Good afternoon, ladies and gentlemen. I am Vaidehi, the moderator for this webinar. Welcome to the Bharti Airtel Limited fourth quarter ended March 31st, 2023 earnings webinar. Present with us today is the senior leadership team of Bharti Airtel Limited. I must remind you that the overview and discussions today may include certain forward-looking statements that must be viewed in conjunction with the risks that we face. Post the management opening remarks, we will open up for an interactive Q&A session. Interested participants may click on Raise Hand option on your Zoom application to join the Q&A queue. The participants may click this option during the management opening remarks itself to ensure they find a place in the queue. Upon announcement of name, participants to kindly click on Unmute Myself in the pop-up screen and start asking the question post-introduction. With this, I would now like to hand over to Mr. Gopal Vittal for his opening remarks. Thank you very much. Welcome to the earnings call for Airtel. With me on this call are Soumen, Harjeet and Naval. This quarter's earnings call will be really focused on a stock take of 2023, the full year 2023. In addition, I will underscore yet again why we are so well-positioned for the future. Let me start with a quick update on our business, and let me do that with ESG. During the year, we received multiple accolades, the Golden Peacock Global Award, the ICSI National Award for Excellence in Corporate Governance, and Crisil GVC Level 1 rating, which is the highest rating on governance. Also received, you know, we received a rating upgrade from MSCI and CDP. Finally, we've received the ESG Excellence Award at the inaugural edition of the Dun & Bradstreet ESG Leadership Summit 2023. We take great pride in our governance, the diversity of our board, and the quality of transparency of disclosures. Equally, the environmental impact of our business operations has now been embedded deeply into the business. I do believe while the road ahead is a long one, I want to give you a few examples of some work that has happened in the quarter. We started construction of our 25 MW data center. This is the first in Calcutta, which will operate fully on green energy. A large part of our rural ex- site expansion now has solar energy access. Airtel 5G Plus network, as you know, is also kinder on the environment because of its special power reduction solution. We've also joined the WEF Initiative Alliance of CEO Climate Leaders India. This alliance is aimed to serve as a high-level platform for business leaders to support concrete plans and ideas to step up India's climate action and green transition efforts. Let me turn to our performance. Let me do that with a quick roundup on the full year 23 results. I want to start by underscoring the simplicity of our strategy. Our focus is to drive quality customers, give them a great experience. We wanna be digital at the core and use this digital capabilities to build new streams of revenue, and do this while we're stripping out waste. We've delivered strong revenues and operating margins across the portfolio during the year. The overall free cash flow, which is EBITDA minus CapEx, as we look at it, is about INR23,000 crores for the India business in full year 2023. This was despite heightened CapEx, rural expansion, and really no meaningful tariff hikes. Our net debt now is at 3.4. This is at the India level. It's at a comfortable level in India, and overall, of course, the consolidated level is at 2.8. Our performance is really based on solid execution. We've delivered a strong growth in postpaid for the year. We've delivered strong growth on 4G net adds, and we've seen sustained growth in both homes and B2B. There's been a historic movement on the network. We added almost 37,500 sites in a year, 37,492 to be precise, and about 33,650 km of fiber. One of the interesting things that we're doing is to leverage FTTH, which is fiber to the home, to wire up our towers. This has been a huge game changer for us, in terms of wiring up our towers on a very, very smart and efficient basis. In fact, our smart investments and obsession with experience resulted in us staying out of the expensive 700 MHz band because we bolstered our mid-band holdings over a four -year period. It was a bold decision to go with NSA, which is non-standalone architecture on 5G. This is already giving us better coverage, lower CapEx, lower carbon footprint, and better experience. At the same time, standalone architecture, which is SA, is also ready for enterprise. We've already had it ready in our environment. Today on 5G, we are in about 3,500 cities and towns of the 7,000 that we have in India. We're adding almost 35- 40 cities every single day. We believe we will conclude our urban coverage this year in some of the key rural pockets as well. Let me turn to a quick update on our performance for the quarter. We've delivered a consistent and competitive performance despite two lesser days in the quarter. Our consolidated revenues grew by just under 1%, 0.6 to be precise, sequentially to over INR 36,000 crores. Our EBITDA margins were at 52.2%. We've seen continued efforts on bottom waste. In fact, one of the most interesting deliveries that we're very proud of is our network OpEx for India went up just by 7.5% in full year 2023, despite serious cost headwinds in terms of energy as well as rollouts. In the mobility business, we added 7.4 million 4G net adds. We had strong momentum on postpaid with net additions of 663,000. Our reported ARPU came in at INR193. Do remember that this quarter had two lesser days. On a normalized basis, if I don't take the two days, but take a one-day basis, on a normalized basis, we are already at INR195. This was led by smartphone upgrades, data monetization efforts, and a modest flow-through from the increased tariff on the entry plan, where we took pricing up from INR99- INR155. On the broadband business, we had a strong end to the year with 4 lakh net adds. The full year, in fact, was at 1.6 million. Today, we are present in just under 1,200 cities, up from 847. We're now hitting the tail end of the cities because we're seeing bulk of the growth coming from the key cities, the top 200, 300 cities. In the DTH