Annual Report 2006 07

IDEA CELLULAR LIMITED
AN IDEA CAN CHANGE YOUR LIFE
IDEACellular
ANNUAL REPORT 2006 - 2007

In homage to our visionaries
our inspirations and our guiding light
Aditya Vikram Birla
Ghanshyamdas Birla
IDEACellular The strength of every successful organization
lies in its capacity to innovate. Innovation, as
such, is set in motion with the induction of
powerful values of Aditya Birla Group,
which have been the central inspiration behind the advancement
of the group.
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At the
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heart of
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every
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big Idea
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We at Idea Cellular have successfully imbibed these core values which

will serve as the fuel for our continuous
progress. Thereby, strengthening our overall
stance and willing us to scale heights
beyond expectations.
Integrity
An can change your life
Honesty in
every action
Acting and taking decisions in a
manner that is fair, honest, following
the highest standards of profess-
ionalism and also perceived to
be so. Integrity for us means not
only financial and intellectual
integrity, but in all other forms as are
commonly understood.
Commitment
Deliver on
the promise
On the foundation of integrity, doing
whatever it takes to deliver value to
all stakeholders. In the process,
taking ownership of our actions and
decisions, those of our team and that
part of the organization that we are
responsible for.
Passion
Energized action
A missionary zeal arising out of
emotional engagement with the
organization that makes work joyful
and inspires each one to give his or
her best. Relentless pursuit of goals
and objectives with the highest level
of energy and enthusiasm, that is
voluntary and spontaneous.
Seamlessness
Boundary less
in letter & spirit
Thinking and working together
across functional silos, hierarchies,
business and geographies. Lever-
aging the available diversity to garner
synergy benefits and promote
openness through sharing and
collaborative efforts.
Speed
One step
ahead always
Responding to internal and external
customers with a sense of urgency.
Continuously seeking to crash
timelines and choosing the right
rhythm to optimize organization
efficiencies.
Dear Fellow Shareholders,
Chairman’s India stands in the midst of an epochal transformation. Today,
letter we are the fourth largest economy in the world in terms of

purchasing power parity, the third largest in Asia, and the
to shareholders
second largest among the emerging nations. Growing at a clip
of over 9% annually, India is one of the few markets that has
enormous potential for growth and earnings in practically all
sectors. There is no let up from the Government on the reform
process which has spurred the economy. These
developments at the macro level will have a positive impact on
your Company.
Your company has posted a commendable performance. Its

net consolidated turnover at Rs 43,873 mn, up by 47%, with a
net profit of Rs 5,022 mn reflecting a sharp growth of 137%, is
indeed praiseworthy.
The Indian mobility industry has set a fast pace during the
financial year 2006-07, growing at around 69% with total
mobility subscribers touching 162 mn by March 2007. The
three key growth drivers remain the reduced cost of entry into
the sector, reduced cost of ownership, and expanding
coverage. With over 209 mn subscribers as of end September
2007, representing a wireless penetration level of around
18 %, the Indian market offers an attractive opportunity.
Your Company is gaining in stature. It enjoys a leadership

position in most of the eight service areas in which it operates,
viz., Maharashtra, Gujarat, Andhra Pradesh, Kerala, Madhya
Pradesh, Delhi, Uttar Pradesh (West) and Haryana. During the
financial year 2006 - 07, three new service area operations
were rolled out in Himachal Pradesh, Rajasthan and
Uttar Pradesh (East), thereby expanding the Company's
network to eleven service areas. Your Company has done
extremely well in the FY 2007, increasing its subscriber base
from 7.37 mn as of March 2006 to 14.01 mn as of
March 2007, witnessing a growth of almost 90%. During the
year, your Company was listed, and as of end September
2007, its market Capitalization stood at over Rs 330 bn.
For our success, much credit must go to our people. The

quality of our people, their intellect and emotional
commitment has been and continues to be unwavering. I than 4000 of our high caliber management talent have
deeply acknowledge their contribution in perpetuating such been put through our Development Assessment Centres
a meritocratic organization. and their professional development plans charted out.
The Aditya Birla Group: In Perspective Our Investments in to employee development both through
classroom teaching, e-learning, personal coaching by
In line with our vision to be a premium conglomerate with a
senior management and mentoring have been scaled up.
clear focus at each business level, I am pleased to inform
you that our geographic reach has far expanded. This year Given the intense war for talent, in addition to these HR
has indeed been a landmark year consequent to major systems, we have taken a slew of initiatives to strengthen
acquisitions. Today our Group is a US$ 24 billion our employer brand and to improve the quality of life of our
corporation with a market cap in excess of US$ 34 billion, employees. This, we hope, will help us keep the edge.
anchored by a committed 100,000 workforce belonging to
We have set up a taskforce to define the unique
25 nationalities, representing 20 countries across
employment proposition that our Group can and does offer.
5 continents. We are all glued together by a common set of
Our intent is to ensure that these employee value
values Integrity, Commitment, Passion, Seamlessness and
propositions translate in the day-to-day experiences of our
Speed.
people and enhance their involvement with our Group.
As a Group, we are a meritocracy with a sharp focus on
To offer our people a share in the value created by the
people processes. We try and make space for new ideas
organization, we announced the Employee Stock Option Plan
and encourage a spirit of experimentation. Champions of
which we expect to roll out in the next financial year. This would
good ideas have every chance to try them out.
give them an increasing sense of ownership in our Group.
Our people systems and our Group’s HR strategy continue
It is with a great sense of pride that I share with you the fact
to evolve as our Group increasingly globalises. In this
that our Group has been adjudged as the Best Employer in
regard, we are continuously innovating to support our
India in 2007 and amongst the top 20 Best Employers in
business vision with world-class HR processes and
Asia in the Hewitt- Economic Times and Wall Street Study of
strategies. The Group-wide implementation of the Project –
2007. This is a singular achievement and a great honour,
Poornata – the people soft based HR-ERP Programme, in its
given that the Study encompassed 230 companies in India
first year of implementation is already reckoned as an
and over 700 companies in Asia. This honour is also a
enable of strategic people decisions. These on-line people
reflection of the pride, the affection and attachment that
processes enhance transparency and productivity.
colleagues all over have for our Group.
Talent management and strengthening of the talent pool in
While we cherish this acknowledgement, we realise that we
building leadership across the Group continues to be a
have to work harder in the people area and bring in an even
focus area. On the professional front, our people systems
sharper focus on employees and their engagement.
are aligned to foster excellence, empower and enrich
Best regards,
people, recognize creativity, innovation and reward
performance. People with a track record, people with a Yours sincerely,
passion to perform are steered on to a growth trajectory. Our
endeavours to identify, develop and push high potential
talent, which was an initiative begun two years ago, will soon
be institutionalized. It might interest you to learn that more Kumar Mangalam Birla
Table of
Contents
01 Corporate Information
02 Financial Highlights
03 Management Discussion and Analysis
08 Directors' Report
14 Report on Corporate Governance
26 Auditors’ Report
32 Balance Sheet
33 Profit and Loss Account
34 Schedules to the Accounts
56 Cash Flow Statement
59 Consolidated Financial Statements
84 Statement pursuant to Section 212
Subsidiary Accounts
85 Aditya Birla Telecom Limited
103 Swinder Singh Satara & Co. Limited

Corporate
Information
Board of Directors
Mr. Kumar Mangalam Birla Chairman

Smt. Rajashree Birla Non Executive Director
Mr. Arun Thiagarajan Independent Director
Mr. G. P. Gupta Independent Director
Mr. Mohan Gyani Independent Director
Ms. Tarjani Vakil Independent Director
Mr. Biswajit A. Subramanian Non Executive Director
Mr. M.R. Prasanna Non Executive Director
Mr. Saurabh Misra Non Executive Director
Mr. Sanjeev Aga Managing Director
Chief Financial Officer Registered Office

Mr. AJS Jhala Suman Tower,
Plot No. 18, Sector No. 11,
Company Secretary Gandhinagar - 382 011
Mr. Pankaj Kapdeo
Corporate Office
Auditors Windsor,
Deloitte Haskins and Sells 5th Floor, Off CST Road,
Chartered Accountants Near Vidya Nagari, Kalina,
706, B Wing, Santacruz (East),
ICC Trade Tower, Mumbai - 400 098
Senapati Bapat Road,
Pune - 411 016 Registrar and Share
Transfer Agent
RSM & Co. Bigshare Services Private
Chartered Accountants Limited
Ambit RSM House, E/2, Ansa Industrial Estate,
449, Senapati Bapat Marg, Saki Vihar Road, Saki Naka,
Lower Parel, Andheri (East),
Mumbai - 400 013 Mumbai - 400 072
Subscriber Base
Financial 16
14
No Mn 14.0
Highlights 12
10 7.4
at a glance 8 5.1
6 2.7
4
2
0
FY 2004 FY 2005 FY 2006 FY 2007
Top Line
Rs Bln 44
50
40 30
23
30
13
20
10
0
FY 2004 FY 2005 FY 2006 FY 2007
EBITDA
15.0
Rs Bln
16
14 11.0
12 8.0
10
8
4.0
6
4
2
0
FY 2004 FY 2005 FY 2006 FY 2007
Net Profit
5.0
Rs Bln
5
4
3 2.1
2 0.8
1
0
-1
-2
(2.0)
-3
FY 2004 FY 2005 FY 2006 FY 2007
Annual Report 2006-07
Management Discussion & Analysis
Industry growth
The Indian mobility industry has set a fast pace during the FY 2007, growing at around 69% with total mobility subscribers
touching 162 mn by March 2007. The three key drivers of the fast growth remain the reduced cost of entry into the
sector, reduced cost of ownership, and expanding coverage. With wireless penetration level still at around 18%, the Indian
market offers an attractive opportunity. Your Company has done extremely well in the FY 2007, increasing its subscriber
base from 7.37 mn as of end March 2006 to 14.01 mn as of end March 2007, witnessing a growth of almost 90%. Your
Company became listed in March 2007, and is among the top fifty companies in India with a market cap of over Rs. 330
bn. Idea Cellular Ltd. is now a part of the Aditya Birla Group.
Major Regulatory Developments

Review of Access Deficit Charges (ADC)
The ADC regime initially introduced by the Telecom Regulatory Authority of India (TRAI) with effect from May 2003, has
evolved from a fixed charge per call regime to a mix of revenue share on national calls and fixed charges on international
calls over the period. With effect from April 1, 2007, the percentage of ADC revenue share has been reduced from 1.5%
to 0.75%.
Reduction in roaming tariffs
The TRAI, in January 2007, issued the 44th amendment to its Telecommunication Tariff Order (TTO), primarily focused on
Roaming Tariffs. The Order has reduced the ceiling rates on all domestic roaming calls and abolished the rental/surcharge
for national roaming.
Enhancement of Foreign Direct Investment (FDI) ceiling from 49% to 74% in the Telecom Sector
The Department of Industrial Policy & Promotion (DIPP) had announced on November 3, 2005 (vide Press Note 5 of 2005
SERIES), the enhancement in FDI ceiling from 49% to 74%, subject to certain conditions. Owing to complexities involved
in implementation of the conditions, the Department of Telecommunications (DoT) had granted several extensions to the
telecom licensees to ensure compliance. Now, vide Press Note 3 (2007 SERIES), the DIPP has superseded the earlier
Press Note 5 and increased the FDI limit to 74% including both direct & indirect foreign investments in the licensee
company. Under the new Press Note, FDI upto 49% will be governed by the automatic route, and anything beyond 49%
through the FIPB, subject to compliance of certain terms and conditions.
Universal Service Obligation (USO) Subsidy
The Universal Service Obligation Fund came into force from April 1, 2002, with the objective of providing access to
telecommunication services to population in the rural and remote areas at affordable prices. In January 2007, the Universal
Service Obligation Fund (USOF) Administration floated tenders to extend financial assistance for setting up infrastructure
(passive and active) for the provision of mobile services in the rural areas on a cluster (group of districts) basis.
Idea has been declared a successful bidder in a total of 27 clusters comprising 2731 sites. This provides us the opportunity
to enter into rural markets with reduced capex costs, as only the opex charges are required to be paid to the Infrastructure
Provider who sets up the tower under the scheme.
Subscriber Verification
The DoT, vide its letter dated November 22, 2006, directed all service providers to complete the re-verification of their
pre-paid subscriber base by March 31, 2007, post which no subscriber without due verification would be allowed on
the system. The re-verification was also to be re-confirmed by calling up the subscribers. Post March 31, 2007, if any

Idea Cellular Limited
subscriber was found without due verification, the operator was liable to a penalty of Rs. 1000 per violation, besides
immediate disconnection of the subscriber. The Company has made best efforts to comply with DoT orders on this issue.
GSM Spectrum Allocation
The GSM spectrum allocation is governed by the new Spectrum Allotment Criteria declared on March 29, 2006. The
Wireless Planning & Coordination (WPC) Order also clarifies that spectrum allotment is subject to availability. For the
purpose of spectrum allotment, the active subscribers and peak traffic averaged over a month (for a minimum of 40
mErlangs per subscriber) in the Visitor Locator Register (VLR) would be taken into account.
Regulation on Port Charges
The TRAI amended the Regulation on Port charges. The amended regulation effective from April 1, 2007 envisages
reduction in the Port charges by approximately 23% ~ 29% on various slabs. Interconnection seekers are required to
place demand for the required number of Ports, on every Point of Interconnection (POI) on the basis of traffic projection
over six months.
Roaming Revenue Sharing
The TRAI published its decision disallowing any revenue sharing on roaming calls and reiterated that the termination
charges prescribed by them are cost based, and since no additional cost is incurred in terminating roaming traffic, there
is no justification for higher payout to the terminating network.
Interconnection of Intelligent Network (IN) of all Service Providers
The TRAI issued a regulation mandating all service providers to provide interconnection to all eligible service providers so
that subscribers of all access providers can access the IN services offered by other service providers. Service providers
are required to enter into reciprocal and non-discriminatory agreements for technical and commercial aspects of such
connectivity within three months.
Establishment of the Telecommunication Consumers Education and Protection Fund (TCEPF)
In June 2007, the TRAI issued a regulation for the establishment of the TCEPF, for the purpose of consumers’ awareness,
education, and the protection of their interests. Under the said regulation, the telecom service provider has to transfer to
the credit of the fund the excess amount collected and lying unclaimed by the subscriber, under any regulation or order
or direction.
Curb Unsolicited Commercial Calls
In June 2007, the TRAI issued a regulation for establishing a mechanism for curbing unwanted telemarketing calls, wherein
a National Do Not Call (NDNC) registry will be maintained containing a list of telephone numbers of subscribers who do
not want to receive unsolicited commercial communication. The telemarketer will have to verify their calling telephone
numbers list with the NDNC registry before making a call.
TDSAT Judgement on AGR
During August 2007, TDSAT has pronounced its judgement on the long pending AGR dispute. TDSAT in its judgement has
maintained that only those items which lead to revenues from telecom activity should be part of AGR. Based on the same,
revenue streams like income from dividend, interest income on savings, capital gains, foreign exchange fluctuation gains
etc. have been excluded from the definition of AGR. The revenues from activities like income on subscriber deposits which
are linked to telecom activity would be included in the definition of AGR.
TRAI recommendations on review of license terms & conditions
TRAI has released its recommendation on review of license terms & conditions on August 29, 2007. The key highlights
of the recommendations are: No cap on number of access service providers in any service area; Significantly tighter
subscriber linked criteria for spectrum allocation (as an interim measure) for both GSM & CDMA; A committee to be

formed to frame new spectrum allocation criteria; Additional spectrum beyond initial allotment only upon compliance with
roll-out obligation; For spectrum beyond 10 MHz (and upto 15 MHz), licensees to pay one time spectrum charges on a
per MHz basis and a higher spectrum usage charge; All spectrum (excluding 800, 900 and 1800 bands) to be auctioned
in future; Access Service using Combination of Technologies to be permitted; Market share of merged operator not to
exceed 40% in terms of subscriber and revenue market share; M & A activity will not be allowed if it reduces the number
of operators in a circle to below four; Cross holding ceiling increased to 20%, up to 10% under the automatic route, and
between 10-20% to be approved on a case by case basis; Licensee who covers 75% of development blocks in service
area (excluding Metro areas) to be eligible to pay USO levy at 3% instead of 5% of AGR.
Discussion on Financial and Operational Performance

With an appointed date of April 1, 2006, seven subsidiaries of Idea Cellular Limited, viz., Idea Mobile Communications
Limited, Idea Telecommunications Limited, BTA Cellcom Limited, Sapte Investments Private Limited, Vsapte Investments
Private Limited, Bhagalaxmi Investments Private Limited and Asian Telephone Services Limited have been merged with
Idea Cellular Limited. Of the above subsidiaries, Idea Mobile Communications Limited had operations in the three telecom
service areas of Uttar Pradesh (West) & Uttaranchal, Haryana, Kerala and BTA Cellcom Limited had operations in the
telecom service area of Madhya Pradesh & Chattisgarh as on March 31, 2006. Thus, figures and amounts for FY 2006-
07 and FY 2005-06 have been considered as per Consolidated Financial Statements to have a meaningful discussion
and analysis.
Revenues
During the year ended March 31, 2007, revenues grew by 47% to Rs. 43,873 mn from Rs. 29,869 mn for the year ended
March 31, 2006. Revenues from SMS and related application services accounted for about 9% of the revenues for the
year. Revenues from National Long Distance Services accounted for approx Rs. 779 mn, which stood eliminated during
the course of inter segment consolidation.
Operating Expenses
During the year ended March 31, 2007, the Company incurred operating expenses of Rs. 29,011 mn representing 66.1%
of the revenue. The main contributors to the total operating expenses were; Roaming and Access charges at 16.7%,
Subscriber Acquisition & Servicing Expenditure at 12.9%, Network Operating Expenditure at 12.2%, Licence and WPC
charges at 10.2% and Personnel Expenditure at 5.9%.
Profit before Interest, Depreciation and Amortisation
For the year ended March 31, 2007, the Company had a Profit before Interest, Depreciation and Amortisation of
Rs. 14,862 mn, representing an increase of 36.8% compared to the year ended March 31, 2006. The operating profit
margin for 2006-07 and 2005-06 stood at 34% & 36% respectively. The decrease in margin was mainly attributable to
the commencement of operations in the new service areas of Himachal Pradesh, Uttar Pradesh (East) and Rajasthan.
Interest, Depreciation and Amortisation
During the year ended March 31, 2007, the Company had a depreciation and amortisation charges of Rs. 6,718 mn.
Interest cost and financing charges net of treasury income and foreign exchange gain/(loss), stood at Rs. 3,051 mn for
the year against Rs. 3,171 mn for previous year. Though there has been an increase in the overall borrowings level, the
Company has managed to reduce the interest rate to contain the overall interest cost.
Profits and Taxes
The Profit Before Tax for the year stood at Rs. 5,093 mn, an increase of 132%, as compared to the last year ended March
31, 2007. The tax charge for the current year is at Rs. 70 mn mainly attributable to the Fringe Benefit Tax. The profit after
tax for year ended March 31, 2007 was Rs. 5,022 mn resulting in a net profit margin of 11.4%.

Capital Expenditure
During the year ended March 31, 2007, the Company has incurred capital expenditure of Rs. 28,367 mn.
Balance Sheet
During the year under review, Preference Shares amounting to Rs. 4,830 mn were redeemed along with the redemption
premium of Rs. 2,733 mn, aggregating to Rs. 7,563 mn. Further, the Equity Share Capital of the Company grew by
Rs. 3,333.33 mn representing issuance of 333.33 mn Equity Shares of Rs. 10 each, consequent to the Pre-IPO
Placements and the Initial Public Offer. The Share Premium Account of the Company stood at Rs. 18,313 mn after
including the premium of Rs. 65 per Equity Share collected on issuance of shares and reduced by issue expenses and
redemption premium on Preference Shares amounting to Rs. 620 mn and Rs. 2,733 mn respectively. With the merger
of our subsidiaries, majority of the amount resting as goodwill in the consolidated financials prepared under AS 21 stood
eliminated.
Due to the acquisition being accounted under pooling of interest method as per AS 14, Rs. 12,314 mn has been added
to the negative balance of profit and loss, while increase in reserves were Rs. 1,060 mn resulting in a reduction of net-
worth by Rs. 11,254 mn. After taking in to account the net profits earned by the Company during FY 2006-07, the Profit
and Loss debit balance as at March 31, 2007 is Rs. 24,502 mn.
The Gross Tangible Block stood at Rs. 70,627 mn and Net Tangible Block including Capital Work In Progress (CWIP)
stood at Rs. 44,254 mn as at March 31, 2007. Net Intangible block was at Rs. 11,776 mn at the end of FY 2006-07.
The increase in net current assets amounting to Rs. 9,516 mn mainly represented the increase in deposits due to IPO
proceeds, offset by increased creditors for Capital Expenditure.
Human Resources
Your Company maintains a healthy relationship with its employees through an enabling and participative work environment.
It commits itself to the values of integrity, commitment, passion, seamlessness and speed. Idea Cellular Ltd. invests
heavily in people, people processes and skill development. An Organisation Health Study (OHS) is conducted at regular
intervals and the findings of the OHS Reports are analysed, and concern areas are suitably addressed. The total number
of Employees as on March 31, 2007 was 4662.
Risk Management
The Risk management framework at your Company ensures compliance with the requirements of clause 49 of the Listing
Agreement. The framework establishes risk management across all service areas and functions of the Company and has
in place procedures to inform the Board Members about risk assessment and minimisation procedure. These processes
are periodically reviewed to ensure that the Executive Management controls risks through means of properly defined
framework. The various risks including the risks associated with Economy, Regulations, Competition, Foreign Exchange,
Interest rate etc. are monitored and managed in an effective manner.
Internal Control System

Your Company has appropriate internal control system for business processes, with regards to efficiency of operations,
financial reporting, compliance with applicable laws and regulations etc. Regular internal audits and checks ensure that
responsibilities are executed effectively. All operating parameters are monitored and controlled. The audit committee of the
Board of Directors actively reviews the adequacy and effectiveness of internal control system and suggests improvement
for strengthening them, from time to time.

Opportunities, Risks, Concerns and Threats
The Indian telecommunication industry has emerged as the fastest growing telecom markets in the world and is poised to
deliver solid growth as a result of several economic reforms that have lead to strong GDP growth. Higher per capita income
is also giving impetus for telecom growth. As India still remains a largely under-penetrated market, it is one of the most
attractive telecom markets in the world today. Your Company is well poised to exploit this opportunity.
The churn in this industry is high and thus, the same acts as a threat as well as provides an opportunity with respect to
market share of your Company.
Your Company operates in an Industry which is highly competitive and faces intense competition from other operators
including some of the state-owned enterprises which are controlled by the Government and thus enjoy certain advantages.
Further, your Company may face additional competition from alternative or new mobile technologies. The Company,
however, being an incumbent player in most of the service areas, it operates in, is strong enough to withstand the
additional competition, if any.
Your Company requires certain approvals, licenses, registrations and permissions for operating its business. In addition,
regulators may impose conditions in relation to the grant of licenses and approvals and any such requirements could
have a material adverse effect on Company’s business. The Company, however, does not perceive adverse changes in the
regulatory environment and is confident that the government will continue to ensure a level playing field for all operators
keeping the customers’ best interest in mind.
The Company’s business is dependent on a limited number of vendors to supply critical network and other equipment
and services. Besides this, its ability to provide a quality mobile network and expanding the area of operations is also
dependent on the Spectrum allocation. The Company has entered into 2-3 years’ contracts with equipment providers to
ensure smooth supply of network equipments.
The telecommunications industry requires personnel with diverse skills and the growth of the Indian economy has led to a
scarcity for talented managerial personnel. The Company believes that its success in the future is substantially dependent
on the expertise of our management team and as a retention strategy; it is in process of implementation of Employees’
Stock Option Scheme. The Company places considerable emphasis on development of leadership skills and building
employee motivation.
Outlook
We believe the mobile telecom sector is poised for continued high growth, and your Company is attractively placed to
benefit from this. We aim to strengthen our operations in existing service areas, and expand to new service areas. Your
Company aims to maintain and build upon the quality services it provides to its subscribers, underpinned by a strong brand
identity.
Cautionary Statement
Statements in the management discussion and analysis describing the Company’s objectives, projections, estimates,
expectations may be “forward-looking statement” within the meaning of applicable securities laws and regulations. Actual
results could differ materially from those expressed on implied. Important factors that could make a difference to the
Company’s operations include economic conditions affecting demand/supply and price conditions in the domestic markets
in which the Company operates, changes in the Government Regulations, tax laws and other statutes and incidental
factors.

DIRECTORS’ REPORT
Dear Shareholders,
The Directors are pleased to present their Twelfth Annual Report together with the Audited Accounts of your Company for
the financial year ended March 31, 2007.
Financial Results
Financial highlights of the consolidated Statement of Operations of your Company for the year 2006-07 are as under:
(Rs. in million)
Particulars 2006-07 2005-06

Income from Services 43,664 29,662
Other Income 209 207
Total Revenue 43,873 29,869
Operating Expenses 29,011 19,005
EBITDA 14,862 10,864
Depreciation and Amortisation 6,718 5,495
PBIT 8,144 5,369
Interest and Financing charges 3,051 3,171
PBT 5,092 2,198
Taxes 70 80
Net Profit after Tax 5,022 2,118
Balance brought forward from previous year (17,088) (19,205)
Accumulated Losses acquired on amalgamation of subsidiaries & leave
(12,437) Nil
provisions for earlier years due to revised AS-15.
Cumulative Losses (24,502) (17,088)
Overview
During the year ended March 31, 2007, consolidated gross revenues grew by 47% to Rs. 43,873 mn from Rs. 29,869
mn for the year ended March 31, 2006. Your Company registered a consolidated net profit of Rs. 5,022 mn against a net
profit of Rs. 2,118 mn in 2005-06.
Dividend
As your Company is yet to recoup the accumulated losses, your Directors have not recommended any payment of dividend
for the year.
Review of Consolidated Operations
Your Company recorded an increase of 90% in its subscriber base from 7.37 mn as of March 31, 2006 to 14.01 mn
as of March 31, 2007. Your Company has increased its market share from 7.7% in 2005-06 to 8.6% in 2006-07 on
a national basis. The total Minutes of Usage increased from 21 billion minutes in 2005-06 to 46 billion minutes in
2006-07, showing an increase of 119%. Your Company has expanded its network from 1944 cities and towns at end of
FY 2005-06 to 4432 cities and towns at end of FY 2006-07. Your Company has commenced National Long Distance
service to carry part of the Company’s own traffic.
Capital Expenditure
Your Company continues its aggressive pursuit of network expansion along with an improved quality experience to the
customer. Your Company has incurred a capex of Rs. 28,367 mn and had cash outflows of Rs. 22,819 mn during
FY 2006-07 on a consolidated basis.

Employee Stock Option Scheme
Your Directors appreciate the critical role its employees play in your Company’s growth. To share the value created by
employees and to promote the culture of employees ownership in your Company, the Directors introduced the “Employee
Stock Option Scheme – 2006” (ESOS-2006). This is in accordance with the provisions of Securities and Exchange board
of India (Employees Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999 as amended. Your
Directors have approved granting, offering and issuing in one or more tranches equity shares not exceeding 39,530,408
to eligible employees of the Company including its subsidiaries as may be decided by the ESOS Compensation Committee,
subject to the approval of shareholders.
Shareholders approval has been requested by way of Postal Ballot dated September 10, 2007.
Awards and Recognitions
l Your Company is the only Indian GSM operator to win the award in 12th Annual ‘GSM Association Global Mobile
Awards’, at 3GSM World Congress held in Barcelona, Spain, in February 2007. This award, received for two successive
years in the same category despite stiff competition with top-notch global GSM nominees, is for your Company’s
unique, “CARE” service in the “Best Billing or Customer Care Solution”.
l To create year round visibility and ensure brand salience, your Company keeps coming up with media innovations
through tie-ups with media partners. One such innovation - The Idea sponsored News Headlines, has won the Gold
in the Business Excellence Awards 2006 ceremony, in the “Best Use of Sponsorship – Non Sports” category, a first
of its kind innovation across industries.
l Your Company has been awarded the “Indian Operator of the Year” Award at a function held on the sidelines of
CommunicAsia, Singapore. This award was received at the 4th Annual Asian Mobile News Awards Nite on June 20,
2007.
Human Resources
As part of the Aditya Birla Group which has been adjudged “The Best Employer of India (2007)” and among the Top 20 in
Asia by the Hewitt Economic Times Study and the Hewitt Wall Street Journal Study respectively, your Company invests in
fostering people development, identifying and grooming management talent and has the culture of harnessing employees’
potential to the maximum.
Significant corporate developments
l In August 2006, your Company entered into a Long Term Financing Arrangement for an amount of Rs. 42,240 mn
with the IDBI led consortium. The facility envisaged the refinancing of all existing debt and part financing capital
expenditure requirement.
l Your Company has launched commercial mobile services in the service areas of Rajasthan, Uttar Pradesh (East) and
Himachal Pradesh during the period of September – November 2006. In these markets, your Company has captured
3.4% market share by end of March 2007.
l Your Company made Initial Public Offering and raised Rs. 25,000 mn including Pre IPO placements. The Issue was
oversubscribed more than 50 times and attracted the then highest ever over-subscription by the Qualified Institutional
Buyers category in the history of Indian capital markets. Further, by exercising the Green Shoe Option, Rs. 3,187.50
mn were additionally received in April 2007. The Equity Shares of your Company were listed on the Bombay Stock
Exchange and the National Stock Exchange on March 9, 2007.
l In March 2007, outstanding Preference Shares of Rs. 4,830 mn were redeemed along with a redemption premium
of Rs. 2,733 mn.
l Your Company has entered into a ten years business transformation pact to integrate, innovate, and transform its
business processes and IT infrastructure with International Business Machines (IBM). The pact, sizing upto US$ 600
- 800 mn, depending upon business revenues and service area expansions, is designed on an innovative risk - reward
revenue sharing model.

