Good afternoon, everyone. Warm welcome to Bharti Airtel Limited Q3 ended December 2021 earnings webinar. I must remind you that discussions today may include certain forward-looking statements that must be viewed with the risks we may face. Present on this call is senior leadership team of Bharti Airtel. Post the opening remarks, we'll open the floor for Q&A. Please use raise hand option to join Q&A queue. With this, I would like to hand over to Mr. Gopal Vittal, MD and CEO, India and South Asia for opening remarks. Thank you, Gopal. Thank you. Thank you, Rajiv. Good afternoon, ladies and gentlemen. Thank you for joining this webinar to discuss our results for the quarter ended 31 December 2021. Also present with me on this webinar are Soumen, our new CFO, Harjeet Kohli and Rajiv Sharma. As you know, the government announced seminal reforms in September last year. These have really infused confidence in the industry. As far as we are concerned, we've chosen the moratorium on spectrum and AGR dues rather than equity conversion of interest on these dues. In addition, as part of our commitment to financial prudence, we have decided to prepay the high cost spectrum debt liability of over INR 15,000 crore. This has allowed us to clear deferred liabilities for the spectrum acquired in 2014. This will also save us interest and enhance cash flows. While the reforms are game-changing, more needs to be done, and we look forward to the next round of measures planned by the government. In particular, the high levies on the industry need rationalization. Equally, the reserve prices for 5G spectrum must be lowered so that it is viable for us to purchase spectrum. An important event this quarter has been the strengthening of the partnership with Google, with a commitment to invest up to $1 billion through a combination of $700 million of equity and up to $300 million in creating a corpus to drive mutually agreed commercial objectives. As a part of the first commercial agreement, both companies will work to scale Airtel's offerings across three areas of device, cloud, and networks. I do want to underscore through this investment a very strong validation of Airtel's role in being a leading pioneer of India's digital revolution. A third event in this quarter was the successful conclusion of the Airtel VSAT business with Hughes to become the largest VSAT company in India. Let me now turn to our performance for the quarter. Overall, this has been another quarter of solid execution for Airtel that has seen broad-based growth across the entire portfolio. Our consolidated revenues for the quarter grew by 5.4% sequentially to get to INR 29,867 crores and our EBITDA margins improved by 40 basis points over the last quarter from 49.5% to 49.9%. Let me briefly touch on each of our businesses. In our broadband business, we are seeing very healthy customer additions driven by the increased demand of fiber to the home. We have now hit a milestone of going past the 4 million customer homes mark. Sequential growth has been strong at 11.8% this quarter. Our very innovative Uber-like digital model with the local cable operator, as a partner, as also the acceleration in the rollout of our own fiber in the top 100 cities are the pivots around which our home broadband strategy revolves. Our overall presence has now expanded to 672 towns and has enabled us to add 1.1 million home passes in the quarter. We believe fiber to the home is a massive opportunity for us. We will continue to step up investments to take our network to 2,000 towns across India with 35 million home passes in the next three years. In the DTH business, we have a presence in 18 million homes with an ARPU of INR 146. We recently changed the box pricing and reduced channel commissions. These are expected to move the industry towards a more sensible business model by lowering the gross additions in the category while focusing on net net additions. That said, Free Dish continues to disrupt the business model as good content continues to be offered for free in vast swathes of the country. At the same time, the irony is that the opportunity to convert and upgrade from cable is massive. There's also a huge opportunity to monetize OTT content and deliver a unified connected experience through Airtel Xstream. To address this, we've developed a compelling proposition for customers which will be launched in February. Let me now turn to Airtel Business. Airtel Business clocked another quarter with double-digit year-on-year revenue growth, with revenues touching INR 4,107.6 crores, up 13.4% year-on-year. We continue to outperform our peers and expand market share. We have a solid portfolio of services spanning connectivity, cybersecurity, data centers, IoT, and CPaaS. In each of these areas, we are now the leading player, and in security, we're already amongst the top 10. Our CPaaS business has again outperformed the market and grown at very strong double digits. Our strategy, as I mentioned earlier, revolves around going both wide and deep. wide to tap into the 80% of customers who account for only 20% of our revenues, and deep in the accounts we already have a solid presence in, so that we can sell many more products and raise switching costs. Our emphasis on new product acceleration therefore continues. Now on to the mobile business. Mobile revenue has grown by 5.9% sequentially, driven largely by improved pricing and modest 4G upgrades. ARPU has risen to INR 163, an increase of almost INR 9. We are again at a lifetime high in terms of revenue market share of almost 37%, validating our strategy of winning with quality customers. Early signs of the tariff increase have been encouraging, and the full flow-through is expected to be felt in quarter four. At the same time, we have seen some sim consolidation leading to some moderation in customer additions as customers make decisive choices in favor of their preferred brand. We expect this consolidation trend to correct from here on. In the postpaid segment, we are seeing good momentum at 320,000 net adds as we drive our premiumization agenda with a significant retooling of our overall customer experience. As a consequence, we now have decisive leadership in this segment. We are very bullish on the future of this segment. In sum, we are seeing consistent growth across our overall portfolio. This applies across all our core businesses, homes, mobile, and enterprise. Last quarter, I talked of the moats that we are building. Let me provide a little more texture to this. We've stopped thinking of our business as a telecom business, but increasingly think of our business as a digital business end to end. At the core of our business is our digital infrastructure. Over these past five years, we've invested about $46 billion in creating the finest digital highway over which 40% of India's economic and digital activity takes place. A large part of the heavy lifting in terms of access, be it wireless or wired, as also spectrum is