business, we lost 39,000 customers in the quarter, but this was largely due to seasonality. Cricket, as you know, has an impact on DTH. If you strip out the cricket viewers out of the customer base, which we do now on a very scientific basis, this results in the core business looking strong, or looking better, let me put it that way. We do expect this to play out in the coming quarter. April and May have been strong in terms of net additions. I do want to say that our strategy of convergence, which is bringing the aggregation of all video content, linear content, along with broadband, is working, and we believe we are now outperforming the DTH industry by a margin. On the Airtel Business, revenue in the quarter was flat sequentially, but we did let go of some low-margin deals. Therefore, I do want to say that the underlying business remains strong. This was reflected in the margin expansion of 1.3% in Q4. For the year as a whole, we've delivered just under 16% revenue growth, the highest in the last decade. Our connectivity market share has moved up by 220 basis points and is now at 34%. Our IoT market share is now close to 53%. New businesses such as cloud, IoT are now growing at well over 50%. Let me turn to the digital businesses. Our payments bank saw strong momentum. Our monthly transacting users were up by 14.5% sequentially to just under 55 million. The deposit growth is growing at 58%. Annualized revenues are now at INR 1,516 crores, 18% up over the last quarter. Actually, more like 19% up over the last quarter. Digital businesses now are at well over INR 1,100 crores annualized. Let me now turn to the future of Airtel. Let me talk about the five critical areas that I would say make us really well-positioned. The first is our portfolio. This is now growing in strength. Africa is now at 31% of the overall portfolio and continues to do well. India wireless is at 54%, where we still have significant upsides on smartphone upgrades and a reset on tariff. The homes and enterprise business constitute the balance at 25%. Here there is a momentum that we're seeing led by structural changes in the market with growth coming at the top end. Growth of broadband and convergence, as well as increased digitalization of businesses are the tailwinds in the homes and enterprise space. All of this play to our strengths, therefore investments are now being stepped up in line with where the growth is to drive this portfolio and make it even more resilient. The second reason I would say we are well-positioned is a brutal focus on quality customers. Today what I want to do is to take a geographical cut on these quality customers. The first lens or the first cut that we look at geographically is rural. I mentioned last quarter on that we have an opportunity to expand into 60,000-odd high-potential villages to win a greater 4G share of net additions. This expansion is in line with our plan, and early results have been encouraging. As a result, we are now at a lifetime high in terms of revenue market share at just under 39%, 38.7% on a comparable basis. I say comparable because our reporting reflects segmental performance unpeeled for mobile, broadband, DTH, and B2B. The second lens of this geographical cut is the top 150 cities. These cities account for almost 40% of the overall telecom market in India, and they're growing rapidly. Specifically, 80% of the market for postpaid, broadband, converged homes, and in fact, on B2B, it's more like 95%, is concentrated in these 150 cities. Our focus is to win these cities, bringing the full power of the Airtel network, our channels, and all power using digital tools. Let me explain this in a little more detail. Let me start with postpaid. As I said, 80% of the market is in a 150 cities. 5G is the pivot around which postpaid performance can truly accelerate. Today, almost 32 of the 335 million users we have already have a 5G handset. For postpaid users, this number is as high as 33%. While for the aggregate it's a little under 10%, for postpaid this is 33%. The structure of families in these top cities is also changing. There are more and more nuclear families, and this is the reason for our INR599 plan launch in postpaid, which locks a nuclear family, let's say a husband and a wife, into one plan. Homes. Again, 75% of the market for broadband is in the top 150 cities. We have a renewed focus on fast rollout. We're rolling out almost 1.6 million home passes every single quarter. As I mentioned, convergence is the route around which we are entering the home. Broadband plus linear content and Xstream, where we are aggregating over 20 of the 35 odd OTT apps, are all provided in the form of one plan. Another area is channels. All high-value channels are predominantly focused on these 150 cities. Our own stores, our installation teams, our digital marketing focus, and the 30 million existing high-value or homes who use 1 or more of the services that we offer are already in these cities. Our channels are now therefore fully integrated on an omnichannel basis. 30% of our high-value acquisitions are now starting online and are integrated omnichannel. Every 1 of our people across our own employees as well as our partners, 60,000 of them, are integrated on Airtel Work. As a result, we see massive synergies in the delivery of SIMs, installation of broadband, installation of DTH. The store, which is our own store, is the fulcrum around which all of this revolves. This is one of the reasons why we are expanding our low-cost single-seater stores across the key cities in the neighborhood catchments to reach the customer directly. Lastly, let me talk about B2B. As I said, 95% of the B2B market is in the top 150 cities. Within this, the top 500 accounts, the top 500 businesses are growing disproportionately. Account management brilliance is what we want to drive in these accounts. For every account, we are mapping the key decision-makers, understanding their needs and the problems they are trying to solve across a range of areas, and then bringing our full suite of solutions to bear. We've seen early successes. 