Fundamental Analysis:

It comprises of three stages, A. Basic Economic Analysis. B. Industries Analysis. C. Company Analysis. A. Basic Economic Analysis of India. Economic Analysis is a systematic approach to determining the optimum use of scarce resources, involving comparison of two or more alternatives in achieving a specific objective under the given assumptions and constraints. Economic analysis takes into account the opportunity costs of resources employed and attempts to measure in monetary terms the private and social costs and benefits of a project to the community or economy. The economic analysis assesses the short to medium-term determinants of price developments. The focus is on real activity and financial conditions in the economy. The economic analysis takes account of the fact that price developments over those horizons are influenced largely by the interplay of supply and demand in the goods, services and factor markets. Indian Economic can be analysed base on following factors, 1. GDP (Gross Domestic Product): GDP growth indicators The Indian economy found itself in the heart of conflicting demands of managing growth as well as price stability. From advanced estimates of a 9% GDP growth for 2011-12 made during the previous economic survey to a mid-year analysis of 7.5%, the economy is finally expected to grow at a much slower rate of 6.9%. Global factors such as crisis in the Eurozone, sluggish growth in many industrialized countries, hardening international crude oil prices and domestic factors such as tightening of monetary policy have influenced the growth rate of the Indian economy. The GDP growth estimated in 2011-12 has been the lowest in eight years, with the exception of the year 2008-09 (year of the global economic crisis). However, globally, India ranks amongst the foremost in terms of economic growth rate (after China). Both agriculture and service sectors have continued to perform well and the slowdown is attributable to the weakening industrial growth. The Indian economy growth is at its lowest in the last 6 years (excluding 2008-09). Globalisation, while providing new opportunities, also brings along new challenges and responsibilities. This has directly impacted the Indian economy growth. There are some positive indications that the weakness in economic activity is at its lowest and upswing is imminent.

GDP Growth
9.6 9.3 6.7 8.4 8.4 6.9

2006-2007

2007-2008

2008-2009

2009-2010

2010-2011

2011-2012

The latest information on quarterly estimates of GDP is available for the first two quarters of 2012-2013. The GDP growth in the first and second quarters of 2012-2013 is estimated at 5.5 per cent and 5.3 per cent, as compared to 8.0 per cent and 6.7 per cent during the corresponding periods of 2011-2012. Global economic influence India is no longer only a spectator to the global economy. Changes in the global economy have begun to have a large implication on India. Simultaneously, Indias influence on the global economy is also increasing steadily. As Indias GDP composition has undergone a significant change over the past two decades from a manufacturing to services economy, the global economy has also undergone a radical change in terms of its configuration. The composition of large emerging economies (especially BRIC countries) to the global GDP has increased from 8.4% in 2000 to 18.2% in 2010. The decline in share of developed economies to the global GDP can be particularly marked to the decline of the EUs share and the shift of growth from Japan to China. The Chinese economy has grown fivefold to become the second largest economy in the world. Despite a lower growth rate than its neighbour China, Indias growth also has begun to impact the global economy and this is evident from the fact that it is the fourth largest economy in PPP terms. 2. Agriculture: As per the fourth advance estimates for 2011-12, food grains production was estimated at 257.44 million tonnes, out of which Kharif production was 129.94 million tonnes and Rabi production was 127.50 million tons. During the South West monsoon season of 2012, the country as a whole received 8 per cent less rainfall than the Long Period Average (LPA). Central India and North-west India experienced deficiency level of (-) 4 and (-) 7 per cent, respectively and the Peninsular India received (-) 10 per cent less rainfall. North East India received 11 per cent less rainfall than LPA. At district level 10 per cent of districts received excess rainfall 48 per cent normal rainfall 37 per cent deficient rainfall and 5 per cent scanty rainfall. Southwest monsoon (June to September 2012) rainfall for the country as a whole and the four broad geographical regions is given in the table below. Out of 36 Sub Divisions, 13 recorded deficient rainfall during the South West monsoon in 2012. Out of the 23 remaining sub divisions 1 recorded excess rainfall and the remaining 22 recorded normal. Out of 628 Metrological districts for which data are available 365 (58%) received excess/normal rainfall and the remaining 263 (42%) received deficient/scanty rainfall during the season There has been a decline in the overall area coverage of food grains during kharif 2012-13 as compared to kharif 2011-12 (4th advance estimates) due to deficient south west monsoon. The area coverage under food grains during kharif 2012-13 stood at 665.03 lakh hectares compared to 720.86 lakh hectares last year. The major decline in the area of kharif foodgrains has been due to shortfall in the area under rice in Andhra Pradesh, West Bengal, Jharkhand and Bihar, coarse cereals mainly due to lower coverage under bajra in Rajasthan; and also pulses. The area under oil seeds has also been lower as compared to the previous year. The area coverage under kharif rice during 2012-13 is around 391.62 lakh hectares which is lower by 9.06 lakh hectares compared to last year. The area coverage under sugarcane during the current year has marginally improved to 51 lakh hectares, which is higher by about 0.13 lakh hectares as compared to the previous year and the area under cotton has decreased to116.14 lakh hectares as compared to 121.78 lakh hectares during 2010-11 registering a decrease of