done. Massive investments have been made in our transport infrastructure, in both domestic fiber and international submarine cables. This is what allows us to be ready for 5G. Another very critical part of this digital infrastructure is data. We now have a massive data infrastructure, a layer that has actually cleaned, tagged, and coded every one of our 350 million customers. Over 400 data scientists and engineers work on this to lend agility and intelligence for all of Airtel. Above this digital infrastructure layer sits our digital experience. This runs across every part of Airtel. Our channels, our customer touch points, our network experience, our customer-facing applications, our go-to-market capabilities, our stores, and even our delivery teams of installation and fault repair are all seen through one customer, one Airtel omni-channel view. Be it improving the experience, recommending an additional service, collecting payments, or simply engaging, this digital layer enables all of this. Our organization structure also reflects this now. We have one mass retail channel that's responsible for all consumer categories, DTH, prepaid, and bank. We have one direct to customer channel that serves over 1,600 catchments in urban India and is responsible for all consumer categories, postpaid, broadband, DTH, and bank. We have one digital channel that serves all of Airtel's businesses. We have one home delivery organization that's responsible for all of Airtel serving the home. We have one B2B channel that uses different levels of customer touch, from direct to digital, in serving all our large as well as smaller companies and businesses. It is through this digital experience that we're able to deliver the best experience for our customers, and this is really what allows us to win our premiumization agenda and have industry-leading ARPUs. It's the same digital experience that allows us to have low levels of churn and raises switching costs for customers. The third layer is our digital enterprise business. This is a key moat for Airtel because our customers trust us with their data and want to work with us due to the respect they have for our governance and privacy. This is an intangible but priceless source of competitive advantage. The core of our enterprise digital offer is around connectivity, but this rides on the digital infrastructure that serves all Airtel businesses. We are number one here. What makes it really interesting is what rides on top of this. In cybersecurity, as I mentioned, we're already amongst the top ten players. We're number one in IoT. SD-WAN is another exciting business, software-defined wide area networks. Our recent announcement to acquire a significant stake in Lavelle to develop and build software-defined wide area networks will be an important driver of growth in this area. The fourth layer is digital banking. This has been a business that we've built silently. Today, Airtel Payments Bank has a customer base of 122 million, with a monthly transacting user base of over 32 million users. We are decisively winning in small towns and rural areas on the back of our distribution advantages. However. This is a business that has infinite potential, and we are ratcheting up the growth of the digitally savvy user. We think of the opportunity here in the form of a funnel. At the base of the funnel are the 100 million Airtel Thanks users. We wanna enable them with an Airtel UPI handle. At the next layer is our bank or wallet user who transact on the app. Onboarding this customer is being enabled across all our channels. This user is exceptionally valuable for a variety of reasons that include the number of transactions that they make, as also the deposits they maintain. We're now firing up this proven toolkit to accelerate payments. We already have an annualized GMV of $20 billion and are the only profitable payments player in the fintech space. Our profitability comes from our biggest strength, the low cost of acquisition. The fifth and final layer is our digital services. We have now tested, proven, and will scale 4 exciting new businesses, each of which are in very large and growing markets. Airtel IQ is our full suite of cloud communication solutions that spans voice, messaging, video streaming, call masking, virtual contact center solutions, and ultimately, even workforce management. This is a large INR 8,000 crore+ category that is exploding in terms of growth. Airtel Ads is our ad tech platform that leverages all our digital assets. We have 135+ brands and relationships with all large agencies. The solution here is a consent-based, privacy-safe platform that serves one of the biggest pools of quality customers across multiple screens. We're further strengthening this platform by investing in blockchain capabilities and developing solutions that address privacy issues and potential regulations around them. Again, we're in a very large INR 12,000 crore category that's growing rapidly. Nxtra is our data center platform that is already serving hundreds of customers and all hyperscalers. We've added 28 MW of capacity in just 1 quarter across 4 locations. Our capability in the cloud now allows us to partner the large tech companies on public cloud, help scale private cloud for entities that want data stored in India, and edge cloud that enables businesses to provide low-latency experiences for customers at the point of consumption. Lastly, our digital marketplace. This marketplace on the basis of partnerships for digital services, that's what it operates on. Our focus here is around content, loans, and insurance. In the content area, we have two models. One is the Xstream partnership, where we provide a single sign-on unified search, a catalog of compelling content, and a great payments experience to our customers. We also have partnerships with the leading content players such as Netflix, Amazon, and Disney. In the lending area, we've now developed our own proprietary credit score and have commenced lending on our platform through partners. Our insurance partnerships are also seeing traction. With the 180 million-plus monthly active users on our platform through Airtel Thanks, Wynk, and Xstream, we believe we can build another meaningful revenue stream here around the digital marketplace. In sum, these five layers of digital infrastructure, digital experience, digital enterprise, digital banking, and digital services is what the new Airtel is about. While we do this, we are passionate about fiscal prudence. We therefore remain focused on exercising tight control on OpEx through a multi-year War on Waste program. We're also disciplined on CapEx through tools that allows us to plan and sweat every single tower that we put up. Our balance sheet is strong, with an improved leverage ratio of 2.67. We expect the tariff hike and operating, free cash flows to help further de-lever the balance sheet. Finally, a quick word on ESG. During the quarter, we constitute an ESG committee made up of