50 of our top accounts grew by 300% versus 25% growth seen in the overall top 500 account segment. The third area that we are that I want to talk about is an obsession with customer experience. This is another reason why I would say that we are well-positioned. We have renewed our focus on improving experience. The whole company is focused only on one metric, and we call this interactions. We want to drive down interactions. Every interaction, we believe, is an underlying fault or a lack of understanding where we have not been able to ensure with our customers. These interactions go across all our channels, whether it's call centers, it's stores, it's the web, it's the app, or it's on social media. To solve this, what we're now doing is building four critical platforms: buy, build, pay, and serve. Buy is about customers buying anything. build is really all about billing, so any kind of bill that is done, whether it's a bill or an add to bill. Pay is about paying from any channel through any mode whatsoever. Serve is both self-serve as well as assisted care. Each of these platforms is exposed to a common channel layer, which is integrated omnichannel. Underlying all of this is our foundational layer, which is our data layer, which is all about our unified customer master. The fourth reason I would say we are well-positioned is really all about building our digital businesses, which leverage our platform. As I mentioned before, we see Airtel in three parts. The bottom layer is our digital infrastructure, which includes our data infrastructure. The layer on top is our digital experience, which I've just spoken about. The layer on top, which allows us to actually build these services on top of these underlying platforms, is really the digital services. Our digital services now span CPaaS, Airtel IQ, Cloud, SD-WAN, and Ads. Our Ads business is now being pivoted to put dramatic focus on Airtel Finance. We have partnered with Axis Bank and NBFCs such as DMI Finance through deep API integrations on the Airtel Thanks App to natively offer loans and credit cards to our customers. By leveraging an industry-first proprietary machine learning and AI-led model, combined with an end-to-end digital experience, Airtel Finance is offering instant loan disbursements, flexible EMI options, and a native post-purchase experience on Airtel Thanks. Our co-branded credit card with Axis Bank comes with various offers on telecom, utility, various offline and online payments. Within a few months of launch, this part of our business has served more than 2.8 lakh customers. We've already hit about INR 1,200 crores of annualized lending run rate and 2.4 lakh of annualized credit card issuance run rate. As you can see, the power of this platform enables us to participate across the value chain by leveraging core strengths. Finally, the fifth reason that I want to underscore on why we're well-positioned is the war on waste. We've relaunched our war on waste program to bring renewed energy behind it. Four big areas we're looking at. First is network costs. We have started relocating high-cost sites. About 66,500 sites have been identified for specific actions around energy, rental, as well as re-engineering the site. This is seeing good traction, which is why network OpEx has been well controlled despite massive rollouts. The second area is sales costs, where we are taking actions to lower the reliance on inefficient channels that either have a high cost per gross addition or high early churn. Massive data science is being deployed to identify the early churn right down to a single outlet and a retailer level. The third area is on CapEx. We stopped all capacity investments into 4G since we are now seeing traffic offload of up to 30% in a site where 5G has been launched. Finally, we're seeing a war on failure and interactions, which will also lower costs. To sum up, I think we've... I would say we've had a satisfactory performance as we close the year with share gains across our businesses. We're building a future-proof Airtel that's bringing renewed focus on execution around a simple and cohesive strategy. We are financially in a stronger place. Operating cash flows are expected to more than meet CapEx needs while reducing leverage as well. Yet, our concern on return on capital employed remains. At 8.5%, this is way too low. We hope some sense will prevail in the industry to move up tariffs sooner rather than later. With that, let me hand over for questions. 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 analysts and investor community only. Due to time constraints, we would request you if you could limit the number of questions to two per participant 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, participants to kindly click on unmute myself in the pop-up screen and start asking the question post-introduction. The first question comes from Mr. Kunal Vora. Mr. Vora, you may please unmute your side, introduce yourself, and ask your question now. Yeah, thanks for the opportunity. This is Kunal from BNP Paribas. My first question is on postpaid. On postpaid front, you've seen an acceleration in customer addition. Is this being led by 5G, and can you talk about how the postpaid ARPU is trending versus prepaid? Have you seen any increased aggression by any of the peers? Yes, as I mentioned earlier, we are using 5G as a pivot to accelerate postpaid. We've also launched our INR599 plan targeted specifically at nuclear families. That's also seeing some good traction. As far as ARPU is concerned, you know that the pricing of postpaid has a significant premium over prepaid, clearly the ARPU is much stronger than what you would see on prepaid. Gopal, my question was on the change, the delta. If I look at, like, last six months, one year, how is the postpaid ARPU trending versus prepaid? Is it, like, similar trend or postpaid is declining or any of that? No, it's broadly around the same. Okay. Okay. My second question, I just wanted to get some sense on how you are looking at AI. We've seen big, rapid progress since the launch of ChatGPT in the last few months. How do you see AI impacting your business, and are you seeing any cost rationalization, customer experience upgrades, revenue growth opportunities? Whatever, any thoughts on how AI will impact your business in the longer term? Yeah, that's a great question. I think we have a full team now assessing the impact of these on our