5.64 lakh hectares. As per the 1st Advance Estimates (covering only kharif crops), production of food grains during 2012-13 is estimated at 117.18 million tonnes. Oilseeds production stood at 18.78 million tonnes, sugarcane at 335.33 million tons and cotton at 33.4 million bales of 170 kg each. These production estimates are at lower levels compared to last year primarily due to deficient south west monsoon in 2012 and resultant acreage losses. 3. Infrastructure: The index for eight core industries (comprising crude oil, petroleum refinery products, coal, electricity, cement, finished carbon steel, natural gas and fertilizers with a combined weight of 37.90 per cent in the Index of Industrial Production) grew by 3.3 per cent during 2012-13 (April- December) as compared to growth rate of 4.8 per cent achieved during the corresponding period of 2011-12. Two out of the eight core sectors namely steel and electricity sectors recorded lower rates of growth of 3.6 per cent and 4.6 per cent respectively during 2012-13(April-December) as compared to 9.1 per cent and 9.3 per cent during 2011-12(April- December). The growth in coal, refinery products and cement was 5.7 per cent, 6.9 per cent and 6.1 per cent respectively during 2012-13(April-December) and in crude oil, natural gas and fertilizers sectors, the growth was negative during the same period. 4. Rate of Inflation: The headline inflation measured in terms of Wholesale Price Index (WPI) averaged 9.56 per cent in 2010-11 and decelerated to 8.94 per cent in 2011-2012 and 7.46 per cent in the first 10 months of 2012-13 (Apr-Jan). In January 2013, inflation was placed at a 38 month low of 6.62 per cent. The level of inflation and its movement across three major commodity groups varied significantly. Primary articles having a weight of 20.12 per cent in WPI recorded year-on-year inflation of 10.31 per cent in January 2013 as compared to inflation of 2.76 per cent in the same month last year. Fuel & power having weight of 14.91 per cent in WPI recorded year-on-year inflation of 7.06 per cent in January 2013 as compared to 16.99 per cent in the same month last year. Manufactured products, having weight of 64.97 per cent in WPI recorded an inflation of 4.81 per cent in January 2013 as compared to an inflation of 6.71 per cent in the same month last year. The food inflation comprising primary food articles and manufactured food products (weight of 24.31 per cent in WPI) at 10.57 per cent in January 2013 was significantly higher as compared to an inflation of 1.45 per cent in January 2012. The core inflation which corresponds to inflation for non-food manufactured products and keenly observed by the Reserve Bank of India moderated from its peak of 8.50 per cent in March 2011 to 4.12 per cent in January 2013. Apart from monetary measures taken by the Reserve Bank of India, softening of international and domestic prices of metals, chemicals and textile products contributed to the moderation of this inflation. 5. Balance of Payment: In the first Half (H1-April-September 2012) of 2012-13, steep decline in exports as compared to imports was responsible for widening of trade deficit to US$ 90.7 billion (10.8 per cent of GDP) vis--vis US$ 89.5 billion (9.9 per cent of GDP) in H1 of 2011-12. Net invisible balance declined to US$ 51.7 billion (6.2 per cent of GDP) during H1 of 2012-13 from US$ 53.1 billion (5.9 per cent of GDP) in H1 of 2011-12. The current account deficit (CAD) has worsened to US$ 39.0 billion (4.6 per cent of GDP) during H1 of 2012-13 as compared to US$ 36.4 billion (4.0 per cent of GDP) in

