Defending its slower-than-Idea volume and revenue growth in India, Airtel management essentially indicated that the two companies are pursuing different strategies and the company is internally extremely satisfied with the performance of the India wireless business. We agree that Bharti?s performance on the India wireless side has been solid in the past few quarters in its own right; however, volume growth differential (on voice and especially data) versus Idea is too glaring to dismiss, in our view.
Airtel's management, like Idea?s, reiterated that it does not foresee a need for meaningful fresh 3G/4G cell sites for the next few years. This is in line with our view that 3G/4G cell site additions would be primarily in the form of loading.
The company, while avoiding any meaningful discussion on the upcoming auctions, did indicate that it expects the auctions to be rational. Definition of ?rationality? is the real unknown here and we maintain that the outcome of upcoming auctions is tricky to call.