business. Yes, you are right. There are opportunities around experience. There are opportunities in go-to-market. There are opportunities in procurement. There are opportunities in analytics. There are also opportunities in prediction of, you know, upgrades of where devices, which devices will move up. Across our businesses, there are opportunities. There are also attendant related risks around cybersecurity and things like that. All of that is being studied. There are some experiments that we have begun and in small areas. Nothing really meaningful to report back, but we are really looking at this very closely and we are, we have a team working on how we can bring in some of these technologies into our core business. Thanks. Just one last question, if you can share your thoughts on CapEx for FY 2024 and 2025? I think the quarter's CapEx at 9,000 crores is a little elevated, but if you take the full year's CapEx is about INR28,500 crores for the full year. As I mentioned before, if you take a three-year view, we'll be broadly in that same ballpark of what we normally do. We have reason to believe that the full year CapEx for 2023-2024 will be in the same ballpark as what we had in the current year. In that broad ballpark. Understood. In FY 25, would you expect a reduction in CapEx considering that rural expansion will be behind, 5G urban expansion will be behind, and rural 5G might not really be happening. Would it be fair to expect that in FY 25 there will be a decline in CapEx? I would imagine that our 4G rollout is more or less be completed. I think there'll be a few places, very small rollouts in a few circles, broadly that will be completed. We are not investing anything more in 4G capacity, as I mentioned. Transport investments will continue as we wire up towers. We are also investing in some of our other businesses. Businesses like data centers, homes will continue to see, you know, strong investments, and so on. Wireless CapEx on 5G will certainly come down relative to what we would have seen in this year. We would have completed the urban coverage more or less during the course of this year. We will start hitting some of the, you know, sort of villages as well, top villages. How far that will then go into 2024, 2025 is something that we will assess. You know, this is a modular business, as you know. Wireless is modular. You go and string a set of radios on a tower, based on where the traffic is, where devices are coming up. We will be tracking that closely. I think one of the things that we've seen on devices is that shipments are slowing down. I'm sure, Kunal, you've seen it as well. This is happening all over the current world, because I think device replacement cycles are extending and that also entry-level smartphone prices have moved up. To that extent, if that trend continues, that will also give you some relief on the amount of CapEx that will be needed in rural areas as we get into 2024, 2025. Understood. Thanks, Gopal. That's it from me. The next 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. Thanks for the opportunity. This is Piyush from HSBC. Two questions. On the 5G subscriber, could you share some color on how the behavior is against a 4G subscriber, like data usage, use of applications, you know, now since we are in the second quarter? Can I just confirm how much customers in postpaid were on 5G? I missed that number. The second question, on the second one, about 30 odd%, 32% of our postpaid users already have a 5G handset. On 5G, I think that today what's happening is that 5G on a existing plan is being given away free. It's unlimited data on a 5G device. Not everybody has opted for it because you do need to get on the Thanks app, Airtel Thanks App, to take it for the period of which your recharge or your cycle exists. Not everybody's taken it, but where people have taken it, obviously they're using a lot more. I think the broader point, Piyush, is that this is one of the first times that I think the telecom industry is moving well ahead of the rest of the ecosystem. If you look at the telecom industry, what is 5G? 5G is not just a radio technology anymore. In my view, 5G is a supercomputer. It's a supercomputer that's connected to the cloud. Because it is able to dramatically change things in terms of not just speeds, which we are delivering. You know, you see 400, 500 Mbps speeds. It also gives you significantly lower latency because the compute will now move towards the edge, and it allows you to have 100x the number of devices in a given square kilometer of area relative to 4G. It is a supercomputer. Now, if on a supercomputer you are... The applications that you need on a supercomputer are very different from your regular applications. The applications today that most people use are the same applications: messaging, video, you know, browsing. If you're getting a supercomputer and you're using this to, basically for Microsoft Excel or Word, then you're not using the supercomputer in its, in its entirety. This is where I feel that the rest of the ecosystem needs to catch up with the telecom industry. The rest of the ecosystem across devices, across applications, content, all of that needs to change. We hope that over the next coming years, this ecosystem will flourish because remember 4G, industries have been built on 4G networks. Ride-sharing was built on it, food delivery was built on it, e-commerce has been built on it, payments has been built on it. This is a smile around which more applications need to come, but the telecom industry is right now well ahead of the rest of the ecosystem. Thanks, Gopal. On second question is on home broadband. ARPU is coming off. It is down 6% year-on-year. Is it due to price competition or mix change of lower ARPU subs that is, as you're expanding in new cities? What's the outlook of home broadband ARPU? I think that when you look at the, you know, rollout that you're seeing, many of the customers who are coming in beyond the top 100 cities are coming on slightly lower-end plans, and that is leading to some dilution in ARPU. I mean, I'm quite relaxed about the dilution ARPU that we're seeing because this is profitable business, number one. Number two is the revenue is growing strongly and, you know, the margins are