the board of directors to sharpen our focus on the ESG agenda and on creating value through sustainable business practices. We have an internal ESG committee as well that comprises of management that meets on a far, far more frequent basis. We have now agreed a clear set of goals and initiatives in this area, which we will soon disclose. We also joined the Science Based Targets initiative's Business Ambition for 1.5 degrees Celsius campaign and adopted targets to significantly reduce our carbon footprint and emissions from network operations. We also became the first Indian telecom company to join the UN Global Compact while remaining aligned with the Paris Agreement and proactively implementing clean, fuel-based power solutions for our towers, our data centers, our switching centers, and other facilities. We remain committed to society, our customers, and employees right through these harrowing times of the pandemic. We continue to demonstrate the highest standards of corporate, financial, and operational disclosures. In sum, I would say that we've had a very eventful quarter. A much-needed tariff increase, the investment by Google, the merger of our VSAT business with Hughes, and above all, solid execution and sustained performance. Let me hand it back to Rajiv at this point. Thank you very much, Gopal. We'll now open the floor for Q&A. Rajitha, you may moderate the Q&A session now. Thank you very much, sir. We will now begin the Q&A interactive session for all the participants. Please note that the Q&A session will be restricted to analyst and investor community. Due to time constraints, we would request if you could limit the number of questions to two per participants to enable more participation. Interested participants may click on Raise Hand option on Zoom application to join the Q&A queue. Upon announcement of name, participant to kindly click on Unmute Myself in the pop-up on screen and start asking the question post-introduction. The first question comes from Mr. Piyush Choudhary. Mr. Choudhary, you may please unmute your side, introduce yourself, and ask your question now. Yeah. Hi, good afternoon. This is Piyush from HSBC. Congratulations, Gopal and team, for strong execution. 2 questions. Firstly, on the mobile side, you mentioned about the SIM consolidation, which is happening in the industry at the moment. Do you think this will still continue given the tariff hikes which have happened? And what do you think post, like, probably a quarter or so, where does subscriber growth settles down for the industry? That's the first one. Secondly, we have seen growth in ARPU this quarter, but EBITDA margin in the mobile business has not expanded. Any specific reason, and are there any structural costs over here or we should see EBITDA margin expanding going forward? Yeah. Thank you. Thank you, Piyush. Let me take both, and if there's anything to add, then maybe Shamind can add on. On the SIM consolidation, yes, we did see significant SIM consolidation during the quarter that we've been through. Remember, the level of consolidation that we saw was much lower than what we saw in the first round of tariff increase that happened back in 2019. We were almost flat in terms of overall customer additions. I would say that in relative terms, I think we've come out quite well. January was a very cold month, and I think the pass-through of the SIM consolidation sort of continued, but I would expect that this will be fully moderated as we go through into February and March, and we should hopefully see business back as usual, towards the end of this coming quarter and certainly into quarter one. On the growth in ARPU, you're right. I think while there were, you know, the margin EBITDA, I think went up by around, went to about 53%-54%, in that ballpark. The fact is that we had headwinds in terms of network costs. We had substantial rollouts, capacity enhancements, rollout of sub-gigahertz that happened in the first half of the year. In addition to some increases in channel commissions and sales incentives. I think it was that combination that led to the margin EBITDA being what it is. In our business, as you know, we do get operating leverage, so if you have revenue growth, then a significant part of that flows through to EBITDA, and I don't see any reason why that should change in the coming quarters going forward. Got it. Just to clarify here, the increase in channel commissions and sales incentives, are these sustaining or these are some kind of one-off promotions? No, I think what's happened is that there is a slightly elevated level of channel commissions that is happening for the last few months and, perhaps the last 4 or 5 months, and that's continued. Is that totally out of whack? No, I wouldn't say so. All right. Thanks a lot. Thank you very much, Mr. Chaudhary. The next question comes from Mr. Sanjesh Jain. Mr. Jain, you may please unmute your side, introduce yourself and ask your question now. Thanks, Gopal and team, for taking my question. I'm Sanjesh Jain from ICICI Securities. Sanjesh, you're not very audible. If you can just speak a little louder. Hi, is it good now? Yeah, it's perfect now. Okay, thank you. First question on the 4G subscriber addition. This is a quarter we saw, where we saw record smartphone sales in the Indian market. While the 4G addition for all the operators put together looks like fairly muted versus how the smartphone sales are happening. What are we missing here? What is stopping the 2G to 4G transition, which has been fantastic for last three to four year? Why is this sudden deceleration? That's one question. And connected to that is the data usage per subscriber. I've been looking, it's been plateauing at 17-19 GB a month across the operator, and it's hardly inching up. Does that mean that it's very hard for us to imagine a premiumization or the opportunity for the premiumization where the subscriber jump to a higher pack is very limited from here? This is my first question. Yeah, I think we saw about 3 million 4G net additions in the quarter. If I just look at the device shipments, October smartphone shipments was 18 million and November was 13 million. October is typically the Diwali kind of shipments. I don't think that has seen a commensurate flow through into 4G net additions in the quarter. Mind you, Sanjesh, this quarter has been a quarter where tariffs have been increased. As a consequence, I think there is a moderation in 4G net additions because of SIM consolidation also that's happened. Given this tariff increase, we still saw a 3 million increase in our 4G net additions. My sense is that this should moderate now going forward into quarter four. Remember, the other point to make on the device shipments is that these shipments don't necessarily get into customers' hands, because they're also part of the inventory cycle that happens within the trade. On the data usage, I think, you know, I think the GB per month is a function of the massive allowances