l Your Company has signed a US$ 500 mn contract with Nokia Siemens Networks to expand and strengthen the
Company’s network. Under this contract, Nokia Siemens Network will expand the network in Delhi, Haryana, Uttar
Pradesh (both East and West), Andhra Pradesh and Kerala service areas. The two-years contract includes supply and
services of GSM equipment, “Intelligent Network”, value-added services, circuit and packet core equipment.
l Your Company has signed a US$ 343 mn contract for GSM expansion with Ericsson in the Maharashtra, Gujarat,
Rajasthan, Madhya Pradesh and Himachal Pradesh service areas. Under this contract, Ericsson will provide radio
access, microwave transmission and next-generation, mobile softswitch network architecture, between February
2007 to November 2009. Ericsson will help in building a state-of-the-art cellular network across the five service areas
that will enable a smooth transition to a 3G-ready network.
New products and initiatives
Your Company has made extensive progress on the marketing front by introducing various unique and innovative products
and services across all service areas of operation. Some of the major initiatives are:
l Roam Like Home
Your Company is the first operator to commercially launch Roam Like Home service for its International Inroaming
customers. This service enables international inroamers to seamlessly access Voice Mails through home short codes,
log on to the home network’s VAS Voice codes, including helpline and emergency numbers. Inroamers can also dial
from the phone book without having to add any country code prefixes.
l Free Life Insurance cover
Your Company has entered into a brand alliance with Birla Sun Life Insurance Company Limited to leverage the
intrinsic strengths of the Group companies. This enabled Idea subscribers opting for this scheme to get free life
insurance for a period of one year and an add-on connection with free airtime for a specified period.
l Idea Rocks India
Idea Rocks India tour concerts were staged in 25 cities and the televised show of one of the concerts was telecasted
on Zee TV. The tour was supported by a 360° media campaign.
l VAS Initiative : Star to Copy
Your Company launched a unique, first of its kind product, which allows an Idea Subscriber to easily copy the Dialer
Tone of another Idea Subscriber, whom he/she has called. The subscriber only needs to dial “ * ” while listening to
the Dialer Tone. This simple product helps the customer to bypass the lengthy process of selecting a Dialer Tone,
providing instant gratification. The product aims to generate sizeable revenue, in view of the popularity of Dialer Tones
and the simplicity of application.
l Idea IIFA Awards Yorkshire 2007
In a first of its kind brand association in the mobile entertainment space, your Company sponsored the IIFA Awards
2007, the most coveted and prestigious Indian Film Awards held at Yorkshire. IDEA IIFA offered the best platform
to demonstrate the true essence of mobile and entertainment convergence. With IDEA IIFA, privileged customers
of IDEA had access to specially created merchandise, contests, video and MMS downloads and several other value
added services.
Mergers and Acquisitions
l In June 2006, Escorts Telecommunications Limited became the subsidiary of your Company and subsequently was
renamed as Idea Telecommunications Limited.
l In February 2007, your Company acquired 10,000,000 Equity Shares of Rs. 10 each of Aditya Birla Telecom
Limited, a Company holding License to operate in the telecom service area of Bihar, for a purchase consideration of
Rs. 100 mn. With this acquisition, Aditya Birla Telecom Limited has become a wholly owned subsidiary of your
Company.
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l The corporate structure was rationalised by merging seven subsidiaries, viz., Idea Mobile Communications Limited,
Idea Telecommunications Limited, BTA Cellcom Limited, Sapte Investments Private Limited, Vsapte Investments
Private Limited, Bhagalaxmi Investments Private Limited and Asian Telephone Services Limited.
The statement of your Company’s interest in the subsidiaries namely, Aditya Birla Telecom Limited and Swinder Singh
Satara & Co. Limited as at March 31, 2007, prepared in accordance with the provisions of Section 212 (3) of the
said Act, is attached to the Balance Sheet.
Transfer of Telecom Licences
Following the amalgamation of the erstwhile subsidiaries into your Company, application for transfer of telecom licences held
by the erstwhile subsidiaries were made to DoT. The transfer of licences in the name of the Company is expected shortly.
Fixed Deposits
Your Company does not accept or hold any deposits and, as such, no amount of principal or interest on fixed deposits was
outstanding on the date of the Balance Sheet.
Corporate Governance
Your Directors reaffirm their continued commitment to good corporate governance practices. Your Company adheres to all
major stipulations laid down in this regard, as provided in Clause 49 of the Listing Agreement with the Stock Exchanges
which relates to Corporate Governance. A detailed report on Corporate Governance, together with, a certificate from
Statutory Auditors forms part of this Report.
Conservation of Energy, Technology Absorption, Foreign Exchange Earnings & Outgo
The particulars as required to be disclosed pursuant to Section 217(1)(e) of the Companies Act, 1956 read with the
Companies (Disclosures of Particulars in the Report of Board of Directors) Rules, 1988, are given in the Annexure forming
part of this Report.
Particulars of Employees
The particulars of employees as required under Section 217(2A) of the Companies Act, 1956, and the Companies
(Particulars of Employees) Rules 1975, as amended, forms part of this Report. However, in pursuance of Section
219(1)(b)(iv) of the Companies Act, 1956 this Report is being sent to all the shareholders of the Company excluding the
aforesaid information and the said particulars are made available at the registered office of the Company. The members
interested in obtaining such particulars may write to the Company Secretatry at the registered office of the Company.
Directors’ Responsibility Statement
Pursuant to Section 217(2AA) of the Companies Act, 1956, the Directors, based on the representations received from
the Operating Management, confirm that:
a) in the preparation of the annual accounts, the applicable accounting standards have been followed and that there
are no material departures;
b) they have, in the selection of the accounting policies consulted the Statutory Auditors and have applied them
consistently, and, made judgements and estimates that are reasonable and prudent, so as to give a true and fair
view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for that
period;
c) they have taken proper and sufficient care, to the best of their knowledge and ability, for the maintenance of adequate
accounting records, in accordance with the provisions of the Companies Act, 1956, for safeguarding the assets of the
Company and for preventing and detecting fraud and other irregularities;
d) they have prepared the annual accounts on a going concern basis.
Board of Directors
During the year under review, Mr. Sanjeev Aga, was appointed as Managing Director of your Company with effect from
November 1, 2006 for a period of five years.
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l Mr. D. Bhattacharya, Director resigned from the Board of Directors of your Company with effect from April 25, 2007.
Your Directors have expressed their gratitude for the guidance, support and contributions made by Mr. D. Bhattacharya
in the deliberations of the Board, and have placed on record their appreciation for the same.
l Mr. Biswajit A. Subramanian and Mr. G. P. Gupta were appointed as Additional Directors vide Circular Resolution
dated December 1, 2006 and December 11, 2006 respectively. As per the provisions of Section 260, they will
hold office up to the date of the ensuing Annual General Meeting of the Company. Your Company has received
notices under Section 257 of the Act along with the requisite deposit, in respect of the above persons proposing
their appointment as Directors of the Company. Resolution seeking approval of the Members for the appointment of
Mr. Biswajit A. Subramanian and Mr. G. P. Gupta as Directors of the Company have been incorporated in the Notice
of the ensuing Annual General Meeting along with brief details about them.
l In accordance with the Articles of Association of your Company, Mr. Saurabh Misra, Ms. Tarjani Vakil and Mr. Mohan
Gyani retire from office by rotation, and being eligible, offer themselves for re-appointment at the ensuing Annual
General Meeting of the Company.
Auditors
M/s. Deloitte Haskins and Sells, Chartered Accountants and M/s. RSM & Co., Chartered Accountants, the joint Statutory
Auditors of the Company hold office until the conclusion of the ensuing Annual General Meeting. The members are informed
that M/s. RSM & Co., Chartered Accountants have since been merged with another firm of Chartered Accountants.
Accordingly, the other surviving Auditor, M/s. Deloitte Haskins and Sells, Chartered Accountants, have confirmed their
eligibility and willingness to accept the office on re-appointment.
Auditors’ Report
The Board has duly reviewed the Statutory Auditors’ Report on the accounts. With regard to Note 4 of the Auditors’ Report,
it is being clarified that transfer of Telecom licences of erstwhile Idea Mobile Communications Limited, BTA Cellcom
Limited and Idea Telecommunications Limited, in the name of the Company from DoT are expected shortly.
Acknowledgments
Your Directors wish to convey their appreciation to all subscribers, promoters, lenders, trading partners, suppliers and the
Government for their invaluable support and look forward to continued support in the future. Your Directors wish to place
on record their appreciation to employees at all levels for their hard work, dedication and commitment, which has enabled
the Company to march ahead.
For and on behalf of the Board
Date : October 11, 2007 Kumar Mangalam Birla

Place : Mumbai Chairman
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ANNEXURE TO THE DIRECTORS’ REPORT
Particulars pursuant to the Companies (Disclosure of Particulars in the Report of the Board of Directors) Rules 1988, are
furnished hereunder:
A. CONSERVATION OF ENERGY : Not Applicable
B. TECHNOLOGY ABSORPTION, RESEARCH &
DEVELOPMENT (R & D)
1. Specific areas in which R & D is carried
out by the Company : Not Applicable
2. Benefits derived as a result of the above R & D : Not Applicable
3. Future Plan of action : Not Applicable
4. Expenditure on R & D
a) Capital : Nil
b) Recurring : Nil
c) Total : Nil
d) Total R & D expenditure as percentage of : Nil
total turnover
Technology Absorption, Adaptation and Innovation
1. Efforts in brief towards technology absorption, : Development of a skilled team of engineers in
adaptation, innovation the area of radio engineering, installation of base
station and operation of mobile telecom services.
2. Benefits derived as a result of the above efforts : Cost of installation of base station reduced due to
better network planning and designing. Achieved
better coverage and high quality of reception.
3. Particulars of imported technology in the last five years
a) Technology imported : Not Applicable
b) Year of import : Not Applicable
c) Has the technology been fully absorbed : Not Applicable
If not fully absorbed areas where this has not
taken place, reasons thereof and future plans
of action
C. Foreign exchange earnings and outgo
1. Earnings : Rs. 728.04 mn
2. Outgo (includes CIF value of imports) : Rs. 9,498.59 mn
Date: October 11, 2007 Kumar Mangalam Birla

Place: Mumbai Chairman
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CORPORATE GOVERNANCE REPORT
Governance Philosophy
The Aditya Birla Group is committed to the adoption of best governance practices and its adherence in the true spirit,
at all times. Our governance practices are self-driven, reflecting the culture of the trusteeship that is deeply ingrained in
our value system and reflected in our strategic thought process. The principles of Corporate Governance in Idea Cellular
Limited are based on five basic tenets:
l Board accountability to the Company and shareholders;
l Strategic guidance and effective monitoring by the Board;
l Protection of minority interests and rights;
l Equitable treatment of all shareholders;
l Superior transparency and timely disclosure.
In line with this philosophy, Idea Cellular Limited is striving for excellence through adoption of best governance and
disclosure practices. Your Company is fully compliant with all the provisions of Clause 49 of the Listing Agreement of the
Stock Exchanges. The details of the compliance are as follows:
1. BOARD OF DIRECTORS
Composition of the Board
The Board of your Company consisted of 11 Directors as on March 31, 2007, comprising of a Non-Executive Chairman, a
Managing Director, 4 Independent Directors and 5 Non-Executive Directors with considerable experience in their respective
fields. The Board is headed by a Non-Executive Chairman and the number of Independent Directors exceeds one-third of
the total strength of the Board, thus the composition of the Board is in conformity with Clause 49 of the Listing Agreement
entered with the stock exchanges.
None of the Directors on the Board is a Member on more than 10 Committees or a Chairman of more than 5 Committees
(as specified in Clause 49), across all the companies in which he/she is a Director. The necessary disclosures regarding
committee positions have been made by the Directors.
The composition of the Board of Directors as on March 31, 2007 is as follows:
Name of Director Category No. of Outside Directorship(s) Outside Committee Positions
Held8 Held9
Public Private Member Chairman/
Chairperson
Mr. Kumar Mangalam Birla1 Non-Executive 11 11 - -
Mrs. Rajashree Birla2 Non-Executive 6 12 - -
Mr. D. Bhattacharya 2 & 7 Non-Executive 7 - 1 -
Mr. M. R. Prasanna Non-Executive 5 5 - -
Mr. Saurabh Misra 2
Non-Executive 3 - 1 -
Mr. Biswajit A. Subramanian3 Non-Executive - - - -
Mr. Arun Thiagarajan4 Independent 11 1 5 2
Mr. G. P. Gupta 5
Independent 13 - 5 4
Mr. Mohan Gyani 4
Independent - - - -
Ms. Tarjani Vakil 4
Independent 5 1 2 4
Mr. Sanjeev Aga 6
Managing Director 3 - - -
1. Appointed as Director & Chairman w.e.f. June 20, 2006.
2. Appointed as Director w.e.f. June 20, 2006.
3. Appointed as Director w.e.f. December 1, 2006.
4. Appointed as Director w.e.f. September 2, 2006.
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5. Appointed as Director w.e.f. December 11, 2006.
6. Appointed as Managing Director of the Company w.e.f. November 1, 2006.
7. Resigned as Director w.e.f. April 25, 2007.
8. Excluding Directorship in foreign companies and companies under Section 25 of the Companies Act, 1956.
9. Only two Committees viz. Audit Committee and Shareholders’/Investors’ Grievance Committee are considered.
Non-Executive Directors’ Compensation and Disclosure

Apart from sitting fees that are paid to the non-executive directors including independent directors for attending Board/
Committee meetings, no other fees/commission were paid during the year. No significant material transactions have been
made with non-executive Directors vis-a-vis your company.
Board Meetings and Procedure
The Company has a well-defined process of placing vital and sufficient information before the Board pertaining to the
matters to be considered at each Board and Committee meetings, to enable the Board to discharge its responsibilities
effectively.
The Company Secretary in consultation with the concerned person in the senior management finalises the agenda, which
is distributed to the Board members in advance of the meetings.
The Board Meetings are generally held at least once in a quarter. During the year 2006-07, the Board met four times on
June 20, 2006, September 2, 2006, October 19, 2006 and January 22, 2007. The time gap between two meetings was
not more than four months. The Board Meetings are generally held in Mumbai.
The attendance of Directors at Board Meetings held and at the last Annual General Meeting is as under :
Name of Director No. of Board Meetings held during the tenure Attended Last AGM
Held Attended
Mr. Kumar Mangalam Birla 4 4 No
Mrs. Rajashree Birla 4 2 No
Mr. D. Bhattacharya 4 3 No
Mr. M. R. Prasanna 4 3 Yes
Mr. Saurabh Misra 4 4 No
Mr. Biswajit A. Subramanian 1 1 N.A.
Mr. Arun Thiagarajan 3 3 No
Mr. G. P. Gupta 1 1 N.A.
Mr. Mohan Gyani 3 2 No
Ms. Tarjani Vakil 3 3 No
Mr. Sanjeev Aga 4 4 No
Code of Conduct
The Board of Directors play an important role in ensuring good governance and have laid down the Code of Conduct for
all Board members and senior management of the Company. The code is also posted on the website of the Company
(www.ideacellular.com). All Board members and senior management have confirmed compliance to the Code of Conduct.
A declaration signed by the Managing Director regarding affirmation of the compliance with the Code of Conduct by the
Board and senior management of the Company is appended at the end of this report.
2. COMMITTEES OF THE BOARD
A. Audit Committee
Composition, Meetings and Attendance
The Company has an Audit Committee at the Board level with the powers and the role that are in accordance
with Clause 49 of the Listing Agreement and Section 292A of the Companies Act, 1956. The Committee acts
as a link between the Management, the Statutory and Internal Auditors and the Board of Directors and oversees
the financial reporting process. All the members of the Audit Committee including the Chairman are Independent
Directors. The majority of the Audit Committee members have accounting and financial management expertise. The
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Managing Director and the Chief Financial Officer of the Company are permanent invitees of the Audit Committee
and representatives of the Statutory and Internal Auditors of the Company are also invited to the Audit Committee
Meetings. The Company Secretary acts as Secretary to the Committee.
During the year 2006-07, the Audit Committee met four times on June 20, 2006, October 18, 2006, January 22,
2007 and March 30, 2007.
The composition of the Audit Committee as on March 31, 2007 and the attendance of the members at the meetings
held are as follows:
Name of Director Category No. of Meetings held during the tenure No. of meetings attended
Mr. G. P. Gupta (Chairman)
1
Independent 1 1
Mr. Arun Thiagarajan 2
Independent 3 2
Ms. Tarjani Vakil3 Independent 3 3
1. Appointed as Member effective January 22, 2007.
2. Appointed as Member effective September 2, 2006.
3. Appointed as Member effective September 2, 2006.
Mr. M.R. Prasanna and Mr. Saurabh Misra ceased to be members of the Audit Committee with effect from September
2, 2006 and Mr. Sanjeev Aga ceased to be member with effect from January 22, 2007.
Terms of reference
The broad terms of reference of Audit Committee include the following as mandated in Clause 49 of the Listing
Agreement and Section 292A of the Companies Act, 1956:
a) Oversight of the Company’s financial reporting process and the disclosure of its financial information to ensure
that the financial statement is correct, sufficient and credible;
b) Recommending to the Board, the appointment, re-appointment and if required, the removal of external auditor,
determination of audit fee and also approval of payment for any other services;
c) Reviewing with the management, the annual financial statements before submission to the Board, with particular
reference to:
• Changes in accounting policies and practices;
• Major accounting entries based on exercise of judgement by the management;
• Qualifications in Draft Audit Report;
• Significant adjustments made in financial statements arising out of audit findings;
• The Going Concern assumption;
• Compliance with Accounting Standards;
• Compliance with listing and other legal requirements concerning financial statements;
• Any related party transactions i.e. transactions of the Company of material nature, with promoters or
the management, their subsidiaries or relatives etc. that may have potential conflict with the interests of
Company at large;
• Matters required to be included in the Directors’ Responsibility Statement, in terms of Section 217 (2AA) of
the Companies Act, 1956.
d) Reviewing the adequacy of internal audit function, including the structure of the internal audit department,
staffing and seniority of the official heading the department, reporting structure, coverage and frequency of
internal audit;
e) Discussion with internal auditors on any significant findings and follow-up thereon;
f) Reviewing the findings of any internal investigations by the internal auditors, into matters where there is suspected
fraud or irregularity or a failure of internal control systems of a material nature and reporting the matter to the
Board;
g) Reviewing with the management, the performance of external and internal auditors and the adequacy of internal
control systems;
h) Discussion with external auditors before the audit commences on the nature and scope of audit as well as having
post-audit discussions to ascertain any area of concern;
i) Reviewing with the management, the quarterly financial statements before submission to the Board for
approval;
16
j) Reviewing the reasons for substantial defaults in the payment to the depositors, debenture holders, shareholders
(in case of non-payment of declared dividends) and creditors;
k) Review of Management Discussion and Analysis of financial condition and results of operations;
l) Review of Management Letters/Letters of Internal Control Weaknesses issued by the Statutory/Internal Auditors;
m) Reveiw of functioning of ‘Whistle Blower Mechanism’, in case the same exists; and
n) Carrying out any other function as and when referred by the Board.
B. Remuneration Committee
The Company has constituted a Remuneration Committee comprising of three Non-Executive Directors, of which
two are Independent Directors. Presently, the Committee comprises of Mr. Arun Thiagarajan, Ms. Tarjani Vakil and
Mr. M. R. Prasanna.
During the year, the Remuneration Committee met once on January 22, 2007 and all the three members attended
the said meeting.
Terms of reference
The broad terms of reference of Remuneration Committee include the following:
a) Review of remuneration payable to Directors and senior officials of the Company;
b) Reviewing and advising the Board over the remuneration policies of the Company generally; and
c) Such other matters as may be decided by the Board from time to time.
C. Shareholders’/Investors’ Grievance Committee
The Shareholders’/Investors’ Grievance Committee oversees the redressal of shareholders’/investors’ complaints/
grievances like transfer of shares, non-receipt of annual report, dividend payment, issue of duplicate share certificates,
transmission of shares and other related complaints.
The Committee also monitors dematerialisation, rematerialisation, splitting and consolidation of shares and debentures
issued by the Company.
The Committee comprises of three Directors, of which one member is an Executive Director and two members are
Non-Executive Directors of the Company. Presently, the committee comprises of Mr. Sanjeev Aga, Mr. M. R. Prasanna
and Mr. Saurabh Misra.
During the year, no meetings of the Shareholders’ / Investors’ Grievance Committee were held.
Compliance Officer
Mr. Pankaj Kapdeo, General Manager (Legal) & Company Secretary, acts as the Compliance Officer of the Company.
The Compliance Officer can be contacted at:
“Windsor”, 5th Floor,
Off CST Road, Near Vidya Nagari,
Kalina, Santacruz (E), Mumbai – 400 098
Tel. : +91-22-66820106
Fax : +91-22-66820499
E-mail: shs@idea.adityabirla.com
D. Compensation Committee
During the year, the Compensation Committee known as (“ESOS Compensation Committee”) was constituted in
accordance with SEBI (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999 for
formulation of an Employee Stock Option Scheme. The Committee will oversees the implementation of the Scheme,
its administration, supervision and formulating detailed terms and conditions in accordance with SEBI Guidelines.
The Compensation Committee comprises three Non-Executive Directors, of whom two members are Independent
Directors of the Company. Presently, the Committee comprises of Mr. Kumar Mangalam Birla, Mr. Arun Thiagarajan and
Ms. Tarjani Vakil.
During the year, no meetings of the Compensation Committee were held.
E. Finance Committee
The Company has constituted a Finance Committee to approve matters relating to availing of financial facilities. The
Committee comprises of three Directors of whom two are Non-Executive Directors. Presently, the Committee comprises of
Mr. M.R. Prasanna, Mr. Saurabh Misra and Mr. Sanjeev Aga.
During the year, three meetings of the Finance Committee were held.
17
F. IPO Committee
The IPO Committee of the Company was constituted to give effect to the Initial Public Offering of the Company. The
Committee comprises of three Directors of whom two are Non-Executive Directors. Presently, the Committee comprises of
Mr. M. R. Prasanna, Mr. Saurabh Misra and Mr. Sanjeev Aga.
During the year four meetings of the IPO Committee were held.
3. SUBSIDIARY COMPANIES
The Company does not have any material non-listed Indian subsidiary, whose turnover or net worth (i.e. paid-up
capital and free reserves) exceeds 20% of the consolidated turnover or net worth respectively, of the Company.
4. DISCLOSURES
a) Disclosure on materially significant related party transactions
The related party transactions are placed before Audit Committee on a quarterly basis. For the financial year
ended March 31, 2007, there were no transactions of material nature with related parties which are not in the
normal course of business. The related party transactions have been disclosed under Note 26 of Schedule 22B
of the Balance Sheet forming part of the Annual Report.
b) Disclosure of Accounting Treatment
There is no deviation in following the treatments prescribed in any Accounting Standard in preparation of financial
statements of the Company during the year.
c) Details of non-compliance with regard to the Capital Market
The Company has complied with all the requirements of the stock exchanges as well as the regulations and
guidelines prescribed by the Securities and Exchange Board of India. There were no penalties or strictures
imposed on the Company by Stock Exchanges or SEBI, or, any statutory authority on any matter related to capital
markets during the last three years.
d) Board Disclosures - Risk Management
The Company has an integrated approach to managing the risks inherent in the various aspects of business.
The Audit Committee of the Board is regularly informed about the business risks and steps taken to mitigate the
same.
e) Proceeds from Public Issue
During the year, the Company completed its Initial Public Offering (IPO) of equity shares. The Company has
placed a detailed statement, containing the uses/application of funds raised through the said IPO before the
Audit Committee held on April 25, 2007.
The proceeds of the Initial Public Offering of the Company have been utilized for the purposes mentioned in the
prospectus only and reported on a quarterly basis as a part of quarterly financial results.
f) Remuneration of Directors
i) Remuneration paid/payable to the Executive Director for the financial year ended March 31, 2007
is given as under:
The remuneration package of Executive Director i.e. Mr. Sanjeev Aga, Managing Director comprises of a fixed
salary component and a performance linked bonus. The remuneration package as recommended by the Board
has been approved by the shareholders in the Extra-Ordinary General Meeting held on November 15, 2006.
Executive Relationship Business Remuneration during 2006-07
Director with other relationship
Directors with the
Company, if All elements of Fixed component & Service Stock
any remuneration performance linked Contract, Option
package i.e. salary, incentives, along notice period, details, if
benefits, bonuses, with performance severance fee any
pension etc. criteria
Mr. Sanjeev – Managing Rs. 13,321,115 See See See
Aga Director Note (a) Note (b) Note (c)
(a) Mr. Sanjeev Aga was paid a sum of Rs. 2.73 million towards performance incentive linked to achievement of targets.
(b) The appointment is for a period of five years w.e.f. November 1, 2006. The appointment is subject to termination by three
months notice on either side. No severance fees is payable to the Managing Director.
(c) During the year 2006-07, the Company did not have Scheme for grant of Stock Options to its Directors or Employees.
18
ii) Remuneration paid/payable to the Non-Executive Director for the financial year ended March 31,
2007 is given as under:
The Non-Executive Directors are not paid any remuneration except sitting fees for meeting of the Board
and Committees, if any, attended by them. The sitting fees, as determined by the Board, are presently
Rs. 20,000/- and Rs. 10,000/- for each meeting of the Board and other Board Committees respectively.
The details of the sitting fees paid to Non-Executive Directors are as under:
Name of the Non-Executive Director Sitting Fees (Rs.)
Mr. Kumar Mangalam Birla 80,000
Mrs. Rajashree Birla 40,000
Mr. D. Bhattacharya 60,000
Mr. M. R. Prasanna 120,000
Mr. Saurabh Misra* -
Mr. Biswajit A. Subramanian -
Mr. Arun Thiagarajan 70,000
Mr. G. P. Gupta 30,000
Mr. Mohan Gyani 20,000
Ms. Tarjani Vakil 100,000
* Mr. Saurabh Misra has expressed his unwillingness to accept sitting fees. He is not being paid any sitting fees
for attending the meeting of Board of Directors of the Company.
Mr. Sanjeev Aga has been paid Rs. 80,000 as sitting fees in his capacity as Non-Executive Director upto
October 31, 2006.
iii) Details of Shareholding of Directors are given as under:
Name of the Director No. of Equity Shares
Mr. Kumar Mangalam Birla 233,333
Mr. D. Bhattacharya 6,202
Mr. M. R. Prasanna 1,873
Mr. G. P. Gupta 4,192
Ms. Tarjani Vakil 147
Mr. Sanjeev Aga 122,868
5. Management
A detailed Management Discussion and Analysis forms part of the Directors’ Report.
No material transaction has been entered into by the Company with the Promoters, Directors or the Management,
their subsidiaries or relatives etc., that may have a potential conflict with the interest of the Company.
6. Shareholders
i) Disclosure regarding appointment or re-appointment of Directors
The Company has provided all the details of the Directors seeking appointment or re-appointment in the AGM
Notice enclosed with this Annual Report.
ii) Communication to Shareholders
The Company’s quarterly financial results, investor updates, official news releases and other general information
about the Company are posted on the Company’s website (www.ideacellular.com). The quarterly financial results
of the Company are generally published in The Economic Times and Western Times (a regional daily published
from Gujarat). At the end of each quarter, we organise an earnings call with analysts and investors and the
transcripts are posted on the website thereafter.
iii) General Body Meetings
The last three Annual General Meetings were held as under:
Financial Year Date Time Venue
2005-06 September 30, 2006 11:30 a.m. Suman Tower, Plot No. 18, Sector - 11, Gandhinagar - 382 011
2004-05 September 22, 2005 11:30 a.m. Suman Tower, Plot No. 18, Sector - 11, Gandhinagar – 382 011
2003-04 September 29, 2004 11:30 a.m. Suman Tower, Plot No. 18, Sector - 11, Gandhinagar - 382 011
19
Court Convened Meeting
A Court Convened Meeting of the Equity and Preference Shareholders was held on March 26, 2007 for approval
of a Scheme of Amalgamation between (i) Bhagalaxmi Investments Pvt. Ltd., (ii) Sapte Investments Pvt. Ltd.,
(iii) Asian Telephone Services Ltd., (iv) Vsapte Investments Pvt. Ltd. (v) BTA Cellcom Ltd., (vi) Idea Mobile
Communications Ltd., (vii) Idea Telecommunications Ltd. (collectively referred as subsidiary companies) and the
Company.
Court Convened Meeting for approval of Scheme of Amalgamation
Year 2006-07
Location Town Hall, Sector - 17, Gandhinagar - 382 011, Gujarat
Date March 26, 2007
Date of declaration of poll results March 26, 2007
Equity Shareholders Preference Shareholders
Number of shareholders attended 116 2
and voted at the meeting (Shareholding Votes - 1,485,818,199) (Shareholding Votes - 483)
Shareholders whose votes were 19 Nil
invalid (Shareholding Votes - 5,521,261)
Shareholders who voted in favour of 97 2
the Scheme (Shareholding Votes - 1,480,296,938) (Shareholding Votes - 483)
Votes against the Scheme Nil Nil
Special Resolutions passed at the last 3 AGMs

a) 2005-06 – Annual General Meeting held on September 30, 2006
• No Special Resolution was passed
b) 2004-05 – Annual General Meeting held on September 22, 2005
• Consider fresh issue of shares
• Consider enhancement of Authorised Share Capital
c) 2003-04 – Annual General Meeting held on September 29, 2004
• Consider fresh issue of shares
• Consider enhancement of Authorised Share Capital
• Consider Amendment in the Articles of Association of the Company
• Consider appointment of Manager of the Company
iv) Special Resolution through Postal Ballot
During the year, the Company has not passed any Special Resolution through postal ballot.
7. CEO/CFO CERTIFICATION
As required by Clause 49 of the Listing Agreement, the CEO/CFO certification is given elsewhere in the Annual
Report.
8. REPORT ON CORPORATE GOVERNANCE
This Corporate Governance Report forms part of the Annual Report. The Company is fully compliant with all the
provisions of Clause 49 of the Listing Agreement of the Stock Exchanges of India.
9. COMPLIANCE
A Certificate from the Statutory Auditors of the Company, confirming compliance with all the conditions of Corporate
Governance, as stipulated in Clause 49 of the Listing Agreement of the stock exchanges is annexed to the Directors’
Report and forms part of the Annual Report.
20
GENERAL SHAREHOLDERS’ INFORMATION
1. Annual General Meeting
Day and Date : Wednesday, December 12, 2007
Time : 2.00 p.m.
Venue : Emerald Hall, Haveli Arcade, Hotel Haveli,
Sector - 11, Gandhinagar – 382 011
2. Financial Calendar for 2007-08 (Tentative)
Financial reporting for the quarter ending June 30, 2007 : End July 2007
Financial reporting for the quarter ending September 30, 2007 : End October 2007
Financial reporting for the quarter ending December 31, 2007 : End January 2008
Financial reporting for the quarter ending March 31, 2008 : End April 2008
Annual General Meeting for the year 2007-08 : July/August 2008
3. Book Closure Date : December 7, 2007 to December 12, 2007
(both days inclusive)
4. Dividend Payment Date : Not Applicable
(Since no final dividend is proposed for
the Financial Year 2006-07)
5. Registered Office : Suman Tower,
Plot No. 18, Sector - 11,
Gandhinagar – 382 011
Gujarat (India)
Tel. : +91-79-66714000
Fax : +91-79-23232251
6. Listing Details
The Equity Shares of the Company are listed on:
Name of Stock Exchanges
National Stock Exchange of India Limited Bombay Stock Exchange Limited
“Exchange Plaza”, Bandra-Kurla Complex, Phiroze Jeejeebhoy Towers,
Bandra (East), Mumbai – 400 023 Dalal Street, Mumbai – 400 001
The Company’s payment of Listing Fees is up-to-date.
7. Stock Codes
Stock Code Reuters Bloomberg
Stock Exchange, Mumbai 532822 IDEA.BO IDEA IN
National Stock Exchange IDEA IDEA.NS NIDEA IN
ISIN INE669E01016
8. Market Price Data

Month Bombay Stock Exchange Limited National Stock Exchange of India Limited
High Low Close Avg. Vol. High Low Close Avg. Vol.
(in Rs.) (in Rs.) (in Rs.) (in Nos.) (in Rs.) (in Rs.) (in Rs.) (in Nos.)
*March - 07 98.40 84.00 94.55 10,031,989 103.00 84.40 94.60 24,548,407
* The Equity Shares of the Company were listed on March 9, 2007
21
9. Stock Performance
a) Comparison of the Company’s share price with NSE Nifty
!dea Share Price Vs NSE Nifty
100 3900
Idea Share Price 95 3825
NSE Nifty
90 3750
85 3675
80 3600
9-Mar-07
12-Mar-07
13-Mar-07
14-Mar-07
15-Mar-07
16-Mar-07
19-Mar-07
20-Mar-07
21-Mar-07
22-Mar-07
23-Mar-07
26-Mar-07
28-Mar-07
29-Mar-07
30-Mar-07
!dea Share Price NSE Nifty
b) Comparison of the Company’s share price with BSE Sensex

!dea Share Price Vs BSE Sensex
100 13400
95 13150
Idea Share Price
BSE Sensex
90 12900
85 12650
80 12400
9-Mar-07
12-Mar-07
13-Mar-07
14-Mar-07
15-Mar-07
16-Mar-07
19-Mar-07
20-Mar-07
21-Mar-07
22-Mar-07
23-Mar-07
26-Mar-07
28-Mar-07
29-Mar-07
30-Mar-07
!dea Share Price BSE Sensex
10. Registrar and Share Transfer Agents