strong. Even the cost of doing business in these cities has been done on the basis of a really innovative model, which is a partnership with local cable operators, where the CapEx requirements is much lower than what we would have in the top 100 cities. All in all, I think we've got the right business model for accelerated growth in home broadband. Got it. Thanks a lot. The next question comes from Sanjesh Jain. Mr. Jain, you may please unmute your side, introduce yourself and ask your question now. Hi, Gopal. Good afternoon. Sanjesh here from ICICI Securities. I got couple of questions. First, on the 5G subscriber, I know it's a very short period, but what is the average usage of a 5G customer versus a 4G customer? Have we seen any early signs of these 5G customer upgrading the plans to the higher plan where the data allowances are more? I know we have an unlimited plan, but still any signs between people will stick to this kind of usage once we move them from unlimited to limited, and that can benefit ARPU, say, in FY 2024, 2025? You had a second question, Sanjesh? This is only one? I got few more. Yeah. Okay. Okay. I'll take this one, and then you can ask your other question. The what we are seeing is a growth in usage. If you leave the unlimited, obviously there's a big growth in usage there, and that is not necessarily monetized because it's unlimited. We are seeing for those who don't take the 5G, they don't sort of go and claim the unlimited on the app. We are seeing a growth in. We're firstly seeing lower churn, and we're also seeing a growth in consumption. That growth is a direct impact on some revenue because what happens is we have this concept of data breachers, which essentially means that on a given day, given a daily plan construct, the number of days that a customer breaches their allowance for the day. We have a lot of data science and a lot of contextual triggers to buy impulse data packs on the go in a very easy way. That revenue stream of data monetization is beginning to see some growth, and yes, the effort to upgrade them to a higher data plan, obviously continues along with that. Because for those who breach on a regular basis, let's say eight, 10 times a month, clearly, you know, they benefit by moving to a higher plan, which then gives you an annuity stream of revenue. So both those moves we are seeing. At this point, this is small because remember the handsets that are 5G enabled on our network are only about 10%, 11%. So to that extent, as this grows, there should be some impact on ARPU. Fair enough. On the unlimited pack, can you just share the data, what is the usage per subscriber there? I know it is not sustainable, but still a ballpark number would really help. I think it's early days, Sanjesh. Maybe next quarter we'll give you a better color on it. It's too insignificant right now because the adoption rates are very low. I suspect they will continue to remain low. They're not going to be anywhere upwards of maybe 15%-20%. Today they're in the low single digits. Therefore, this really doesn't have a material impact. Don't forget that the capacities that are there on the, on 5G, given a 100 MHz tranche of spectrum that we have, along with the efficiency that this has, is like massive. I'm not worried about this having any impact on CapEx for the next five years. The challenge only is that I believe at some stage you need to price in this, because the tariffs that are operating, the amounts of allowances that we are giving, you know, whether you look at rate per GB or the ARPUs that we have in India, they are the lowest in the world, and they're the lowest compared to, you know, even markets like Pakistan or Sudan or Sub-Saharan Africa, let alone markets like Indonesia and Thailand and all that, where, you know, in many parts, many states, India is getting towards those income levels. It really does need to move up. Fair enough. Second, on the enterprise side, I can see the CapEx has gone up, which indicates that we are now started investing in the data center. We have told that we will grow by 4x. How should we see this revenue coming up? Are we pre-booked this to the hyperscalers, so as soon as the CapEx is completed, we will be booking the revenue? With this, what does it mean to our enterprise revenue growth? I think that this quarter's CapEx is elevated on the enterprise business fundamentally because of some specific deals that have happened. This is a combination of some cables, cable investments and it's a lumpy investment, cable investments and some bandwidth that needed to be bought to support our network. These are lumpy investments. This will be lost in subsequent quarters. This has not had any meaningful impact on account of Data Centers. I mean, the growth, the incremental growth is not on account of Data Centers. The Data Center investment continues. The broader answer to your question is that as soon as the, you know, Data Centers are built out, Typically, when we are building for hyperscalers, we build in advance, we build it to suit. To that extent, we've got the commitment already, and as soon as it's ready, which typically a data center takes maybe 12 to 18 months to complete, you know, the moment it's done and handed over, the revenues begin, and then those are annuity revenues. If you're building smaller data centers, then you need to fill that out. That takes about maybe six months because you get smaller, domestic players, where the margins are also better, the returns are better. They come in and actually fill out the data center. Got it. Got it. My next question is on the 5G OpEx and the network on the 5G. Are we charging the entire 5G OpEx or it is capitalized considering that we are ready to do a commercial launch? Jio shared that they have lit close to 60,000 sites. Where are we in comparison to Jio in terms of number of sites presence on the 5G? As of now, this project is still underway. As of now it's capitalized. The project is still underway because the rollout has just about begun, and we hope that, you know, this will start peeling off in the coming quarters as we start sort of lighting up more and more 5G and meet the central criteria on which we peel that off. As far as your second question was, sorry, Sanjesh, I missed