H1 of 2011-12. Widening of trade deficit and moderation in net invisible surplus were responsible for increase in CAD. There was a mixed trend in the capital inflows during first half of 2012-13. The net FDI (inward minus outward) to India decreased to US$ 12.8 billion during first half of 2012-13 vis-a-vis US$ 15.7 billion during the corresponding period of previous year. Net portfolio flows including FIIs, however, increased to US$ 5.8 billion during H1 of 2012-13 as against US$ 1.3 billion in H1 of 2011-12. NRI deposits remained robust at US$ 9.4 billion in H1 of 2012-13 (US$ 3.9 billion in H1 of 2011-12) but net flows under ECBs declined sharply to US$ 1.7 billion during H1 of 2012-13 from US$ 8.4 billion in H1 of 2011-12. Net flows under trade credit increased to US$ 9.5 billion during April-September 2012 as against US$ 5.9 billion during the corresponding period of 2011-12. Net capital flows declined to US$ 40.0 billion (4.8 per cent of GDP) in H1 of 2012-13 as against US$ 43.5 billion (4.8 per cent of GDP) in H1 of 2011-12. As the capital inflows during the first half of 2012-13 were sufficient to finance the current account deficit; there was a net accretion of US$ 0.4 billion to reserves (on a BOP basis) during H1 of 2012-13. Foreign exchange reserves reached all-time high level of US$ 322.2 billion at end August 2011. However, reserves declined thereafter and stood at US$ 294.4 billion at end March 2012. This showed a decline of US$ 10.4 billion from the level of US$ 304.8 billion at end March 2011. In 2012-13, the foreign exchange reserves remained in the range of US$ 286.0 billion to US$ 295.6 billion. At end December 2012, reserves stood at 295.6 billion, indicating a marginal increase of US$ 1.2 billion from US$ 294.4 billion at end March 2012. 6. Human Development: Economic growth though important cannot be an end in itself. The Twelfth Five Year Plan, with its focus on 'Faster, More Inclusive and Sustainable Growth', puts the growth debate in the right perspective. The government's targeted policies for the poor, with the prospect of fewer leakages, can help better translate outlays into outcomes. Expenditure on social services by the general government (centre and states combined) has increased in recent years reflecting the higher priority given to this sector. Expenditure on social services increased considerably in the Twelfth Plan, with the education sector accounting for the largest share, followed by health. As a proportion of GDP, expenditure on social services increased from 5.9 per cent in 2007-08 to 6.8 per cent in 2010-11 and further to 7.1 per cent in 2012-13(BE). Nevertheless, India's expenditure on health as a per cent of GDP is lower than in many other emerging and developed countries and the share of the public sector still lower. Poverty has declined in the country, though precisely how poverty is measured is currently being examined. Based on the methodology suggested by the Tendulkar Committee, the percentage of people living below the poverty line in the country declined from 37.2 per cent in 2004-05 to 29.8 per cent in 2009-10. Even in absolute terms, the number of poor people declined by 52.4 million during this period. Of this, 48.1 million are rural poor and 4.3 million urban poor. Thus poverty has declined on an average by 1.5 percentage points per year between 2004-05 and 2009-10. The annual average rate of decline during the period 2004-05 to 2009-10 is twice the rate of decline during the period 1993-94 to 2004-05. In the last few years public expenditure on social programmes increased dramatically. In the Eleventh Plan period nearly 7 lakh crore has been spent on the 15 major flagship programmes. A number of legislative steps have also been taken to secure the rights of people, like the Right to

Information Act, the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA), the Forest Rights Act, and the Right to Education (RTE). However, there are also pressing governance issues like programme leakages and funds not reaching the targeted beneficiaries that need to be addressed. Direct benefit transfer (DBT) with the help of the Unique Identification (UID) number can help plug some of these leakages.