Bigshare Services Private Limited
E/2 Ansa Industrial Estate,
Sakivihar Road, Saki Naka,
Andheri (East),
Mumbai – 400 072
Tel. : +91-22-28470652
Fax : +91-22-28475207
11. Share Transfer System
Transfer of shares in physical form are processed within a period of 12 days from the date of the lodgement subject
to documents being valid and complete in all respects. There have been no instances of transfer of shares in the
physical form during the financial year 2006-07.
12. Investor Services
During the year, 8808 complaints/queries were received of which 8128 were redressed and 680 were pending as
on March 31, 2007. The complaints/queries received by the Company were in the nature of non-receipt of shares/
refund order relating to the Initial Public Offering.
All these complaints/queries have been resolved.
22
13. Distribution of Shareholding
The distribution of shareholding of the Company as on March 31, 2007 is as under:
No. of Equity Shares No. of Shareholders % to total No. of Shares held % to total
held Shareholders Shareholding
Upto 5000 327,468 97.66 53,798,148 2.08
5000 – 10000 3,266 0.97 2,519,730 0.10
10001 – 20000 1,575 0.47 2,298,235 0.09
20001 – 30000 756 0.22 1,878,474 0.07
30001 – 40000 372 0.11 1,289,874 0.05
40001 – 50000 394 0.12 1,828,416 0.07
50001 – 100000 743 0.22 5,022,633 0.19
100001 & above 745 0.22 2,524,225,029 97.35
14. Shareholding Pattern

The shareholding pattern of the Company as on March 31, 2007 is as under:
Category No. of Shares % Shareholding
Promoters* 1,477,945,714 57.00
Foreign Institutional Investors 664,564,184 25.63
Non-Resident Indians/Overseas Corporate Bodies 312,380,495 12.05
Mutual Funds, Financial Institutions and Banks 43,010,088 1.66
Bodies Corporate 13,118,800 0.51
Resident Indians 81,841,258 3.15
*Excluding 4,25,00,000 Equity Shares lent by the promoter, pursuant to the Green Shoe Option under the Initial Public Offering.
15. Dematerialisation of Shares and Liquidity
The Shares of the Company are compulsorily traded in dematerialised form. The shares of the Company are admitted
for trading under both the Depository Systems in India – NSDL and CDSL. A total number of 2,592,859,952 Equity
Shares of the Company constituting over 99.99% of the issued and subscribed Share Capital were in dematerialised
form as on March 31, 2007.
16. Outstanding GDRs/ADRs etc.
No GDRs/ADRs /Warrants or Convertible Instruments are outstanding as on date of this report.
17. Investor Correspondence
In order to facilitate quick redressal of the grievances/queries, the Investors and Shareholders may contact at the
under mentioned address for any assistance:
On other than Secretarial Matters On Secretarial and Investor Grievance Matters
Mr. AJS Jhala Mr. Pankaj Kapdeo
Chief Financial Officer General Manager (Legal) & Company Secretary
“Windsor” 5th Floor, Off CST Road, “Windsor” 5th Floor, Off CST Road,
Near Vidya Nagari, Kalina, Santacruz (East), Near Vidya Nagari, Kalina, Santacruz (East),
Mumbai – 400 098 Mumbai – 400 098
Tel. : +91-22-66820000 Tel. : +91-22-66820000
Fax : +91-22-66820499 Fax : +91-22-66820499
E-mail : ajs.jhala@idea.adityabirla.com E-mail : shs@idea.adityabirla.com
23
DECLARATION
As provided under Clause 49 of the Listing Agreement with the Stock Exchange(s), it is hereby declared that all the Board
Members and Senior Management personnel of the Company have affirmed the compliance with the Code of Conduct
for the year ended March 31, 2007.
Date : October 11, 2007 Sanjeev Aga

Place : Mumbai Managing Director
CEO/CFO CERTIFICATION
We, Sanjeev Aga, Managing Director and AJS Jhala, Chief Financial Officer certify that:
a) We have reviewed the financial statements and cash flow statements for the year ended March 31, 2007 and to the
best of our knowledge and belief:
i) these statements do not contain any materially untrue statement or omit any material fact or contain statements
that might be misleading;
ii) these statements together present a true and fair view of the Company’s affairs and are in compliance with
existing Accounting Standards, applicable laws and regulations.
b) To the best of our knowledge and belief, no transactions entered into by the Company during the year ended March
31, 2007 are fraudulent, illegal or violative of the Company’s code of conduct.
c) We accept the responsibility for establishing and maintaining internal controls for financial reporting and we have
evaluated the effectiveness of internal control systems of the Company pertaining to financial reporting. We have
disclosed to the Auditors and the Audit Committee, deficiencies in the design and operations of such internal controls,
if any, of which we are aware and steps have been taken to rectify these deficiencies.
d) We have indicated to the Auditors and the Audit Committee:
i) Significant changes in the internal control over financial reporting during the year;
ii) Significant changes in the accounting policies during the year and that the same has been disclosed in the notes
to the financial statements; and
iii) Instances of significant fraud of which we have become aware and the involvement therein, if any, of the
management or any employee having a significant role in the Company’s internal control system over financial
reporting.
AJS Jhala Sanjeev Aga

Chief Financial Officer Managing Director
Date : October 11, 2007
Place : Mumbai
24
CERTIFICATe
To the Members of
We have examined the compliance of conditions of Corporate Governance by Idea Cellular Limited (the ‘Company’), for
the year ended on March 31, 2007, as stipulated in Clause 49 of the Listing Agreement of the said Company with stock
exchanges.
The compliance of conditions of Corporate Governance is the responsibility of the Management. Our examination has been
limited to a review of the procedures and implementation thereof adopted by the Company for ensuring compliance with
the conditions of Corporate Governance as stipulated in the said Clause. It is neither an audit nor an expression of opinion
on the financial statements of the Company.
In our opinion and to the best of our information and according to the explanations given to us and the representations
made by the Directors and the Management, we certify that the Company has complied with the conditions of Corporate
Governance as stipulated in Clause 49 of the above mentioned Listing Agreement.
We further state that such compliance is neither an assurance as to the future viability of the Company nor of the efficiency
or effectiveness with which the Management has conducted the affairs of the Company.
For RSM & Co. For Deloitte Haskins & Sells

Chartered Accountants Chartered Accountants
Vilas Y. Rane Hemant M. Joshi

Partner Partner
Membership No.: F-33220 Membership No.: 38019
Mumbai: October 11, 2007 Mumbai: October 11, 2007
25
AUDITORS’ REPORT
To The Members of
1. We have audited the attached Balance Sheet of Idea Cellular Limited (‘the Company’) as at March 31, 2007 and
also the Profit and Loss Account and the Cash Flow Statement of the Company for the year ended on that date,
annexed thereto (together referred to as ‘financial statements’). These financial statements are the responsibility of
the Company’s management. Our responsibility is to express an opinion on these financial statements based on our
audit.
2. We conducted our audit in accordance with auditing standards generally accepted in India. Those Standards require
that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are
free of material mis-statement. An audit includes examining, on a test basis, evidence supporting the amounts
and disclosures in the financial statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall financial statement presentation. We
believe that our audit provides a reasonable basis for our opinion.
3. As required by the Companies (Auditors’ Report) Order, 2003, (‘the said Order’) issued by the Central Government
of India in terms of sub-section (4A) of Section 227 of the Companies Act, 1956, on the basis of such checks of
the books and records of the Company as we considered necessary and appropriate, and according to information
and explanations given to us during the course of the audit, we enclose in the Annexure a statement on the matters
specified in paragraphs 4 and 5 of the said Order.
4. Attention is invited to Note 4 of Schedule 22B of the Financial Statements. As detailed in the said note, pending
the transfer of Telecom licenses of the erstwhile Idea Mobile Communications Limited, BTA Cellcom Limited and
Idea Telecommunications Limited in the name of the Company, the Company has given effect to the Scheme of
Amalgamation in the financial statements. Implications if any, in the event of non transfer of the licenses are not
ascertainable at this stage.
5. Further to our comments in the Annexure referred to in paragraph 3 above, we report that :
(a) we have obtained all the information and explanations which to the best of our knowledge and belief were
necessary for the purposes of our audit;
(b) in our opinion, proper books of account as required by law have been kept by the Company so far as appears
from our examination of those books;
(c) the Balance Sheet, Profit and Loss Account and Cash Flow Statement dealt with by this report are in agreement
with the books of account;
(d) in our opinion, the Balance Sheet, Profit and Loss Account and Cash Flow Statement dealt with by this report
comply with the Accounting Standards referred to in sub-section (3C) of Section 211 of the Companies Act,
1956 so far as they apply to the Company;
26
(e) on the basis of the written representations received from the directors as on March 31, 2007 and taken on
record by the Board of Directors, we report that none of the director is disqualified as on March 31, 2007 from
being appointed as a director in terms of Clause (g) of sub-section (1) of Section 274 of the Companies Act,
1956; and
(f) subject to what has been stated in paragraph 4 above, in our opinion and to the best of our information and
according to the explanations given to us, the said financial statements read together with the notes thereon give
the information required by the Companies Act, 1956, in the manner so required and give a true and fair view in
conformity with the accounting principles generally accepted in India :
(i) in the case of the Balance Sheet, of the state of affairs of the Company as at March 31, 2007;
(ii) in the case of the Profit and Loss Account, of the profit of the Company for the year ended on that date;
and
(iii) in the case of the Cash Flow Statement, of the cash flows of the Company for the year ended on that
date.


Partner Partner
Membership No. : F-33220 Membership No. : 38019
Date : October 11, 2007 Date : October 11, 2007
Place : Mumbai Place : Mumbai
27
ANNEXURE TO THE AUDITORS’ REPORT
(Referred to in paragraph 3 of our report of even date)
1. In respect of its fixed assets :

a) The Company has maintained proper records showing full particulars, including quantitative details and situation
of fixed assets.
b) Fixed Assets have been physically verified by the management according to the regular programme of periodical
verification in phased manner which in our opinion is reasonable having regard to the size of the Company and
the nature of its fixed assets. Pursuant to the programme, a portion of the fixed assets has been physically
verified by the management during the year and no material discrepancies between the book records and the
physical inventory have been noticed.
c) During the year, the Company has not disposed off substantial part of the fixed assets.
2. In respect of its inventories :
a) The inventories, except for those lying with the third parties, have been physically verified by the management at
the year-end. In our opinion, the frequency of such verification is reasonable.
b) In our opinion and according to the information and explanations given to us, the procedures of physical verification
of inventories followed by the management are reasonable and adequate in relation to the size of the Company
and the nature of its business.
c) On the basis of our examination of the records of inventory and according to the information and explanations
given to us, we are of the opinion that the Company is maintaining proper records of inventory. The discrepancies
noticed on verification between the physical stock and the book records were not material.
3. According to the information and explanations given to us, the Company has not granted/taken any loans, secured
or unsecured, to/from companies, firms or other parties covered in the register maintained under Section 301 of the
Companies Act, 1956.
4. In our opinion, and according to the information and explanations given to us, having regard to explanation that
major capital goods and spares thereof purchased are of special nature and suitable alternative sources do not exist
for obtaining comparable quotations, there are adequate internal control procedures commensurate with the size of
the Company and the nature of its business with regard to purchase of inventory and fixed assets and for the sale
of goods and services. During the course of our audit we have not observed any continuing failure to correct major
weaknesses in such internal control systems with regard to purchase of inventory and fixed assets and for the sale of
goods and services.
5. In our opinion and according to the information and explanations given to us, there were no contracts, particulars of
which needed to be entered in the register maintained under Section 301 of the Companies Act, 1956 and hence
provisions of paragraph 4(v)(b) of the said Order relating to reasonableness of price having regard to prevailing market
price is not applicable to the Company.
6. In our opinion and according to the information and explanations given to us, the Company has not accepted any
deposits from the public to which the directives issued by the Reserve Bank of India and the provisions of Sections
58A and 58AA of the Companies Act, 1956 and the rules framed thereunder are applicable.
28
7. The Company has appointed an external agency for conducting internal audit so as to cover the entire operations over
a period of time. In our opinion, the internal audit system in respect of areas covered is commensurate with the size
and nature of the business of the Company.
8. We have broadly reviewed the books of account maintained by the Company pursuant to the rules prescribed by the
Central Government for maintenance of cost records under Section 209(1)(d) of the Companies Act, 1956 in respect
of telecommunication activities and are of the opinion that prima facie, the prescribed accounts and records have
been made and maintained. However, we have not made a detailed examination of the records.
9. In respect of statutory dues :
a) According to the information and explanations given to us and the records of the Company examined by us, in
our opinion, the Company is generally regular in depositing the undisputed statutory dues including Provident
Fund, Employees’ State Insurance, Income-Tax, Sales Tax, Wealth Tax, Service Tax, Customs Duty, Excise Duty,
Cess and any other statutory dues as applicable with the appropriate authorities.
b) According to the information and explanations given to us, no undisputed amount payable in respect of Provident
Fund, Employees’ State Insurance, Income-Tax, Sales Tax, Wealth Tax, Service Tax, Customs Duty, Excise Duty,
Cess and any other statutory dues applicable to it were in arrears, as at March 31, 2007 for a period of more
than six months from the date they became payable.
c) According to the information and explanations given to us, there are no dues of Excise Duty, Wealth Tax, Customs
Duty, Employees’ State Insurance which have not been deposited on account of any dispute. The dues of Income
Tax, Service Tax, Sales Tax and Entry Tax as disclosed below have not been deposited by the Company on account
of disputes.
Name of the Statute Nature Period to Amount Forum where the dispute is pending
of Dues which the (Rs. million)
amount
pertains
Bombay Sales Tax Act, 1959 Sales Tax 1998-99 to 55.45 Deputy Commissioner of Sales Tax
2002-03
Bombay Sales Tax Act, 1959 Sales Tax 2000-01 43.90 Sales Tax Tribunal
Bombay Sales Tax Act, 1959 Sales Tax 2001-02 & 6.15 Deputy Commissioner of Sales Tax
2002-03
Andhra Pradesh General Sales Tax Sales Tax 1997-98 2.89 Andhra Pradesh High Court
Act, 1957
Uttar Pradesh Trade Tax Act, 1948 Sales Tax 2003-04 4.38 Deputy Commissioner of Trade Tax, Noida
Delhi Sales Tax Act, 1975 Sales Tax 2004-05 90.05 Additional Commissioner of Sales Tax, Delhi
Delhi Sales Tax Act, 1975 Sales Tax 2003-04 113.44 VAT Officer KDU, Delhi
Gujarat Sales Tax Act, 1969 Sales Tax 1998-99 to 7.04 Sales Tax Tribunal/Gujarat High Court
2001-02
Chhattisgarh Commercial Tax Act, Sales Tax 1999-00 to 1.69 Deputy Commissioner (Appeals), Raipur
1994 2002-03
Madhya Pradesh Commercial Tax Sales Tax 1997-98 0.21 Commercial Tax Tribunal, Bhopal
Act, 1994
Chhattisgarh Commercial Tax Act, Sales Tax 2000-01 0.31 Appellate Board
1994
29
Name of the Statute Nature Period to Amount Forum where the dispute is pending
of Dues which the (Rs. million)
amount
pertains
Madhya Pradesh Commercial Tax Sales Tax 2003-04 2.94 Madhya Pradesh High Court
Act, 1994
Kerala Sales Tax Act, 1963 Sales Tax 1997-98 to 15.36 Kerala High Court
1998-99
Kerala Sales Tax Act, 1963 Sales Tax 1998-99 0.06 Deputy Commissioner Sales Tax
Kerala Sales Tax Act, 1963 Sales Tax 1997-98 0.40 Sales Tax Appellate Tribunal
Uttar Pradesh Trade Tax Act, 1948 Sales Tax 2006-07 2.70 Deputy Commissioner, Sales Tax
Entry Tax Act, 1976 Entry Tax 1997-98 to 4.81 Commercial Tax Tribunal, Bhopal
2002-03
Entry Tax Act, 1976 Entry Tax 2002-03 0.01 Deputy Commissioner (Appeals), Raipur
Income Tax Act, 1961 Income Tax 1997-98, 1.90 Assessing Officer (TDS) Pune/ ITAT, Pune
1998-99 &
2000-01
Income Tax Act, 1961 Income Tax 2004-05 3.98 Commissioner of Income Tax (Appeals)
Income Tax Act, 1961 Income Tax 2006-07 57.00 Commissioner of Income Tax (Appeals)
Income Tax Act, 1961 Income Tax 2002-03 2.61 Income Tax Appellate Tribunal, Hyderabad
Income Tax Act, 1961 Income Tax 2000-01 0.47 Income Tax Appellate Tribunal, Pune
Income Tax Act, 1961 Income Tax 2000-01 0.29 Additional Commissioner of Income-Tax, Pune
Income Tax Act, 1961 Income Tax 2000-01 0.69 Income Tax Appellate Tribunal, Pune
Income Tax Act, 1961 Income Tax 2000-01 6.00 Commissioner of Income Tax (Appeals), Pune
Income Tax Act, 1961 Income Tax 2002-03 0.24 Additional Commissioner of Income Tax, Pune
Income Tax Act, 1961 Income Tax 2000-01 0.31 Additional Commissioner of Income Tax, Pune
Income Tax Act, 1961 Income Tax 2003-04 14.94 Commissioner of Income Tax (Appeals), Pune
Finance Act, 1994 (Service Tax Service Tax 2002-03 0.11 Central Excise Service Tax Appellate Tribunal
provisions) - Bangalore
Finance Act, 1994 (Service Tax Service Tax 2000-01 to 0.75 Commissioner Appeal, Central Excise
provisions) 2004-05
Finance Act, 1994 (Service Tax Service Tax 2004-05 & 17.46 Commissioner, Central Excise
provisions) 2005-06
10. In our opinion, the accumulated losses of the Company are not less than fifty percent of its net worth. However, the
Company has not incurred cash losses during the current financial year covered by our audit and the immediately
preceding financial year.
30
11. In our opinion and according to the information and explanations given to us, the Company has not defaulted in
repayment of dues to the financial institutions and banks.
12. According to the information and explanations given to us, the Company has not granted loans and advances on the
basis of security by way of pledge of shares, debentures and other securities.
13. The Company is not a chit fund or a nidhi/mutual benefit fund/society. Therefore, the provisions of paragraph 4(xiii) of
the said Order are not applicable to the Company.
14. In our opinion and according to the information and explanations given to us, the Company is not dealing in or trading
in shares, securities, debentures and other investments.
15. According to the information and explanations given to us, the Company has not given any guarantee for loans taken
by others from banks or financial institutions.
16. In our opinion and according to the information and explanations given to us, the term loans taken by the Company
have been applied for the purpose for which they were raised to the extent utilised.
17. On the basis of an overall examination of the Balance Sheet of the Company, in our opinion and according to the
information and explanations given to us, as at the Balance Sheet date funds amounting to Rs. 3,928.50 million
raised on a short-term basis have been used for long-term purpose.
18. The Company has not made preferential allotment of shares to parties and companies covered in the register
maintained under Section 301 of the Companies Act, 1956, during the year.
19. The Company has not issued any debentures during the year.
20. The management has disclosed the end use of money raised by public issue and the same has been verified by us.
21. During the course of our examination of the books of account, carried out in accordance with generally accepted
auditing practices in India, and according to the information and explanations given to us, we have neither come
across any incidence of fraud on or by the Company, noticed or reported during the year, nor have we been informed
of any such case by the management other than four subscriber frauds which were not material.


Partner Partner
31
Balance sheet as at March 31, 2007
(Rs. in million)

Schedules March 31, 2007 March 31, 2006
SOURCES OF FUNDS
Shareholders Funds
Share Capital 1 25,928.60 27,425.27
Reserves and Surplus 2 20,371.49 998.41
46,300.09 28,423.68
Loan Funds
Secured 3 35,397.68 14,707.53
Unsecured 4 7,107.36 14,448.54
42,505.04 29,156.07
Deferred Tax Liability (Net) (Refer Note B 29 to Schedule 22) 10.55 –
TOTAL 88,815.68 57,579.75
APPLICATION OF FUNDS
Fixed Assets
Gross Block (At Cost) 5A 70,619.64 31,663.73
Less : Depreciation 26,371.75 11,576.31
Net Block 44,247.89 20,087.42
Intangible Assets (Net) 5B 11,676.42 8,087.39
Capital Work-in-Progress 5,065.15 959.05
60,989.46 29,133.86
Investments 6 138.31 3,070.31
Current Assets, Loans and Advances
Current Assets
Inventories 7 179.10 88.11
Sundry Debtors 8 1,524.77 908.18
Cash and Bank Balances 9 18,197.28 1,290.91
Other Current Assets 10 757.40 451.35
Loans and Advances 11 4,040.57 13,634.95
24,699.12 16,373.50
Less : Current Liabilities and Provisions 12 21,519.77 7,736.31
Net Current Assets 3,179.35 8,637.19
Profit and Loss Account 24,508.56 16,738.39
TOTAL 88,815.68 57,579.75
Significant Accounting Policies and Notes to the Accounts 22
The Schedules referred to above form an integral part of Accounts
As per our report of even date attached. For and on behalf of the Board
For RSM & Co. For Deloitte Haskins & Sells Sanjeev Aga G. P. Gupta
Chartered Accountants Chartered Accountants Managing Director Director
Vilas Y. Rane Hemant M. Joshi AJS Jhala Arun Thiagarajan
Partner Partner Chief Financial Officer Director
Membership No. : F - 33220 Membership No. : 38019
Pankaj Kapdeo Tarjani Vakil
Company Secretary Director
Date : October 11, 2007 Saurabh Misra
Place : Mumbai Director
32
PROFIT AND LOSS ACCOUNT FOR THE YEAR ENDED MARCH 31, 2007
(Rs. in million)