that are still happening in the industry. I mean, today, for example, at a 299 plan on prepaid, you get 42 gigabytes in a 28-day period, so that's almost 43, 44 gigabytes a month. People are consuming 17, 18 gigabytes and perhaps not being able to completely use it. So this cannot continue to grow infinitely because at some point, you know, people have to lead their lives as well, right? They're already spending four hours a day just looking at the device. In a way, it's a good thing if we are seeing a moderation of GB per month, because then this has its beneficial CapEx implications. I would be, actually, I'm glad to see that it's moderated now. The fact that there were massive allowances given has actually led to the GB per month rising in previous quarters, and that's now beginning to moderate. The overall data consumption growth in the quarter has been soft, primarily because what you normally see during a lockdown. Do you remember April, May, June, there was a lockdown, and then it sort of grew rapidly. During lockdown, you see massive growth, and that moderates as people come back, schools open up and so on and so forth. I wouldn't look too much into that part. I think the 4G net addition slowdown is a simple, simply triggered by the tariff change that happened in the quarter. I think that is expected to moderate as we go forward. The last point is on your premiumization question. I think this has no bearing. The data usage has no bearing on premiumization, because premiumization is really the drivers of premiumization is, one, the feature phone to smartphone upgrade. Second, the prepaid to postpaid upgrade. The third is the postpaid to the entire home offer that we have through Airtel Black. I think that story is totally intact. Fair enough, Gopal. I was looking at the premiumization where people exhaust their data and try to go for a higher GB consumption. I think that complete premiumization is missing in India, and I believe that that was a much larger opportunity for us. That, Sanjay, is a function of the pricing structure. If you had a more sensible price architecture in the country, where, let's say like it happens in many other countries. If you look at Indonesia or China or any of these countries, you know, for INR 100, you get X amount of data, which is, let's say 2. But for INR 200 you get 5, and for INR 500 you get 10, and for 1,000 you get 50. That drives the premiumization. Unfortunately, in India, the pricing structure is all compressed. If you buy something for INR 299, you have everything that you need. That's the problem. It's more a price architecture issue more than anything else. Fair enough. My second question is on the free cash flow generation we have been doing. This quarter, the free cash flow we have generated close to INR 43 billion after paying all the liability, which is a commendable number, and I think this will only grow as the benefit of the tariff flows in. I just wanted to understand the thought process on the utilization of this large free cash flow which is coming into the company. Will it be fair to assume that a majority of it will go into repaying the debt, particularly the high cost debt? If that is true, how should we see the finance cost, which was at INR 33.5 billion this quarter? We have paid a significant amount of high cost debt and we are generating free cash flow, and there is a return of a guarantee by the government. That should have a very large positive bearing. If you can just direct us, say, a quarter or two down the line, how much we will settle this to from INR 33.5 billion of this quarter? Okay. Maybe I'll invite Harjeet then Soumen to comment on this. Yeah, sure. Thanks, Gopal. Sanjesh, I think your comment on the free cash flow is right. Of course, Africa has been free cash flow positive. From a segment perspective, they throw off the dividends to us occasionally, every you know, 3, 6 months. India is now free cash flow positive with lower CapEx, lower taxes and lower interest cost. That dominant portion of the free cash flow in the shorter term for sure is definitely going to pay down the debt. There is a good debt profile mix that we have, as you know, but the higher cost fixed rupee interest rate old debt, bulk of which, as you mentioned, we paid off the 2014 installment at the end of December. There is opportunity now. The government and the DoT has given us the flexibility to do what we can in terms of cash flow matching, repaying when we wish to, et cetera, et cetera. Some of these free cash flows will go to replace some high cost debt. The second portion of yours was on the interest cost. You're absolutely right. The guarantees that have been returned will save between, depending upon which guarantee it is, 0.5%-1.2% of the guarantee commission. That goes into finance charges, and you see that in the interest cost line. You will see savings there. Dominant portion of the savings will be of the 10% interest cost going down to maybe a weighted average 5%, 6%, 7%, depending upon the sources of finance. Last quarter, we used more than half of the source of finance to be the rights issue that we had made. Not everything has been debt financed. The sum total of INR 15,000-odd crore that was paid out plus the guarantee savings is. It's straight out of mathematics. It's about INR 1,000 crore of interest cost saved per annum. A little over that, but that's what the current situation is. If we get more free cash flows, we have more opportunity to substitute, but we will be mindful of maturities. We will not shorten the maturity. Mindful of making sure that we have significant market debt capacity continuing to be available and all sources of finance continuing to be diversified and on the table. Will it be fair to assume that this INR 33.5 billion will inch towards INR 25 billion per quarter? No. I'm talking about per annum savings. You'll have to Yeah. You'll have to quadrise it. Got it. Let me do that math, and I will get back to the team. Just the last bit to Gopal. We have been very strong on the War on Waste, but this quarter and the last quarter as well, the network operating cost looks like it's been growing quite sharply. Can you explain what's driving that cost so sharply? Yeah. I understand there is addition to the network, but on a YOY basis, it is 8%-9%, while the cost inflation is 17.5%. Yeah. I think that's a good question, Sanjesh. I think we are seeing, number one is, like, an aggressive rollout in terms of sites, and you know that that's one of the big components of actually, increase in network costs. Second is, loading charges, because when you sort of deploy additional capacities which you had to do with the rollout of sub-gigahertz, that again, you know, is a headwind on cost. The third headwind is really the rise in energy prices. You know, both diesel which has sort of, increased quite sharply during the course of the last six months. I think it's a combination of all of this. Suffice it to say that, we