7. Services Sector: The services sector is the dominant sector in most developed economies of the world and in some developing economies such as India. The CAGR of the services sector GDP was 10 per cent for the period 2004-05 to 2011-12. It has clearly outgrown both the industry and agriculture sectors. In 2011- 12 and 2012-13, in tune with the general moderation in the economy, the growth rate of the services sector also declined. The services sector is providing employment to more people, but employment growth is probably below the desired pace, given how productive service job are. The slowdown in the rate of growth of services in 2011-12, and particularly in 201213, from the double-digit growth of the previous six years, contributed significantly to slowdown in the overall growth of the economy. While some slowdown could be attributed to the lower growth in agriculture and industrial activities, given the backward and forward linkages with services, lower demand from the rest of the world could also have played a part. 8. Savings: The volume and composition of domestic savings in India have undergone significant changes over the years. The savings rate (gross domestic savings as percentage of gross domestic product at market prices) averaged 18.6 per cent in the 1980s and 23 per cent in the 1990s. The savings rate exceeded 30 per cent for the first time in 200405 and has remained above that level ever since. It peaked in 2007-08 at 36.8 per cent and reached an eight-year low of 30.8 per cent in 2011-12 (the latest period for which we have complete figures). Savings come from three sources, viz. households, the private corporate sector, and the public sector. On average, households accounted for nearly three-fourths of gross domestic savings during the period 1980-81 to 2011-12. The share declined somewhat in recent years, and in the period from 2004-05 to 201112, it averaged 70.1 per cent of total savings. Savings of the private corporate sector accounted for 15 per cent of total savings on an average between 1980-81 and 201112. However, during the years 2004-05 to 2011-12, their share increased to 23.2 per cent. The public sector accounted for 10 per cent of total savings on average between 1980-81 and 2011-12. It has been progressively declining and during 2004-05 to 2011- 12, public savings as a ratio of total savings averaged 6.7 per cent. Within households, the share of financial savings vis--vis physical savings has been declining in recent years. Financial savings take the form of bank deposits, life insurance funds, pension and provident funds, shares and debentures, etc. Financial savings accounted for around 55 per cent of total household savings during the 1990s. Their share declined to 47 per cent in the 2000-10 decade and it was 36 per cent in 2011-12. In fact, household financial savings were lower by nearly ` 90,000 crore in 2011-12 vis--vis 2010-11.

9. Interest Rates: Inflation moderated in 2012, and interest rates remained low. By CBOs estimates, consumer prices, measured by the price index for personal consumption expenditures, increased by 1.5 per cent last year (as measured on a fourth-quarter-to-fourth-quarter basis), compared with an increase of 2.5 per cent in 2011. That moderation is largely attributable to smaller increases in prices for gasoline and food. The core PCE price index which excludes food and energy prices also increased by 1.5 per cent in 2012, down a little from 1.7 per cent in 2011. Other measures, the consumer price index for all urban consumers (CPI-U) and its core version, increased by 1.9 per cent last year. (Rates for the CPI-U differ from those for the PCE price index because of the methods used to calculate those indexes and the larger role of housing rents in the CPI-U.) Since the recession began in December 2007, overall inflation has averaged 1.7 per cent a year according to the PCE price index and 1.9 per cent according to the CPI-U. Interest rates remained low in 2012. Short-term interest rates were near zero, and longer-term rates declined to extremely low levels in the first half of 2012 and stayed unusually low thereafter. Those low rates reflect several factors: Investors expectations that U.S. output will be below its potential for a few years; Investors concerns about banking and fiscal problems in Europe; and On-going efforts by monetary policymakers to keep short- and long-term interest rates low, using the traditional and non-traditional policy actions employed since the recession. That last factor includes the Federal Reserves announcement in late 2012 that it intends to keep its target for the federal funds rate (the interest rate on overnight lending among banks that the Federal Reserve adjusts to conduct monetary policy) near zero until labour market conditions improve or inflation rises notably, and to continue purchasing long-term Treasury securities and mortgage-backed securities.