INCOME
Service Revenue 43,500.16 20,070.68
Sales of Trading Goods (Refer Note B 19 to Schedule 22) 163.84 –
Other Income 13 209.29 105.70
TOTAL 43,873.29 20,176.38
OPERATING EXPENDITURE
Cost of Trading Goods 14 51.73 –
Personnel Expenditure 15 2,608.46 1,184.84
Network Operating Expenditure 16 5,335.72 2,174.46
Licence and WPC Charges 17 4,487.01 2,208.19
Roaming & Access Charges 18 7,320.96 3,459.11
Subscriber Acquisition & Servicing Expenditure 19 5,643.27 2,258.00
Advertisement and Business Promotion Expenditure 2,006.20 850.68
Administration & other Expenses 20 1,560.31 780.58
29,013.66 12,915.86
PROFIT BEFORE FINANCE CHARGES, DEPRECIATION, AMORTISATION & TAX 14,859.63 7,260.52
Finance and Treasury Charges (Net) 21 3,051.06 2,500.10
Depreciation 5A 5,636.66 2,628.80
Amortisation of Intangible Assets 5B 1,081.39 846.57
PROFIT BEFORE TAX 5,090.52 1,285.05
Provision for Taxation – Current – –
– Deferred 10.55 –
– Fringe Benefit Tax 59.36 29.02
PROFIT AFTER TAX 5,020.61 1,256.03
Balance of Loss brought forward from previous year (16,738.39) (17,994.42)
Accumulated Losses acquired on amalgamation (12,668.11) –
Leave Encashment Provision for earlier years (Refer Note B 24 to Schedule 22) (122.67) –
BALANCE OF LOSS CARRIED FORWARD TO BALANCE SHEET (24,508.56) (16,738.39)
EARNINGS PER SHARE (in Rupees)
(Refer Note B 28 to Schedule 22)
Basic 2.19 0.36
Diluted 2.15 0.36
33
Schedules Forming part of accounts
(Rs. in million)
As at As at
March 31, 2007 March 31, 2006
SCHEDULE 1
SHARE CAPITAL
Authorised
3,775,000,000 Equity Shares of Rs. 10 each 37,750.00 37,750.00
500 Redeemable Cumulative Non-Convertible Preference Shares of Rs. 10 mn each 5,000.00 5,000.00
42,750.00 42,750.00
Issued, Subscribed and Paid-Up
Equity Share Capital (Refer Note B 1 to Schedule 22)
2,592,860,539 (Previous year 2,259,527,206) Equity Shares of Rs. 10 each fully paid up 25,928.60 22,595.27
Preference Share Capital (Refer Note B 2 to Schedule 22)
(Previous year 483 8%Redeemable Cumulative Non-Convertible
Preference Shares of Rs. 10 mn each) – 4,830.00
25,928.60 27,425.27
SCHEDULE 2
RESERVES AND SURPLUS
Amalgamation Reserve
Opening Balance 998.41 998.41
Less : Adjustment on Amalgamation of Subsidaries (354.84) –
643.57 998.41
Capital Reserve (Refer Note B 4(b) to Schedule 22) 1,414.56 –
Share Premium Account (Refer Note B 1 & B 2 to Schedule 22)
Premium on issue of Equity Shares 21,666.66 –
Less : Share Issue Expenses (620.04) –
Less : Premium on redemption of Preference Shares (2,733.26) –
18,313.36 –
20,371.49 998.41
SCHEDULE 3
SECURED LOANS
Term Loan
Rupee Loan (Refer Note B 5(a) to Schedule 22)
– From Banks 29,170.50 10,843.31
– From Financial Institutions 6,029.50 3,845.69
(Loan Repayable within one year Rs. 880 mn, Previous year Rs. 1,191 mn)
Vehicle Loan (Refer Note B 5(b) to Schedule 22) 197.19 –
(Loan Repayable within one year Rs. 47.98 mn)
Working Capital Loan (Refer Note B 5(c) to Schedule 22)
– From Banks 0.49 18.53
35,397.68 14,707.53
SCHEDULE 4
UNSECURED LOANS
Short Term Loan
– From Subsidiaries – 1,028.54
– From Banks 5,350.00 13,420.00
– From Others 1,757.36 –
7,107.36 14,448.54
34
SCHEDULE 5A
FIXED ASSETS ( Refer note B 5 to Schedule 22 ) (Rs. in million)
Gross Block Depreciation Net Block
Particulars As at Additions on Additions Sale/ As at As at Additions on Additions Sale/ As at As at As at
April 1, account of for the Adjustment March 31, April 1, account of for the Adjustment March 31, March 31, March 31,
2006 Amalgama- year ended for the 2007 2006 Amalgama- year ended for the 2007 2007 2006
tion March 31, year ended tion March 31, year ended
2007 March 31, 2007 March 31,
2007 2007
Land 31.13 22.45 14.62 – 68.20 – – – – – 68.20 31.13
Leasehold Land 0.34 158.28 134.72 5.63 287.71 0.02 120.34 12.86 4.88 128.34 159.37 0.32
Building 274.14 139.64 142.22 – 556.00 84.79 31.78 18.17 – 134.74 421.26 189.35
Plant & Machinery 30,541.12 15,698.78 22,104.76 80.28 68,264.38 10,893.76 8,946.60 5,480.49 71.26 25,249.59 43,014.79 19,647.36
Furniture & Fixture 385.86 64.46 82.48 8.23 524.57 258.59 33.22 46.57 6.08 332.30 192.27 127.27
Office Equipment 341.45 154.41 72.45 5.31 563.00 278.23 109.17 48.06 4.85 430.61 132.39 63.22
Vehicles 89.69 42.31 244.01 20.23 355.78 60.92 13.78 36.88 15.41 96.17 259.61 28.77
Sub-Total 31,663.73 16,280.33 22,795.26 119.68 70,619.64 11,576.31 9,254.89 5,643.03 102.48 26,371.75 44,247.89 20,087.42
Less : Pre-operative
– – – – – – – 6.37 – – – –
Charge Capitalised
TOTAL 31,663.73 16,280.33 22,795.26 119.68 70,619.64 11,576.31 9,254.89 5,636.66 102.48 26,371.75 44,247.89 20,087.42
Previous Year 26,975.24 – 4,765.09 76.60 31,663.73 8,999.91 2,628.80 52.40 11,576.31 20,087.42
Notes:
1. Exchange difference of Rs. 51.75 mn (Previous year loss of Rs. 17.53 mn) being gain on foreign exchange fluctuation relating to acquisition of fixed assets has been adjusted to relevant fixed assets.
2. Plant & Machinery includes assets held for disposal - Gross Block Rs. 93.84 mn, Net block Rs. 45.00 mn.
SCHEDULE 5B
intangible ASSETS (Rs. in million)
Gross Block Amortisation Net Block
Particulars As at Additions on Additions Sale/ As at As at Additions on Additions Sale/ As at As at As at
April 1, account of for the Adjustment March 31, April 1, account of for the Adjustment March 31, March 31, March 31,
2006 Amalgama- year ended for the 2007 2006 Amalgama- year ended for the 2007 2007 2006
tion March 31, year ended tion March 31, year ended
2007 March 31, 2007 March 31,
2007 2007
Entry/License Fees 14,394.34 4,250.79 2,061.60 – 20,706.73 6,449.26 1,813.56 992.34 – 9,255.16 11,451.57 7,945.08
Computer - Software 451.11 73.14 174.70 – 698.95 308.80 53.82 111.48 – 474.10 224.85 142.31
Sub-Total 14,845.45 4,323.93 2,236.30 – 21,405.68 6,758.06 1,867.38 1,103.82 – 9,729.26 11,676.42 8,087.39
Less : Pre-operative
– – – – – – – 22.43 – – – –
Charge Capitalised
TOTAL 14,845.45 4,323.93 2,236.30 – 21,405.68 6,758.06 1,867.38 1,081.39 – 9,729.26 11,676.42 8,087.39
Previous Year 14,711.11 134.34 – 14,845.45 5,911.49 846.57 – 6,758.06 8,087.39
Notes:
The remaining amortisation period of licence fees as at March 31, 2007 ranges between 8 to 20 years based on the respective telecom service licence period.
35
(Rs. in million)
As at As at
March 31, 2007 March 31, 2006
SCHEDULE 6
INVESTMENTS
Unquoted
Investments in Shares of Subsidiaries
Aditya Birla Telecom Limited (Refer Note B 3(b) to Schedule 22)
10,000,000 fully paid equity shares of Rs. 10 each 100.00 –
Idea Mobile Communications Limited (Refer Note B 4(c) to Schedule 22)
526,000,000 fully paid equity shares of Rs. 10 each – 2,600.00
Sapte Investments Private Limited (Refer Note B 4(c) to Schedule 22)
10,800,000 fully paid equity shares of Rs. 10 each – 108.00
Vsapte Investments Private Limited (Refer Note B 4(c) to Schedule 22)
Bhagalaxmi Investments Private Limited (Refer Note B 4(c) to Schedule 22)
Asian Telephone Services Limited (Refer Note B 4(c) to Schedule 22)
Swinder Singh Satara & Co. Limited
50,000 fully paid equity shares of Rs. 10 each 38.31 38.31
138.31 3,070.31
SCHEDULE 7
INVENTORIES
(At lower of cost or estimated realisable value)
Trading Goods 0.45 0.22
Sims and Other Cards 178.65 87.89
179.10 88.11
SCHEDULE 8
SUNDRY DEBTORS
Debts outstanding for over six months
Unsecured - Considered good 26.39 137.13
- Considered doubtful 2,081.18 1,574.53
2,107.57 1,711.66
Other Debts
Unsecured - Considered good 1,498.38 771.05
- Considered doubtful 144.54 66.40
1,642.92 837.45
Less : Provision for doubtful debts 2,225.72 1,640.93
1,524.77 908.18
Sundry Debtors include certain parties from whom Security Deposits of Rs. 161.12 mn
(Previous Year Rs. 138.07 mn) have been taken and are lying with the Company
SCHEDULE 9
CASH AND BANK BALANCES
Cash and Cheques on Hand 229.22 109.58
Balances with Scheduled Banks
– in Current Accounts 998.40 291.66
– in Deposit Accounts 16,969.66 889.67
(Includes unutilised Initial Public Offer proceeds of Rs. 15,504.50 mn)
18,197.28 1,290.91
36
(Rs. in million)
As at As at
March 31, 2007 March 31, 2006
SCHEDULE 10
OTHER CURRENT ASSETS
Unbilled Revenue 640.15 451.18
Interest Receivable on Deposits with Scheduled Banks 117.25 0.17
757.40 451.35
SCHEDULE 11
LOANS AND ADVANCES
(Unsecured, considered good unless otherwise stated)
Advances recoverable in cash or kind or for value to be received
– Considered good 3,284.12 792.78
– Considered doubtful 90.84 1.12
Less : Provision for doubtful advances 90.84 1.12
3,284.12 792.78
Share Application money with Subsidiaries – 28.35
Advance for purchase of Equity Shares/Licences – 150.00
Deposits with Body Corporates/Subsidiaries 47.62 12,406.56
Deposits and Balances with Govt. Authorities 109.83 56.31
Deposits with others 382.34 107.47
Advance Income Tax 210.67 93.48
Advance Fringe Benefit Tax (Net of Provision of Rs. 87.46 mn) 5.99 –
4,040.57 13,634.95
SCHEDULE 12
CURRENT LIABILITIES AND PROVISIONS
Current Liabilities
Sundry Creditors 16,108.74 5,433.94
Book Bank Overdraft 665.03 374.29
Advances from Customers 2,565.34 1,130.05
Deposits from Customers 570.08 293.73
Other Liabilities 1,054.58 390.38
Interest accrued but not due 17.61 –
20,981.38 7,622.39
Provisions
Gratuity (Refer Note B 23 to Schedule 22) 29.41 33.86
Leave Encashment (Refer Note B 24 to Schedule 22) 255.72 69.02
Site Restoration Cost (Refer Note B 31 to Schedule 22) 253.26 6.70
Provision for Fringe Benefit Tax (Previous year Net of Advance Tax Rs. 24.68 mn) – 4.34
538.39 113.92
21,519.77 7,736.31
37
(Rs. in million)
For the year For the year
ended ended
March 31, 2007 March 31, 2006
SCHEDULE 13
OTHER INCOME
Liabilities/Provisions no longer required written back 174.94 86.12
Gain on Sale of Fixed Assets/Asset disposed off 1.92 4.80
Miscellaneous Receipts 32.43 14.78
209.29 105.70
SCHEDULE 14
COST OF TRADING GOODS SOLD (Refer Note B 15 & 19 to Schedule 22)
Opening Stock 0.22 0.28
Add : Opening Stock acquired on amalgamation 12.19 –
Add : Purchases (net of transfer to consumables) 40.60 0.37
Less : Handset Capitalised 0.83 0.43
Closing Stock 0.45 0.22
51.73 –
SCHEDULE 15
PERSONNEL EXPENDITURE
Salaries and Allowances etc. 2,253.45 1,030.65
Contribution to Provident and Other Funds 127.15 61.25
Staff Welfare 133.72 58.89
Recruitment and Training 94.14 34.05
2,608.46 1,184.84
SCHEDULE 16
NETWORK OPERATING EXPENDITURE
Security Service Charges 559.57 194.68
Power and Fuel 1,094.57 378.56
Repairs and Maintenance - Plant and Machinery 1,170.32 724.01
Switching & Cellsites Rent 495.58 245.61
Lease Line and Connectivity Charges 1,382.78 491.63
Network Insurance 17.47 11.48
Other Network Operating expenses 615.43 128.49
5,335.72 2,174.46
SCHEDULE 17
LICENCE AND WPC CHARGES
Licence Fees 2,777.79 1,423.08
WPC and Spectrum Charges 1,709.22 785.11
4,487.01 2,208.19
SCHEDULE 18
ROAMING & ACCESS CHARGES
Roaming Charges 974.09 683.62
Access Charges 6,346.87 2,775.49
7,320.96 3,459.11
38
(Rs. in million)
ended ended
March 31, 2007 March 31, 2006
SCHEDULE 19
SUBSCRIBER ACQUISITION & SERVICING EXPENDITURE
Cost of Sim and Other Cards 268.59 196.18
Commission and Discount to Dealers & Others 3,135.50 1,285.28
Customer Verification Expenses 178.72 47.52
Collection & Telecalling Expenses 749.91 251.14
Prepaid Recharge Expenses 1,257.15 453.91
Customer Retention & Customer Loyalty Expenses 53.40 23.97
5,643.27 2,258.00
SCHEDULE 20
ADMINISTRATION & OTHER EXPENSES
Repairs and Maintenance – Building 16.59 9.69
– Others 56.24 26.37
Other Insurance 21.47 11.99
Non Network Rent 146.78 63.00
Rates and Taxes 94.66 43.47
Electricity 82.55 47.60
Printing and Stationery 57.28 28.80
Communication Expenses 90.42 40.13
Travelling and Conveyance 277.13 126.89
Provision for bad and Doubtful Debts/Advances 368.17 194.13
Bank Charges 106.71 58.41
Directors Sitting Fees 0.60 –
Legal and Professional Charges 101.28 64.09
Audit Fees (Refer Note B 10 to Schedule 22 ) 14.31 3.80
Miscellaneous Expenses 126.12 62.21
1,560.31 780.58
SCHEDULE 21
FINANCE AND TREASURY CHARGES (NET)
Interest – On Fixed Period Loan 3,048.92 2,337.43
– Others 171.60 45.97
Financing Charges 72.58 149.09
3,293.10 2,532.49
Less :
Interest Received (Gross of Tax) (includes interest on unutilised Initial 170.76 22.30
Public Offer proceeds of Rs. 117.07 mn)
Profit on Sale of Current Investments 81.25 10.39
Gain/(Loss) on Foreign Exchange Fluctuation (9.97) (0.30)
3,051.06 2,500.10
39
SCHEDULE 22
A. Significant Accunting Policies
1. Basis of Preparation of Financial Statements :
The Financial Statements have been prepared under the historical cost convention on accrual basis. The mandatory
applicable Accounting Standards in India and the provisions of the Companies Act, 1956 have been followed in
preparation of these Financial Statements.
2. Fixed Assets :
Fixed Assets are stated at cost of acquisition and installation less accumulated depreciation. Cost is inclusive of
freight, duties, levies and any directly attributable cost of bringing the assets to their working condition for intended
use.
Site restoration cost obligations are capitalised based on a constructive obligation as a result of past events, when it
is probable that an outflow of resources will be required to settle the obligation and a reliable estimate of the amount
can be made. Such costs are depreciated over the remaining useful life of the asset.
3. Expenditure during pre-operative period of licence :
Expenses incurred on Project and other charges during construction period are included under pre-operative expenditure
(grouped under Capital Work in Progress) and are allocated to the cost of Fixed Assets on the commencement of
commercial operations.
4. Depreciation and amortisation :
Depreciation on Fixed Assets is provided on straight-line method on the basis of estimated useful economic lives as
given below :
Tangible Assets Years
Buildings 10 to 30
Network Equipments 10 to 13
Other Plant and Machineries 5
Office Equipments 3 to 9
Computers 3
Furniture and Fixtures 3 to 10
Motor Vehicles 4 to 5
Leasehold Improvements Period of lease
Intangible Assets :
i) Cost of Rights and Licences including the fee paid on fixed basis prior to revenue share regime, is amortised on
commencement of operations over the period of licence.
ii) Software, which is not an integral part of Hardware, is treated as Intangible asset and is amortised on straight-
line basis over their useful economic lives, estimated by the management between 3 to 5 years.
5. Inventories :
Inventories are valued at cost or net realisable value, whichever is lower. Cost is determined on weighted average
basis.
40
6. Foreign currency transactions :
Transactions in foreign currency are recorded at the exchange rates prevailing at the dates of the transactions. Gains/
Losses arising out of fluctuation in exchange rates on settlement are recognised in the profit and loss account, except
in case of fixed assets where such gains/losses are adjusted to the carrying cost of the respective assets.
Foreign currency monetary assets and liabilities are restated at the exchange rate prevailing at the Period end and
the overall net gain/loss is adjusted to the profit and loss account, except in case of liabilities relating to acquisition
of fixed assets which are adjusted to the carrying cost of the respective assets.
In case of Forward Exchange Contracts, the difference between the forward rate and the exchange rate at the date of
transaction is recognised in the profit and loss account over the life of the contract, except in case of liabilities relating
to acquisition of fixed assets, which are adjusted to the carrying cost of the respective asset.
7. Taxation :
a) Current Tax : Provision for current income tax is made on the taxable income using the applicable tax rates and
tax laws.
b) Deferred Tax : Deferred tax arising on account of timing differences and which are capable of reversal in one or
more subsequent periods is recognised using the tax rates and tax laws that have been enacted or substantively
enacted. Deferred Tax assets are not recognised unless there is virtual certainty with respect to the reversal of
the same in future years.
8. Retirement Benefits :
Contributions to Provident and pension funds are funded with the appropriate authorities and charged to the Profit
and Loss Account.
Contributions to superannuation are funded with the Life Insurance Corporation of India and charged to the Profit and
Loss Account.
Liability for gratuity as at the year end is provided on the basis of actuarial valuation and funded with Life Insurance
Corporation of India.
Provision in accounts for leave benefits to employees is based on the revised AS-15, which is as under :
a) Actuarial valuation done by projected accrued benefit method at the period end for long-term compensated
absences.
b) On undiscounted basis for the portion of accumulated leave which an employee can encash during the short
term period.
9. Revenue Recognition and Receivables :
Revenue on account of mobile telephony services and sale of handsets and related accessories is recognized net
of rebates, discount, service tax, etc. on rendering of services and supply of goods respectively. Recharge fees on
recharge vouchers is recognised as revenue as and when the recharge voucher is activated by the subscriber.
Unbilled receivables, represent revenues recognised from the bill cycle date to the end of each month. These are
billed in subsequent periods as per the terms of the billing plans.
Debts (net of security deposits outstanding there-against) due from subscribers, which remain unpaid for more than
90 days from the date of bill and/or other debts which are otherwise considered doubtful, are provided for.
Provision for doubtful debts on account of Interconnect Usage Charges (IUC), Roaming Charges and passive
infrastructure sharing from other telecom operators is made for dues outstanding more than 180 days from the date
of billing other than cases when an amount is payable to that operator or in specific case when management is of the
view that the amount is recoverable.
41
10. Investments :
Current Investments are stated at lower of cost or fair value in respect of each separate investment.
Long-term investments are stated at cost less provision for diminution in value other than temporary, if any.
11. Borrowing Cost :
Interest and other costs incurred in connection with the borrowing of the funds are charged to revenue on accrual
basis except those borrowing costs which are directly attributable to the acquisition or construction of those fixed
assets, which necessarily take a substantial period of time to get ready for their intended use. Such costs are
capitalised with the fixed assets.
12. Licence Fees – Revenue Share :
With effect from August 1, 1999 the variable Licence fee computed at prescribed rates of revenue share is being
charged to the Profit and Loss Account in the period in which the related revenue arises. Revenue for this purpose
comprises adjusted gross revenue as per the licence agreement of the licence area to which the licence pertains.
13. Contingent Liability :
Disclosure for contingent liabilities are considered to the extent of notices/demands received by the Company.
14. Leases :
a) Operating : Lease of assets under which significant risks and rewards of ownership are effectively retained by the
lessor are classified as operating leases. Lease payments under an operating lease are recognised as expense
in the Profit and Loss Account, on a straight-line basis over the lease term.
b) Finance : Leased assets acquired on which significant risk and reward of ownership effectively transferred to the
Company are capitalised at lower of fair value or the amounts paid under such lease arrangements. Such assets
are amortised over the period of lease.
15. Earnings Per Share :
The earnings considered in ascertaining the Company’s EPS comprises the net profit after tax, after reducing dividend
on Cumulative Preference Shares for the period (irrespective of whether declared, paid or not), as per Accounting
Standard 20 – Earning Per Share, issued by the Institute of Chartered Accountants of India. The number of shares
used in computing basic EPS is the weighted average number of shares outstanding during the period. The diluted
EPS is calculated on the same basis as basic EPS, after adjusting for the effects of potential dilutive equity shares
unless the effect of the potential dilutive equity shares is anti-dilutive.
16. Impairment of Assets :
Assets that are subject to impairment are reviewed for impairment whenever events or changes in circumstances
indicate that the carrying amount may not be recoverable. An impairment loss is recognised for the amount by which
the assets carrying amount exceeds its recoverable amount. The recoverable amount is higher of the assets fair value
less costs to sell and value in use. For the purpose of impairment, assets are grouped at the lowest levels for which
there are separately identifiable cash flows (Cash Generating Units, i.e. Licensed Telecom Service Areas).
17. Provisions :
Provisions are recognised when the Company has a present obligation as a result of past events; it is more likely that
an outflow of resources will be required to settle the obligation; and the amount has been reliably estimated.
18. Issue Expenditure :
Expenses incurred in connection with issue of equity shares are adjusted against share premium.
42
B. notes to accounts
1. Initial Public Offer (IPO)

During the year, the Company completed a Public Issue of 283,333,333 Equity Shares of Rs. 10 each for cash at a
price of Rs. 75 each aggregating to Rs. 21,250.00 mn following a Pre IPO placement of 50,000,000 equity shares of
Rs. 10 each amounting to Rs. 3,750.00 mn at the above mentioned price. The premium of Rs. 65 per share,
amounting to Rs. 21,666.66 mn from both the allotments has been credited to Share Premium Account. The Share
Premium Account stands net of share issue expenses of Rs. 620.04 mn.
Pursuant to the Public Issue, shares of the Company are listed on National Stock Exchange and Bombay Stock
Exchange effective March 9, 2007.
The Company also opted for the Green Shoe Option (GSO) of 42,500,000 equity shares of Rs. 10 each amounting to
Rs. 3,187.50 mn. As on March 31, 2007, the above amount was lying to the credit of the GSO account. This amount
was received on April 5, 2007 and equity shares were allotted on the same day.
Total object of the issue is amounting to Rs. 25,378.00 mn, Rs. 25,000.00 mn have been received from the Pre IPO
& IPO proceeds upto March 31, 2007. The balance of Rs. 378.00 mn would be met from the GSO proceeds. The
actual utilisation as per the objects of the issue is as under :
(Rs. in million)
Activity To be financed through Actual Utilisation upto
the issue proceeds March 31, 2007
Building, strengthening and expanding our network and
related services in the New Circles 9,708.00 1,312.20
Capital expenditure for NLD operations 808.00 –
Roll out for services in Mumbai Circle 6,470.00 –
Redemption of Preference Shares 7,567.00 7,563.30
Issue Expenses 825.00 620.04
Total 25,378.00 9,495.54
2. Preference Shares
The Company redeemed 483 Preference Shares of Rs. 10 mn each amounting to Rs. 4,830.00 mn alongwith
the redemption premium of Rs. 2,733.26 mn on March 26, 2007. This redemption premium is adjusted in Share
Premium account.
3. Investments
a) Idea Telecommunications Limited (ITL)
On receipt of approval from Department of Telecommunications (DoT), the Company renamed Escorts
Telecommunications Limited to Idea Telecommunications Limited effective August 1, 2006. ITL has the licence
to provide cellular services in the service areas of Rajasthan, Himachal Pradesh and Eastern Uttar Pradesh.
The Company has acquired 100% equity shares of ITL for which an advance of Rs. 150.00 mn was paid during
Financial Year 2004-05.
ITL has been subsequently merged with Idea Cellular Limited. (Refer note 4a below)
b) Aditya Birla Telecom Limited (ABTL)
The Company has acquired 100% Equity Shares of Aditya Birla Telecom Limited (ABTL) on February 28, 2007
for a total consideration of Rs. 100.00 mn. ABTL has licence to provide services under Unified Access Service
for the telecom service area of Bihar (including the State of Jharkhand).
43
4. Amalgamation of Subsidiaries
a) In accordance with the Scheme of Amalgamation of the following erstwhile wholly owned subsidiaries with the
Company,
Sr. No. Name Nature of Business
i. Idea Mobile Communications Limited
ii. BTA Cellcom Limited GSM based telecommunication services
iii. Idea Telecommunications Limited
iv. Sapte Investments Private Limited
v. Vsapte Investments Private Limited Investment companies holding shares in BTA Cellcom
vi. Bhagalaxmi Investments Private Limited Limited
vii. Asian Telephone Services Limited
as sanctioned by the Honourable High Courts of Delhi, Gujarat, Madhya Pradesh and Bombay, the assets,
liabilities, reserves and accumulated losses of the above subsidiaries were transferred to and vested in the
Company with effect from April 1, 2006. The last of the High Court Orders approving the scheme was received
on September 10, 2007 and the last of the certified copies of the High Court Orders sanctioning the scheme
was filed with the Registrar of Companies (RoC) on September 14, 2007.
In accordance with the Scheme of Amalgamation and the court orders, the Company has applied to the DoT
for transfer of telecom licences mentioned in the scheme pertaining to telecom service areas of the erstwhile
subsidiaries, namely BTA Cellcom Limited, Idea Mobile Communications Limited and Idea Telecommunications
Limited in favour of the Company. As the transfer formality of the licences is pending with DoT, the Company
has sought necessary legal opinion for giving effect in the accounts following the dissolution of the subsidiary
companies without winding up upon filing of the court order with the respective RoC’s. The Company has been
advised that the scheme is effective from the date of the filing with last certified copy of the High Court with the
RoC viz. September 14, 2007 and that the transfer formality by the DoT would be in line with Clause 10(ii) of
the licensing conditions which is as under :
“Provided that the aforesaid written consent permitting transfer or assignment will be granted; whenever a
merger of two licensee (Indian) companies is approved by the High Court but no compromise in competition
occurs in the provision of telecom service.”
The Company meets the above condition and accordingly, the scheme has been given effect to in these
accounts.
b) The amalgamation has been accounted as per “Pooling of Interest” method as prescribed by Accounting Standard
14 on –“Accounting for Amalgamations” issued by the Institute of Chartered Accountants of India. Accordingly
the assets, liabilities, reserves and accumulated losses of the above subsidiaries as at April 1, 2006 have been
taken over at their respective book values. Capital Reserve of Rs. 1,414.56 mn appearing in the books of ITL has
been taken to Capital Reserves forming part of Reserves and Surplus of the Company. The difference between
Investment values and the equity share capital of the respective companies amounting to Rs. 354.84 mn has
been adjusted from Amalgamation Reserve.
c) As per the Scheme of Amalgamation, the following entire issued, subscribed and paid-up Equity shares of
Rs. 10 each comprising of :
– 526,000,000 shares of Idea Mobile Communications Limited,
– 75,091,937 shares of BTA Cellcom Limited,
– 61,000,000 shares of Idea Telecommunications Limited,
– 10,800,000 shares of Sapte Investments Private Limited,
– 10,800,000 shares of Vsapte Investments Private Limited,
– 10,800,000 shares of Bhagalaxmi Investments Private Limited,
– 10,800,000 shares of Asian Telephone Services Limited
stand cancelled.
44
d) In view of the aforesaid amalgamation with effect from April 1, 2006, the figures for the current year are not
comparable to those of the previous year.
5. Term Loan
a) From Banks and Financial Institutions
Term Loans amounting to Rs. 35,200.00 mn secured by way of first charge/assignment ranking pari-passu
interse the lenders, are as under :
i. First charge by mortgage on all the movable and immovable properties of the Company,
ii. A first priority charge over all intangible assets of the Company,
iii. Assignment of the rights, titles and interest, on deposits, investments, bank accounts, book debts, insurance
covers, other general assets, letters of credit and guarantee or performance bond, provided in favour of the
Company.
b) Vehicle Loan
Vehicle Loan amounting to Rs.197.19 mn is secured by hypothecation of Vehicles against which the loans have
been taken.
c) Working Capital
Cash Credit amounting to Rs.0.49 mn is secured by hypothecation of all moveable assets of the Company.
6. Interest from Department of Telecommunications
The Company had recognised an income of Rs. 802.27 mn during the year ended March 31, 2003 being refund
of excess interest charged by DoT on the licence fee payable by the Company pursuant to the judgement dated
April 9, 2002 of Telecom Disputes Settlement and Appellate Tribunal (TDSAT). During the previous years, DoT
arbitrarily acknowledged an amount of Rs. 758.76 mn against Company’s claim of Rs. 802.27 mn. The Company
has represented this matter with DoT. The Company has not provided for the difference of Rs. 43.51 mn, as in the
opinion of the management, the amount is recoverable from DoT.
The Company is also entitled to interest on the amount of the refund so accrued in terms of the Supreme Court
Judgement; the recognition of revenue on account of the same has been postponed pending acceptance in this
respect by DoT. As of March 31, 2007, this case is pending before the Honurable Supreme Court.
7. Contingent Liabilities
a) On March 2, 2006, the Honourable Supreme Court passed an order adjudicating that providing of
telecommunication services cannot be termed as ‘Goods’ under the Sale of Goods Act. In view of the above
judgement, demands raised for Sales Tax on Activation of new connections, Rentals and Airtime by Sales Tax
Authorities stand extinguished. As of March 31, 2007, Sales Tax demands of Rs. 931.40 mn. are required to be
yet formally vacated by the authorities.
b) Additional carriage charges demanded by BSNL on calls to Cellone of Rs. 325.38 mn, following its appeal in the
Honurable Supreme Court over the judgement of TDSAT restraining BSNL from collecting the same from private
operators.
c) Export obligation under EPCG (Export Promotion Credit Gurantee) Scheme is Rs. 301.06 mn. (Previous year
Rs. 346.55 mn). Failure to meet this export obligation within the stipulated time frame as per Foreign Trade
Policy 2004-2009 would result in the payment of the aggregated differential duty saved amounting to
Rs. 37.72 mn along with interest thereon. The Company is confident of meeting the obligations based on its
current international in-roaming revenue trends.
d) Letter of Credit facilities, utilised as on March 31, 2007 is Rs. 3,288.00* mn (Previous year Rs. 1,972.28 mn).
* Out of the above Rs. 3,075.12 mn have been paid as on August 31, 2007.
e) During the financial year, the WPC Wing of the DoT has raised demands towards monthly compounded interest
on WPC charges for the period upto the financial year 2002-03 in respect of the telecom service areas of the
erstwhile IMCL and BTA Cellcom Ltd.
Telecom operators had paid WPC Royalty and license fees towards GSM frequency, access and back-bone
frequency charges on circle area basis as provided in the license terms from inception till financial year 2002-03
45
while the DoT demands were on city basis. The above matter was disputed by the operators and contested in
TDSAT. DoT proposed a change in the basis of levy of spectrum charges based on revenue share vide their letter
dated April 18, 2002 on the condition of its acceptance in entirety and withdrawal of all legal proceedings by
the operators. Vide their letter dated March 26, 2002, DoT had also given time to the operators to deposit the
earlier principal demands by April 15, 2002. The operators accepted the offer of change to revenue share basis
on August 23, 2002. The interest demand now raised by WPC wing of DoT for the period before April 15, 2002
is contrary to the DoT proposal in 2002.
The Company is therefore in the process of taking suitable remedial action on these demands including a notice
to the erstwhile promoter of Idea Mobile Communications Limited for Rs. 348.79 mn. In the light of the above
facts, no provision has been considered necessary to be made in the books as of March 31, 2007. However, for
obtaining clearance towards the issue of licence for its Mumbai telecom service area, the Company deposited
these interest demands of Rs. 405.02 mn under protest on November 9, 2006.
f) Other Matters not provided for
(Rs. in million)
Particulars As on As on
March 31, 2007 March 31, 2006
Income Tax Matters not acknowledged as debts 98.38 9.18
Sales Tax & Service Tax Matters not acknowledged as debts 313.83 52.64
Dividend on cumulative preference shares – 1,844.34
Other claims not acknowledged as debts 505.36 247.62
g) Estimated amount of contracts (net of advance) remaining to be executed on capital account and not provided
for.
(Rs. in million)
March 31, 2007 March 31, 2006
Estimated amount of contracts (net of advance) 10,177.57 1,444.77
8. Details of Guarantees given

(Rs. in million)
March 31, 2007 March 31, 2006
Bank Guarantees given to DoT including performance guarantees of 3,807.39 1,410.60
Rs. 1,140.00 mn (previous year Rs. 350.00 mn)
Bank Guarantees given to BSNL 241.64 162.76
Bank Guarantees given to Others 278.01 60.18
Corporate Guarantee given to others on behalf of Subsidiary Company 70.00 385.00
9. In accordance with an assignment agreement entered between the original promoters of the amalgamated subsidiary
Idea Mobile Communications Limited (IMCL) i.e. Escorts Ltd. and First Pacific Company Ltd., IMCL had issued interest
free unsecured Bond of Rs. 1,757.36 mn to Escorts Limited vide a Loan Agreement dated January 15, 2004. This
bond was in lieu of the loans from the original promoters and included accrued interest of Rs. 857.36 mn. on June
10, 2004. This Bond is repayable on January 15, 2014 and carries a put option for Escorts Limited for a period of
thirty days commencing on January 15, 2010 to redeem the entire amount or part thereof at a price which would
have been payable by the Company had the Company opted for an early redemption in accordance with the terms
of the said agreement. The Company is entitled to pre-payment and set off against certain contingent liabilities that
may crystallise after June 10, 2004.
On the request of Escorts Ltd., the Company on July 21, 2006 has consented to release the redemption proceeds of
the above loan to UTI Bank on the same terms and conditions, as mentioned in the above Loan Agreement.
46
10. Auditors’ Remuneration (exclusive of service tax) :
(Rs. in million)
Particulars For the Year ended For the Year ended
March 31, 2007 March 31, 2006
Statutory Audit Fees 8.50 3.50
Audit Fee to erstwhile subsidiary auditors 4.66 –
Tax Audit Fees 1.15 0.30
Certification and other matters (incl. in legal & professional charges) 5.58 1.30
Out of Pocket Expenses (incl. in misc. expenses) 1.35 0.50
Total Remuneration 21.24 5.60
Excludes Rs. 12.00 mn. paid to Statutory Auditors included under issue expenses forming part of Share Premium
Account.
11. CIF Value of Imports :
(Rs. in million)
Particulars For the year ended For the year ended
March 31, 2007 March 31, 2006
Capital Goods (including Spares) 9,265.67 3,314.91
12. Expenditure in Foreign Currency (on remittance basis) :

(Rs. in million)
March 31, 2007 March 31, 2006
Interest 56.15 3.91
Travel 5.44 3.46
Professional & Consultancy Fees 25.59 15.75
International Roaming Services 61.48 29.56
Others 84.26 27.59
13. Earning in Foreign Exchange (on receipt basis) :

(Rs. in million)
March 31, 2007 March 31, 2006
International Roaming Services 725.90 699.48
Others 2.14 –
14. Managerial Remuneration under Section 198 of the Companies Act, 1956 paid or payable during the
financial year is as under :
(Rs. in million)
March 31, 2007 March 31, 2006
A) Salary including perquisites 11.26 3.09
B) Contribution to provident and other fund 1.02 0.43
C) Performance Incentive 3.17 1.46
Total 15.45 4.98
The above remuneration excludes gratuity & leave encashment amounts as the same has been provided based on
actuarial valuation.
47
15. Quantitative details of goods traded :