are working on a very strong program, along with our partners in the tower company, and we're looking at a whole bunch of things. We have used a lot of tools in our NOC. We have built some AI and ML tools, to actually turn off power and energy on the fly. These are experiments that we are running, and these have given us some good results. These will be rolled out into the coming quarters. Secondly, we're also looking at reducing the complexity on our networks in terms of switch off of certain technologies if the capacities are not utilized during certain times of the day. That's the second area that's being looked at. The third is a massive conversion from indoor to outdoor so that the energy consumption goes down. The fourth area is also looking at renegotiation on rentals. This of course needs to be done in partnership with the tower companies. All of these levers are being looked at. There is a very strong focus and a very strong program that's actually driving all this. Yes, in the last few months we have seen these headwinds and that's hit us, yes. Thanks. Thanks, Gopal, and thanks for all the answers. I will get back in the queue for more questions, and best of luck for coming quarters. Thank you very much, Mr. Jain. The next question comes from Mr. Vivekanand Subbaraman. Mr. Subbaraman, you may please unmute your side, introduce yourself, and ask your question now. Hi, this is Vivekanand from Ambit Capital. Two questions. One is how quickly would you deploy the $300 million Google corpus that is targeted at upgrading 2G users to 4G? Do you think that after this tariff hike and your user base already now 62% on 4G, it might be a good idea to deploy this quickly? That's question one. Secondly, how to think about price hikes in let's say calendar year 2022, now that we are seeing some SIM consolidation and certain digital ecosystem players like Meta Platforms, even they are commenting that their India user growth seems to be hurt by price hike. How to think about tariff hikes from here on? Thank you. Yeah. Thank you, Vivekanand. I think on the $300 million corpus with Google, like I mentioned at the last call, one of the big levers is really device upgradation. The second is networks, and the third is cloud. We are in partnership on the cloud space as well from a go-to-market perspective. Let me talk a little bit about devices. I think for us the big opportunity is the upgradation from feature phone to smartphone. We've developed certain several capabilities, you know, software features that will enable us to actually lock a phone on the fly if an EMI is not paid. So these are capabilities that we've developed. There are platforms that we're working with to actually lend into devices in order to bring the unit price of the device down. The second is that you can also give targeted discounts and cash backs into specific devices, so that's another area that we are looking at. We will be aggressive in actually driving upgradation. At the same time, we do it sensibly because as I've mentioned in the past, getting into a subsidy type of game is not a great idea in a market like India, actually in any market. In India, particularly the P&L in any way can't absorb it because network costs are so high. Having said that, we do see a significant increase in the ARPU when people move from feature phone to smartphones. In the longer term, this upgradation is essential, and as a consequence, we will use part of this corpus as well as all our capabilities to drive this upgradation. On the price hikes, as I've mentioned before, you know, we hope that the ARPU of the industry, our ARPU gets to 200 soon, preferably in 2022 itself, and then kind of settles, you know, soon after in the next few years to 300, which is really the modest and a good level of ARPU, which can then turn a return on capital of upwards of 15%, which is really a kind of return that should be a respectable return. I do expect, I mean, this is now from my perspective, a tariff hike sometime in 2022. I don't think it's gonna happen in the next few months, for the next 3-4 months, simply because the SIM consolidation and growth needs to come back. I do expect another round of tariff increases. Of course, it's got to be determined by the competitive dynamic and by what happens in, you know, to the other players. We wouldn't hesitate to lead it just as we have, as we've done in the recent past. One small follow-up on the tariff hike. This time and last time also it was a broad-based tariff increase across price points, right? Across data you know across the data allowance limits. When we look at say certain longer duration packs they seem to be very aggressively priced vis-a-vis say the 28-day packs. Is there any thought process of you know having a bit more steeper curve in this versus what we have today in the longer duration pack? Yeah, I think that's. I mean, just that, you know, we just took up the tariffs by around 20% across all our packs. Yes, there are maybe some slightly higher discounts on longer duration packs. Equally, you must recall, you must remember that on the longer duration packs, let me just pull back. On the, you know, the more compressed your recharge period, the more you actually can lose revenue. That is because every customer does not necessarily recharge on the very next day that their validity expires. It's actually good business to move people to a longer duration pack because you lose. You gain that incremental revenue in those days when otherwise you may not have recharged. There will be some discount on the longer duration packs. In specific, if there are some packs that need to be adjusted, that's something that, you know, we'll keep looking at those changes. But at this point, we just moved everything up by 20%. Fair enough. Thanks a lot, and all the best. Thank you very much, Mr. Subbaraman. The next question comes from Mr. Pranav Kshatriya. Mr. Pranav Kshatriya, you may please unmute your side, introduce yourself and ask your question now. Hey. Thanks for the opportunity. I have a couple of questions. First question is regarding this, you know, home passes, you know, you plan to take it to 2000 towns. When we expanded the home pass to almost 600 cities and towns, it was done largely in collaboration with the cable operators. Should we expect the same model to continue or, you know, you expect to roll out your own home passes, you know, to a large extent? That's my first question. Second question is on 5G. How do you see 5G as an opportunity, considering it will require significant investment and possibly also will help, you know, gain market share on the other side? This is more from a timing perspective that how should we expect the 5G rollout to be? I mean, would it be more accelerated rollout, you know, as soon as the spectrum is available or it will possibly take time considering the 5G ecosystem is not available? Some qualitative statement there would be. Thank you. Okay. All right. No, thank you. On