B. Industries Analysis: Telecom Industries The telecom sector continued to grow during FY12 albeit at a much slower pace compared to the previous year. Net addition of wireless subscribers dropped by over 50% to about 9 million per month during FY12 compared to approximately 19 million per month in FY11. The fall in net additions was primarily due to urban saturation without a sustained increase in rural penetration as telecom operators slowed the pace of network roll out in rural areas (Figure A). The wireless subscriber base at the end of March 2012 was 919 million as against 812 million in March 2011. According to TRAIs standard for recognition of active subscribers, India had 683 million active wireless subscribers as of March 2012, that is, 74% of the reported subscriber base. Wire line subscriber base declined from 34.7 million in March 2011 to 32.2 million in March 2012. The overall teledensity increased from 71% in March 2011 to 79% in March 2012. Urban teledensity reached 169% while rural teledensity stood at 39% by the end of March 2012. The teledensity growth has slowed down considerably during FY12 as compared to FY11. The year FY12 was fairly subdued for the telecom tower sector both in terms of organic growth and M&A activities. The tower companies have been rather cautious in rolling out new towers; instead they have been focusing on increasing the tenancy on their existing towers. Roll out of 3G services by telecom operators has helped the tower companies increase their tenancies during this year. No major M&A transactions have taken place during the year. Broadband penetration continues to be a major challenge for the Indian economy. Broadband subscriber base reached 13.8 million in March 2012 from 11.5 million in March 2011, a growth of almost 15%. National Broadband Policy (NBP) released by the Telecom Regulatory Authority of India (TRAI) in December 2010 had suggested a roadmap to increase the Broadband subscriber base to 75 million connections by 2012 and to 154 million subscribers by 2014. NBP had also envisaged development of National Broadband Network (NBN), an open access optical fibre network connecting all habitation with population of 500 and above, planned to be built with an investment of approximately ` 60,000 crore by National Optical Fibre Agency, a special organisation proposed to execute this project. The last mile connectivity was to be provided by mix of 3G / 4G network, cable network and wireline broadband. No action has been taken on this front so far. Auction for 3G spectrum, which is envisaged as one of the last mile wireless technology for Broadband, was completed in May 2010. Almost all the telecom operators who had won spectrum during 3G auction, launched operations in their respective circles. Most of the players also entered into 3G roaming pacts with other operators thereby providing pan-India 3G network to their customers. While the official numbers for the 3G subscriber base have not been disclosed by the operators, the continuous investment by them in roll out of 3G networks suggests that the service is finding good traction. The 3G roaming agreements signed by the telecom operators have been declared invalid by the Department of Telecom (DoT) in December 2011. The Telecom Disputes Settlement and Appellate Tribunal (TDSAT) however immediately gave a stay order on DoTs notice to the telecom operators. The matter is currently sub-judice with the TDSAT. Broadband Wireless Access (BWA) auction was also conducted in FY11 to facilitate the introduction of 4G technology in India. Out of all the auction winners, Airtel is the only operator which has formally launched the 4G services so far, in Kolkata and Bengaluru. Reliance Industries had won panIndia BWA spectrum in this auction and since then has been signing deals on the

content side, which may be leveraged by the Company while offering 4G services. Augere, which won the spectrum in Madhya Pradesh, awarded the 4G network roll out contract to Ericsson in October 2011. While the 3G / 4G network roll out by the operators is happening in a phased manner, to promote greater broadband access and usage in the country, it is imperative that NBN, envisaged in the TRAI recommendations of December 2010, is put in place. Efforts are also required to generate regional language content and applications which address the specific needs of the different regions / sections of the society, to truly realise the potential of broadband penetration in India. The other policy development from FY11, Mobile Number Portability (MNP), was launched in February 2011 on an all India basis and has had a mixed impact on the telecom operators so far. As of end March 2012, over 41.9 million subscribers had submitted their requests to various service providers for porting their mobile numbers. Although prima facie this is a fairly small number compared to the 660 million active wireless subscribers, it is important from the perspective that a large part of these subscribers are active longterm subscribers.

1. Item License fee

Extension of license Spectrum sharing

M&A

Policy announcements in the telecom sector: Currents Status Proposed change 6-10% of Adjusted Gross Revenue Uniform license fee at 8% of Adjusted based on service area. Gross Revenue phased in over next two Current license tenure is 20 years years. To be extended for 10 years at a time. License fee at time of extension; Rs. 20 mn for Metros and A circle; Rs. 10 mn for B circle; Rs. 5 mn for C circle. Start-up spectrum (4.4MHz on GSM) Spectrum to be paid for separately. was bundled with license. Spectrum over prescribed limit to be surrendered. Limit is 10MHz in Metros and 8MHz in other circles Legality of the 3G roaming Spectrum sharing now permitted on 2G but arrangements by Bharti, Idea and. not on 3G Vodafone under review by the Telecom Tribunal 40% resultant revenue market share Allowed automatically upto 35% resultant revenue market share. DoT to await TRAI recommendation before extending it to beyond 35% up to 60%

2. Telecom licenses cancelled in the 2G scam: Company Licenses issued Spectrum held post Jan 2008 (MHz) Videocon Loop Telecom Uninor Sistema Shyam Etisalat Stel Idea Cellular 21 21 22 21 15 6 13* 88.0 88.0 92.4 52.5** 66.0 26.4 52.8

TTSL

7.5**

Total

122

473.6

Affected subscribers (MN) Remarks 5.4 Licenses cancelled. Spectrum withdrawn. 3.2 Licenses cancelled. Spectrum withdrawn 36.3 Licenses cancelled. Spectrum withdrawn 12.6 Licenses cancelled. Spectrum withdrawn 1.7 Licenses cancelled. Spectrum withdrawn 3.5 Licenses cancelled. Spectrum withdrawn 6.7 13 circle licenses cancelled & spectrum withdrawn 0.2 3 CDMA licenses cancelled & spectrum withdrawn 69.6