March 31, 2007 March 31, 2006
Handsets Nos. Value Nos. Value
(Rs. in (Rs. in
million) million)
Opening Stock 234 0.22 402 0.28
Addition on Amalgamation of Subsidiaries 87 0.99 – –
Purchases (Net of Returns) 5 0.08 21 0.37
Sales – – – –
Handsets Capitalised/written off 218 0.82 189 0.43
Closing Stock 108 0.45 234 0.22
16. During the year, the Company has purchased and sold following units :
During the year ended March 31, 2007 During the year ended March 31, 2006
Qty in Rs. in Qty in Rs. in Qty in Rs. in Qty in Rs. in
Particulars ‘000 million ‘000 million ‘000 million ‘000 million
Units Purchase Units Sale Units Purchase Units Sold Sale Value
Purchased Value Sold Value Purchased Value
Birla Cash Plus - Institutional Premium Plan - Growth 838,536 9,855 838,536 9,878 27,344 300 27,344 300
Birla SunLife Cash Manager – IP – Growth 200,954 2,478 200,954 2,481 46,150 523 46,150 523
Birla Cash Plus - Institutional Growth - - - - 9,919 180 9,919 180
Canliquid Institutional Plan - Growth 15,529 200 15,529 200 47,917 598 47,917 599
DBS Chola Liquid Fund - Institutional Plus – Growth 34,861 510 34,861 511 23,128 318 23,128 318
DSP Ml Liquidity Fund- IP - Growth 70,110 735 70,110 736 17,060 285 17,060 285
DSP Ml Liquidity Fund- Regular - Growth 4,031 70 4,031 70 - - - -
DWS Insta Cash Plus Fund - IP - Growth 111,194 1,270 111,194 1,271 9,151 100 9,151 100
Deutsche Insta Cash Plus Fund - Growth Plan - - - - 7,559 85 7,559 85
Grindlays Cash Fund Plan B – Growth - - - - 17,936 225 17,936 225
HDFC Cash Mgmt Fund - Savings Plus - Growth 3,208 50 3,208 50 22,723 333 22,723 333
HDFC Cash Mgmt Fund - Savings Plan - Growth - - - - 12,263 170 12,263 170
HSBC Cash Fund - Institutional - Growth - - - - 12,309 140 12,309 140
HSBC Cash Fund - Institutional Plus - Growth 89,022 1,020 89,022 1,021 - - - -
ING Vysya Liquid Fund - IP - Growth 77,991 900 77,991 901 17,922 190 17,922 190
ING Vysya Liquid Fund - Super IP - Growth 29,005 320 29,005 320 - - - -
JM High Liquidity - I P - Growth 26,510 320 26,510 320 - - - -
JM High Liquidity - Super IP - Growth 44,326 505 44,326 505 29,588 318 29,588 318
Kotak Liquid - Inst Premium Plan - Growth 207,746 3,065 207,746 3,068 54,487 745 54,487 746
Kotak Liquid - IP - Growth 3,503 50 3,503 50 - - - -
LIC MF Liquid Fund - Growth 147,334 1,955 147,334 1,960 42,051 521 42,051 522
Principal Cash Mgmt Fund Lo- I P - Growth 12,160 145 12,160 145 4,330 50 4,330 50
Principal Cash Mgmt Fund Lo-Inst Prem. Plan-Growth 147,434 1,700 147,434 1,702 - - - -
Prudential ICICI Liquid - I P - Growth 5,658 65 5,658 65 3,032 50 3,032 50
Prudential ICICI Liquid - Inst Plus - Growth 13,012 195 13,012 195 7,880 133 7,880 133
Prudential ICICI Liquid - Super IP - Growth 350,653 3,825 350,653 3,841 - - - -
SBI Magnum Insta Cash - Cash Plan 195,026 3,255 195,026 3,265 - - - -
SBI Magnum Inst. Income - Savings Plan - Growth 11,192 130 11,192 130 22,905 251 22,905 251
SBI Magnum Instacash Fund-Short Term Plan-Growth Option - - - - 8,329 100 8,329 100
48
During the year ended March 31, 2007 During the year ended March 31, 2006
Qty in Rs. in Qty in Rs. in Qty in Rs. in Qty in Rs. in
Particulars ‘000 million ‘000 million ‘000 million ‘000 million
Units Purchase Units Sale Units Purchase Units Sold Sale Value
Purchased Value Sold Value Purchased Value
Standard Chartered Liquidity Manager Fund - Growth 107,531 1,150 107,531 1,151 4,962 50 4,962 50
Standard Chartered Liquidity Manager Fund Plus - Growth 115,737 1,215 115,737 1,216 - - - -
Tata Liquid Fund - HIP - Growth 12,047 145 12,047 145 - - - -
Tata Liquid Fund - SHIP - Growth 135,515 1,830 135,515 1,833 50,829 633 50,829 634
Tata Liquidity Management Fund - Growth 128,712 1,345 128,712 1,348 4,982 50 4,982 50
Tata Liquid Super High Investment Fund - Daily Dividend - - - - 1,346 15 1,346 15
Templeton India Treasury Management Account - Growth - - - - 2,994 50 2,994 50
Templeton India TMA - IP - Growth 5,141 60 5,141 60 - - - -
Templeton India TMA - Super IP - Growth 13,548 150 13,548 150 - - - -
UTI Liquid Fund - Cash Plan - IP - Growth 118,697 1,429 118,697 1,433 58,531 654 58,531 655
UTI Money Market - Growth 14,365 290 14,365 291 - - - -
Grand Total 3,290,288 40,232 3,290,288 40,313 567,628 7,063 567,628 7,074
17. Licences
The Company has acquired following additional licences :
National Long Distance (NLD) service licence on November 23, 2006
Unified Access Services (UAS) licence for Mumbai telecom service area on December 5, 2006
Accordingly, the Company has commenced the NLD service within its mobility circles with effect from December 1,
2006.
Applications have also been separately filed for migration of the existing CMTS to UAS licences.
18. a) Sundry Creditors as on March 31, 2007 includes an amount of Rs. 7.11 mn (Previous year Nil) outstanding to
the following small scale industries :
1. Pep Infotech Ltd.
2. Paruthi Engineers
3. M J Structures
4. Raj Engineering Works
5. Industrial Equipment Company
6. Cell-Com Teleservices Pvt. Ltd.
7. Classic Designers & Interiors Decorators
8. Chilton Refrigeration Pvt. Ltd.
9. Malayalam Industries Ltd.
10. Power World
b) The Company is in the process of identifying the suppliers, if any, covered under the Micro, Small & Medium
Enterprises Development Act, 2006. Due to non-availability of data, the details required have not been
furnished.
19. Sale & Cost of Trading Goods
The telecom service areas of UP (West), Haryana and Kerala (erstwhile subsidiary Idea Mobile Communications
Limited) were following the practice of invoicing sim cards as goods. Pursuant to Supreme Court ruling in case of
BSNL vs UOI & others and following receipt of the legal opinion sought in this regard, the above mentioned telecom
service areas have aligned their documentation in line with the service stand followed by the other telecom service
areas of the Company effective November 1, 2006. The Sale of Trading Goods & Cost of Trading Goods therefore
reflect the amounts pertaining to the period till October 31, 2006. Quantitative details of the sim cards invoiced
during April 1, 2006 to October 31, 2006 is as follows :
49
For the Year ended March 31, 2007
Sim Cards Value
Nos.
(Rs. in million)
Addition on amalgamation of Subsidiaries 632,676 11.20
Purchases (Net of Returns) 3,092,272 55.57
Issues # 1,135,462 15.05
Sales 2,589,486 163.84
# include 1,132,592 no. of Sim Cards consumed in the course of providing services w.e.f. November 1, 2006.
20. During the year ended March 31, 2007, there is no accelerated depreciation (Previous year Rs. 82.99 mn) provided
on any of the fixed assets.
21. Capital work-in-progress includes equipment and machinery in stock, advances for construction and erection work,
expansion project and the following pre-operative expenses pending allocation
(Rs. in million)
March 31, 2007 March 31, 2006
Salaries and Allowances 92.73 42.52
Contribution to Provident and other funds 0.23 2.88
Power and Fuel 4.83 1.39
Repairs & Maintenance – Plant & Machinery 2.38 –
Insurance 1.97 0.48
Rent 28.60 11.93
Travelling & Conveyance 8.50 4.80
Legal and Professional Fees – 1.45
Miscellaneous Expenses 0.83 –
Operational Vehicle Running Expenses 10.66 2.84
Total 180.74 73.73
Add : Balance brought forward from previous year 14.80 0.56
Add : Addition on amalgamation of Subsidiaries 0.35 –
Less : Capitalised during the period 173.11 59.49
Balance carried forward 22.78 14.80
22. Details of foreign currency exposures that are not hedged by a derivative instrument or otherwise :
(Rs. in million)
Particulars As on March 31, As on March 31,
2007 2006
Sundry Creditors :
Sundry Creditors in USD 103.42 50.76
Sundry Creditors in EURO 2.18 –
Sundry Creditors in NOK – 0.01
Sundry Creditors in GBP 0.02 0.01
The Equivalent INR of sundry creditors in Foreign Currency 4,636.13 2,270.41
Sundry Debtors :
Sundry Debtors in USD 5.20 2.25
The Equivalent INR of sundry debtors in Foreign Currency 226.72 100.40
50
23. Provision for Gratuity
The following table sets out the status of the gratuity plan as required under Accounting Standard -15 on “Employee
Benefits”
Reconciliation of opening and closing balances of the present value of the defined benefit obligation
(Rs. in million)
Sr. Particulars Policy Policy Policy Policy
No. MP. No. MP. No. MP. No. MP. No.
5092145 634757 109254 304606
1 Assumptions : As on March 31, 2007
Discount Rate 7.50% 7.50% 8.00% 7.50%
Salary Escalation 5.00% 5.00% 7.00% 5.00%
2 Table showing changes in present value of obligations As on March 31, 2007
Present value of obligations as at beginning of year 4.09 33.79 5.02 13.48
Interest cost 0.31 2.53 0.40 1.01
Current Service Cost 1.18 6.79 1.53 3.07
Benefits paid 0.96 2.98 0.16 0.85
Actuarial Loss on obligations 2.59 5.29 1.40 7.25
Present value of obligations as at end of year 7.21 45.42 5.38 23.96
3 Table showing changes in the fair value of plan assets As on March 31, 2007
Fair value of plan assets at beginning of year 3.19 12.75 2.71 17.74
Expected return on plan assets 0.24 0.96 0.22 1.60
Contributions 0.92 10.75 0.85 13.86
Benefits paid 0.96 2.98 0.16 0.85
Actuarial Gain on Plan assets 0.07 0.21 0.04 0.31
Fair value of plan assets at the end of the year 3.46 21.99 3.68 32.67
4 Table showing fair value of plan assets
Fair value of plan assets at beginning of year 3.19 12.75 2.71 17.74
Actual return on plan assets 0.29 1.16 0.24 1.60
Contributions 0.92 10.75 0.85 13.86
Benefits paid 0.96 2.98 0.16 0.85
Funded status (3.75) (23.42) (1.71) 8.71
Excess of Actual over estimate return on plan assets 0.05 (23.42) 0.02 NIL
(Actual rate of return = Estimated rate of return as ARD falls on March 31)
5 Actuarial Gain/Loss recognised As on March 31, 2007
Actuarial Gain/(Loss) for the year – Obligation (2.59) (5.29) 1.40 7.25
Actuarial Gain for the year – plan assets 0.07 0.21 0.04 0.31
Total Gain/(Loss) for the year (2.52) (5.08) 1.44 6.93
Actuarial Gain/(Loss) recognised in the year (2.52) (5.08) 1.44 6.93
6 The amounts to be recognised in Balance Sheet and Statement of Profit and Loss
Present value of obligations as at the end of the year 7.21 45.42 5.38 23.96
Fair value of plan assets as at the end of the year 3.46 21.99 3.68 32.67
Funded status (3.75) (23.42) (1.71) 8.71
Net liability recognised in Balance Sheet 3.54 23.42 2.45 -
7 Expenses Recognised in Statement of Profit & Loss
Current Service cost 1.18 6.79 1.53 3.07
Interest cost 0.31 2.53 0.40 1.01
Net Actuarial loss recognised in the year 2.52 5.08 1.44 6.93
Expenses recognised in statement of Profit & Loss 3.77 13.44 0.27 9.41
51
24. Provision for Leave Encashment
The Company had provided for the leave encashment as per the actuarial valuation till March 31, 2006 as required
then by Accounting Standard-15 on “Accounting for Retirement Benefits in the Financial Statements of Employers”.
With revision in Accounting Standard-15 on “Employee Benefits”, the Company has recalculated its liability towards
accumulated leave balances. As per the transitional provisions of revised Accounting Standard-15 on “Employee
Benefits”, the charge for the period prior to March 31, 2006 amounting to Rs. 122.67 mn has been adjusted in the
opening balance of Profit and Loss Account.
25. Segment Reporting
a) Primary Segments :
The Company operates in two business segments:
a) Cellular Mobile Telephony Services (CMTS)
b) National Long Distance (NLD)
b) Secondary Segment :
The Company caters only to the needs of Indian market representing a singular economic environment with
similar risks and rewards and hence there are no reportable geographical segments.
Primary Business Information (Business Segments) for FY 2006-07
(Rs. in million)
Particulars Business Segments Elimination Total
Mobility NLD
Revenue
External Revenue 43,873.29 - - 43,873.29
Inter-segment Revenue - 778.96 (778.96) -
Total Revenue 43,873.29 778.96 (778.96) 43,873.29
Segment Result 7,984.80 156.78 - 8,141.58
Interest & Financing Charges (Net) - - - 3,051.06
Profit before Tax - - - 5,090.52
Provision for Tax (Net) - - - 69.91
Profit after Tax 5,020.61
Other Information
Segment Assets 68,338.36 234.39 (209.09) 68,363.66
Unallocated Corporate Assets - - - 17,463.23
Total Assets 68,338.36 234.39 (209.09) 85,826.89
Segment Liabilities 64,156.29 77.61 (209.09) 64,024.81
Unallocated Corporate Liabilities - - 10.55
Total Liabilities 64,156.29 77.61 (209.09) 64,035.36
Capital Expenditure 27,951.20 25.00 - 27,976.20
Depreciation & Amortisation 6,717.61 0.44 - 6,718.05
Previous years figures are not given as in previous year there was only one segment and NLD services started
during the current financial year w.e.f. December 1, 2006.
26. Related Party Transactions
a) As per Accounting Standard-18 on “Related Party Disclosure” issued by the Institute of Chartered Accountants
of India, related parties of the Company are disclosed below :
List of Related Parties :
Promoters
Hindalco Industries Limited
52
Grasim Industries Limited
Aditya Birla Nuvo Limited (formerly known as Indian Rayon and Industries Limited)
Tata Industries Limited (upto June 20, 2006)
Apex Investments (Mauritius) Holding Private Limited (formerly AT & T Cellular Pvt. Limited)
(upto June 20, 2006)
Birla TMT Holdings Pvt. Limited
Aditya Birla Telecom Limited (upto August 28, 2006)
Subsidiaries
Aditya Birla Telecom Limited (w.e.f. February 28, 2007)
Key Management Personnel
Mr. Sanjeev Aga, Managing Director (w.e.f. November 1, 2006)
Mr. Vikram Mehmi, Chief Executive Officer (upto October 30, 2006)
Mr. Satish Rajgarhia, Manager (upto August 31, 2006)
Mr. AJS Jhala, Chief Financial Officer (w.e.f. August 7, 2006)
Disclosure in respect of Related Parties
Transactions during the year ended March 31, 2007 :
(Rs. in million)
Particulars Nature of Relationship
Key Management
Promoters Subsidiaries
Personnel
ICDs Placed 100.00
- -
(0.15)
Interest on ICDs Placed - 2.76 -
Repayment of ICDs Placed 60.00
Remuneration 31.43
- -
(17.92)
Purchase of Shares 100.00 - -
Purchase of Services -
- -
(74.22)
Sale of Services -
- -
(81.92)
Purchase of Fixed Assets 5.39 -
-
(0.57)
Sale of Fixed Assets - -
-
(0.03)
Unsecured Loans received - -
-
(3,760.59)
Unsecured Loans given - 4.87
-
(8,663.69)
Expense incurred by Company on behalf of 0.01 - -
Expense incurred on Company’s behalf by 1.71 - -
Rent Paid 2.70
- -
(2.70)
(Figures in bracket are for the period ended March 31, 2006)
53
Outstanding as on March 31, 2007 :
(Rs. in million)
Nature of Relationship
Particulars Key Management
Promoters Subsidiaries
Personnel
ICDs Placed 40.00
- -
(6,463.87)
Unsecured Loan taken 0.80
- -
(1,028.53)
Unsecured Loan given 7.63
- -
(5,932.85)
Remuneration Payable - - 7.51
Accounts Payable 0.13 - -
Corporate Guarantee 70.00
- -
(85.00)
(Figures in bracket are for the period ended March 31, 2006)
b) Disclosures of amounts at the year end and the maximum amount of loans & advances outstanding during the
year.
(Rs. in million)
Name of Subsidiary Outstanding as on Maximum
March 31, 2007 outstanding during
the year
Aditya Birla Telecom Limited 40.00 100.00
27. The Company has entered into non-cancellable operating leases for periods ranging from 36 months to 60 months.
The total minimum lease payments amounting to Rs. 45.17 mn for the current year, in respect thereof, included
under rent.
The future lease payments in respect of the above are as follows.
(Rs. in million)
Particulars Not later than Later than one year Later than five
one year but not later than years
five years
Minimum Lease payments 162.39 592.48 -
28. Basic & Diluted Earning Per Share

For the year ended For the year ended
on March 31, 2007 on March 31, 2006
Nominal value of Equity Shares (Rs.) 10/- 10/-
Profit after Tax (Rs. in million) 5,020.61 1,256.03
Less : Preference Share Dividend (Rs. in million) - 434.96
Profit attributable to equity shareholders (Rs. in million) 5,020.61 821.07
Weighted average number of equity shares outstanding during the
year 2,291,992,960 2,259,527,206
Basic Earnings Per Share (Rs.) 2.19 0.36
Shares to be issued under Green Shoe Option 42,500,000 -
Weighted average number of diluted equity shares 2,334,492,960 2,259,527,206
Diluted Earnings Per Share (Rs.) 2.15 0.36
54
29. Deferred Tax
As of March 31, 2007, the Company has deferred tax liability of Rs. 820.74 mn. and deferred tax asset of
Rs. 810.19 mn as under :
(Rs. in million)
Particulars As at March 31, As at March 31,
2007 2006
Deferred Tax Liability :
Depreciation of Fixed Assets 742.05 529.43
Amortisation of Entry & Licence Fee (Net) 78.69 48.82
Total Deferred Tax Liability 820.74 578.25
Deferred Tax Asset :
Provision for Doubtful Debts 756.52 552.71
Provision for Leave Encashment 53.67 23.23
Provision for Gratuity - 2.31
Total Deferred Tax Asset 810.19 578.25*
Net Deferred Tax Liability 10.55 -
* Deferred Tax Assets recognised to the extent of Deferred Tax Liability
30. In terms of the requirements of the Accounting Standard - 28 on “Impairment of Assets” issued by the Institute of
Chartered Accountants of India, the amount recoverable against Fixed Assets has been estimated at the period end by
the management based on the present value of estimated future cash flows expected to arise from the continuing use
of such assets. The recoverable amount so assessed was found to be adequate to cover the carrying amount of the
assets, therefore no provision for impairment in value thereof has been considered necessary, by the management.
31. The movement in the Site Restoration Cost is set out as follows :
(Rs. in million)
March 31, 2007 March 31, 2006
Opening Balance 6.70 -
Addition on amalgamation of Subsidiaries 115.91 -
Additional Provision 137.35 6.70
Payment/Reversal/Expenses 6.70 -
Closing Balance 253.26 6.70
32. Previous year’s figures have been re-grouped/re-arranged wherever necessary to conform to the current period
grouping.
55
Cash flow statement for the year ended march 31, 2007
(Rs. in million)
March 31, 2007 March 31, 2006

A) Cash Flow from Operating Activities
Net Profit after Tax 5,020.61 1,256.03
Adjustments for
Depreciation 5,636.66 2,628.80
Amortisation of Intangible Assets 1,081.39 846.57
Interest Charge and Forex 3,051.06 2,529.57
Profit on Sale of Current Investment (81.25) (10.39)
Provision for Bad & Doubtful Debts/Advances 368.17 194.13
Provision for Gratuity, Leave Encashment &
Site Restoration Cost 153.54 20.84
Provision for Fringe Benefit Tax 59.36 29.02
Provision for Deferred Tax 10.55 –
Liability no longer required written back (174.94) (91.23)
Interest Received (170.76) (22.30)
(Profit)/Loss on sale of Fixed Assets/Assets Discarded (1.92) 1.19
9,931.86 6,126.20
Operating profit before working capital changes 14,952.47 7,382.23
Changes in Current Assets and Current Liabilities
(Increase)/Decrease in Sundry Debtors (590.08) (4.17)
(Increase)/Decrease in Inventories (69.97) 46.55
(Increase)/Decrease in Other Current Assets 27.79 (124.86)
(Increase)/Decrease in Loans and Advances (2,043.67) (179.13)
Increase/(Decrease) in Current Liabilities 3,871.52 1,144.16
1,195.59 882.55
Cash generated from operations 16,148.06 8,264.78
Tax (paid)/Refund ( FBT & TDS ) (96.97) (43.27)
Net cash from Operating Activities 16,051.09 8,221.51
B) Cash Flow from Investing Activities
Purchase of Fixed Assets & Intangible Assets
(including CWIP) (22,815.17) (2,924.95)
Proceeds from sale of Fixed Assets 19.12 23.01
Short Term Deposits with Subsidiaries – (0.15)
Payment for purchase of Shares (100.00) –
Sale/(purchase) of Other Investments 81.25 –
Interest and Dividend Received 63.91 32.69
Net cash from/(used in) investing activities (22,750.89) (2,869.40)
C) Cash Flow from Financing Activities
Proceeds from issue of Share Capital 25,000.00 –
Share Issue Expenses (620.04) –
Repayment of Preference Share Capital (4,830.00) –
Premium on redemption of Preference Shares (2,733.26) –
Proceeds from Long Term Borrowings 35,397.20 –
Repayment of Long Term Borrowings (15,690.05) (2,217.75)
Proceeds from Short Term Loan 17,874.66 16,120.00
Repayment of Short Term Loan (27,958.54) (12,702.21)
Short Term Loans from/to Subsidiary & Other Body Corporate – (4,099.41)
Interest Paid (3,039.25) (2,680.71)
56
Cash flow statement for the year ended march 31, 2007
(Rs. in million)
March 31, 2007 March 31, 2006

Net cash from/(used in) financing activities 23,400.72 (5,580.08)
Net increase/(decrease) in cash and cash equivalent 16,700.92 (227.97)
Cash and cash equivalent at the beginning 1,290.91 1,518.88
Add : Cash and Cash Equivalents acquired on account
of amalgamation 205.45 –
Cash and cash equivalent at the end 18,197.28 1,290.91
Notes to Cash Flow Statement for the year ended March 31, 2007
1 Cash and cash equivalent includes
- on Current Accounts 998.40 291.66
- on Deposit Accounts 16,969.66 889.67
18,197.28 1,290.91
2. The above cash flow statement has been prepared under the indirect method as set out in Accounting Standard - 3 on “Cash Flow
Statement” issued by Institute of Chartered Accountants of India.
3. Refer Note B4 to Schedule 22 for details of amalgamation of erstwhile subsidiaries with the Company.
4. Previous year’s figures have been re-arranged/re-grouped wherever necessary.
57
balance Sheet Abstract and company’s general business profile
I. REGISTRATION DETAILS
Registration No. 3 0 9 7 6 State Code 0 4 Date 1 4 0 3 1 9 9 5
Date Month Year
Balance Sheet date 3 1 0 3 2 0 0 7
II. CAPITAL RAISED DURING THE YEAR (Rupees in Thousand)

Public Issue Rights Issue
2 8 3 3 3 3 3 N I L
Bonus Issue Private Placement
N I L 5 0 0 0 0 0
III. POSITION OF MOBILISATION AND DEPLOYMENT OF FUNDS (Rupees in Thousand)
Total Liabilities Total Assets
8 8 8 1 5 6 8 0 8 8 8 1 5 6 8 0
SOURCES OF FUNDS
Paid-up Capital Reserves and Surplus
2 5 9 2 8 6 0 0 2 0 3 7 1 4 9 0
Secured Loans Unsecured Loans
3 5 3 9 7 6 8 0 7 1 0 7 3 6 0
Net Fixed Assets Investments
6 0 9 8 9 4 6 0 1 3 8 3 1 0
Net Current Assets/(Liability) Miscellaneous Expenditure
3 1 7 9 3 5 0 N I L
Accumulated Losses
2 4 5 0 8 5 6 0
IV. PERFORMANCE OF COMPANY (Rupees in Thousand)

Turnover Total Expenditure
4 3 8 7 3 2 9 0 2 5 9 6 2 6 0 0
(includes other income) (Includes prior period adjustments)
+ – Profit/(Loss) Before Tax + – Profit/(Loss) After Tax
+ 5 0 9 0 5 2 0 + 5 0 2 0 6 1 0
(Please tick appropriate box + for profit- for loss)
Earnings Per Share before Tax and exceptioal items (weighted) (Rs.) Dividend Rate (%)
+ 2 . 1 9 0 0
V. GENERIC NAMES OF PRINCIPAL PRODUCTS/SERVICES OF THE COMPANY (As per monetary terms)
Item Code No. (ITC Code) N A
Product Description T E L E C O M S E R V I C E S

Sanjeev Aga G. P. Gupta
Managing Director Director
AJS Jhala Arun Thiagarajan
Chief Financial Officer Director
58
AUDITORS’ REPORT ON THE CONSOLIDATED FINANCIAL STATEMENTS
To The Board of Directors of
1. We have audited the attached Consolidated Balance Sheet of Idea Cellular Limited (‘the Company’), and its subsidiaries
(the Company and its subsidiaries constitute ‘the Group’) as at March 31, 2007 and also the Consolidated Profit and
Loss account and the Consolidated Cash Flow Statement for the year ended on that date annexed thereto (all together
referred to as “the consolidated financial statements”). These financial statements are the responsibility of the Company’s
management and have been prepared by the Management on the basis of separate financial statements and other financial
information regarding components. Our responsibility is to express an opinion on these consolidated financial statements
based on our audit.
2. We conducted our audit in accordance with the auditing standards generally accepted in India. Those Standards require that
we plan and perform the audit to obtain reasonable assurance about whether the financial statements are prepared, in all
material respects, in accordance with an identified financial reporting framework and are free of material misstatement. An
audit includes, examining on a test basis, evidence supporting the amounts and disclosures in the financial statements. An
audit also includes assessing the accounting principles used and significant estimates made by the Management, as well
as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our
opinion.
3. The financial statements of Swinder Singh Satara and Co. Ltd. have been audited by one of the joint auditors, M/s. RSM &
Co., Chartered Accountants.
4. We did not audit the financial statements of Aditya Birla Telecom Limited, whose financial statements reflect total assets
(net) of Rs. 114.36 million as at March 31, 2007, total revenue of Rs. 0.07 million and net cash flows from operating
activities amounting to Rs. 3.37 million for the year ended on that date as considered in the consolidated financial
statements. These financial statements and other financial information have been audited by other qualified auditor whose
reports have been furnished to us by the Management of the Group, and our opinion, is based solely on the reports of the
other auditor.
5. We report that the consolidated financial statements have been prepared by the Company’s Management in accordance
with the requirements of Accounting Standard 21 ‘Consolidated Financial Statements’ issued by the Institute of Chartered
Accountants of India.
6. Attention is invited to Note 4 of Schedule 22 B of the Consolidated Financial Statements. As detailed in the said note,
pending the transfer of Telecom licenses of the erstwhile Idea Mobile Communications Limited, BTA Cellcom Limited and Idea
Telecommunications Limited in the name of the Company, the Company has given effect to the scheme of Amalgamation
in the financial statements. Implications if any, in the event of non transfer of the licenses are not ascertainable at this
stage.
7. Based on our audit and on consideration of reports of other auditor on separate financial statements and on the other
financial information of the components, and to the best of our information and explanations given to us, subject to what
has been stated in paragraph 6 above, we are of the opinion that the attached consolidated financial statements give a true
and fair view in conformity with the accounting principles generally accepted in India:
a) in the case of the Consolidated Balance Sheet, of the state of affairs of the Group as at March 31, 2007;
b) in case of the Consolidated Profit and Loss Account, of the profits of the Group for the year ended on that date; and
c) in the case of the Consolidated Cash Flow Statement, of the cash flows of the Group for the year ended on that
date.

Partner Partner
59
Consolidated Balance sheet as at March 31, 2007
(Rs. in million)
Schedule
March 31, 2007 March 31, 2006
SOURCES OF FUNDS
Shareholders' Funds
Share Capital 1 25,928.60 27,425.27
Reserves and Surplus 2 20,371.49 998.41
46,300.09 28,423.68
Loan Funds
Secured 3 35,397.68 15,708.59
Unsecured 4 7,107.36 17,147.36
42,505.04 32,855.95
Deferred Tax Liability(Net) (Refer Note B 21 to Schedule 22) 10.55 –
TOTAL 88,815.68 61,279.63
Fixed Assets
Gross Block (At Cost) 5A 70,626.73 47,939.60
Less: Depreciation 26,372.30 20,830.99
Net Block 44,254.43 27,108.61
Intangible Assets (Net) 5B 11,776.42 9,934.31
Capital Work-in-Progress 5,069.03 1,733.60
61,099.88 38,776.52
Goodwill on Consolidation (Refer note B 5 to schedule 22) 61.20 11,791.10
Investments 6 12.32
Current Assets
Inventories 7 179.10 109.04
Sundry Debtors 8 1,524.77 1,302.86
Cash and Bank Balances 9 18,199.40 1,492.50
Other Current Assets 10 757.50 678.41
Loans and Advances 11 3,999.56 2,343.26
24,660.33 5,926.07
Less: Current Liabilities and Provisions 12 21,520.34 12,301.80
Net Current Assets/(Current Liabilities) 3,139.99 (6,375.73)

Profit and Loss Account 24,502.29 17,087.74

TOTAL 88,815.68 61,279.63
60
Consolidated PROFIT AND LOSS ACCOUNT FOR THE YEAR ENDED MARCH 31, 2007
(Rs. in million)
Schedules
March 31, 2007 March 31, 2006
Service Revenue 43,500.16 29,496.07

Sales of Trading Goods (Refer Note B 12 to Schedule 22) 163.84 165.75
Other Income 13 209.29 207.42
TOTAL 43,873.29 29,869.24
Cost of Trading Goods 14 51.73 72.32
Personnel Expenditure 15 2,608.71 1,781.19
Network Operating Expenditure 16 5,335.72 3,197.31
Licence and WPC Charges 17 4,487.01 3,020.18
Roaming & Access Charges 18 7,320.96 4,994.20
Subscriber Acquisition & Servicing Expenditure 19 5,643.27 3,465.59
Advertisement and Business Promotion Expenditure 2,006.20 1,252.74
Administration & other Expenses 20 1,557.84 1,221.34
29,011.44 19,004.87
PROFIT BEFORE FINANCE CHARGES, DEPRECIATION, AMORTISATION & TAX 14,861.85 10,864.37
Finance and Treasury Charges (Net) 21 3,051.18 3,171.12
Depreciation 5 A 5,636.77 4,451.45
Amortisation of Intangible Assets 5 B 1,081.39 1,043.67
PROFIT BEFORE TAX 5,092.51 2,198.13
Provision for taxation - Current 0.42 33.78
- Deferred 10.55 –
- Fringe Benefit tax 59.36 46.70
PROFIT AFTER TAX 5,022.18 2,117.65
Balance of Loss brought forward from previous year (17,087.74) (19,205.39)
Accumulated Losses acquired on amalgamation (12,314.06) –
Leave Encashment Provision for earlier years (Refer Note B 16 to Schedule 22) (122.67) –
BALANCE OF LOSS CARRIED FORWARD TO BALANCE SHEET (24,502.29) (17,087.74)

EARNINGS PER SHARE (in Rupees)
(Refer Note B 20 to Schedule 22)
Basic 2.19 0.74
Diluted 2.15 0.74

61
Schedules Forming part of the Consolidated Accounts
(Rs. in million)
As at As at
SCHEDULE 1
SHARE CAPITAL
AUTHORISED
3,775,000,000 Equity Shares of Rs. 10 each 37,750.00 37,750.00
500 Redeemable Cumulative Non-Convertible Preference Shares of Rs. 10 mn each 5,000.00 5,000.00
42,750.00 42,750.00
ISSUED, SUBSCRIBED and PAID-UP
Equity Share Capital (Refer Note B 1 to Schedule 22)
2,592,860,539 (Previous year 2,259,527,206) Equity Shares of Rs. 10 each fully paid up 25,928.60 22,595.27
Preference Share Capital (Refer Note B 2 to Schedule 22)
(Previous year 483 8% Redeemable Cumulative Non Convertible Preference Shares of
Rs. 10 mn each) – 4,830.00
25,928.60 27,425.27
SCHEDULE 2
RESERVES AND SURPLUS
Amalgamation Reserve
Less : Adjustment on Amalgamation of Subsidaries (Refer note B 4(b) to schedule 22) (354.84) –
643.57 998.41
Capital Reserve on Consolidation (Refer Note B 4(b) to Schedule 22) 1,414.56 –
Share Premium Account (Refer Note B 1 & B 2 to Schedule 22)
Premium on issue of Equity Shares 21,666.66 –
Less : Share Issue Expenses (620.04) –
Less : Premium on redemption of Preference Shares (2,733.26) –
18,313.36 –
20,371.49 998.41
SCHEDULE 3
SECURED LOANS
Term Loan
Rupee Loan (Refer Note B 6(a) to Schedule 22)
– From Banks 29,170.50 11,843.31
– From Financial Institutions 6,029.50 3,845.69
(Loan Repayable within one year Rs. 880.00 Mn, Previous year Rs. 1,191.00 mn)
Vehicle Loan (Refer note B 6(b) to schedule 22) 197.19 1.05
(Loan Repayable within one year Rs. 47.98 mn)
Working Capital Loan (Refer Note B 6(c) to Schedule 22)
– From Banks 0.49 18.54
35,397.68 15,708.59

SCHEDULE 4
UNSECURED LOANS
Short Term Loan
From Banks 5,350.00 15,390.00
From Others 1,757.36 1,757.36