that. Jio mentioned that they have lit 60,000 sites. Yeah, yeah. Got it. Got it. yeah. Got it. Got it. yeah. Got it. Got it. Yeah. 60,000. I think one thing that I do want to underscore, Sanjesh, is that we are not in a maniacal rush to compete on the number of sites. The technology we are using is different. NSA is fundamentally different from NSA, from SA. It gives us more coverage. In fact, I mentioned to you, I think about three quarters ago that from my house in Gurgaon to the office, we have about 18, actually 23 sites in that stretch. I was surprised early on to find that 6 sites that we had put was giving almost seamless coverage on 5G from what was needed on 4G. NSA gives you better coverage. I think that's the reality, and that's because the midband is doing the uplink and the 3.5 is traversing much further on the downlink. I explained that in some detail a few quarters ago. We are not chasing number of sites. What we are instead chasing is coverage where we need it. That we are absolutely, we are already there in 3,500 cities. To that extent, we are not going to be at, you know, any disadvantage whatsoever on coverage. Got it. I'm squeezing one last data point question. The SG&A cost in India grew by 36% in FY 2023. This is significantly a sharp jump. Can you help us understand what's leading to such a sharp jump in SG&A cost, and how should we factor this for the years coming? Maybe, Soumen, you can answer this question. Gopal. Sanjesh, I think the SG&A cost is primarily driven by the competitive intensity to acquire customers in the market. We have always held that this is a fruitless money being spent and people keep on churning. To remain competitive in the market, we need to have our terms which are rightful. You would see there is some softening of that in Q4 because we have taken some steps through data analytics. We have tried to find out places where we can optimize. In the center of the plate, the competition is very stiff, and we need to match what other players in the industry is offering in terms of acquiring customers. Hence you see that increase. You know, I just wanna supplement what Soumen says. I really think, you know, beyond a point, like SG&A, the cost that the commissions and all that that are being given by the industry at large, unfortunately, you know, you have to match it because otherwise you tend to lose, is not a healthy practice because it leads to a very high level of early tenured customer churn. That's what shows up in overall churn numbers. If you split the churn into first four months churn and subsequent churn, our subsequent four-month churn, after four months, the churn is very low. It's the first four months that's high. I hope better sense will prevail. We have, in fact, started making some moves to lower some channel commissions on SG&A on our own. We are tracking the impact of that over the last, 45 days. We hope that this will sustain. We do hope that, you know, this better sense prevails. The next question is from Vivekanand Subbaraman. Mr. Subbaraman, you may please unmute your side, introduce yourself and ask your question now. Hi, this is Vivekanand Subbaraman from Ambit. My two questions. The first one is on millimeter wave spectrum. Gopal, could you please tell us the plans of utilizing this spectrum? Is it going to be used for enterprises or FWA? Also, you know, related to this, could you just give us an update on the FWA? You know, you said that you are looking at it. What's the update on the CPE and the viability of this? That's one. Secondly, on B2B, noted your opening remarks on you giving up certain low margin business. Growth seems to have come off here. How should we think about fiscal 2024 and 2025 revenue growth with respect to B2B revenues? I understand that there is some lumpiness with respect to data centers also. Thank you. Yeah, I think there's somebody talking on the other side, so maybe if you just mute your. Sorry, sorry. Yes, sir. I think on the millimeter wave spectrum, this is really precious spectrum. It's a large tranche. It has helped us save us spectrum user charges as well. To that extent, it's paid back for itself, that spectrum. The fact is that it is still early days. We've got 5G networks. These are currently empty. We're rolling this out. I think that there is no plan right now to use the millimeter wave. I think we're doing some trials to check what, you know, the propagation characteristics and so on. Those are more on a long-term basis of when, if and when we need it. At this point, there is no plan whatsoever. On the fixed wireless access, the cost of the CPEs are still very high, and I've mentioned this before. If you look at the cost per home pass on fiber, Cost per connected home pass, given our utilization, the cost per connected home pass typically is in the ballpark of $100-$120 for us. $120 per connected home pass. In the LCO side, it's even lower. If you look at the CPE, which is equivalent to a cost of connected home pass, because for every connected home, you need a CPE. In any case, you need a router, which is the same as what you would do in a broadband home. The cost of the CPE is more like $170-$180. It's much higher than the cost per connected home pass. Remember, fiber gives you consistent experience, so you're gonna get the same experience every day, but it's a dedicated pipe into your home. In the case of fixed wireless access, you may get a very good experience when the networks are empty. In five, seven years, like we're seeing in the case of T-Mobile in the U.S., you're already beginning to see challenges on network experience through fixed wireless access. It's at best a technology that can be used to go where fiber is not able to go and then follow that up with fiber. That said, we have a team looking at this. We are working on it because as scale mounts, you may see some reduction in fixed wireless access, CPE costs. Right now, that doesn't seem to be on the anvil. On B2B, I would not worry about the growth seeming to come off this quarter. As I said, it was a, you know, some lumpy business that we actually chose to walk out of for the right reasons. The underlying growth trajectory seems to be strong. You know, the funnels that we're seeing in the order books, which