Bharti Axa Life Insurance Ltd

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BHARTI AXA LIFE INSURANCE LTD .

Bharti AXA Life Insurance is a joint venture between Bharti, India's leading private

telecom company and AXA, world leader in financial protection and wealth

management. Their philosophy is to build around the promise of making people "Life

Confident"...

Bharti Enterprises and AXA Asia Pacific Holdings Limited (AXA) signed an

agreement to establish a joint venture named Bharti AXA Life Insurance Company

Limited to carry on life insurance business in India.

August 26, 2005, New Delhi : Bharti Enterprises and AXA Asia Pacific Holdings

Limited (AXA) signed an agreement to establish a joint venture named Bharti AXA

Life Insurance Company Limited to carry on life insurance business in India.

Under the agreement AXA has a 26% equity interest in the joint venture, while Bharti

holds the balance. AXA, a global leader in insurance business, enabled the company

to have access to AXAs global life insurance and asset management expertise. Bharti

brought its strong local market knowledge, reputation and India-wide retail presence.

The insurance sector in India provides a mega opportunity for private players like

Bharti Axa Despite the strong growth witnessed by the sector in the recent years,

nearly 80% of the Indian population is without life insurance coverage. As one of

Indias leading business conglomerates having an established brand and a significant

presence in the retail space, Bharti has inherent advantages in being a part of this

growth story. In AXA, Bharti has a global leader as its partner, one that is known for

its expertise and best practice across the world. More importantly, this new venture

also fits into our strategy of taking on projects that make a difference to the society at

large.

This joint venture is an opportunity for AXA to enter the Indian life insurance market,

one of the most attractive emerging insurance markets. India is a fast growing

economy and a huge market with more than 1.1 billion people. This coupled with a

large middle class and increasing income levels will drive growth in the insurance

market. Bharti is a well-established and financially strong group whose capabilities

and network will be of significant value to the joint venture.

The joint venture invested in the region of Rs. 500 crores (115 Million USD) over the


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first three to four years of operations, reflecting both partners commitment to quickly

establish a strong foothold in the Indian market.

The joint venture commenced business in the first half of 2006, subject to IRDA,

FIPB and other statutory approvals.

Vision

To be a leader and the preferred company for financial protection and

wealth management in India

Strategy

To achieve a top 5 market position in India through a multi-distribution, multi-product

platform. To adapt AXA's best practice blueprints as a sound platform for profitable

growth. To leverage Bharti's local knowledge, infrastructure and customer base. To

deliver high levels of shareholder return. To build long term value with our business

partners by enhancing the proposition to their customers. To be the employer of

choice to attract and retain the best talent in India. To be recognized as being close

and qualified by our customers

Strategic differentiators

Strong partner Bharti - provides access to customer base of more than 20 million

Multi channel execution capability

Current Asia product range which is a strong match to products sold to the mass

and mass affluent

Global scale providing cost effective and speedy re-use of systems, products and

business capability

Strong AXA and Bharti brands which can be leveraged to attract and retain a high

quality management team.


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SWOT ANALYSIS OF BHARTI AXA

Strengths

Use of brand affinity of Airtel to promote insurance sales.

Bharti brought its strong local market knowledge, reputation and India.

Associated with AXA world leader in financial protection and wealth management,

ranked No 13 in the Fortune 500 list of global companies and has enabled the

company to have access to AXAs global life insurance and asset management

expertise.

Strong partner Bharti - provides access to customer base of more than 20 million

Weakness

Late entrant in the insurance sector

Thin distribution network all over the nation

Very less number of product offering in comparison to its competitors

Lack of confidence among the customers as parent company does not have a financial

background.

Opportunities

Strong growth of unit linked market at the mass affluent end.

Potentially with 20% insurance cross sale only to new telecom customers, this

network can yield 48 lac policies per year with sum assured of nearly Rs 58000

crores.

Threats

Many more companies are lining up to enter into Indian Insurance Industry.

Consumers preference is still more towards public sector insurance companies

Documents

Bharti Axa Life Insurance Ltd