7,107.36 17,147.36
62
Schedules Forming part of the consolidated accounts
SCHEDULE 5A
FIXED ASSETS (Rs. in million)
Particulars As at Additions on Additions Sale/ As at As at Additions on Addi- Sale/ As at As at As at
April 1, account of for the Adjustment March 31, April 1, account of tions for Adjustment March 31, March 31, March 31,
2006 Amalgamation year ended for the 2007 2006 Amalgamation the year for the 2007 2007 2006
March 31, year ended ended year ended
2007 March 31, March 31, March 31,
2007 2007 2007
Land 53.57 – 14.62 – 68.19 – – – – – 68.19 53.57
Leasehold Land 156.26 2.64 134.72 5.63 287.99 120.26 0.09 12.86 4.88 128.33 159.66 36.00
Building 420.58 – 142.22 – 562.80 117.01 – 18.28 – 135.29 427.51 303.57
Plant & Machinery 46,233.66 6.24 22,104.78 80.28 68,264.40 19,839.91 0.45 5,480.49 71.26 25,249.59 43,014.81 26,393.75
Furniture & Fixture 449.73 0.59 82.48 8.23 524.57 291.77 0.05 46.57 6.08 332.31 192.26 157.96
Office Equipment 495.08 0.78 72.45 5.31 563.00 387.34 0.06 48.06 4.85 430.61 132.39 107.74
Vehicles 130.72 1.28 244.01 20.23 355.78 74.70 – 36.88 15.41 96.17 259.61 56.02
Sub-Total 47,939.60 11.53 22,795.28 119.68 70,626.73 20,830.99 0.65 5,643.14 102.48 26,372.30 44,254.43 27,108.61
Less : Pre-operative Charge – – – – – – – 6.37 – – – –
Capitalised
Total 47,939.60 11.53 22,795.28 119.68 70,626.73 20,830.99 0.65 5,636.77 102.48 26,372.30 44,254.43 27,108.61
Previous Year 40,637.18 – 7,418.59 116.17 47,939.60 16,461.20 – 4,451.45 81.66 20,830.99 27,108.61
Notes :
(1) Exchange difference of Rs. 51.75 mn (Previous year loss of Rs. 17.53 mn ) being gain on foreign exchange fluctuation relating to acquisition of fixed assets has been adjusted to relevant fixed assets.
(2) Plant & Machinery includes assets held for disposal - Gross Block Rs. 93.84 mn, Net block Rs. 45.00 mn.
Schedule 5B
INTANGIBLE ASSETS (Rs. in million)
Particulars As at Additions on Additions Sale/ As at As at Additions on Addi- Sale/ As at As at As at
April 1, account of for the Adjustment March 31, April 1, account of tions for Adjustment March 31, March 31, March 31,
2006 Amalgamation year ended for the 2007 2006 Amalgamation the year for the 2007 2007 2006
March 31, year ended ended year ended
2007 March 31, March 31, March 31,
2007 2007 2007
Entry/License Fees 17,859.13 786.00 2,061.60 – 20,706.73 8,086.46 176.37 992.34 – 9,255.17 11,451.56 9,772.67
Computer - Software 524.25 100.00 174.70 – 798.95 362.61 – 111.48 – 474.09 324.86 161.64
TOTAL 18,383.38 886.00 2,236.30 – 21,505.68 8,449.07 176.37 1,103.82 – 9,729.26 11,776.42 9,934.31
Less : Pre-operative Charge
Capitalised – – – – – – – 22.43 – – – –
Total 18,383.38 886.00 2,236.30 – 21,505.68 8,449.07 176.37 1,081.39 – 9,729.26 11,776.42 9,934.31
Previous Year 18,230.71 – 152.67 – 18,383.38 7,405.40 – 1,043.67 – 8,449.07 9,934.31
Note :
The remaining amortisation period of licence fees as at March 31, 2007 ranges between 8 to 20 years based on the respective telecom service licence period.
63
(Rs. in million)
As at As at
SCHEDULE 6
INVESTMENTS
Unquoted
Units of Mutual Funds (Current) 12.32 –
12.32 –
SCHEDULE 7
INVENTORIES
(At lower of cost or estimated realisable value)
Trading Goods 0.45 12.41
Sim Cards and Others 178.65 96.63
179.10 109.04
SCHEDULE 8
SUNDRY DEBTORS
Debts outstanding for over six months
Unsecured – Considered Good 26.39 173.78
– Considered Doubtful 2,081.18 1,802.15
2,107.57 1,975.93
Other Debts
Unsecured – Considered Good 1,498.38 1,129.08
– Considered Doubtful 144.54 98.83
1,642.92 1,227.91
Less : Provision for doubtful debts 2,225.72 1,900.98
Total 1,524.77 1,302.86
Sundry Debtors include certain parties from whom Security Deposits of Rs. 161.12 mn
(Previous Year Rs. 203.40 mn) have been taken and are lying with the Company
SCHEDULE 9
– in Current Accounts 999.25 436.26
– in Deposit Accounts 16,970.86 938.95
(Includes unutilised Initial Public Offer proceeds of Rs. 15,504.50 mn)
18,199.40 1,492.50
64
(Rs. in million)
As at As at
March 31, 2007 March 31, 2006
SCHEDULE 10
OTHER CURRENT ASSETS
Receivable Others 0.09 0.06
Unbilled Revenue 640.15 667.95
Interest Receivable on Deposits 117.26 10.40
757.50 678.41
SCHEDULE 11
LOANS AND ADVANCES ( Refer note B 1 to schedule 22 )
(Unsecured, considered good unless otherwise stated)
Advances recoverable in cash or kind or for value to be received
– Considered good 3,284.13 1,416.21
– Considered Doubtful 90.84 90.84
Less : Provision for Doubtful Advances 90.84 90.84
3,284.13 1,416.21
Advance for purchase of Equity Shares/Licences ( Refer note B 6 to schedule 17 ) – 150.00
Deposits with Body Corporates ( Refer note B 2 to schedule 22 ) – 376.92
Deposits and Balances with Govt. Authorities 109.83 62.26
Deposit with others 383.80 154.22
Advance Income Tax 215.81 183.65
Advance Fringe Benefit Tax (Net of Provision of Rs. 87.46 mn) 5.99 –
3,999.56 2,343.26
SCHEDULE 12
Current Liabilities
Sundry creditors 16,108.53 8,469.62
Book bank overdraft 665.03 668.86
Advances from customers 2,565.34 1,732.56
Deposits from customers 570.08 673.26
Other liabilities 1,055.36 491.91
Interest accrued but not due 17.61 5.80
20,981.95 12,042.01
Provisions
Gratuity (Refer Note B 15 to Schedule 22) 29.41 34.76
Leave Encashment (Refer Note B 16 to Schedule 22) 255.72 98.99
Site Restoration Cost (Refer Note B 23 to Schedule 22) 253.26 121.74
Provision for Fringe Benefit Tax (Previous year Net of Advance Tax of Rs. 35.75 mn) – 4.30
538.39 259.79

21,520.34 12,301.80
65
(Rs. in million)
ended ended
March 31, 2007 March 31, 2006
SCHEDULE 13
OTHER INCOME
Liabilities/Provisions no longer required written back 174.94 168.57
Gain on Sale of Fixed Assets/Asset disposed off 1.92 4.80
Miscellaneous Receipts 32.43 34.05
209.29 207.42
SCHEDULE 14
COST OF TRADING GOODS SOLD (Refer Note B 12 to Schedule 22)
Opening Stock 0.22 23.70
Add : Opening Stock acquired on amalgamation 12.19 –
Add : Purchases (net of transfer to consumables) 40.60 61.46
Less : Consumption 0.83 0.43
Closing Stock 0.45 12.41
51.73 72.32
SCHEDULE 15
PERSONNEL EXPENDITURE
Salaries and Allowances etc. 2,253.66 1,549.95
Contribution to Provident and Other Funds 127.15 99.61
Staff Welfare 133.72 86.01
Recruitment and Training 94.18 45.62
2,608.71 1,781.19
SCHEDULE 16
NETWORK OPERATING EXPENDITURE
Power and Fuel 1,094.57 601.12
Repairs and Maintenance - Plant and Machinery 1,170.32 983.56
Switching & Cellsites Rent 495.58 318.35
Lease Line and Connectivity Charges 1,382.78 824.45
Network Insurance 17.47 16.44
Other Network Operating expenses 615.43 199.28
5,335.72 3,197.31
SCHEDULE 17
LICENCE AND WPC CHARGES
Licence Fees 2,777.79 1,910.65
WPC and Spectrum Charges 1,709.22 1,109.53
4,487.01 3,020.18
SCHEDULE 18
ROAMING and ACCESS CHARGES
Roaming Charges 974.09 855.39
Access Charges 6,346.87 4,138.81
7,320.96 4,994.20
66
(Rs. in million)
ended ended
March 31, 2007 March 31, 2006
SCHEDULE 19
SUBSCRIBER ACQUISITION and SERVICING EXPENDITURE
Cost of Sim and Other Cards 268.59 223.17
Commission and Discount to dealers & others 3,135.50 2,065.94
Customer Verification Expenses 178.72 73.02
Collection & Telecalling Expenses 749.91 415.12
Prepaid recharge Expenses 1,257.15 649.89
Customer Retention & Customer Loyalty Expenses 53.40 38.45
5,643.27 3,465.59
SCHEDULE 20
ADMINISTRATION and OTHER EXPENSES
Repairs and Maintenance – Building 16.59 17.87
– Others 56.24 42.57
Other Insurance 21.47 20.00
Non Network Rent 144.08 83.56
Rates and Taxes 94.73 55.38
Electricity 82.55 66.08
Printing and Stationery 57.28 44.12
Communication Expenses 90.42 64.32
Travelling and Conveyance 277.17 193.63
Provision for bad and doubtful debts/advances 368.17 357.33
Bank Charges 107.03 84.95
Directors Sitting Fees 0.60 –
Legal and Professional Charges 101.36 76.40
Audit Fees 14.33 10.93
Miscellaneous Expenses 125.82 104.20
1,557.84 1,221.34
SCHEDULE 21
FINANCE AND TREASURY CHARGES (NET)
Interest
– On Fixed Period Loan 3,048.92 2,945.48
– Others 172.06 70.01
Financing Charges 72.58 193.37
3,293.56 3,208.86
Less :
Interest Received (Gross of Tax) (Includes interest on unutilised Initial Public Offer
proceeds of Rs. 117.07 mn) 171.03 26.90
Profit on Sale of Current Investments 81.32 10.39
Gain/(Loss) on foreign exchange fluctuation (9.97) 0.45
3,051.18 3,171.12
67
SCHEDULE 22
A. Significant Accounting Policies - Consolidated

1. Basis of Preparation of Financial Statements :
The Consolidated Financial Statements of Idea Cellular Limited (“the Company”) and its subsidiary companies
(together referred to as the “Group”) have been prepared in accordance with Accounting Standard 21 on ‘Consolidated
Financial Statements’ issued by the Institute of Chartered Accountants of India (“ICAI”). The Consolidated Financial
Statements are prepared under historical cost convention on accrual basis. The mandatory applicable accounting
standards have been followed in preparation of these financial statements.
2. Principles of Consolidation :
The basis of preparation of the Consolidated Financial Statements is as follows:
The Financial Statements (The Balance Sheet, the Profit and Loss Account, and the Cash Flow Statement) of the
Company and its subsidiaries have been combined on a line-by-line basis by adding together the book values of
like items of assets, liabilities, income and expenses, after eliminating intra-group balances, transactions and the
resulting unrealised profit or losses.
The Financial Statements of the subsidiaries used in the consolidation are drawn upto March 31, 2007, the same
reporting date as that of the Company.
The differential with respect to the cost of investments in the subsidiaries over the Company’s portion of equity is
recognised as Goodwill or Capital Reserve, as the case may be.
The Consolidated Financial Statements are prepared using uniform accounting policies for like transactions and other
events in similar circumstances except where stated otherwise.
The list of subsidiaries, which are included in this Consolidated Financial Statements along with Company’s holding
therein, is as under :
Sl. Name of the Company Voting Power %
No. As at March 31, 2007 As at March 31, 2006
1 Swinder Singh Satara and Co. Limited 100.00 100.00
2 Aditya Birla Telecom Limited * 100.00 –
3 Sapte Investments Private Limited – 100.00
4 Vsapte Investments Private Limited – 100.00
5 Bhagalaxmi Investments Private Limited – 100.00
6 Asian Telephone Services Limited – 100.00
7 BTA Cellcom Limited – 100.00
8 Idea Mobile Communications Limited – 100.00
All the above subsidiaries are incorporated in India

* On February 28, 2007, the Company acquired the entire shareholding of Aditya Birla Telecom Limited, as a
consequence of which the said Company became its wholly owned subsidiary.
68
3. Fixed Assets :
Fixed assets are stated at cost of acquisition and installation less depreciation. Cost is inclusive of freight, duties,
levies and any directly attributable cost of bringing the assets to their working condition for intended use.
Site restoration cost obligations are capitalised based on a constructive obligation as a result of past events, when it
is probable that an outflow of resources will be required to settle the obligation and a reliable estimate of the amount
can be made. Such costs are depreciated over the remaining useful life of the asset.
4. Expenditure during pre-operative period of licence :
Expenses incurred on project and other charges during construction period are included under pre-operative expenditure
(grouped under capital work in progress) and are allocated to the cost of fixed assets on the commencement of
commercial operations.
Depreciation on fixed assets is provided on straight line method (except stated otherwise) on the basis of estimated
useful economic lives as given below:-
Tangible Assets Years

Buildings 9 to 30
Network Equipments 10 to 13
Other Plant and Machineries 5
Office Equipment 3 to 9
Computers 3
Furniture and Fixtures 3 to 10
Motor Vehicles 4 to 5
Leasehold Improvements Period of lease
Intangible Assets :
i) Cost of Rights and Licences including the fees paid on fixed basis prior to revenue share regime is amortised on
commencement of operations over the period of license.
ii) Software, which is not an integral part of hardware, is treated as intangible asset and is amortised on straight-line
basis over their useful economic lives, estimated by the management between 3 to 5 years.
6. Licence Fees – Revenue Share :
With effect from August 1, 1999 the variable Licence fee computed at prescribed rates of revenue share is being
charged to the profit and loss account in the Period in which the related revenue arises. Revenue for this purpose
comprises adjusted gross revenue as per the license agreement of the license area to which the license pertains.
7. Inventories :
Inventories are valued at cost or net realisable value, whichever is lower.
8. Foreign currency transactions :
Transactions in foreign currency are recorded at the exchange rates prevailing at the dates of the transactions. Gains/
losses arising out of fluctuation in exchange rates on settlement are recognised in the Profit and Loss account, except
in case of fixed assets where such gains/losses are adjusted to the carrying cost of the respective assets.
Foreign currency monetary assets and liabilities are restated at the exchange rate prevailing at the period end and
the overall net gain/loss is adjusted to the Profit and Loss account, except in case of liabilities relating to acquisition
of fixed assets which are adjusted to the carrying cost of the respective assets.
69
In case of Forward Exchange Contracts, the difference between the forward rate and the exchange rate at the date
of transaction is recognised in the Profit and Loss account over the life of the contract, except in case of liabilities
relating to acquisition of fixed assets, which are adjusted to the carrying cost of the respective asset.
9. Leases :
a) Operating : Lease of assets under which significant risks and rewards of ownership are effectively retained by the
lessor are classified as operating leases. Lease payments under an operating lease are recognised as expense
in the profit and loss account, on a straight-line basis over the lease term.
b) Finance : Leased assets acquired on which significant risk and reward of ownership effectively transferred to the
Company are capitalised at lower of fair value or the amounts paid under such lease arrangements. Such assets
are amortised over the period of lease.
10. Taxation :
a) Current Tax : Provision for current income tax is made on the taxable income using the applicable tax rates and
tax laws.
b) Deferred Tax : Deferred tax arising on account of timing differences and which are capable of reversal in one or
more subsequent periods is recognised using the tax rates and tax laws that have been enacted or substantively
enacted. Deferred tax assets are not recognised unless there is virtual certainty with respect to the reversal of
the same in future years.
11. Contingent Liability :
Disclosure for contingent liabilities are considered to the extent of notices/demands received by the group.
12. Retirement Benefits :
Contributions to Provident and pension funds are funded with the appropriate authorities and charged to the profit
and loss account.
Contributions to superannuation are funded with the Life Insurance Corporation of India and charged to the profit and
loss account.
Liability for gratuity as at the year end is provided on the basis of actuarial valuation and funded with Life Insurance
Corporation of India.
Provision in accounts for leave benefits to employees is based on the revised AS-15 which is as under :
a) Actuarial valuation done by projected accrued benefit method at the period end for long-term compensated
absences.
b) On actual basis for the portion of accumulated leave which an employee can encash during the short term
period.
13. Revenue Recognition and Receivables :
Revenue on account of mobile telephony services and sale of handsets and related accessories is recognised net
of rebates, discount, service tax, etc. on rendering of services and supply of goods respectively. Recharge fees on
recharge vouchers is recognised as revenue as and when the recharge voucher is activated by the subscriber.
Unbilled receivables, represent revenues recognised from the bill cycle date to the end of each month. These are
billed in subsequent periods as per the terms of the billing plans.
Debts (net of security deposits outstanding there against) due from subscribers, which remain unpaid for more than
90 days from the date of bill and/or other debts which are otherwise considered doubtful, are provided for.
Provision for doubtful debts on account of Interconnect Usage Charges (IUC), Roaming Charges and passive
infrastructure sharing from other telecom operators is made for dues outstanding more than 180 days from the date
of billing other than cases when an amount is payable to that operator or in specific case when management is of the
view that the amount is recoverable.
70
14. Investments :
Current Investments are stated at lower of cost or fair value in respect of each separate investment.
Long-term investments are stated at cost less provision for diminution in value other than temporary, if any.
15. Borrowing Cost :
Interest and other costs incurred in connection with the borrowing of the funds are charged to revenue on accrual
basis except those borrowing costs which are directly attributable to the acquisition or construction of those fixed
assets, which necessarily take a substantial period of time to get ready for their intended use. Such costs are
capitalized with the fixed assets.
16. Earnings Per Share :
The earnings considered in ascertaining the Group’s EPS comprises the net profit after tax, after reducing dividend
on Cumulative Preference Shares for the Period (irrespective of whether declared, paid or not), as per Accounting
Standard 20 issued by the Institute of Chartered Accountants of India. The number of shares used in computing
basic EPS is the weighted average number of shares outstanding during the Period. The diluted EPS is calculated on
the same basis as basic EPS, after adjusting for the effects of potential dilutive equity shares unless the effect of the
potential dilutive equity shares is anti-dilutive.
17. Impairment of Assets :
Assets that are subject to impairment are reviewed for impairment whenever events or changes in circumstances
indicate that the carrying amount may not be recoverable. An impairment loss is recognised for the amount by which
the assets carrying amount exceeds its recoverable amount. The recoverable amount is higher of the assets fair value
less costs to sell and value in use, For the purpose of impairment, assets are grouped at the lowest levels for which
there are separately identifiable cash flows (Cash Generating Units, i.e. License Circles).
18. Provisions :
Provisions are recognised when the Group has a present obligation as a result of past events; it is more likely than not
that an outflow of resources will be required to settle the obligation; and the amount has been reliably estimated.
19. Issue Expenditure :
Expenses incurred in connection with issue of equity shares are adjusted against share premium.
71
SCHEDULE 22
B. Notes to Accounts - Consolidated
1. Initial Public Offer (IPO)
During the year, the Company completed a public issue of 283,333,333 equity shares of Rs. 10 each for cash at
a price of Rs. 75 aggregating to Rs. 21,250.00 mn following a pre-IPO placement of 50,000,000 equity shares of
Rs. 10 each amounting to Rs. 3,750.00 mn at the above mentioned price. The premium of Rs. 65 per share,
amounting to Rs. 21,666.66 mn from both the allotments has been credited to Share Premium Account. The share
premium account stands net of share issue expenses of Rs. 620.04 mn.
Pursuant to the Public Issue, shares of the Company are listed on National Stock Exchange and Bombay Stock
Exchange effective March 9, 2007.
The Company also opted for the Green Shoe Option (GSO) of 42,500,000 equity shares of Rs. 10 each amounting to
Rs. 3,187.50 mn. As on March 31, 2007, the above amount was lying to the credit of the GSO account. This amount
was received on April 5, 2007 and equity shares were allotted on the same day.
Total objects of the issue is amounting to Rs. 25,378.00 mn. Rs. 25,000.00 mn have been received from the Pre
IPO & IPO proceeds upto March 31, 2007. The balance of Rs. 378.00 mn would be met from the GSO proceeds. The
actual utilisation as per the objects of the issue is as under :
(Rs. in million)
To be financed Actual
Activity through the issue Utilisation upto
proceeds March 31, 2007
Building, strengthening and expanding our network and related
services in the New Circles 9,708.00 1,312.20
Capital expenditure for NLD operations 808.00 –
Roll out for services in Mumbai Circle 6,470.00 –
Redemption of Preference Shares 7,567.00 7,563.30
Issue Expenses 825.00 620.04
Total 25,378.00 9,495.54
2. Preference Shares
The Company redeemed 483 Preference Shares of Rs. 10 mn each amounting to Rs. 4,830.00 mn along with
the redemption premium of Rs. 2,733.26 mn on March 26, 2007. This redemption premium is adjusted in Share
Premium account.
3. Investments
a) Idea Telecommunications Limited (ITL)
On receipt of approval from Department of Telecommunication (DoT), the Company renamed Escorts
Telecommunications Limited to Idea Telecommunications Limited (ITL) effective August 1, 2006. ITL has the
licence to provide cellular services in the service areas of Rajasthan, Himachal Pradesh and Eastern Uttar
Pradesh. The Company has acquired 100% equity shares of ITL for which an advance of Rs. 150.00 mn was
paid during Financial Year 2004-05.
ITL has been subsequently merged with Idea Cellular Limited. (Refer Note 4a below)
72
b) Aditya Birla Telecom Limited (ABTL)
The Company has acquired 100% Equity Shares of Aditya Birla Telecom Limited (ABTL) on February 28, 2007
for a total consideration of Rs. 100.00 mn. ABTL has licence to provide services under Unified Access Service
for the telecom service area of Bihar (including the State of Jharkhand).
4. Amalgamation of Subsidiaries
a) In accordance with the scheme of amalgamation of the following erstwhile wholly owned subsidiaries with the
Company,
Sl. No. Name Nature of Business

i Idea Mobile Communications Limited
ii BTA Cellcom Limited GSM based telecommunication services
iii Idea Telecommunications Limited
iv Sapte Investments Private Limited
v Vsapte Investments Private Limited Investment companies holding shares in
vi Bhagalaxmi Investments Private Limited BTA Cellcom Limited
vii Asian Telephone Services Limited
as sanctioned by the Honourable High Courts of Delhi, Gujarat, Madhya Pradesh and Bombay, the assets,
liabilities, reserves and accumulated losses of the above subsidiaries were transferred to and vested in the
Company with effect from April 1, 2006. The last of the High Court Orders approving the scheme was received
on September 10, 2007 and the last of the certified copies of the High Court Orders sanctioning the scheme
was filed with the Registrar of Companies (RoC) on September 14, 2007.
In accordance with the scheme of amalgamation and the court orders, the Company has applied to the DoT
for transfer of telecom licences mentioned in the scheme pertaining to telecom service areas of the erstwhile
subsidiaries, namely BTA Cellcom Limited, Idea Mobile Communications Limited and Idea Telecommunications
Limited in favour of the Company. As the transfer formality of the licences is pending with DoT, the Company
has sought necessary legal opinion for giving effects in the accounts following the dissolution of the subsidiary
companies without winding up upon filing of the court order with the respective RoC’s. The company has been
advised that the scheme is effective from the date of the filing with last certified copy of the High Court with the
RoC viz. September 14, 2007 and that the transfer formality by the DoT would be in line with Clause 10(ii) of
the licensing conditions which is as under :
“Provided that the aforesaid written consent permitting transfer or assignment will be granted; whenever a
merger of two licensee (Indian) companies is approved by an High Court but no compromise in competition
occurs in the provision of telecom service.”
The Company meets the above condition and accordingly, the scheme has been given effect to in these
accounts.
b) The amalgamation has been accounted as per “Pooling of Interest” method as prescribed by Accounting Standard
14 on – “Accounting for Amalgamations” issued by the Institute of Chartered Accountants of India. Accordingly
the assets, liabilities, reserves and accumulated losses of the above subsidiaries as at April 1, 2006 have been
taken over at their respective book values. Capital Reserve of Rs. 1,414.56 mn appearing in the books of ITL
has been taken to Capital Reserves forming part of Reserves and Surplus of the Group. The difference between
Investment values and the equity share capital of the respective companies amounting to Rs. 354.84 mn has
been adjusted from Amalgamation Reserve.
c) As per the scheme of amalgamation, the following entire issued, subscribed and paid-up Equity shares of Rs. 10
each comprising of :
– 526,000,000 shares of Idea Mobile Communications Limited,
– 75,091,937 shares of BTA Cellcom Limited,
73
– 61,000,000 shares of Idea Telecommunications Limited,
– 10,800,000 shares of Sapte Investments Private Limited,
– 10,800,000 shares of Vsapte Investments Private Limited,
– 10,800,000 shares of Bhagalaxmi Investments Private Limited,
– 10,800,000 shares of Asian Telephone Services Limited
stand cancelled.
d) In view of the aforesaid amalgamation with effect from April 1, 2006, the figures for the current year are not
comparable to those of the previous year.
5. Goodwill on Consolidation
(Rs. in million)
As at As at
Name of Company
March 31, 2007 March 31, 2006
On Acquisition of Aditya Birla Telecom Ltd. 25.34 –
On Acquisition of Swinder Singh Satara & Co. Ltd. 35.86 35.86
On Acquisition of SPV’s * – 132.81
On Acquisition of BTA – 4,300.04
On Acquisition of IMCL – 7,322.39
Total 61.20 11,791.10
* Includes the following companies :
– Sapte Investments Private Limited
– Vsapte Investments Private Limited
– Bhagalaxmi Investments Private Limited
– Asian Telephone Services Limited
Consequent to merger of subsidiaries mentioned in the scheme of amalgamation, goodwill amounting to
Rs. 11,755.24 mn arising on acquisition of these subsidiaries, stands eliminated.
6. Term Loan
a) From Banks and Financial Institutions
Term Loans amounting to Rs. 35,200.00 mn secured by way of first charge/assignment ranking pari-passu
interse the lenders, are as under :
i. First charge by mortgage on all the movable and immovable properties of the Company,
ii. A first priority charge over all intangible assets of the Company,
iii. Assignment of the rights, titles and interest, on deposits, investments, bank accounts, book debts, insurance
covers, other general assets, letters of credit and guarantee or performance bond, provided in favour of the
Company.
b) Vehicle Loan
Vehicle Loan amounting to Rs.197.19 mn is secured by hypothecation of Vehicles against which the loans have
been taken.
c) Working Capital
Cash Credit amounting to Rs. 0.49 mn is secured by hypothecation of all moveable assets of the Company.
74
7. Interest from Department of Telecommunications
The Company had recognised an income of Rs. 802.27 mn. during the year ended March 31, 2003 being refund
of excess interest charged by DoT on the licence fee payable by the Company pursuant to the judgement dated
April 9, 2002 of Telecom Disputes Settlement and Appellate Tribunal (TDSAT). During the previous years, DoT
arbitrarily acknowledged an amount of Rs. 758.76 mn. against Company’s claim of Rs. 802.27 mn. The Company
has represented this matter with DoT. The Company has not provided for the difference of Rs. 43.51 Mn., as in the
opinion of the management, the amount is recoverable from DoT.
The Company is also entitled to interest on the amount of the refund so accrued in terms of the Supreme Court
judgment; the recognition of revenue on account of the same has been postponed pending acceptance in this respect
by DoT. As of March 31, 2007, this case is pending before the Hon’ble Supreme Court.
8. Contingent Liabilities
a) On March 2, 2006, the Honourable Supreme Court passed an order adjudicating that providing of
telecommunication services cannot be termed as ‘Goods’ under the Sale of Goods Act. In view of the above
judgement, demands raised for Sales Tax on Activation of new connections, Rentals and Airtime by Sales Tax
Authorities stand extinguished. As of March 31, 2007, Sales Tax demands of Rs. 931.40 mn, are required to be
yet formally vacated by the authorities.
b) Additional carriage charges demanded by BSNL on calls to Cellone of Rs. 325.38 mn, following its appeal in the
Honourable Supreme Court over the judgement of TDSAT restraining BSNL from collecting the same from private
operators.
c) Export obligation under EPCG (Export Promotion Credit Guarantee) Scheme is Rs. 301.06 mn. (Previous
year Rs. 346.55 mn). Failure to meet this export obligation within the stipulated time frame as per Foreign
Trade Policy 2004-2009 would result in the payment of the aggregated differential duty saved amounting to
Rs. 37.72 mn along with interest thereon. The Company is confident of meeting the obligations based on its
current international in-roaming revenue trends.
d) Letter of Credit facilities, utilised as on March 31, 2007 is Rs. 3,288.00* mn (Previous year Rs. 2,719.38 mn)
* Out of the above Rs. 3,075.12 mn have been paid as on August 31, 2007
e) During the financial year, the WPC Wing of the DoT has raised demands towards monthly compounded interest
on WPC charges for the period upto the financial year 2002-03 in respect of the telecom service areas of the
erstwhile IMCL and BTA Cellcom Ltd.
Telecom operators had paid WPC Royalty and license fees towards GSM frequency, access and back-bone
frequency charges on circle area basis as provided in the license terms from inception till financial year 2002-03
while the DoT demands were on city basis. The above matter was disputed by the operators and contested in
TDSAT. DoT proposed a change in the basis of levy of spectrum charges based on revenue share vide their letter
dated April 18, 2002 on the condition of its acceptance in entirety and withdrawal of all legal proceedings by
the operators. Vide their letter dated March 26, 2002, DoT had also given time to the operators to deposit the
earlier principal demands by April 15, 2002. The operators accepted the offer of change to revenue share basis
on August 23, 2002. The interest demand now raised by WPC wing of DoT for the period before April 15, 2002
is contrary to the DoT proposal in 2002.
The Company is therefore in the process of taking suitable remedial action on these demands including a notice
to the erstwhile promoter of Idea Mobile Communications Limited for Rs. 348.79 mn. In the light of the above
facts, no provision has been considered necessary to be made in the books as of March 31, 2007. However, for
obtaining clearance towards the issue of license for its Mumbai telecom service area, the Company deposited
these interest demands of Rs. 405.02 mn under protest on November 9, 2006.
75
f) Other Matters not provided for
(Rs. in million)
As on As on
Particulars March 31, 2007 March 31, 2006
Income Tax Matters not acknowledged as debts 98.38 17.19
Sales Tax & Service Tax Matters not acknowledged as debts 313.83 167.85
Dividend on cumulative preference shares – 1,844.34
Other claims not acknowledged as debts 505.36 361.62
g) Estimated amount of contracts (net of advance) remaining to be executed on capital account and not provided for.
(Rs. in million)
As on As on
Estimated amount of contracts (net of advance) 10,177.57 2,573.51
9. Details of Guarantees given

(Rs. in million)
As on As on
Bank Guarantees given to DoT including Performance Guarantees
of Rs. 1,140.00 mn (previous year Rs. 450.00 mn) 3,807.39 1,884.67
Bank Guarantees given to BSNL 241.64 257.71
Bank Guarantees given to Others 278.01 62.59
Corporate Guarantee given to others on behalf of the Group 70.00 385.00
10. In accordance with an assignment agreement entered between the original promoters of the amalgamated subsidiary
Idea Mobile Communications Limited (IMCL) i.e. Escorts Ltd. and First Pacific Company Ltd., IMCL had issued interest
free unsecured Bond of Rs. 1,757.36 mn to Escorts Limited vide a Loan agreement dated January 15, 2004. This
bond was in lieu of the loans from the original promoters and included accrued interest of Rs. 857.36 mn on June
10, 2004. This Bond is repayable on January 15, 2014 and carries a put option for Escorts Limited for a period of
thirty days commencing on January 15, 2010 to redeem the entire amount or part thereof at a price which would
have been payable by the Company had the Company opted for an early redemption in accordance with the terms
of the said agreement. The Company is entitled to pre-payment and set off against certain contingent liabilities that
may crystallise after June 10, 2004.
On the request of Escorts Ltd, the Company on July 21, 2006 has consented to release the redemption proceeds of
the above loan to UTI Bank on the same terms and conditions, as mentioned in the above loan agreement.
11. Licences
The Company has acquired following additional licences :
National Long Distance (NLD) service licence on November 23, 2006.
Unified Access Services (UAS) licence for Mumbai Telecom Circle on December 5, 2006.
Accordingly, the Company has commenced the NLD service within its mobility circles with effect from December 1, 2006.
Applications have also been separately filed for migration of the existing CMTS to UAS licences.
76
12. Sale & Cost of Trading Goods
The telecom service areas of UP (West), Haryana and Kerala (erstwhile subsidiary Idea Mobile Communications
Limited) were following the practice of invoicing sim cards as goods. Pursuant to Hon’ble Supreme Court ruling in case
of BSNL vs UOI & others and following receipt of the legal opinion sought in this regard, the above mentioned telecom
service areas have aligned their documentation in line with the service stand followed by the other telecom service
areas of the Company effective November 1, 2006. The Sale of Trading Goods & Cost of Trading Goods therefore
reflect the amounts pertaining to the period till October 31, 2006.
13. During the year ended March 31, 2007, there is no accelerated depreciation (Previous year Rs. 506.26 Mn) provided
on any of the fixed assets.
14. Details of foreign currency exposures that are not hedged by a derivative instrument or otherwise:
(Rs. in million)
As on As on
Sundry Creditors :
Sundry Creditors in USD 103.42 71.66
Sundry Creditors in EURO 2.18 3.93
Sundry Creditors in NOK – 0.01
Sundry Creditors in GBP 0.02 0.01
The Equivalent INR of Sundry Creditors in Foreign Currency 4,636.13 3,415.68
Sundry Debtors :
Sundry Debtors in USD 5.20 2.95
The Equivalent INR of Sundry Debtors in Foreign Currency 226.72 131.78
15. Provision for Gratuity

The following table sets out the status of the gratuity plan as required under Accounting Standard -15 on “Employee
Benefits”
Reconciliation of Opening and Closing balances of the present value of the defined benefit obligation
(Rs. in million)
Sl. Particulars Policy Policy Policy Policy
5092145 634757 109254 304606
1. Assumptions As on March 31, 2007