will translate into revenue for this coming quarter, we already know. We finished April, and we're into May, look strong. I would not, read too much into this last quarter. That's helpful. Just one small follow-up with respect to FWA. Since you are thinking about your DTH business from a converged homes lens perspective, which is linear TV plus non-linear in the same box, is there a possibility of you bundling, you know, FWA with perhaps the high-value DTH homes that you are currently offering and potentially some innovation on the box side here? Thank you. Yeah. I mean, that can be done because that box works on Wi-Fi. To that extent, That'll obviously be done. Okay. Any thoughts on, you know, whether this is viable, you know, for the higher value customers? I mean, I understand that the reliability is not great, so, No, it's not just the reliability, it's also the economics. Okay. Got it. Thanks. The next question comes from Paresh Jain. Mr. Jain, you may please unmute your side, introduce yourself, and ask your question now. The next question is from Gaurav Rateria. Mr. Rateria, you may please unmute your side and ask your question now. Mr. Rateria, you may please unmute your side, introduce yourself, and ask your question now. Vaidehi, should you try and take another question? Ask maybe if there is. Sure. The next question is from Aliasgar Shakir. Mr. Shakir, you may please unmute your side, introduce yourself and ask your question now. Yeah. Hi. Thanks for the opportunity. This is Alia sgar from Motilal Oswal. Gopal, I have just one question on the 5G, you know, CapEx sense. I hear your thoughts in terms of, you know, the point that we have for the first time, telecom operators are ahead of the curve in terms of 5G investments. I just want to understand, you know, in terms of typical trends of how a new technology rollout happens with initially, you know, focus on coverage, then densification, you know, and then moving back to your from probably NSA to SA, refarming, how these trends will follow. Do you think, you know, unlike 4G, this will be a very long, prolonged, you know, 5G rollout, or it will be, you know, probably between three to five years. Based on these factors, how the trends of CapEx will follow. Do you think things could probably make you prepone some of your CapEx or, you know, how are you thinking about this? Aliasgar, I think, let me sort of just say this to a couple of things. Number one is that while disproportionately shipments that are happening in India are smartphone-led, there are still almost, you know, 25%-30% of shipments that are coming in on feature phones. When the world has moved to 5G, there are still customers out there who are buying 2G phones because they simply can't afford it. India is, as you know, a disparate society, right? There are people who are very rich, high-end homes. There's a big middle, which is the smartphones. There is also a bottom, which is, you know, needs to think about every rupee they spend. The second trend that you're seeing is the device replacement cycles have started extending. If you're carrying a phone, which remember we have 10% odd 5G devices in our base, the total shipments that are coming in, about 30% of new phones are already 5G enabled, 35% or so. Because these phones are over 20,000, all are 100% 5G enabled. Above 50,000 is smaller, and below that it's even smaller. As people upgrade, if the device replacement cycle is in itself extending, then the movement to 5G will be also a little more limited. That's the second thing. The third thing to look at is the structure of the network. Any network has 20% of sites which have very high utilization, the next 20% slightly lower, and the bottom 20% is almost very, very low. If your utilization of your sites, of the 235,000 sites, let's say 70,000-80,000 sites are very, very low in terms of utilization. The existing spectrum that you have, the existing technologies that there are already delivering fabulous experience. I mean, they're giving you 20 Mbps-30 Mbps and likely talk. For the applications that use these devices, 3 Mbps-4 Mbps is more than adequate. I think this is going to be initial heavy rollout like we have seen in or like we are seeing in FY 2022-2023. There will probably be continued rollout in 2023, sorry, 2024-2025. 2023-2024, heavy rollout. 24, 25, continued rollout, and then some moderation. Over a period of time, as all of these devices start shipping out and moving up to 5G, you will start seeing operators beginning to refarm spectrum. We have plenty of mid-band spectrum. We have 2300 spectrum. All of that can slowly be refarmed towards 5G. Once you've got the mid-band spectrum really refarmed to 5G, and maybe one or two cities may move faster than other cities, Delhi could move faster, Mumbai could move faster. These cities will move to SA first. That's the way that you have to think about it. I do not have any reason to believe that the elevated levels of CapEx that you're seeing in the short term will continue for, you know, forever in the medium term. It can't be like that. Understood. This is very, very helpful. Just one question on the, you know, digital avenues that we are targeting. You know, I see, you know, about a decade back when, you know, telcos were a dumb pipe. Today, we have so much more to offer to the customer. How big you think this can become over a five-year period, you know? Can this really become a reasonable contributor to your revenue? How big it will be, I don't know. I think the core business, because we are in an annuity business, we still have a lot of headroom for growth, particularly in homes, even on wireless with tariffs having to go up, et cetera, is still high. B2B has a lot of headroom for growth, as I've already mentioned, not just on connectivity, but also on the digital services and adjacencies around connectivity, things like cloud, cybersecurity, IoT, then data centers that we spoke about, CPaaS, et cetera. These digital businesses, if you include all of these as digital business, I think it could be quite meaningful. I think, you know, it will never be in the same sort of ballpark as what you have on the large mothership. The good news is all of this is very capital efficient because it sits on an existing