the home passes, I think that we are in the top 100 cities, we have our own fiber where we actually go direct. This is what we call our own model. In the rest of the cities, we have this partnership with a local cable operator, and we will continue to roll out through the local cable operator because the pace of the rollout that they're able to, and the fact that we continue to own the customer, but we make sure that the quality of the experience is great, actually lends itself very well to that model. The cost of rollout is lower, the pace is higher, and given that we control the experience, actually we are very, very satisfied with that model. On 5G, we expect TRAI. Well, if I can ask one follow-up. Does that have any implications on the profitability per se, considering you'll have to shell out a significant commission to the partners? Well, you know, you can look at it like that or you can say that, look, in the last 12-15 months, we would not have been able to roll out at all if we had not done it. It's a theoretical question because, yes, there is a commission payout, but then there's an opportunity that we've actually gained through this partnership. And so to that extent, we are in the game because of this partnership, because if we had not been there, to scale this up across the country would have been almost impossible given the extent of investment that would have been required at that very stage. There's also a lot of capability that needs to be built in that kind of a rollout. I would say that, you know, all said and done, I think it's a very, very good model for us. On the 5G side, TRAI is likely to come back with their response probably in March. You've seen the statements made by, you know, the DoT secretary as also the minister that there could be an auction between May and June. The first question is what happens to the reserve price? The industry has argued for a dramatic reduction in reserve price, and I think representations have been made from COAI. We have made these representations. As I mentioned in the past, we will not be able to afford to buy the spectrum at the reserve price that was there when the last auction happened. We are hoping that there will be a substantial reduction in spectrum prices. Through the reforms, the 20-year spectrum has now been made to 30 years. We are also expecting a more considerate payment terms for the spectrum, which is again something that the industry has asked for. Now coming to your question on 5G. If you look at the shipments, they are gradually growing. They're still in the teens as a percentage of smartphones, so they haven't really like flipped over completely. But the fact is that if you look at the installed 5G devices in India today as a percentage of the overall smartphones, it's still in the ballpark of 3%-4%. I would imagine that by March 2023, they will probably get to about 10%-12%. The real Base of 5G from a consumer standpoint will really be in 2023, 2024. The second thing is that if you look at the B2B side and you look at the applications that require 5G, these are still globally, there are not too many applications that are really required on 5G. Having said that, India needs 5G, and I would say I would imagine that over the next five to seven years you will see rapid growth of 5G networks. From our side, we stand committed to actually making investments into 5G. I think the time has come now to do that. The only question is how much, and that's a function of the fact that the access side of the investment, which is the radio side of the investment, is always modular. Because remember, we have a lot of data to know in every single site how many devices are there, how many smartphones are there, what are the number of devices that have price point of more than 10,000, more than 15,000, and that can determine a graded rollout across the country over the next few years. On the other hand, when you look at transport infrastructure, you need to get that ready because that has a much longer gestation. A lot of our investment is going behind getting our transport infrastructure ready, our fiber to the towers, our electronics, our core networks, and so on and so forth, because these have longer gestation. The rollout of access is really a 3-4-month game. The only question is how much do you wanna do, at what point in time, so that you can sweat that asset when you actually put it. That's the way we think about it. My argument would be absolutely ready for 5G. Let's hope for the right reserve prices in terms of lower spectrum price and the right payment terms. We keep rolling out as and when we see the devices begin to proliferate. Thank you, Gopal, for this, detailed answer. Thank you so much. Thank you very much, Mr. Kshatriya. The next question comes from Mr. Sanket Baheti. Mr. Baheti, you may please unmute your side, introduce yourself and ask your question now. Yeah, hi. I'm Sanket Baheti calling from GC Holdings. A few questions from my side. What are the key reason behind the interest cost increase and depreciation on a quarter-on-quarter basis? And can you please quantify the impact of Ind AS 116 on depreciation and interest cost during the quarter? Soumen, you'll take that? Yeah. The increase in depreciation is primarily because of two reasons. One, we have bought spectrum during this year, whose amortization has kicked in. Also, there is a rollout of CapEx which is happening. So as and when they are getting capitalized, it is coming and hitting a depreciation. So those are the primary reasons why depreciation has gone up. As far as interest is concerned, bulk of the impact is because of Forex rate fluctuations. We have had a large impact in both India as well as if you look at the consolidated numbers, even in the Africa operations. So the Forex revaluation impact of this quarter is significantly more compared to last quarter, and that has given that impact. Maybe I'll just quickly compliment Soumen, just one comment, for you, Sanket. The net debt figures are snapshot figures. September end to December end give you a snapshot. The interest is a flow figure. The bulk of the net debt repayment was essentially the DoT repayment that we did probably in the third week of December, 20th or 21st December. Keep that in mind as you look at the interest flow. Secondly, as Soumen was mentioning, when the spectrum which has been allocated starts getting, you know, commercialized, as the amortization kicks in, so does the interest component on the deferred liability under the same spectrum. That has also gotten some increase in cost. The other way to look at this is, as earlier question was asked, in the interest cost alone line, you will have a saving going forward for the INR 15,000 crore that has been paid, which was erstwhile accruing 10%. Now given the sources of finance which is mixed from cash, the rights money and some bit of debt, will be substantially lower than 10%. That I think is the annualized saving which will