Leading telecom service provider Bharti Airtel has proposed an enabling provision to increase the annual pay package of company Chairman and Managing Director Sunil Bharti Mittal to Rs 70 crore. However, in a statement, Airtel said Mittal’s total remuneration will not increase during FY12.
“The proposal to revise the remuneration of chairman and managing director Sunil Bharti Mittal up to a maximum of Rs 70 crore as proposed in the company’s 2011 AGM notice, is an enabling provision for the next five years and should be seen in that light.”
The proposed package is almost 2.5 times the remuneration of Rs 27.5 crore he had drawn last financial year. The company has sought its shareholders’ nod for the increase in Mittal’s renumeration and his re-appointment as the managing director for another five years with effect from October 1, read the notice on the company’s website. The proposal will come up in the annual general meeting (AGM) on September 1.
The human resource committee of the board of directors of Bharti Airtel makes recommendations for certain senior level positions which is then approved by the board every year. The committee on July 29, had decided on not increasing the remuneration for Mittal for FY12, the statement added.
According to the AGM notice, the proposed package has a total fixed pay (including salary, allowances and retirement benefits) of up to Rs 20 crore per annum. Apart from this, the variable pay (performance-linked incentives) component will be up to 200 per cent of the annual fixed pay in a financial year and perquisites of up to 50 per cent of the fixed pay, taking the total package for Mittal to a maximum of Rs 70 crore.
At present, Mittal’s fixed renumeration stands at Rs 10 crore, plus variable pay and other benefits. His pay package in 2010-11 included salary and allowances of Rs 9.58 crore, performance-linked incentive of Rs 17.87 crore and perquisites worth Rs 4,83,000.
Mittal on tariffs, competition in the mobile industry
On tariffs, Mittal said in the company’s annual report for FY11 released on Monday, said: “Tariffs have stabilised ensuring return of reasonable growth for us. Although, a fair amount of regulatory uncertainty still pervades the air with regard to allocation and pricing of 2G spectrum, the principal stakeholders appear to be heading towards some sort of a consensus on key issues.”
Bharti Airtel, along with other players like Vodafone Essar and Idea Cellular, has recently raised tariffs by 20 per cent in select circles. The margins and revenues of mobile firms have taken a hit due to increased competition, low tariffs and higher payout for acquiring 3G and BWA spectrums. The hike in tariffs was after a gap of almost 2-3 years.
Mittal said competition in the market with 12-13 players is clearly abating and some semblance of sanity was being restored and consolidation is imminent. “India will continue to be the leading market in our portfolio. Its inherent growth and our continued leadership will keep contributing substantially to our global stature in the years to come.”