Hence their movement may lead to much higher revenue loss for the wireless operators that loose customers than the subscriber numbers suggest. The regulatory uncertainty for the sector continued during the year. The New Telecom Policy 2011 (NTP 2011) was expected to be announced during FY12 but the policy has been delayed as the Government could not reach consensus on various key issues. These include issues like the maximum amount of spectrum an operator can hold, spectrum pricing and price discovery mechanism, spectrum refarming, license renewal norms and M&A norms. The draft NTP 2011 released in October 2011 did not delve into the policy steps required to deal with these issues. A detailed NTP is expected later this calendar year. Meanwhile the Government has been making periodic announcements on various aspects of NTP 2011. Some of the key announcements made so far are given in Table 1. On the 2G scam, the Supreme Court in February 2012 cancelled 122 telecom licenses issued after January 2008 for process lapses during their allotment (Table 2). The Supreme Court also asked the Government to issue fresh licenses and spectrum by August 31, 2012 by way of an auction process. TRAI has thereafter released its recommendations to DoT on auction of spectrum in various spectrum bands. During FY13 TRAI has recommended auctioning only 5 MHz spectrum in each telecom circle. This auction will be open for all participants including the incumbent operators, the operators who have lost their license due to Supreme Court order and any new entrant. If these recommendations are accepted, there would be a maximum of one new operator per circle, as against 4-7 operators whose licenses have been cancelled. TRAI has also recommended a detailed plan for auction of spectrum in all frequency bands (700 MHz, 800 MHz, 900 MHz, 1800 MHz, 2100 MHz and 2300 MHz) till FY15 and the reserve price for each of these spectrum bands. A roadmap for spectrum refarming is also provided in these recommendations. These

recommendations are due for review by the Telecom Commission and Empowered Group of Ministers (EGoM) in the coming weeks.

C. Company Analysis:

Idea Cellular Limited

An Aditya Birla Group Company

Profit and Loss for the year ended March 31, 2012
Particulars For the year ended March 31, 2012 (RS. Mn) 193,381.85 1,505.00 524.78 195,411.63 For the year ended March 31, 2011 (Rs. Mn) 153,965.51 418.47 648.18 155,032.16

INCOME Service Revenue Sale of Trading Goods Other Income TOTAL OPERATING EXPENDITURE Cost of Trading Goods Sold Personnel Expenditure Network Expenses and IT Outsourcing Cost License Fees and WPC Charges Roaming & Access Charges Subscriber Acquisition & Servicing Expenditure Advertisement and Business Promotion Expenditure Administration & other Expenses 1,413.72 9,499.16 48,608.39 23,231.83 32,798.75 19,869.00 4,281.21 4,786.20 144,488.26 50,923.37 10,557.29 412.24 8,055.51 42,057.26 17,728.00 24,754.48 15,884.53 3,858.16 4,373.60 117,123.78 37,908.38 3,966.38

PROFIT BEFORE FINANCE CHARGES, DEPRECIATION, AMORTISATION & TAXES Finance & Treasury Charges (Net)

Depreciation Amortisation of Intangible Assets PROFIT BEFORE TAX Provision for Taxation Current - Deferred - MAT Credit PROFIT AFTER TAX Earnings Per Share of Rs.10/- each fully paid up (in Rs.) -Basic -Diluted

24,356.93 5,456.42 10,552.73 2,227.52 3,173.60 (2,078.27) 7,229.88

21,452.86 2,520.55 9,968.59 1,802.41 957.32 (1,778.21) 8,987.07

2.19 2.18

2.72 2.72

Balance Sheet as at March 31, 2012

Particulars As at March 31, 2012 (Rs. Mn) As at March 31, 2011 (Rs. Mn)

EQUITY AND LIABILITIES Shareholders Funds Share Capital Reserves and Surplus 33,088.45 97,394.48 130,482.93 Compulsorily Convertible Preference Shares (issued by Subsidiary Company) Non-Current Liabilities Long-Term Borrowings Deferred Tax Liabilities (Net) Other Long-Term Liabilities Long-Term Provisions 19.25 33,032.72 89,947.35 122,980.07 19.25