start from this phase. Okay. Sir, impact of Ind AS 116 on depreciation and interest cost? You can consider a 70/30 ratio for that. Okay. Sir, one more question. Sir, how much quantum of the high cost debt that we are willing or can repay in the coming quarters, so as to reduce, further reduce, because we will be generating huge amount of free cash, from the proceeds we receive from Google and the cash flow that we'll be generating. How much high cost debt we can repay in coming quarters? I'll take that, Sanket. The total debt profile for India has now literally 0 net bank debt. We have finance lease obligation which will continue. These are accounting long leases that we have signed up, nothing needs to be done. On the DoT liabilities, there are various rounds of spectrums and there are various attached interest costs there. We have as low as 7.5, 8%, and as high as 10% also available. With the flexibility the government and the DoT has provided to the operators and the industry to pay as and when they think it's fine for them to resubstitute this, I think that's an opportunity. Free cash flow in the shorter term should go to replace this high cost debt. There may also be an opportunity to substitute a lower cost of debt from the market given that we actually are zero net bank debt right now. As the opportunities arise, some of these combination of free cash flow and substituted debt should go towards paying down. High cost DoT liabilities. We have over INR 20,000 crore of 10% interest rate DoT liability still existing in the profile on the 2015 spectrum. Okay. Thank you, sir. Thank you so much. Thank you very much, Mr. Baheti. The next question comes from Mr. Kunal Vora. Mr. Vora, you may please unmute your side, introduce yourself and ask your question now. Yeah. Hi, this is Kunal Vora from BNP Paribas. First question, you've already discussed a bit about it, but just wanted to go, like, little deeper on the SIM consolidation. So what's the extent of dual SIM subscribers left in the market now, as you've seen SIM consolidation happening over the years? And what is your assessment of unique users in the market and the potential to add over the next two, three years? Well, I think that if you look at it, you know, while there are 1 billion-odd SIMs, and if you go back and look at it, let's say, over a 12-month period against 1 billion SIMs, I would imagine that there'd probably be 20%-25% SIM consolidation. So, potentially the real number of SIMs would have been 700-750 million. And with any round of tariff increase, you do see some consolidation. There will still be some dual SIM customers even after this round. And so my sense is that, you know, each shock of tariff increase or each trigger for tariff increase is. There is a tendency for customers at the margin to reassess whether they should put their preference behind one brand or the other. That will keep diminishing as we go forward. The exact estimate of what is the level of SIM consolidation, I don't think it's 30%, I don't think it's 0%. It's somewhere in between now. If there's another round of tariff increase, you will again see some consolidation. That's just a short-term phenomenon which then equalizes and normalizes as people get adjusted to a new normal. I mean, the fact is that our pricing in India is abysmally low. You know, we are among the lowest in the world for the allowances that we give and the ARPUs that we have, the rate per gigabyte of data. This is really among the lowest anywhere in the world, and even if you compare to Sub-Saharan Africa or Bangladesh or any market, Indonesia, you'll find us among the lowest. That coupled with the fact that this is now an essential service and is so important to everything that you do on your economic activity, I think, you know, will get absorbed finally. Just a follow-up on that. Like, I mean, with minimum charge being INR 100 now, should we expect that it'll mostly be serious customers left in the category and we are on the last leg of SIM consolidation? Well, like I said, I think that there will still be some SIM consolidation. I mean, there'll still be some dual SIM customers still around. You know, we'll see what happens whether tariffs were to go up again, whether there'll be a little bit more SIM consolidation. I would imagine there could be. Okay. Second question on the home broadband. What's the potential you see over the next two-three years? Can the subscriber base double considering that you are going from 600 towns to 2,000 towns? How do you see the ARPUs as customers come into, like, lower entry points? On the 35 million home pass, which you're talking about, what should be the conversion we should expect? Like, because industry standard has been about 20%. Is that something which is inching up now? Yeah. In our case, we are higher than 20%. We don't declare those numbers, but I can confirm that we are substantially higher than 20%. We have a strong program of something called Start Green, which is really, you know, putting the entire effort of our direct to customer channel through micro-marketing in the catchment in order to actually grow the utilization in the early stage. We also have a one CLM across the company, where we look at the customer as one across all our businesses, and that enables us to really target a customer very efficiently. I do believe that this is a very, very exciting business. I think the fact that we are going to roll out as much as we are, and, I don't think it's enough, we need to roll out even more rapidly, just shows you how excited we are about this business and how much growth potential it has. I think that this business will certainly see substantial growth over the next three years. Okay. Lastly, on digital TV, just one last question. Churn level has been consistently inching up. You did talk about free dish being a problem, but is it also because of the viewership shifting to mobile and cord cutting happening because of that reason? Like, churn level is still high despite the original content being back. Just wanted to understand why we are seeing this annualized churn of 25% in DTH. Yeah. I think that you know, there are two things that I would say. One is that we have had box prices being quite low, and so there is some rotation in the industry in terms of people buying new boxes to basically consume content and then replacing that with another new box. That has been corrected because we've moved up the pricing of the box substantially. We re-lowered the channel commission, so we're already seeing the impact of that in terms of more quality new customer additions. So I think that's the first part. The second structural issue that's happening in the industry is this free dish. I think if you travel to the north of India, particularly the Hindi belt, and this is across whether it's Bihar, UP, MP, even places like Gujarat, you will see a substantial amount of penetration of Doordarshan Free Dish. As a consequence, because it's