infrastructure. Like I talked, I think it rides on the underlying data infrastructure that we've built over the last five years, and that makes it incredibly efficient. Let me give you an example of the lending part, which we spoke about earlier. I said that we are doing over INR 100 crores of lending, and we started this literally a couple of months ago. By the way, it's only 15 people who are working on it because these 15 people are really building this, you know, machine learning and AI-led algorithms, which are credit profiling an individual customer. We have 16 million users on our network who are pre-credit approved, who are ready to be, you know, offered a loan. That power of our data infrastructure, I think very few companies will have, very few industries, and that's the advantage that we bring. It costs nothing because the infrastructure is already there. It's just now intelligently looking at what that means and how you can use it. Got it. I think this will probably also more be used to create a sticky customer base. Absolutely. Without a doubt. Right. Thank you. Because we also had other value earlier that, you know, besides of course a native journey on the app where you can lend, you've got the credit model. We're also able to remind for collection and use our outreach to actually collect the money on behalf of the bank. To that extent, that's another powerful value-added service that we can offer. That's what gives us a margin on the disbursement without carrying any of the balance sheet risk of actually, you know, or the book of the lender. Right. Got it. This is very helpful. Thank you so much. The next question is from Gaurav Rateria. Mr. Rateria, you may please unmute your side, introduce yourself and ask your question now. Hi, this is Gaurav Rateria from Morgan Stanley. Two questions from my side. First, Gopal, what's your view on the pricing differential between consumer who was on the higher end of the data consumption bucket versus lower end? You think it's appropriately priced right now? Can this change when 5G becomes more ubiquitous? Second question is on the capital allocation. What would be the right capital structure post which the free cash flow will be used to return, bulk of it will be used to return to the shareholders? Lastly, any reiteration of what is, you know, strategic versus non-strategic from a core assets perspective, which you can look to monetize over time? Where does Indus Towers fit in the scheme of things? Thank you. I think that the structure of pricing, and I've spoken about this earlier, I feel in India is unfortunately broken because, you know, you have a one size fits all pricing approach. It's not the way that any industry works. Any consumer industry, you will typically have, you know, people who are able to pay more, get a lot more for the upgrade. People who pay less get a lot less. In our case, you know, if our plan starts at INR240 or INR200, gives you 1.5 GB of data a day, plus unlimited calling, plus 100 text messages. There's very little reason for them to actually buy a higher plan unless they are unique users at the margin who are actually, like, going through their allowances using a lot more. To that extent, I think it's not the right price architecture which we need in a market like India. You look at other markets, forget about even Western Europe, which also operate like this, but look at even markets like Indonesia or Thailand or Philippines. I mean, all of them have these kind of price structures. Ideally you should have INR 100, you get very little. INR 200, you get more. Let's say for INR 1,000 you get huge amounts. That would actually maximize the ARPU. The other alternative to raising ARPU is then everybody pays a little bit more. That's really what's been happening in the Indian context. I think the price architecture is a little bit wonky. I think our on our on our capital allocation, I think we are very clear that we will continue to invest in the business for competitive growth. Then, you know, we would like to leverage down de-lever our balance sheet. Then, the time will come, we will be able to return money to shareholders. I think at this point in time, we wanna get our debt down to even more comfortable levels. It's not that we are uncomfortable, but it just gives you a lot more headroom for maneuver to do things that are, that the business needs to do to sustain growth. On the strategic versus non-strategic assets, I would say all our businesses, whether it's B2B, homes, mobility, and you can see the, you know, the way I articulated it, rural, 150 cities, all our businesses coming together, channels coming together. It's one relationship, it's one business which is riding an existing infrastructure. All of this is core. The infrastructure business is never core to us. To that extent, I mean, when I talk about infrastructure, I'm not talking about fiber, I'm talking about data centers, towers, which is why we got Carlyle into data centers. That's why we set up a joint venture with, you know, Vodafone Idea on Indus Towers. The fact is that tower business is our heartbeat, so we cannot afford to have that in any way face volatility. If it means that in the short term to prevent volatility because one player could have challenges, if we have to creep up and actually take control, we will. If the tower business is stable, there's no intention for us to actually put any capital into, to rise, taking a stake. In fact, I would do the contrary to actually maybe even dilute our stake. That is, I would say, a theoretical question because at this point in time we just need to have Indus be a strong tower company. That's really how we look at it. Thank you. With this, I would now like to hand over the proceedings to Mr. Gopal Vittal for his closing remarks. I wanna thank you again for a very engaging discussion. I think we've had a round of questions around all areas. I think we've had, as I said, a satisfactory end to the year and a competitive performance, consistent performance, and a profitable performance. We hope to continue this into the coming year as well. Thank you. Thank you all. Thank you everyone for joining us today. Recording of this webinar will also be available on our website for your reference.