95,221.56 6,272.98 4,312.43 1,920.41 107,727.38

89,947.60 3,099.33 2,346.41 1,709.47 97,102.81

Current Liabilities Short-Term Borrowings Trade Payables Other Current Liabilities Short-Term Provisions 17,275.34 31,417.93 39,356.25 72.72 88,122.24 TOTAL ASSETS Non-Current Assets 326,351.80 17,903.93 35,779.63 28,263.97 67.06 82,014.59 302,116.72

Fixed Assets Tangible Assets Intangible Assets Capital Work-in-Progress Goodwill Long-Term Loans and Advances 201,304.75 68,571.89 6,798.50 61.20 22,562.74 299,299.08 Current Assets Current Investments Inventories Trade Receivables Cash and Bank Balances Short-Term Loans and Advances Other Current Assets 976.00 925.66 8,226.98 1,520.73 15,385.67 17.68 27,052.72 TOTAL 326,351.80 10,200.00 659.18 5,557.12 4,577.44 10,981.70 8.08 31,983.52 302,116.72 175,997.74 48,851.21 36,005.53 61.20 9,217.52 270,133.20

Cash Flow Statement for the year ended March 31, 2012
Particulars For the year ended March 31, 2012 (Rs. Mn) Amount Amount For the year ended March 31, 2012 (Rs. Mn) Amount Amount

A) Cash Flow from Operating Activities Net Profit after Tax Adjustments For Depreciation Amortisation of Intangible Assets 7,229.88 8,987.07

24,356.93 5,456.42

21,452.86 2,520.55

Interest and Financing Charges Profit on sale of Current Investment Provision for Bad & Doubtful Debts / Advances. Employee Stock Option Cost Provision for Gratuity, Leave Encashment Provision for Deferred Tax Provision for Current Tax (Net of MAT Credit Entitlement) Provision for Current Tax (Net of MAT Credit Entitlement) Liabilities/Provisions no longer required written back. Interest Income (Profit)/Loss on sale of Fixed Assets / Assets Discarded Operating Profit before Working Capital Changes Adjustments for changes in Working Capital (Increase)/Decrease in Trade Receivables (Increase)/Decrease in Inventories (Increase)/Decrease in Other Current and Non-Current Assets (Increase)/Decrease in Long Term and Short Term Loans and Advances Increase/(Decrease) in Trade Payables, Other Current and Non-Current Liabilities and Provisions Cash generated from Operations Tax paid (including TDS) (Net) Net Cash from/(used in) Operating Activities B) Cash Flow from Investing Activities Purchase of Fixed assets & Intangible assets (including CWIP) Proceeds from sale of Fixed Assets Profit on sale of Current Investments and Interest Received Net Cash from/(used in) Investing Activities C) Cash Flow from Financing Activities Proceeds from issue of Equity Share Capital Proceeds from Long Term Borrowings

10,481.74 (291.71) 597.31 35.88 174.03 3,173.60 149.25

5,161.59 (472.68) 445.86 150.34 232.21 957.32 24.20

(450.89) (134.52) 11.95

(558.73) (645.15) 247.92

43,559.99 50,789.87

29,516.29 38,503.36

(3,267.17) (266.48) (3.37) (13,291.34)

1,131.71 (122.83) 219.43 9,204.28

8,360.20 (8,468.16) 42,321.71 (4,140.89) 38,180.82

5,323.27 15,755.86 54,259.22 (3,327.03) 50,932.19

(47,326.59) 59.04 416.63 (46,850.92)

(85,472.73) 271.28 1,609.68 (83,591.77)

237.10 38,322.60

138.36 38,804.29

Repayment of Long Term Borrowings Proceeds from Short Term Borrowings Repayment of Short Term Borrowings Payment of Interest and Financing Charges Net Cash from/(used in) Financing Activities Net Increase/(Decrease) in Cash and Cash Equivalents Cash and Cash Equivalents at the beginning Cash and Cash Equivalents at the end

(30,345.21) 42,521.84 (43,150.47) (11,199.84) (3,613.98) (12,284.08) 14,733.68 2,449.60

(13,919.91) 29,737.02 (12,078.27) (9,228.59) 33,452.90 793.32 13,940.36 14,733.68

Balance sheet - Idea Cellular Ltd.

