricky Ricky Ponting’s face was well worth watching during the match.  Everything that he is laying his hands on is turning into cow dung.  Looks like Australia committed the same mistakes that West Indies did in the 90s after a superb 80s.  By not managing to get effective players to replace the likes of Waugh brothers, Taylor, Warne, McGrath, Slater, Hayden etc the Aus team is now in a serious rut.

Warner and Shaun Marsh are great prospects, but Aus doesnt have a bowling lineup that can bowl out an opposition twice in a test match.  In McGrath and Warne they had 2 of the most lethal and consistent bowlers.  Of course such players are born only once in a generation, but for sure there has been no good nurturing of the kids to replace the giants.

Compared to them, i believe the Indian team has done a better transition.  With Kumble and Ganguly gone and with Dravid almost out, India has lost a majority of the Fab 5 that it boasted of.  The one day team has no one from the Fab 5 except Sachin Tendulkar and unlike the past when we switched off the TV when Sachin got out, today hardly anyone blinks.

From the boring domination of the Aussies at the beginning of this decade to a much more rounded competition (South Africa, India and Australia), i believe we could be looking at much better matches ahead.

Also once Muralitharan and Jayasuriya hang their gloves, Sri Lanka would also be on their way down.

So, what have i been doing in the past 2 months ever since the markets crashed and the economic gloom all around? Invest in the stock markets of course.  Some of the best companies are available at dirt cheap prices or at the lowest ever prices in their lifetime.  I know of a lot of people who are staying away and waiting for the markets to stabilize (am not sure what that means), but am buying.

I have started buying small amounts in L&T even though am not really appreciative of the L&T management trying its luck in the Satyam muck.  I have also started buying into Tata Motors.  Also have averaged out my investments in Reliance Communications, Punj Lloyd, Suzlon & Praj Industries.

Disclaimer:  I would like to hereby declare that all the investments that i write in my posts are not to be taken as an advice.  Iam not responsible for any losses that you might make by following  what i have mentioned in this blog. Please approach a Certified Financial Advisor for more info or do your own research before investing.

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Very often we get a good bargain and think that we are quite intelligent to get that bargain. Whereas in truth, the reason why we got the bargain could have been simply because we were lucky or just happened to be at the right place at the right time.

A friend of mine had bought Reliance Communications stocks at around Rs 480 per share sometime back and had been looking for an opportunity to average out the price.  The current market crash provided a great buy opportunity for him.  When the stock reached Rs 215, i bought a few.  My friend laughed at me and said that it will go down further.  Just as he predicted, the stock fell to Rs 209.  He put a buy trigger at Rs 205.  I advised him to buy it at Rs 209 itself as there was nothing great he was going to gain by buying a stock for 4 rupees cheaper when his idea has been to be a long term investor (a holding period of at least 2-3 years).

The stock zoomed from around 209 rupees to 263 rupees (as of 05/01/2009).  Even though he wanted to, he never got the opportunity to buy in as the stock has been on a northern journey ever since it was announced that Reliance Communications was going to offer GSM services all over India.  The chances of the stock now coming back to my friend’s expectaions are lower now.

One may say that he has lost nothing becuase he didnt buy anything.  No doubt its true, but he lost the chance of buying the stock at around 210 rupees. Had he bought the stock at Rs 210, he would have been sitting on Rs 53 profit per share within 15 days. Also, he lost the chance to average out the stock value which he had previously bought at around Rs 480.

The Lesson: Never try to time the market. If you truly believe in the stock and if you have done all your research into the fundamentals of the stock and the company, then go ahead and buy it.

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