free, we are seeing people make choices away from paid subscriptions towards Free Dish. I think it's a structural issue. We've taken this up with the broadcasters. We've also spoken to the regulator to see how we can deal with it. On the cord-cutting side, I don't see much of an impact yet because this is largely a very urban phenomenon. Remember, to cord cut, you really do need to pay a substantial subscription. Amazon is at almost now INR 299 a month. Amazon, sorry, Netflix is at INR 299 a month. Amazon is at INR 1,499 a year. These are not you know particularly. The subscriptions that they have are not large enough to meaningfully displace the opportunity on linear. That said, I think one of the big call-outs for us is to use our digital marketplace capabilities to monetize these OTT subscriptions. We've dramatically improved the payments experience. Today you get a QR code on the screen, you can just flash it, pay for it, and get on with subscription. We're already seeing rapid growth on our side in terms of OTT subscriptions on our large screen. This we will continue to drive and we do get commissions then from our OTT partners. The real structural issue in the market is free-to-air. The more short-term issue has been the correction in channel commissions, which I think has actually done well to reduce this rotation and therefore minimize churn. Sure. Does it mean that price hikes in this category is going to be difficult and, you'll have to depend on subscriber additions for growth, considering that even at current price- No, I wouldn't say that. I wouldn't say that. I think that, you know, we'll wait to hear what happens on NTO 2.0. Sure. My sense is that there will be some price increase that the broadcasters will also look for. That obviously will then get passed on to customers. We haven't seen any price increase in DTH now for two years, so it's been a long time, there's been absolutely no price increase. Understood. That's it from my side. Thank you very much. Thank you very much, Mr. Vora. The last question comes from Mr. Arun Prasath. Mr. Prasath, you may please unmute your side, introduce yourself and ask your question now. Thank you for the opportunity. This is Arun from Spark Capital. Gopal, my question, I think we already discussed, just a little bit more color on the data traffic, wireless data traffic stagnation sequentially. I think we spoke about per capita consumption, but I'm talking at the network level traffic. This is the lowest I think in the last four, five years. Question is this supply side issues or some lack of demand from the ground level? Otherwise, because last time- No, Arun, I don't think you should read too much into this. The reason you should not read too much into this is that what we've historically seen is when there is a lockdown, there is a massive increase in data consumption. When that happens, like I mentioned before, you don't see the busy hour traffic going up. Remember, all our investments go towards investing in the busy hour. When the lockdown starts lifting and as people come back, you know, to offices and, you know, kids go back to school and people start coming out, you start seeing a lowering of data consumption, but you see the peak beginning to shift, right? The busy hour starts actually going back to the earlier days. This is actually the That's what's happened in this quarter as you look at growth. We would be then concerned if, you know, you don't see any data growth happening in January. That's not the case. I would be relaxed about this. I think, you're reading too much into this. I think the real question is, are you adding 4G customers? Because if you add 4G customers, you get ARPU growth and obviously you get data consumption. I mean, I would be more happy with ARPU growth and revenue growth. Data consumption is just an outcome where people sort of use because they've got smartphones. That's something that if you get 4G additions, then that happens. I wouldn't read too much into it. All right. Second, we also discussed the 5G smartphone, where you discussed at a flow level it is probably 20%, at a stock level it is less than 5%. The less than that is low single digit penetration is at the country level, isn't it? Probably when you are looking at the cluster, because the deployment doesn't happen at the country level, it is more like a state or a city or even at the cluster level. Probably at the cluster level this number would be much higher. Of course you can't buy spectrum for a cluster. Probably my question is that, is there any threshold level of penetration at a cluster level where you would look to deploy 5G in an existing bands, because there are more customers at that cluster are now on 5G smartphones? Well, look, I think 5% is the average, you're right. It's more like 3.5%-4%. There is a distribution of this, obviously. But it's not that it is in some clusters 30%. You know, the distribution is more like from 0% to maybe 9%, right? So that's the sort of variation. Yes, we have a lot of, you know, heuristics to define at what point you need to trigger this investment. We've done that in 4G and we will do that in 5G. I think one of the determining factors will be that when you put in those 5G investments, you want to fill that up so that you don't put any more CapEx on 4G. Because 5G must then displace 4G so that the overall CapEx is still around the same level. I think that is a fine science that we will use to decide where to deploy on a modular basis. As a follow-up, have you completed your TDD deployment across country or still there are some questions? More or less concluded. I think you know, in any network, and this is true for all networks across including ours, in every city, in every state, you have a normal distribution. You have the top 40-50% of sites giving you almost 80% of traffic. The bottom 20% give you nothing. There's no point actually deploying TDD spectrum in the bottom 20% because you really got an empty network in any case, even on the midband, and your experience is great. I think we are much more focused on customer experience, so that whatever people are doing on the device, they're able to do it well. Thanks, Gopal. That's very helpful. All the best. Thank you very much, Mr. Prasath. With this, I will now hand over the proceedings to Mr. Gopal Vittal for closing remarks. I think we've had a good solid discussion. Thank you very much for joining in. I would say that we are pleased with our overall, you know, the quality of our execution across the portfolio. More importantly, we're building a new Airtel, and I think the capabilities that we are building on the digital side are something that are now going across every aspect of our operation. That is certainly gonna, you know, stand us in good stead going forward. Thank you very much. Look forward to seeing you next time. Thank you everyone for joining us today. Recording of this webinar will also be available on our website for your reference.