Discount Rate 7.50% 7.50% 8.00% 7.50%
Salary Escalation 5.00% 5.00% 7.00% 5.00%
2. Table showing changes in present value of obligations As on March 31, 2007
Present value of obligations as at beginning of the
year 4.09 33.79 5.02 13.48
Interest cost 0.31 2.53 0.40 1.01
Current Service Cost 1.18 6.79 1.53 3.07
Benefits paid 0.96 2.98 0.16 0.85
Actuarial Loss on obligations 2.59 5.29 1.40 7.25
Present value of obligations as at end of the year 7.21 45.42 5.38 23.96
77
Sl. Particulars Policy Policy Policy Policy
5092145 634757 109254 304606
3 Table showing changes in the fair value of plan assets As on March 31 2007
Fair value of plan assets at beginning of the year 3.19 12.75 2.71 17.74
Contributions 0.92 10.75 0.85 13.86
Benefits paid 0.96 2.98 0.16 0.85
Actuarial Gain on Plan assets 0.07 0.21 0.04 0.31
4 Table showing fair value of plan assets
Fair value of plan assets at beginning of the year 3.19 12.75 2.71 17.74
Actual return on plan assets 0.29 1.16 0.24 1.60
Contributions 0.92 10.75 0.85 13.86
Benefits paid 0.96 2.98 0.16 0.85
Funded status (3.75) (23.42) (1.71) 8.71
Excess of Actual over estimate return on plan assets 0.05 (23.42) 0.02 NIL
(Actual rate of return = Estimated rate of return as ARD falls on March 31)
5 Actuarial Gain/(Loss) recognised As on March 31, 2007
Actuarial Gain/(Loss) for the year – Obligation (2.59) (5.29) 1.40 7.25
Actuarial Gain for the year – plan assets 0.07 0.21 0.04 0.31
Total Gain/(Loss) for the year (2.52) (5.08) 1.44 6.93
Actuarial Gain/(Loss) recognised in the year (2.52) (5.08) 1.44 6.93
6 The amounts to be recognised in Balance Sheet and statement of Profit and Loss
Present value of obligations as at the end of the year 7.21 45.42 5.38 23.96
Fair value of plan assets as at the end of the year 3.46 21.99 3.68 32.67
Funded status (3.75) (23.42) (1.71) 8.71
Net liability recognised in Balance Sheet 3.54 23.42 2.45 –
7 Expenses Recognised in statement of Profit & Loss
Current Service cost 1.18 6.79 1.53 3.07
Interest cost 0.31 2.53 0.40 1.01
Net Actuarial loss recognised in the year 2.52 5.08 1.44 6.93
Expenses recognised in the Statement of Profit &
Loss Account 3.77 13.44 0.27 9.41
16. Provision for Leave Encashment
The Company had provided for the leave encashment as per the actuarial valuation till March 31, 2006 as required
then by Accounting Standard-15 on “Accounting for Retirement Benefits in the Financial Statements of Employers”.
With revision in Accounting Standard-15 on “Employee Benefits”, the Company has recalculated its liability towards
accumulated leave balances. As per the transitional provisions of revised Accounting Standard-15 on “Employee
Benefits”, the charge for the period prior to March 31, 2006 amounting to Rs. 122.67 mn has been adjusted in the
opening balance of profit and loss account.
17. Segment Reporting
a) Primary Segments :
The Group operates in two business segments :
78
a) Cellular Mobile Telephony Services (CMTS)
b) National Long Distance (NLD)
b) Secondary Segment :
The Group caters only to the needs of Indian market representing a singular economic environment with similar
risks and rewards and hence there are no reportable geographical segments.
Primary Business Information (Business Segments) for the year.
(Rs. in million)
Particulars Business Segments Elimination Total
Mobility NLD
Revenue
External Revenue 43,873.29 – – 43,873.29
Inter-segment Revenue – 778.96 (778.96) –
Total Revenue 43,873.29 778.96 (778.96) 43,873.29
Segment Result 7,986.91 156.78 – 8,143.69
Interest & Financing Charges (Net) – – – 3,051.18
Profit before Tax – – – 5,092.51
Provision for Tax (Net) – – – 70.33
Profit after Tax 5,022.18
Other Information
Segment Assets 68,513.67 234.39 (209.09) 68,538.97
Unallocated Corporate Assets – – – 17,294.76
Total Assets 68,304.58 234.39 (209.09) 85,833.73
Segment Liabilities 64,156.86 77.61 (209.09) 64,025.38
Unallocated Corporate Liabilities – – – 10.55
Total Liabilities 64,156.86 77.61 (209.09) 64,035.93
Capital Expenditure 27,955.10 25.00 – 27,980.10
Depreciation & Amortisation 6,717.72 0.44 – 6,718.16
* Previous year’s figures are not given as in previous year there was only one segment and NLD services started
during the current financial year w.e.f. December 1, 2006
18. Related Party Transactions
As per Accounting Standard-18 on “Related Party Disclosure” issued by the Institute of Chartered Accountants of
India, related parties of the Group are disclosed below :
List of related Parties :
Promoters
Hindalco Industries Limited
Grasim Industries Limited
Aditya Birla Nuvo Limited (formerly known as Indian Rayon and Industries Limited)
Tata Industries Limited (upto June 20, 2006)
Apex Investments (Mauritius) Holding Private Limited (formerly AT & T Cellular Pvt. Limited)
(upto June 20, 2006)
Birla TMT Holdings Pvt. Limited
Aditya Birla Telecom Limited (upto August 28, 2006)
79
Key Management Personnel
Mr. Sanjeev Aga, Managing Director (w.e.f. November 1, 2006)
Mr. Vikram Mehmi, Chief Executive Officer (upto October 30, 2006)
Mr. Satish Rajgarhia, Manager (upto August 31, 2006)
Mr. AJS Jhala, Chief Financial Officer (w.e.f. August 7, 2006)
Disclosure in respect of Related Parties :

Transactions during the year ended March 31, 2007
(Rs. in million)
Particulars Promoters Key Management
Personnel
31.43
Remuneration – (22.51)
Purchase of Shares 100.00 –
Purchase of Fixed Assets 5.39 –
Expense incurred by Group on behalf of 0.01 –
Expense incurred on Group’s behalf by 1.71 –
(Figures in bracket are for the year ended March 31, 2006)
Outstanding as on March 31, 2007

(Rs. in million)
Particulars Nature of Relationship
Promoters Key Management
Personnel
Remuneration Payable – 7.51
Accounts Payable 0.13 –
19. The Company has entered into non-cancellable operating leases for periods ranging from 36 months to 60 months. The total
minimum lease payments amounting to Rs. 45.17 mn for the current year, in respect thereof, included under rent.
The future lease payments in respect of the above are as follows.
(Rs. in million)
Particulars Not later than one Later than one year but Later than five years
year not later than five years
Minimum lease payments 162.39 592.48 –
20. Basic & Diluted Earning Per Share
For the year ended For the year ended

March 31, 2007 March 31, 2006
Nominal value of Equity Shares (Rs.) 10/- 10/-
Profit after Tax (Rs. in million) 5,022.18 2,117.65
Less : Preference Share Dividend (Rs. in million) - 434.96
Profit attributable to equity shareholders (Rs. in million) 5,022.18 1,682.69
Weighted average number of equity shares outstanding during the year
(Nos.) 2,291,992,960 2,259,527,206
Basic Earnings Per Share (Rs.) 2.19 0.74
Shares to be issued under Green Shoe Option (Nos.) 42,500,000 0
Weighted average number of diluted equity shares (Nos.) 2,334,492,960 2,259,527,206
Diluted Earnings Per Share (Rs.) 2.15 0.74
80
21. Deferred Tax
As of March 31, 2007, the Group has deferred tax liability of Rs. 820.74 mn. and deferred tax asset of Rs. 810.19 mn. as under :
(Rs. in million)
Particulars As at As at
March 31, 2007 March 31, 2006
Deferred Tax Liability :

Depreciation of Fixed Assets 742.05 556.12
Amortisation of Entry & Licence Fee (Net) 78.69 49.86
Total Deferred Tax Liability 820.74 605.98
Deferred Tax Asset :
Provision for Doubtful Debts 756.52 575.57
Provision for Leave Encashment 53.67 26.30
Provision for Gratuity – 11.70
Accumulated Business Losses & Unabsorbed Depreciation – 3426.35
Total Deferred Tax Asset 810.19 605.98*
Net Deferred Tax Liability 10.55 –
* Deferred Tax Assets recognised to the extent of Deferred Tax Liability.
22. In terms of the requirements of the Accounting Standard-28 on “Impairment of Assets” issued by the Institute of Chartered
Accountants of India, the amount recoverable against Fixed Assets has been estimated at the period end by the management
based on the present value of estimated future cash flows expected to arise from the continuing use of such assets. The
recoverable amount so assessed was found to be adequate to cover the carrying amount of the assets, therefore no provision for
impairment in value thereof has been considered necessary, by the management.
23. The movement in the Site Restoration Cost is set out as follows:
(Rs. in million)
For the Year ended For the Year ended
Additional Provision 137.35 48.34
Payment/reversal/expenses 6.70 –
Closing Balance 253.26 122.61
24. Previous year’s figures have been regrouped/rearranged wherever necessary to conform to the current period grouping.
81
Consolidated Cash Flow Statement for the year ended March 31, 2007
(Rs. in million)
March 31, 2007 March 31, 2006
Net Profit after Tax 5,022.18 2,117.65
Adjustments For
Depreciation 5,636.77 4,451.45
Amortisation of Intangible assets 1,081.39 1,043.68
Interest charge and Forex 3,051.18 3,224.50
Profit on sale of current investment (81.32) (10.39)
Provision for Bad & Doubtful Debts/Advances 368.17 306.87
Provision for Gratuity, Leave Encashment & Site Restoration Cost 160.23 82.89
Provision for Current Tax 0.42 33.78
Provision for Deferred Tax 10.55 –
Provision for Fringe Benefit Tax 59.36 46.70
Liability no longer required written back (174.94) (164.98)
Interest received (171.03) (26.90)
Profit/(Loss) on sale of Fixed Assets/Assets Discarded (1.92) 0.24
9,938.86 8,987.84
Operating profit before working capital changes 14,961.04 11,105.49

Changes in Current Assets and Current Liabilities
(Increase)/Decrease in Sundry Debtors (590.08) (27.02)
(Increase)/Decrease in Inventories (69.97) 61.43
(Increase)/Decrease in Other Current Assets 27.70 (163.87)
(Increase)/Decrease in Loans and Advances (2,030.59) (403.05)
Increase/(Decrease) in Current Liabilities 3,861.03 2,297.98
1,198.09 1,765.47
Cash generated from operations 16,159.13 12,870.96
Tax paid (FBT & TDS) (101.82) (94.23)
Net cash from operating activities 16,057.31 12,776.73

Purchase of Fixed Assets & Intangible Assets (including CWIP) (22,819.05) (5,292.67)
Proceeds from sale of Fixed Assets 19.12 34.28
Sale/(purchase) of Other Investments (Net) (101.83) –
Interest and Dividend Received 145.49 37.29
Net cash from/(used in) investing activities (22,756.27) (5,221.10)
82
Consolidated Cash Flow Statement for the year ended March 31, 2007
(Rs. in million)
March 31, 2007 March 31, 2006

Proceeds from issue of Share Capital 25,000.00 –
Share Issue Expenses (620.04) –
Repayment of Preference Share Capital (4,830.00) –
Premium on redemption of Preference Shares (2,733.26) –
Proceeds from Long term borrowings 35,397.20 1,001.05
Repayment of Long Term Borrowings (15,690.05) (9,721.51)
Proceeds from Short Term Loan 17,874.66 19,847.36
Repayment of Short Term Loan (27,958.54) (15,209.57)
Short Term Loan to other Body Corporates – (376.92)
Interest Paid (3,039.37) (3,375.04)
Net cash from/(used in) financing activities 23,400.60 (7,834.63)
Net increase/(decrease) in cash and cash equivalent 16,701.64 (279.00)
Cash and cash equivalent at the beginning 1,492.53 1,771.53
Add : Cash and Cash Equivalents acquired on account of amalgamation 5.22 –
Add : Cash and cash equivalents taken over on acquisition 0.01 –
Cash and cash equivalent at the end 18,199.40 1,492.53
-
Notes to Cash Flow Statement for the year ended March 31, 2007
1. Cash and cash equivalent includes
– on Current Accounts 999.25 390.73
– on Deposit Accounts 16,970.86 938.95
18,199.40 1,492.53

2. The above cash flow statement has been prepared under the indirect method as set out in Accounting Standard 3 on Cash Flow
Statement issued by Institute of Chartered Accountants of India.
3. Previous year's figures have been rearranged/regrouped wherever necessary.
83
Statement pursuant to Section 212 of the Companies Act, 1956,
related to Subsidiary Companies
Sl. Particulars Swinder Singh Satara Aditya Birla
No. & Co. Limited Telecom Limited
1. Financial year of the Subsidiary ended on March 31, 2007 March 31, 2007
2. Shares of the Subsidiary held by
the Company on the above date
(a) Number & face value 50,000 Ordinary Shares 10,000,000 Ordinary Shares
of Rs. 10 each of Rs. 10 each
(b) Extent of holding 100% 100%
3. Net aggregate amount of profits/(losses )
of the subsidiary for the above financial year
on the subsidiary so far as they concern
members of the Company
(a) Dealt within the accounts of the Company Nil Nil

for the year ended March 31, 2007 (Rs. mn)
(b) Not dealt with the accounts of the Company
for the year ended March 31, 2007 (Rs. mn) 1.90 (24.26)
4. Net aggregate amount of profits/(Losses) for
previous year of the subsidiary so far as they
concern members of the Company
(a) Dealt within the accounts of the Company for Nil Nil
the year ended March 31, 2007 (Rs. mn)
(b) Not dealt with the accounts of the Company for
the year ended March 31, 2007 (Rs. mn) 1.72 (1.38)

Sanjeev Aga G. P. Gupta
Managing Director Director
AJS Jhala Arun Thiagarajan
Chief Financial Officer Director

84
DIRECTORS’ REPORT of aditya birla telecom limited
Dear Shareholders,
Your Directors have pleasure in presenting the Second Annual Report together with the Audited Accounts of your Company
for the period ended March 31, 2007.
Performance Review
Your Company has obtained the Licence to operate telecommunication services in the service area of Bihar
(including Jharkhand) issued by the Department of Telecommunications, Government of India and the same is under
implementation.
For the period under review, your Company earned income of Rs. 332,964/- by investing funds not required for
immediate use. After accounted for all expenses including financial and interest expenses it has incurred a net loss of
Rs. 22,995,692/- during the year.
Transfer of Entire Shareholding
The entire share capital of the Company has been transferred to Idea Cellular Limited from Aditya Birla Nuvo Limited on
February 28, 2007. Now your Company is a wholly-owned subsidiary of Idea Cellular Limited.
Dividend
Since the Company has not earned any profit for the period ended March 31, 2007, the Directors do not recommend any
dividend for the said period.
Deposits
Your Company has not accepted any deposit under Section 58A of the Companies Act, 1956 during the period ended
March 31, 2007.
Particulars as per Section 217 of the Companies Act, 1956.
Pursuant to Section 217(2A) of the Companies Act, 1956 and Companies (Particulars of Employees) Rules, 1975, it is
reported that there was no employee drawing remuneration during the period mentioned above.
Pursuant to Section 217(2AA) of the Companies Act, 1956, your Directors confirm that :
• In the preparation of the Annual Accounts, the applicable Accounting Standards have been followed along with
proper explanation relating to material departures;
• The Directors have selected such accounting policies and applied them consistently and made judgements
and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the
Company at the end of the Financial Year and of the profit or loss of the Company for that period;
• The Directors have taken proper and sufficient care for the maintenance of adequate accounting records in
accordance with the provisions of this Act for safeguarding the assets of the Company and for preventing and
detecting fraud and irregularities;
• The Directors have prepared the Annual Accounts on a going concern basis.
Directors
During the year, Mrs. Pinky Mehta resigned from the Board of Directors of your Company with effect from January 10,
2007. Further, during the period under review, your Board has been strengthened with the induction of Mr. AJS Jhala as
an Additional Director.
85
Adiyta Birla Telecom Limited
Mr. Manoj Kedia, Director of your Company, retires by rotation at the ensuing Annual General Meeting and being eligible,
offers himself for re-appointment.
Audit Committee
In terms of provisions of Section 292A of the Companies Act, 1956, the Board of Directors have constituted an Audit
Committee comprising of Mr. AJS Jhala, Mr. Adesh Gupta and Mr. Manoj Kedia as its members.
Auditors
The Statutory Auditors of the Company, M/s. Khimji Kunverji & Co., Chartered Accountants, Mumbai retire at the ensuing
Annual General Meeting of the Company and being eligible hereby offer themselves for re-appointment. Your Directors
recommend their re-appointment and authorise the Board to fix their remuneration.
Auditors’ Report
The observations made in the Auditors’ Report are self-explanatory and therefore, do not call for any further comments
under Section 217(3) of the Companies Act, 1956.
Conservation of Energy & Technology Absorption & Foreign Exchange Earnings and Outgo
(a) The particulars required by the Companies (Disclosure of Particulars in Report of Board of Directors) pursuant to
Section 217(1)(e) with regard to Conservation of Energy and Technology Absorption are not applicable since there
was no manufacturing activity during the period under review.
(b) There is no earning or outgoing in foreign exchange during the period under review.
Appreciation
Your Directors wish to place on record their appreciation for the support provided by the Bankers, Regulatory authorities etc.

Director Director
Date : August 31, 2007
Place : Mumbai
86
AUDITORS’ REPORT
To The Members of
Aditya Birla Telecom Limited
We have audited the attached Balance Sheet of Aditya Birla Telecom Limited as at March 31, 2007 and also the
Profit and Loss Account and the Cash Flow Statement for the year ended on that date annexed thereto. These financial
statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these
financial statements based on our audit.
We conducted our audit in accordance with auditing standards generally accepted in India. Those Standards require that
we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material
mis-statement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the
financial statements. An audit also includes assessing the accounting principles used and significant estimates made
by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a
reasonable basis for our opinion.
As required by the Companies (Auditors’ Report) Order, 2003 (hereinafter referred to as the Order), issued by the Company
Law Board in terms of Section 227 (4A) of the Companies Act, 1956 (hereinafter referred to as the Act), we enclose in
the Annexure a statement on the matters specified in paragraphs 4 and 5 of the said order.
Further to our comments in the Annexure referred to above, we report that :
(i) We have obtained all the information and explanations, which to the best of our knowledge and belief were necessary
for the purposes of our audit;
(ii) In our opinion, proper books of account as required by law have been kept by the Company so far as appears from
our examination of those books;
(iii) The Balance Sheet, Profit & Loss Account and Cash Flow Statement dealt with by this report are in agreement with
the books of account;
(iv) In our opinion, the Balance Sheet, Profit and Loss Account and Cash Flow Statement dealt with by this report comply
with the accounting standards referred to in Section 211(3C) of Act;
(v) On the basis of written representations received from the directors as on March 31, 2007 and taken on record by the
Board of Directors, we report that none of the directors is disqualified as on March 31, 2007 from being appointed
as a director in terms of Clause (g) of sub–section (1) of Section 274 of the Act;
(vi) In our opinion and to the best of our information and according to the explanations given to us, the said accounts
give the information required by the Companies Act, 1956, in the manner so required and give a true and fair view in
conformity with the Accounting Principles generally accepted in India:
a) in the case of the Balance Sheet, of the state of the affairs of the Company as at March 31, 2007;
b) in case of the Profit and Loss Account, of the Loss of the Company for the year ended on that date; and
c) in the case of Cash Flow Statement, of the cash flows of the Company for the year ended on that date.
For and on behalf of

Khimji Kunverji & Co.
Chartered Accountants
Per Shivji K. Vikamsey

Partner
Membership No.: 2242

Place : Mumbai
87
Annexure to the Auditors’ Report
(i) (a) The Company has maintained proper records showing full particulars, including quantitative details and situation
of fixed asset. Fixed assets have been physically verified by the management at reasonable interval. As informed,
no material discrepancies were noticed on such verification.
(b) The Company has not disposed off a substantial part of its fixed assets during the year.
(ii) The Company does not hold any stock in trade, hence Clause 4(ii)(a), 4(ii)(b) and 4(ii)(c) of the Order are not
applicable to the Company.
(iii) (a) The Company has not granted any loans, secured or unsecured to companies, firms, and other parties listed in
the register maintained under Section 301 of the Companies Act, 1956. Hence Clause (iii)(b),(c) and (d) are not
(b) The Company has not taken any loans, secured or unsecured from companies, firms, and other parties listed in
the register maintained under Section 301 of the Companies Act, 1956. Hence Clause (iii) (f) and (g) are not
(iv) In our opinion, and according to the information and explanations given to us, there is an adequate internal control
system commensurate with the size of the Company and the nature of its business, for the purchase of fixed assets.
During the year the Company has neither purchased any inventory nor sold any goods or services, hence, the question
of an adequate internal control system commensurate with the size of the Company and the nature of its business
for the areas does not arise.
(v) Based on the Audit procedures applied by us, and according to information and explanations provided by the
management, there are no contracts or arrangements referred to in Section 301 of the Act need to be entered into
the register maintained under the Section. In view of this Clause 4(v)(b) is not applicable.
(vi) The Company has not accepted any deposit from the public in terms of the provisions of Section 58A, 58AA or any
other relevant provisions of the Act. No order has been passed by the Company Law Board or National Company Law
Tribunal or Reserve Bank of India or any Court or any Tribunal.
(vii) The Company has initiated the internal audit and is in the process of getting the internal audit completed.
(viii) The Company is not required to maintain any cost records prescribed by the Central Government under Clause (d) of
sub-section (1) of Section 209 of the Act.
(ix) (a) The Company is regular in depositing undisputed Income tax and there are no arrears thereof as at
March 31, 2007 for a period of more than six months from the date they become payable. During the financial
year under review, there were no employees on the rolls of the Company. Personnel from IDEA Group of companies
have been deployed for rolling out the Cellular-Mobile Network in Bihar Circle and expenses thereon have been
accounted for on the basis of reimbursement claimed by Idea Group of companies. Accordingly Provident Fund
is paid by respective Idea Group companies. We are informed that Investor Education and Protection Fund,
Employees’ State Insurance, Sales Tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty, Cess, and other
statutory dues are not applicable to the Company. There were no arrears as at March 31, 2007 for a period of
more than six months from the date they became payable.
(b) According to the information and explanations given to us there are no disputed Income Tax dues which had not
been deposited.
(x) Since the Company is registered for less than five years the provisions of Clause 4(x) of the Order, not applicable to
the Company.
(xi) The Company has not taken any loans from financial institutions or banks. Therefore, the provisions of Clause 4(xi) of
the Order, not applicable to the Company.
88
(xii) According to the information and explanations given to us and based on the documents and records produced to us,
the Company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures
and other securities.
(xiii) In our opinion, the Company is not a chit fund or a nidhi/ mutual benefit fund/ society. Therefore, the provisions of
clause 4(xiii) of the Order, are not applicable to the Company.
(xiv) In our opinion, the Company is not dealing in or trading in shares, securities, debenture and other investment.
Accordingly, the provisions of Clause 4(xiv) of the Order, are not applicable to the Company.
(xv) According to information and explanations given to us the company has not given any guarantee for loans taken by
others, from banks or financial institutions. Accordingly, the provision of Clause 4(xv) of the Order is not applicable to
the Company.
(xvi) According to the information and explanations given to us, the Company has not raised any term loans during the
year. Accordingly, the provision of Clause 4(xvi) of the Order is not applicable to the Company.
(xvii) According to the information and explanations given to us and on the overall examination of the balance sheet of the
Company, we report that no funds raised on short-term basis have been used for long-term investment.
(xviii) The Company has not made preferential allotment of shares to parties and companies covered in the register
maintained under Section 301 of the Act.
(xix) The Company has not issued any debentures during the year.
(xx) The Company has not raised any money through a public issue during the year.
(xxi) Based upon the audit procedures performed and information and explanations given by the management, we report
that no fraud on or by the Company has been noticed or reported during the course of our audit.
For and on behalf of

Khimji Kunverji & Co.
Per Shivji K. Vikamsey

Partner

Place : Mumbai
89
(Amount in Rupees)

SCHEDULES March 31, 2007 March 31, 2006
SOURCES OF FUNDS
Shareholders' Funds
Share Capital 1 100,000,000 100,000,000
Loans
Unsecured Loan from holding company 40,000,000 –
TOTAL 140,000,000 100,000,000
Fixed Assets 2
Gross Block 100,000,000 –
Less: Accumulated Depreciation/Amortisation – –
Net Block 100,000,000 –
Capital Work In Progress 3,875,988 –
Total Fixed Assets 103,875,988 –
Investments 3 12,321,266 38,164,072
Current Assets
Cash and Bank Balances 4 12,287 622,561
Loans and Advances 5 5,653,941 60,008,992
5,666,228 60,631,553
Less : Current Liabilities and Provisions
Current Liabilities 6 7,502,854 12,275
Provision for Taxation (Net of Advances payment of Tax) – 160,030
7,502,854 172,305
Net Current Assets/(Liabilities) (1,836,626) 60,459,248

Profit and Loss Account 25,639,372 1,376,680
TOTAL 140,000,000 100,000,000
Significant Accounting Policies and Notes to Accounts 10
(The Schedules referred to above forms an integral part of Accounts)
For Khimji Kunverji & Co.
Per Shivji K. Vikamsey AJS Jhala Sanjeev Aga

Partner Director Director
Date : August 31, 2007 Anurag Upadhyaya

Place : Mumbai Company Secretary
90
PROFIT AND LOSS ACCOUNT FOR THE YEAR ENDED MARCH 31, 2007
(Amount in Rupees)
SCHEDULES
March 31, 2007 March 31, 2006
INCOME
Other Income 7 332,964 1,535,990
332,964 1,535,990
EXPENDITURE
Other Expenses 8 656,500 2,387,670
Interest and other Financial Expenses (Net) 9 22,672,156 –
23,328,656 2,387,670
Profit/(Loss) for the year (22,995,692) (851,680)
Provision for Tax 1,267,000 525,000
Profit/(Loss) after tax (24,262,692) (1,376,680)
Balance brought forward (1,376,680) –
Profit/(Loss) available for Appropriation (25,639,372) (1,376,680)
(25,639,372) (1,376,680)
Basic Earning per Share (in Rupees) (2.43) (0.58)

(The Schedules referred to above forms an integral part of Accounts)


91
SCHEDULES FORMING PART OF ACCOUNTS
(Amount in Rupees)
As at As at
March 31, 2007 March 31, 2006
SCHEDULE 1
SHARE CAPITAL
AUTHORISED SHARE CAPITAL
30,090,000 Equity Shares of Rs. 10/- each 300,900,000 300,900,000
1000 Redeemable Preference Shares of Rs. 100/- each 100,000 100,000
301,000,000 301,000,000
ISSUED, SUBSCRIBED AND PAID-UP
10,000,000 Equity Shares of Rs. 10/- each fully paid-up 100,000,000 100,000,000
(The entire paid-up equity capital is held by the holding company, Idea Cellular
Limited)
(Till February 27, 2007, the entire paid-up equity capital was held by the
erstwhile holding company Aditya Birla Nuvo Limited)
100,000,000 100,000,000

SCHEDULE 2
FIXED ASSETS
(Amount in Rupees)
Gross Block Amortisation Net Block
Particulars As at Addition / As at As at As at As at As at
For the
March 31, (Deduction) March 31, March 31, March 31, March 31, March 31,
Year
2006 during the Year 2007 2006 2007 2007 2006
Intangible Assets
Entry/License Fees – 100,000,000 100,000,000 – – – 100,000,000 –
Total – 100,000,000 100,000,000 – – – 100,000,000 –

Previous Year – – – – – –
92
Schedules Forming part of Accounts
(Amount in Rupees)
As at As at
March 31, 2007 March 31, 2006
SCHEDULE 3
INVESTMENTS
Current Investment - Unquoted
Birla Cash Plus Institutional Premium Plan Daily Dividend (1,229,728.61 units) 12,321,266 38,164,072
(Repurchase price Rs. 12,321,266.80, Previous year Rs. 38,188,044.57)
10,674,851.475 Units of Mutual Fund scheme purchase and redeemed
during the year, (Previous year 16,571,733.696)
169,464,540 Nos. of Equity Shares of Idea Cellular Ltd. purchased & sold
during the year, (Previous Year Nil)
12,321,266 38,164,072
SCHEDULE 4
Balance with Scheduled Banks
In Current Account 12,287 20,570
Cash In Hand – 4,035
Cheques on Hand – 597,956
12,287 622,561
SCHEDULE 5
LOANS AND ADVANCES
(Unsecured, considered good except otherwise stated)
Advances recoverable in cash or kind or for value to be received 12,600 –
Deposits 655,000 60,008,992
(Net of Doubtful, fully provided Rs. Nil, Previous year Rs. Nil)

Advance payment of Income Tax and TDS (Net of Income Tax Provision) 4,986,341 –

5,653,941 60,008,992

1) Amount due from Officers 12,600 –
2) Maximum amount due from Officers at any time during the year 12,600 –
3) Due from subsidiary companies (provide name of Companies) – –
4) Includes amount due against advances/ICD given to (give name of Unit/Companies) – –

SCHEDULE 6
Current Liabilities
Sundry Creditors - Amount Payable to Holding Company 4,865,786 –
Other Liabilities 84,180 12,275
Interest Accrued but not due to Holding Company 2,552,888 –
7,502,854 12,275
Provisions
Taxation (Net of Advance Payment) – 160,030
7,502,854 172,305

93
(Amount in Rupees)
ended ended
March 31, 2007 March 31, 2006

SCHEDULE 7
OTHER INCOME
Dividend on Current Investment 332,964 –
Profit on Sale of Investment (Net)
Current – 754,072
Miscellaneous Income
Interest (TDS Rs Nil, Previous Year Rs 174,970) – 781,918
332,964 1,535,990

SCHEDULE 8
OTHER EXPENSES
Payment to Statutory Auditors
For Audit Fees 30,000 7,500
For Certification work 45,000 3,500
For Reimbursement of Expenses 9,180 1,275
Salary, Wages & Bonus 211,319 –
Recruitment Expenses 43,315 –
Travelling Expenses 44,872 –
Office & General Expenses 22,692 –
Stamp Duty and Registrar of Companies filing fees – 2,319,430
Preliminary Expenses – 52,145
Loss on sale of Current Investment (Net) 244,979 –
Miscellaneous Expenses 5,143 3,820
656,500 2,387,670

SCHEDULE 9
INTEREST AND OTHER FINANCIAL EXPENSES
Interest
On Bank Over Draft 66,028 –
Others 50,443,917 –
50,509,945 –

Less : Interest Income (TDS Rs. 6,220,549, Previous Year Rs. Nil) 27,837,789 –
22,672,156 –

94
SCHEDULE 10
A. SIGNIFICANT ACCOUNTING POLICIES
Accounting Convention
The financial statements are prepared under the historical cost convention, on an accrual basis and in accordance
with the applicable accounting standards.
Investments
Long Term Investments are stated at cost after deducting provision, if any, made for decline, other than temporary, in
the values.
Current Investments are stated at lower of cost and market/fair value.
Taxation
Provision for current tax is made on the basis of estimated taxable income for the current accounting year in accordance
with the Income Tax Act, 1961.
The deferred tax for timing differences between the book and tax profits for the year is accounted for, using the tax
rates and laws that have been substantively enacted as of the Balance Sheet date.
Deferred tax assets arising from timing differences are recognised to the extent there is reasonable certainty that
these would be realised in future.
Deferred tax assets are recognised on unabsorbed losses only if there is virtual certainty that such deferred tax asset
can be realised against future taxable profits.
Revenue Recognition
Income from services rendered is recognised as they are rendered based on agreements/arrangements with the
concerned parties.
Dividend income on investment is accounted for when the right to receive the payment is established.
Fixed Assets
Fixed Assets are stated at cost, less accumulated depreciation and impairment loss if any, Cost comprises the
purchase price and any attributable cost of bringing the asset to its working condition for its intended use.
Depreciation/Amortisation
Intangible Assets
Cost of Rights & Licenses including the entry fees paid is amortised on commencement of operations over the period
of license.
Contingent Liability
Contingent liabilities are not provided for and are disclosed by way of notes.
95
B. Notes to Accounts
1. Contingent Liabilities not provided for:

Corporate Guarantee given to Bank/Financial Institution worth Rs. 70,000,000/-
2. Loans & Advances include:
(Amount in Rupees)
Amount Receivable Balance Maximum Balance Maximum
From companies under the same as on amount as on amount
management within the meaning of March 31, due at any March 31, due at any
sub-section (1B) of Section 370 of the 2007 time during 2006 time during
Companies Act, 1956 the year the year
2006-07 2005-06
Birla Global Finance Company – 60,000,000 – –
Laxminarayan Investments Ltd. – 10,000,000 10,000,000 10,000,000
Madura Garments Export Limited – 10,000,000 10,000,000 10,000,000
Alpha Garments Private Limited – 10,000,000 10,000,000 10,000,000
(Merged with MGEL w.e.f. April 1, 2006)
3. Employee & Expenses:

During the financial year under review, there were no employees on the rolls of the Company. Personnel from IDEA
Group Companies have been deployed for rolling out the Network Project in the Bihar Circle. Expenses thereon as well
as other expenses (excluding Fringe Benefit Tax) have been accounted for on the basis of reimbursement claimed by
Idea Group companies.
4. Deferred Tax assets on account of timing difference towards brought forward business loss are not recognised, as
there is no reasonable certainty that sufficient future taxable income will be available to realise the deferred tax
assets.
5. Capital Work in Progress includes:
Amount in
Particular
Rupees
Recruitment Expenses 245,456
Travelling Expenses 254,275
Rent 245,830
Professional Fees 242,000
Salary 2,291,948
Office & General Expenses 128,592
Telephone Charges 30,217
Bank Guarantee Commission 437,670
Total 3,875,988
96
6. Disclosure in respect of Related Parties pursuant to Accounting Standard - 18 :
List of Related Parties as on March 31, 2007
I. Holding Company
Aditya Birla Nuvo Ltd. (ABNL) (upto February 28, 2007)
Idea Cellular Ltd. (ICL) (with effect from February 28, 2007)
II. Fellow Subsidiaries of ABNL with whom transaction upto February 28, 2007.
Alpha Garments Pvt. Ltd. (AGL) (merged with MGEL w.e.f. April 1, 2006)
Birla Global Finance Company Ltd. (BGFCL)
Laxminarayan Investment Ltd. (LIL)
Madura Garments Export Ltd. (MGEL)
Transworks Information Services Ltd. (TISL)
III. Key Management Person
Ms. Nehal Shah, Manager (upto August 1, 2007)
IV. During the year following transactions were carried out with the related parties in the ordinary course
of business.
(Amount in Rupees)
Related Party Transaction Holding Co. - ABNL Holding Co. - ICL Fellow Subsidiaries
of ABNL
Interest Income
Laxminarayan Investment Ltd. 116,986
(109,315)
Alpha Garments Ltd. 243,287
(2,192)
Madura Garments Exports Ltd. 133,699
(2,192)
Birla Global Finance Co. Ltd. 3,615,443
(–)
Interest Expenses
Aditya Birla Nuvo Ltd. 30,271,870
(–)
Transworks Information Services Ltd. 1,665,812
(–)
Idea Cellular Ltd. 2,761,918 –
(–) (–)
Investment
Sale of Shares of Idea Cellular Ltd. 6,863,313,870
(–)
Inter Corporate Deposits given
(–)
Laxminarayan Investment Ltd. –
(10,000,000)
Madura Garment Exports Ltd. –
(10,000,000)
Alpha Garments Private Ltd. –
(10,000,000)
97
Related Party Transaction Holding Co. - ABNL Holding Co. - ICL Fellow Subsidiaries
of ABNL
Inter Corporate Deposits Obtained
Aditya Birla Nuvo Ltd. 6,791,100,000
(–)
(–)
Idea Cellular Ltd. 100,000,000
(–)
ICD Repaid
Aditya Birla Nuvo Ltd. 6,791,100,000
(–)
(–)
Idea Cellular Ltd. 60,000,000
(–)
Inter Corporate Deposits given received back
(–)
Laxminarayan Investment Ltd. 10,000,000
(–)
Madura Garments Exports Ltd. 10,000,000
(–)
Alpha Garments Export Ltd. 10,000,000
(–)
Outstanding Balance as on March 31, 2007
Inter Corporate Deposits 40,000,000
(–)
Sundry Creditors 4,865,786
(–)
Interest Payable 2,552,888
(–)
Notes: 1. Figures in brackets represent corresponding amount of previous year.

