Airtel 2012 Annual Report Download - page 147
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145
BHARTI AIRTEL ANNUAL REPORT 2011-12
(vi)The following table summarizes information about options exercised and granted during the year and about options
outstanding and their remaining contractual life:
Entity Plan Options Remaining Options Granted Options Excercised
Outstanding Contractual
(thousands) term (years) Options Wtd Avg Options Wtd Avg
Fair Value Share Price
Bharti Airtel 2001 Plan - - - - - -
Bharti Airtel 2004 Plan - - - - - -
Bharti Airtel Superpot - - - - - -
Bharti Airtel 2006 Plan 1,445 1.17 to 6.86 239 347.40 594 376.35
Bharti Airtel 2005 Plan 2,602 0.44 to 6.10 28 246.98 597 376.88
Bharti Airtel 2008 Plan
Annual grant plan 4,835 3.25 to 6.17 34 170.18 246 378.51
Bharti Airtel PSP 2009 Plan 1,256 4.34 to 6.34 40 432.50 - -
Bharti Airtel LTIP Plan 406 6.35 422 415.47 - -
Bharti Airtel Special ESOP & RSU 2,362 5.01 to 6.10 361 355.13 578 386.44
(vii) The fair value of the options granted was estimated on the date of grant using the Black-Scholes/ Monte Carlo/Lattice
valuation model with the following assumptions:
Particulars For the year ended For the year ended
March 31, 2012 March 31, 2011
Risk free interest rates 7.76 to 8.63% 7.14% to 8.84%
Expected life 48 to 60 months 48 to 72 months
Volatility 41.07 to 42.09% 37.26% to 46.00%
Dividend yield 0.28% 0.39%
Weighted average share price on the date of grant 361.83 to 424.11 256.95 to 368.00
The volatility of the options is based on the historical volatility of the share price since the Company's equity shares
became publicly traded, which may be shorter than the term of the options.
(viii)The Company has granted stock options to the employees of the subsidiaries i.e. Bharti Hexacom Limited, Bharti
Infratel Limited (BIL) and Bharti Airtel International (Netherlands) B.V. and the corresponding compensation cost is
borne by the Company. Further BIL has also given stock options to certain employees of the Company and the
corresponding compensation cost is borne by BIL.
48. FORWARD CONTRACTS & DERIVATIVE INSTRUMENTS
The Company's activities expose it to a variety of financial risks, including the effects of changes in foreign currency
exchange rates and interest rates. The Company uses derivative financial instruments such as foreign exchange
contracts, option contracts and interest rate swaps to manage its exposures to interest rate and foreign exchange
fluctuations.