Bharti Airtel dropped plans it outlined in April 2021 to shake-up its corporate structure, stating its existing set-up would prove sufficient to develop its digital business and capitalise on recent reforms announced by the Indian government.
In a statement, the company explained it believes its existing corporate structure was “optimal for leveraging” emerging opportunities and unlocking value “while continuing to scale-up Airtel’s digital business”.
It unveiled a new corporate restructuring plan around nine months ago, at the time stating it would place digital initiatives at the core of all its businesses while establishing Airtel Digital as a listed entity housing assets including Airtel X stream, Mitra Payments platform, Airtel Secure and Airtel Cloud.
The new set-up would result in giving Bharti Airtel four main business units: digital; India; international; and infrastructure. The restructure was largely designed to remove regulatory overhang on its digital activities and reduce statutory liabilities, thus improving its operating income.
Its strategy was clearly rethought after a telecoms reform package was announced by the government in September 2021, designed to nurture the sector back to financial health. Crucially, as part of the move the government redefined the controversial issue of adjusted gross revenue, with non-telecoms sales excluded going forward.
The company explained the reform had significantly boosted outlook and investor confidence for the industry, while simplifying the licence framework.
“Bharti Airtel is well positioned to invest aggressively in the emerging growth opportunities offered by India’s digital economy”, the company added in its statement.
When the package was announced, the operator welcomed the move but Gopal Vittal, MD and CEO of the operator’s India and South East unit stated more needed to be done to fuel investments.