Particulars Liabilities Share Capital Reserves & Surplus Net Worth Secured Loans Unsecured Loans TOTAL LIABILITIES Mar'12 12 Months 3,343.79 9,590.74 12,934.54 7,794.14 2,344.03 23,072.71 Mar'11 12 Months 3,351.08 8,979.62 12,330.70 7,760.04 2,797.42 22,888.16 Mar'10 12 Months 3,344.28 8,112.95 11,457.24 5,988.61 537.80 17,983.65 Mar'09 12 Months 3,118.33 8,176.09 11,294.42 5,564.93 2,014.43 18,873.78 Mar'08 12 Months 2,639.12 906.91 3,546.03 5,454.43 1,060.33 10,060.78 Assets Gross Block (-) Acc. Depreciation Net Block Capital Work in Progress. Investments. Inventories Sundry Debtors Cash And Bank 33,211.43 9,468.17 23,743.26 656.62 1,636.81 52.94 807.55 134.19 28,938.75 9,807.13 19,131.62 3,594.05 2,572.81 52.22 461.45 451.54 22,834.40 7,907.34 14,927.06 462.58 2,755.13 46.70 430.12 280.44 15,562.75 4,739.86 10,822.89 1,721.82 4,928.81 42.73 329.59 2,344.43 12,791.22 3,123.83 9,667.39 941.13 569.93 27.62 198.59 497.06

Loans And Advances Total Current Assets Current Liabilities Provisions Total Current Liabilities NET CURRENT ASSETS Misc. Expenses TOTAL ASSETS (A+B+C+D+E)

4,895.44 5,890.13 8,708.81 145.29 8,854.10 -2,963.97 0.00 23,072.71

2,941.45 3,906.64 6,187.79 129.17 6,316.96 -2,410.32 0.00 22,888.16

3,533.15 4,290.40 4,313.76 137.76 4,451.52 -161.12 0.00 17,983.65

2,278.21 4,994.96 3,496.04 98.65 3,594.69 1,400.27 0.00 18,873.78

950.88 1,674.14 2,709.98 81.82 2,791.80 -1,117.67 0.00 10,060.78

Profit & Loss - Idea Cellular Ltd.

Mar'12 Mar'11 Mar'10 Mar'09 Mar'08 12 Months 12 Months 12 Months 12 Months 12 Months INCOME: Sales Turnover Excise Duty NET SALES Other Income TOTAL INCOME 19,275.32 0.00 19,275.32 0.00 19,292.89 15,332.80 0.00 15,332.80 0.00 15,406.81 11,850.24 0.00 11,850.24 0.00 12,087.77 9,857.08 0.00 9,857.08 0.00 10,096.02 6,719.99 0.00 6,719.99 0.00 6,808.42

EXPENDITURE: Manufacturing Expenses Material Consumed Personal Expenses Selling Expenses Administrative Expenses Expenses Capitalised Provisions Made TOTAL EXPENDITURE Operating Profit 11,118.03 0.00 848.34 421.08 2,030.31 0.00 0.00 14,417.75 4,857.56 8,805.10 0.02 719.38 384.84 1,806.01 0.00 0.00 11,715.34 3,617.46 6,129.90 0.02 561.16 406.69 1,508.36 0.00 0.00 8,606.14 3,244.11 4,556.40 18.96 458.46 426.57 1,278.09 0.00 0.00 6,738.48 3,118.60 2,867.83 0.01 332.88 322.43 705.52 0.00 0.00 4,228.66 2,491.33

EBITDA Depreciation Other Write-offs EBIT Interest EBT Taxes Profit and Loss for the Year Non Recurring Items Other Non Cash Adjustments Other Adjustments REPORTED PAT

4,875.14 2,019.46 543.32 2,312.36 1,488.39 823.97 265.72 558.25 -21.60 39.88 0.00 576.54

3,691.47 1,723.00 250.02 1,718.46 894.82 823.64 61.72 761.92 35.22 47.46 0.00 844.60

3,481.64 1,366.61 184.59 1,930.44 982.44 947.99 115.08 832.92 146.30 91.60 -17.17 1,053.66

3,357.53 1,096.72 146.13 2,114.68 1,206.35 908.33 85.65 822.67 162.86 15.68 0.00 1,001.21

2,579.76 756.85 119.91 1,703.00 695.85 1,007.14 72.50 934.64 95.74 13.97 0.00 1,044.36

KEY ITEMS Preference Dividend Equity Dividend Equity Dividend (%) Shares in Issue (Lakhs) EPS - Annualised (Rs) 0.00 0.00 0.00 33,088.45 1.74 0.00 0.00 0.00 33,032.72 2.56 0.00 0.00 0.00 32,998.38 3.19 0.00 0.00 0.00 31,000.95 3.23 0.00 0.00 0.00 26,353.61 3.96