2. No amount in respect of the related parties has been written back/off is provided for during the year.
3. Related parties relationship have been identified by the management and relied upon by Auditors.
7. Earning Per Share (EPS) is calculated as under:

(Amount in Rupees)
Particulars For the year For the year
ended March ended March
31, 2007 31, 2006
Numerator – Net Profit/(Loss) as disclosed in Profit & Loss Account (24,262,692) (1,376,680)
Denominator – weighted average number of Equity Shares outstanding 10,000,000 2,383,698
Nominal value of Shares (in Rs.) 10/- 10/-
98
8. Estimated amount of contract remaining to be executed on Capital Account and not provided for (net of advance)
Rs. Nil, (Previous year Rs. Nil)
9. There is no other additional information pursuant to para 3, 4C, 4D, of Part II of Schedule VI of the Companies Act,
1956.
10. There is no outstanding amount due to Small Scale Industries (SSI) at the year-end.
11. There is no outstanding amount due to Micro, Small and Medium Enterprises defined under The Micro, Small and
Medium Enterprises Development Act, 2006.
12. Previous year’s figures have been re-grouped/re-arranged wherever necessary.


99
CASH FLOW STATEMENT FOR THE YEAR ENDED MARCH 31, 2007
(Amount in Rupees)
March 31, 2007 March 31, 2006

A. CASH FLOW FROM OPERATING ACTIVITIES
Profit/(Loss) after tax (24,262,692) (851,680)
Adjustments for :
Depreciation – –
(Profit)/Loss on sale of investments (244,979) (754,072)
Other Income – (781,918)
Interest Expense 22,672,156 –
Dividend Income (332,964) 22,094,214 – (1,535,990)
Exceptional Items: – –
OPERATING PROFIT BEFORE WORKING CAPITAL CHANGES (2,168,478) (2,387,670)

Entry Fees (100,000,000) –
Capital Work in Progress (3,875,988) –
Decrease/(Increase) in trade and other
receivables (12,600) –
Decrease/(Increase) in deposits 59,353,992 –
Decrease/(Increase) in taxation (5,146,371) –
Increase/(Decrease) in trade and other
payables 7,490,579 (42,190,388) 12,275 12,275
CASH GENERATED FROM OPERATIONS (44,358,866) (2,375,395)

Income Taxes Paid – (364,970)
NET CASH FROM OPERATING ACTIVITIES (44,358,866) (2,740,365)
B. CASH FLOW FROM INVESTING ACTIVITIES

Receipt of Interest – 781,918
Profit/(loss) on sale of investments 244,979 –
Dividend Income 332,964 754,072
Sale/Redemption/(Purchase) of
investments (net) 25,842,806 (38,164,072)
Payment of Interest (22,672,156) (8,992)
NET CASH (USED IN)/FROM INVESTING ACTIVITIES 3,748,593 (36,637,074)
100
CASH FLOW STATEMENT FOR THE YEAR ENDED MARCH 31, 2007
(Amount in Rupees)
March 31, 2007 March 31, 2006

C. CASH FLOW FROM FINANCING ACTIVITIES
Loans given – (60,000,000)
Loans given received back – –
Loan borrowed 100,000,000 –
Loan repaid (60,000,000) –
Proceeds of Issue of Capital – 100,000,000
NET CASH (USED IN)/FROM FINANCING ACTIVITIES 40,000,000 40,000,000
NET INCREASE IN CASH AND EQUIVALENTS (610,274) 622,561
CASH AND CASH EQUIVALENTS (OPENING BALANCE) 622,561 –
CASH AND CASH EQUIVALENTS (CLOSING BALANCE) 12,287 622,561

101
balance SHEET Abstract and company’s general business profile
Registration No. 1 1 – 1 5 8 9 0 State Code 0 4 Date 2 0 1 2 2 0 0 5
Date Month Year
II. CAPITAL RAISED DURING THE YEAR (Rupees in Thousand)

N I L N I L
Bonus Issue Private Placement*
N I L N I L
III. POSITION OF MOBILISATION AND DEPLOYMENT OF FUNDS (Rupees in Thousand)
1 4 0 0 0 0 1 4 0 0 0 0
SOURCES OF FUNDS
1 0 0 0 0 0 N I L
N I L 4 0 0 0 0
1 0 3 8 7 6 1 2 3 2 1
Net Current Assets/(Liability) Miscellaneous Expenditure
– 1 8 3 7 N I L
Accumulated Losses
2 5 6 3 9
IV. PERFORMANCE OF COMPANY (Rupees in Thousand)

3 3 3 2 3 3 2 9
(*includes other income) (*Includes prior period adjustments)
+ – Profit/(Loss) Before Tax + – Profit/(Loss) After Tax
– 2 2 9 9 6 – 2 4 2 6 3
(Please tick appropriate box + for profit- for loss)
Earnings Per Share in Rs. Dividend Rate (%)
– 2 . 4 3 – –
V. GENERIC NAMES OF PRINCIPAL PRODUCTS/SERVICES OF THE COMPANY (As per Monetary Terms)
Item Code No. (ITC Code) N O T A P P L I C A B L E
Description T E L E C O M S E R V I C E S

Director Director

102
Directors’ Report of swinder singh satara & Co. limited
Dear Shareholders,
Your Directors have pleasure in presenting the Annual Report of your Company together with the Audited Financial Statements for the
year ended March 31, 2007.
Financial Results
Your Company is yet to commence operations in its principal line of business. The financial results for the year ended March 31, 2007
is as set out below:
(Amount in Rupees)
Particulars 2006-07 2005-06
Gross Income from operations 2,786,989 2,700,000
Profit/(Loss) Before Depreciation & Taxation 2,366,500 2,353,398
Depreciation 110,967 110,967
Taxation 358,360 519,508
Net Profit/(Loss) for the year 1,897,173 1,722,923
Profit/(Loss) C/f to Balance Sheet 8,425,044 6,527,871
Fixed Deposits
Your Company has not accepted any fixed deposits during the year under review.
Particulars of Employees
The Company does not have employees to whom provisions of Section 217(2A) of the Companies Act, 1956 read with Companies
(Particulars of Employees) Rules, 1975 as amended apply.
Conservation of Energy, Technology Absorption and Foreign Exchange Earnings/Outgo

The Company is not engaged in any manufacturing activity and therefore there are no particulars to be disclosed under Section
217(1)(e) of the Companies (Disclosure of Particulars in the Report of the Board of Directors) Rules, 1988, related to conservation of
energy and technology absorption.
There is no Foreign Exchange Earnings and Outgo during the year.

In relation to financial statements for the year ended March 31, 2007, the Board of Directors state that:
1. The applicable accounting standards have been followed in preparation of the financial statements and there are no material
departures from the said standards;
2. Reasonable and prudent accounting policies have been used in the preparation of the financial statements, that they have been
consistently applied and that reasonable and prudent judgements and estimates have been made in respect of the items not
concluded by the year end, so as to give a true and fair view of the state of affairs of the Company as at March 31, 2007 and of
the profit/(Loss) for the year ended March 31, 2007;
3. Proper and sufficient care has been taken for maintenance of adequate accounting records in accordance with the provisions of the
Companies Act, 1956, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
and
4. The financial statements have been prepared on a going concern basis.
103
Directors
During the year under review, Mr. Satish Rajgarhia, and Mr. Vikram Mehmi resigned from the Board of Directors of your Company with
effect from August 31, 2006 and November 1, 2006 respectively.
The Board of Directors, at its meeting held on August 31, 2006 and November 1, 2006 appointed Mr. AJS Jhala & Mr. Sanjeev Aga as
Additional Directors of your Company with effect from August 31, 2006 and November 1, 2006 respectively. They will hold office upto
the date of ensuing Annual General Meeting, but are eligible to be re-appointed thereat.
Auditors
The Statutory Auditors of the Company, M/s. RSM & Co., Chartered Accountants, New Delhi retire at the ensuing Annual General
Meeting of the Company. The members are informed that M/s. RSM & Co., Chartered Accountants have since been merged with
another firm of Chartered Accountants.
Therefore, your Directors recommend the appointment of M/s. Deloitte Haskins and Sells, Chartered Accountants, who have confirmed
their eligibility and willingness to accept the office if appointed, as Statutory Auditors of the Company to hold office from the conclusion
ensuing Annual General Meeting until the conclusion of the next Annual General Meeting of the Company at such remuneration as may
be decided by the Board.
Acknowledgements
Your Directors wish to place on record their sense of appreciation for the excellent support received from the State Government
Authorities, Bankers and Consultants in the working of the Company.

Director Director
Date : September 4, 2007
Place : Mumbai
104
AUDITORS’ REPORT
To The Members of
1. We have audited the attached Balance Sheet of Swinder Singh Satara & Co. Limited (‘the Company’), as at March 31, 2007
and also the Profit and Loss Account and Cash Flow Statement of the Company for the year ended on that date, annexed thereto
(together referred to as ‘financial statements’).These financial statements are the responsibility of the Company’s management.
Our responsibility is to express an opinion on these financial statements based on our audit.
2. We conducted our audit in accordance with auditing standards generally accepted in India. Those Standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial statements are free of material mis-statement.
An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the
overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.
3. As required by the Companies (Auditor’s Report) Order, 2003, (‘the said Order’) issued by the Central Government of India in
terms of sub-section (4A) of Section 227 of the Companies Act, 1956, on the basis of such checks of the books and records of
the Company as we considered necessary and appropriate and according to information and explanations given to us during the
course of the audit, we enclose in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the said Order, to
the extent applicable to the Company.
4. Further to our comments in the Annexure referred to in paragraph 3 above, we report that :
(a) we have obtained all the information and explanations which to the best of our knowledge and belief were necessary for the
purposes of our audit;
(b) in our opinion, proper books of account as required by law have been kept by the Company so far as appears from our
examination of those books;
(c) the Balance Sheet, Profit and Loss Account and Cash Flow Statement dealt with by this report are in agreement with the books
of account;
(d) in our opinion, the Balance Sheet, Profit and Loss Account and Cash Flow Statement dealt with by this report comply with the
Accounting Standards referred to in sub-section (3C) of Section 211 of the Companies Act, 1956 so far as they apply to the
Company;
(e) on the basis of the written representations received from the directors as on March 31, 2007 and taken on record by the Board
of Directors, we report that none of the directors is disqualified as on March 31, 2007 from being appointed as a director in
terms of clause (g) of sub-section (1) of Section 274 of the Companies Act, 1956;
(f) in our opinion and to the best of our information and according to the explanations given to us, the said financial statements
read together with the notes thereon give the information required by the Companies Act, 1956, in the manner so required
and give a true and fair view in conformity with the accounting principles generally accepted in India:
(i) in the case of the Balance Sheet, of the state of affairs of the Company as at March 31, 2007;
(ii) in the case of the Profit and Loss Account, of the profit of the Company for the year ended on that date; and
(iii) in the case of the Cash Flow Statement, of the cash flows of the Company for the year ended on that date.
For RSM & Co.

Vilas Y. Rane
Partner
Date : September 4, 2007 Membership No.: F – 33220
Place : Mumbai
105
ANNEXURE TO THE AUDITORS’ REPORT
(Referred to in paragraph 3 of our report of even date to the members of Swinder Singh Satara & Co. Limited on the accounts for the
year ended March 31, 2007)
1. a) The Company has maintained proper records showing full particulars, including quantitative details and situation of fixed
assets.
b) As informed and represented to us, fixed assets have been physically verified by the management during the year and no
material discrepancies were noticed on such verification.
c) According to the information and explanations given to us, the Company has not disposed off any fixed assets during the year
and accordingly, the provisions of paragraph 4(i)(c) of the said Order relating to going concern are not applicable.
2. In our opinion, the Company is not dealing in any inventories. Accordingly, the provisions of paragraphs 4(ii)(a) to 4(ii)(c) of the said
Order relating to physical verification, frequency of verification, procedures of physical verification and maintenance of inventory
records are not applicable to the Company.
3. According to the information and explanations given to us, the Company has not taken/granted any loans, secured or unsecured
from/to the companies, firms, or other parties listed in the register maintained under Section 301 of the Companies Act, 1956.
Accordingly, the provisions of the paragraphs 4(iii)(b) to 4(iii)(d) and 4(iii)(f) and 4(iii)(g) are currently not applicable to the
Company.
4. In our opinion and according to the information and explanations given to us, there are adequate internal control procedures
commensurate with the size of the Company and the nature of its business with regard to purchase of fixed assets. During the
current year, the Company had no transactions of purchase of inventories and sale of goods and services.
5. In our opinion and according to the information and explanations given to us, there were no contracts, particulars of which needed
to be entered in the register maintained under Section 301 of the Companies Act, 1956 and hence the provisions of paragraph
4(v)(b) of the said Order relating to reasonableness of price having regard to prevailing market price are not applicable to the
Company.
6. In our opinion and according to the information and explanations given to us, the Company has not accepted any deposits from the
public within the meaning of Section 58A and 58AA of the Companies Act, 1956 and accordingly, the provisions of paragraph 4(vi)
of the said Order relating to reasonableness of price having regard to prevailing market price are not applicable to the Company.
7. The provisions of paragraph 4(vii) of the said Order relating to internal audit system are not applicable to the Company, since the
Company is not a listed company, neither does its paid–up capital and reserves exceeds Rs. 50 lakhs at the commencement of the
financial year concerned nor does the Company have an average annual turnover exceeding five crore rupees for a period of three
consecutive financial years immediately preceding the financial year concerned.
8. The Central Government has not prescribed maintenance of cost records under Section 209(1)(d) of the Companies Act, 1956 for
any of the activities of the Company and accordingly, the provisions of paragraph 4(vii) of the said Order are not applicable.
9. a) The Company is regular in depositing with appropriate authorities undisputed income tax dues. During the year there were no
undisputed statutory dues including those under Provident Fund, Investor Education and Protection Fund, Employees State
Insurance, Income Tax, Sales Tax, Wealth Tax, Service Tax, Customs Duty, Excise Duty, Cess and any other statutory dues.
b) There were no undisputed amounts payable in respect of Income Tax, Service Tax, Sales Tax, Customs Duty, Excise Duty and
Cess outstanding, as at March 31, 2007 for a period of more than six months from the date they became payable.
c) According to the records of the Company, there are no dues of Sales Tax, Income Tax, Customs Duty and Excise Duty which
have not been deposited on account of any dispute.
10. The Company neither has any accumulated losses as at March 31, 2007 nor has incurred any cash losses in the current financial
year and in the immediately preceding financial year and accordingly, the provisions of paragraph 4(x) of the said Order are not
applicable.
11. The Company has not borrowed any funds from financial institutions or banks or debenture holders and accordingly, the provisions
of paragraph 4 (xi) of the said Order relating to default to such parties are not applicable.
12. The Company has not granted loans and advances on the basis of security by way of pledge of shares, debentures and other
securities and therefore, the provisions of paragraph 4(xii) of the said Order relating to maintenance of documents and records are
not applicable.
106
13. In our opinion, the Company is not a chit fund or a nidhi/ mutual benefit fund/ society. Hence, the provisions of paragraph 4(xiii) of
the said Order relating to compliance with the provisions of special statute relevant to chit fund and nidhi/ mutual benefit/ societies
are not applicable to the Company.
14. In our opinion, the Company is not dealing in or trading in shares, securities, debentures and other investments. Accordingly, the
provisions of paragraph 4(xiv) of the said Order relating to maintenance of proper records, timely entries and holding investments
in own name are not applicable to the Company.
15. The Company has not given any guarantee for loans taken by others, from banks or financial institutions and accordingly, the
provisions of paragraph 4(xv) of the said Order relating to terms and conditions and whether prejudicial to Company’s interest are
not applicable to the Company.
16. The Company has not raised any short-term funds during the year and therefore, the provisions of paragraph 4(xvii) of the said
Order relating to usage of such funds are not applicable to the Company.
17. The Company has not raised any short-term funds during the year and therefore, the provisions of paragraph 4(xvii) of the said
Order relating to usage of such funds are not applicable.
18. The Company has not made any preferential allotment of shares to parties and companies covered in the register maintained under
Section 301 of the Companies Act, 1956 and accordingly, the provisions of paragraph 4(xviii) of the said Order relating to terms
and conditions and whether prejudicial to Company’s interest are not applicable to the Company.
19. The Company has not issued any debentures and accordingly, the provisions of paragraph 4(xix) of the said Order relating to
creation of securities or charges in respect of debentures are not applicable to the Company.
20. The Company has not raised any fresh share capital during the year and accordingly, the provision of paragraph 4(xx) of the said
Order relating to end use of money raised are not applicable.
21. During the course of our examination of the books of accounts carried out in accordance with generally accepted auditing practices
in India we have neither come across any incidence of fraud on or by the Company nor have we been informed of any such case
by the management.
For RSM & Co.

Vilas Y. Rane
Partner
Date : September 4, 2007 Membership No.: F – 33220
Place : Mumbai
107
(Amount in Rupees)
SOURCES OF FUNDS
Shareholders’ Funds
Share Capital 1 500,000 500,000
Profit & Loss Account 8,425,044 6,527,871
TOTAL 8,925,044 7,027,871
Fixed Assets
Gross Block (At Cost) 2 7,090,635 7,090,635
Less : Depreciation 554,834 443,867
Net Block 6,535,801 6,646,768

Current Assets
Cash and bank balances 3 2,108,930 1,358,401
Loans and advances 4 1,060,884 603,979
3,169,814 1,962,380
Less : Current Liabilities and Provisions 5 780,571 1,581,277
Net Current Assets 2,389,243 381,103
TOTAL 8,925,044 7,027,871

For RSM & Co
Vilas Y. Rane AJS Jhala Sanjeev Aga

Membership No.: F-33220

Place : Mumbai
108
PROFIT AND LOSS ACCOUNT FOR THE PERIOD ENDED MARCH 31, 2007
(Amount in Rupees)
INCOME
Rental Income 2,700,000 2,700,000

Interest Income 86,989 –
Total 2,786,989 2,700,000
Administration and Other Expenses 6 420,489 346,602

531,456 457,569
Profit/(Loss) before taxes 2,255,533 2,242,431
Provision for tax (net off Rs. 176,370 excess provision 358,360 519,508
written back (Previous Year : Rs. Nil)
Profit/(Loss) after tax 1,897,173 1,722,923
Balance Carried forward from previous year 6,527,871 4,804,948
Balance Carried to Balance Sheet 8,425,044 6,527,871
Earning per Share

Basic No. of equity Share of Rs. 10 each outstanding 50,000 50,000
Basic weighted No. of equity Share of Rs. 10 each outstanding 50,000 50,000
Basic Earning per Share 37.94 34.46
For RSM & Co


Place : Mumbai
109
Schedules forming part of ACCOUNTS
(Amount in Rupees)
As at As at
March 31, 2007 March 31, 2006
SCHEDULE 1
SHARE CAPITAL
AUTHORISED
50,000 Equity Shares of Rs.10 each 500,000 500,000
500,000 500,000
ISSUED, SUBSCRIBED AND PAID-UP
Equity Share Capital
50,000 Equity Shares of Rs. 10 each fully paid up 500,000 500,000
(All the shares are held by the holding company-Idea Cellular Limited)
500,000 500,000
Schedule 2
FIXED ASSETS
(Amount in Rupees)
Particulars Gross Block Depreciation Net Block
As at Additions Sale/ As at As at For the Sale/ As at As at As at
April 1, during Adjustment March 31, April 1, year Adjustment March 31, March 31, March 31,
2006 the year during the 2007 2006 during the 2007 2007 2006
year year
Leasehold Land 282,859 - - 282,859 - - - - 282,859 282,859
Building 6,807,776 - - 6,807,776 443,867 110,967 - 554,834 6,252,942 6,363,909
TOTAL 7,090,635 - - 7,090,635 443,867 110,967 - 554,834 6,535,801 6,646,768
Previous Year 7,090,635 - - 7,090,635 332,900 110,967 - 443,867 6,646,768
110
Schedules forming part OF ACCOUNTS
(Amount in Rupees)
As at As at
March 31, 2007 March 31, 2006
SCHEDULE 3
Cash on hand 68,707 87,058
Balances with Scheduled banks
- on Current accounts 840,223 1,271,343
- on Fixed Deposits 1,200,000 –
2,108,930 1,358,401
SCHEDULE 4
LOAN AND ADVANCES
(Unsecured, considered good)
Prepaid Expenses 90,988 –
Advance Income Tax (net of provision) 157,821 603,979
Interest Receivables 11,731 –
Adjustable Security Deposit 800,344 –
1,060,884 603,979
SCHEDULE 5
CURRENT LIABILITIES
Adjustable Security deposit – 798,247
Other liabilities 780,571 783,030
780,571 1,581,277
(Amount in Rupees)
For the For the
year ended year ended
March 31, 2007 March 31, 2006
SCHEDULE 6
ADMINISTRATION AND OTHER EXPENSES
Power and Fuel – 270,000
Bank Charges 57 100
Rates and Taxes 319,380 22,502
Legal and Consultancy charges 67,344 27,000
Audit Fees 33,708 27,000
420,489 346,602
111
Schedule –7
NOTES TO ACCOUNTS
A. SIGNIFICANT ACCOUNTING POLICIES
1. Accounting Conventions :
The Company follows the mercantile system of accounting and recognizes income and expenditure on accrual basis. The
accounts are prepared on historical cost basis as a going concern.
2. Fixed Assets :
Fixed assets are stated at cost of acquisition / construction less depreciation.

Depreciation on fixed assets is provided on straight-line basis as per rates prescribed in Schedule XIV of the Companies Act,
1956.
4. Deferred tax Assets :

The provision for current income tax is made on the taxable income using the applicable tax rates and tax laws.
Deferred tax arising on account of timing difference and which are capable of reversal in one or more subsequent periods, is
recognised using the tax rates and tax laws that have enacted or substantively enacted.
Deferred tax assets are not recognised unless there is sufficient assurance with respect to the reversal of the same in future
years.
B. NOTES TO ACCOUNTS
1. There are no deferred tax assets or liabilities as at March 31, 2007.
2. Previous Year’s figures have been re-grouped/re-arranged wherever necessary so as to make them comparable with previous year.
For RSM & Co


Place : Mumbai
112
cash flow statement for the year ended March 31, 2007
(Amount in Rupees )
March 31, 2007 March 31, 2006

Net profit/(loss) before tax 2,255,533 2,242,431
Adjustments for :
Operating Profit before Working capital Changes 2,366,500 2,353,398
Adjustments for :
(Increase)/Decrease in other Current Assets – –
(Increase)/Decrease in Loans and Advances (903,063) (605,880)
Increase/(Decrease) in Current Liabilities (800,707) (1,747,618)
(1,703,770) (2,353,498)
Cash generated from/(used in) operations 662,730 (100)
Tax (paid) Refund 87,799 –
Net cash from/(used in) operating activities 750,529 (100)
Net cash from/(used in) investing activities – –
Net cash from/(used in) financing activities – –
Net increase/(decrease) in cash and cash equivalent 750,529 (100)
Cash and cash equivalent at the beginning 1,358,401 1,358,501
Cash and cash equivalent at the end 2,108,930 1,358,401
Notes :
1. Cash and cash equivalent includes balance with scheduled banks in current accounts Rs. 840,223 (Previous year
Rs. 1,271,343)
2. The above cashflow statement has been prepared under the indirect method as set out in Accounting Standard - 3 on Cash Flow
Statement issued by the Institute of Chartered Accountants of India.
3. Previous year’s figures have been re-grouped/re-arranged wherever necessary.
For RSM & Co


Place : Mumbai
113
balance sheet astract and company’s general business profile
Registration No. 1 6 5 1 7 State Code 5 5 Date 1 2 0 9 1 9 8 3
Date Month Year
II. CAPITAL RAISED DURING THE YEAR (Rupees in Thousands)
N I L N I L
Bonus Issue Private Placement
N I L N I L
III. POSITION OF MOBILISATION AND DEPLOYMENT OF FUNDS (Rupees in Thousands)
8 9 2 5 8 9 2 5
SOURCES OF FUNDS
5 0 0 8 4 2 5
N I L N I L
6 5 3 6 N I L
Net Current Assets/(LIability) Miscellaneous Expenditure
2 3 8 9 N I L
Accumulated Losses
N I L
IV. PERFORMANCE OF COMPANY (Rupees in Thousands)
2 7 8 7 5 3 1
Profit/(Loss) Before Tax Profit/(Loss) After Tax items
+ 2 2 5 6
+ 1 8 9 7
(Please tick appropriate box + for profit, – for loss)
Earnings Per Share before Tax and exceptioal items (weighted) (Rs.) Dividend Rate (%)
+ 3 7 . 9 4 0 0
V. GENERIC NAMES OF PRINCIPAL PRODUCTS/SERVICES OF THE COMPANY (As per monetary terms)
Item Code No. (ITC Code) N A
Product
S E R V I C E S
Description

Director Director

Place : Mumbai
114
Corporate Office
Windsor, 5th Floor,
Off CST Road, Kalina,
Santacruz (E),
Mumbai - 400 098
Registered Office
Suman Tower,
Plot No.18, Sector-11,
Gandhinagar - 382 011.

Annual Report 2006 07

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Annual Report 2006 07

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IDEA CELLULAR LIMITED

AN IDEA CAN CHANGE YOUR LIFE

ANNUAL REPORT 2006 - 2007

Aditya Vikram Birla

9822013456798480123459891067890982400011298120123909882035790 98471 13579 982602468098220789009822013456798480123459891067890982400011298120123909882035790 98471 13579 98260246809822

We at Idea Cellular have successfully imbibed these core values which

Chairman’s India stands in the midst of an epochal transformation. Today,

letter we are the fourth largest economy in the world in terms of

Your company has posted a commendable performance. Its

Your Company is gaining in stature. It enjoys a leadership

For our success, much credit must go to our people. The

03 Management Discussion and Analysis

14 Report on Corporate Governance

33 Profit and Loss Account

34 Schedules to the Accounts

56 Cash Flow Statement

59 Consolidated Financial Statements

84 Statement pursuant to Section 212

85 Aditya Birla Telecom Limited

103 Swinder Singh Satara & Co. Limited

Mr. Kumar Mangalam Birla Chairman

Chief Financial Officer Registered Office

Major Regulatory Developments

Discussion on Financial and Operational Performance

Internal Control System

Particulars 2006-07 2005-06

For and on behalf of the Board

Date : October 11, 2007 Kumar Mangalam Birla

For and on behalf of the Board

Date: October 11, 2007 Kumar Mangalam Birla

Non-Executive Directors’ Compensation and Disclosure

Special Resolutions passed at the last 3 AGMs

8. Market Price Data

Idea Share Price 95 3825

b) Comparison of the Company’s share price with BSE Sensex

!dea Share Price BSE Sensex

10. Registrar and Share Transfer Agents

14. Shareholding Pattern

Date : October 11, 2007 Sanjeev Aga

AJS Jhala Sanjeev Aga

For RSM & Co. For Deloitte Haskins & Sells

Vilas Y. Rane Hemant M. Joshi

Mumbai: October 11, 2007 Mumbai: October 11, 2007

For RSM & Co. For Deloitte Haskins & Sells

Vilas Y. Rane Hemant M. Joshi

1. In respect of its fixed assets :

For RSM & Co. For Deloitte Haskins & Sells

Vilas Y. Rane Hemant M. Joshi

1. Initial Public Offer (IPO)

8. Details of Guarantees given

12. Expenditure in Foreign Currency (on remittance basis) :

13. Earning in Foreign Exchange (on receipt basis) :

Particulars For the Year ended For the Year ended

28. Basic & Diluted Earning Per Share

March 31, 2007 March 31, 2006

March 31, 2007 March 31, 2006

II. CAPITAL RAISED DURING THE YEAR (Rupees in Thousand)

IV. PERFORMANCE OF COMPANY (Rupees in Thousand)

For and on behalf of the Board

For RSM & Co. For Deloitte Haskins & Sells

Service Revenue 43,500.16 29,496.07

Significant Accounting Policies and Notes to the Accounts 22

A. Significant Accounting Policies - Consolidated