Scatmag.com

February 2017


BUSINESS NEWS


STAR HOTSTAR: Rs. 409 CR LOSS

Novi Digital Entertainment, a wholly o w n e d subsidiary of Star India, which runs the video over-the-top (OTT) platform Hotstar, has reported a net loss of Rs. 409 crore in FY16 (its first full year of operation) according to the company's filing with the registrar of companies (RoC). During the period, the company notched up a subscription revenue of Rs. 24.1 crore, while revenue from advertising was at Rs. 138.5 crore. It spent Rs. 154.6 crore on advertising and marketing.

The company started operations in February 2015 and posted a net loss of Rs. 77 crore on a revenue of Rs. 51.7 crore before closing FY15, so the figures are not comparable.


GTPL-HATHWAY: 300 CR IPO

Hathway's subsidiary GTPL Hathway Pvt. Ltd has filed its IPO prospectus. The Rs. 300 Crore IPO will consist of both a primary offer, to help the company raise capital and an offer for sale by the promoters. The IPO proceeds will reduce debt.

GTPL provides digital cable TV to 169 towns in Gujarat, West Bengal, Maharashtra, Bihar, Assam, Jharkhand, Madhya Pradesh, Telangana, Rajasthan and Andhra Pradesh. The company had approximately 5.41 million active digital cable subscribers, till end September 2016.

GTPL reported a consolidated revenue of Rs. 852.1 Crore & a profit of Rs. 70 Crore in FY 2015-16.


LIBERTY-VODA JV IN NETHERLANDS

Global MSO Liberty Global plc has completed a merger of its cable TV a n d broadband business in t h e Netherlands with Vodafone Group plc's mobile phone operation there, creating a joint venture valued at US$ 3.68 billion.

As part of the deal, Liberty Global will receive US$2.32 billion & Vodafone will receive US$6.31 million in cash payments

The joint venture is called VodafoneZiggo Group Holding B.V. (Ziggo is the brand name of Liberty Global's existing Dutch operations.)




ORTEL TO INVEST Rs. 300 CRORE

Ortel Communications, Odisha's largest MSO plans to invest Rs 300 crore over the next 2 years on expansion. Bibhu Prasad Rath, president & CEO at Ortel Communications, said the c o m p a n y would use IPO proceeds, debt and internal accrual and equity to meet its funding requirements.

"Ortel is one of the few MSOs which focuses on B2C segment with full control over the last-mile network and directly owns 90% of its subscribers," Rath told the press.

The company, which has remained focused on East India, has a subscriber base of 805,000 as on September 30, 2016, compared with national MSOs, such as Hathway Cable & Datacom, Siti Cable and Den Networks, who claim a base of over 10 million subscribers each.

Over the past few years, Ortel has largely focused on buying out existing MSOs & LCOs for its growth.


DEN REDUCES ISL STAKE

D E N N e t w o r k s plans to offload a further 10% stake in its soccer venture, bringing down its holding in DEN Sports to just 10%.

The company had sold 80% stake in the Indian Super League (ISL) franchise Delhi Dynamos FC in tranches of 55% (Rs. 43.32 crore) and 25% (Rs. 43.32 crore) to Wall Street Investment. The company had invested about Rs. 80-85 crore by way of operating expenses. There was no CAPEX as such. DEN has only recovered its spend, reaping little returns.

Wall Street Investments received approval from the Registrar of Companies, NCT of Delhi and Haryana, to change the name of DEN Sports & Entertainment and DEN Soccer to Delhi Sports & Entertainment and Delhi Soccer, respectively.



DEN NETWORKS: Q3 IMPROVES

Den Networks has reduced its net loss to Rs. 45.1 crore for Q-3 ended December 2016, compared to Rs. 87.39 crore a year ago.

Total income increased 30% to Rs. 298.83 crore.

Cable TV distribution revenue was Rs. 277.36 crore & broadband broke even for the first time, with a revenue of Rs. 21.47 crore, in Q-3.

DEN Networks CEO SN Sharma said " ARPU (including taxes) for DAS 1, 2 and 3 markets stood at Rs. 125, Rs. 95 & Rs. 64 per box respectively which reflects on improvement of 11%, 6% & 23% respectively on Q-o-Q basis , with a strong collection efficiency of 95%."

DEN has also exited 80% of its soccer investments, which were not yielding any returns.

Content cost increased 3.5% to Rs. 119.28 crore & Placement fees rose 2.9% to Rs. 11.82 crore.


FIPB DENIED FOR YOU TELECOM

The FIPB (Foreign Investment Promotion Board) , headed by Economic Affairs Secretary Shaktikanta Das, has deferred You Broadband's proposal.

The cable & broadband company had sought post facto approval for acquisition of 9,79,875 equity shares of its downstream company Digital Outsourcing Pvt. Ltd (DOPL) in exchange for issue of 20,58,759 equity shares issued to its resident shareholders through share swap. DOPL is engaged in the business of cable TV services.


DEMONETISATION HITS ZEEL

Z e e Entertainment Enterprises Ltd (ZEEL) says its domestic ad growth fell to just 3.7% (Rs. 873.7 crore) due to demonetisation, in the October to December 2016 quarter. Generally, media companies do well in the third quarter, thanks to the festive season. However demonetisation reversed this.

International ad revenue was Rs. 81.7 crore.

Subscription revenue grew 13.7% to Rs. 593.5 crore consisting of Domestic subscription at Rs. 481.8 crore & Rs. 111.7 crore in international subscriptions.

Operating cost remained flat at Rs. 703.5 crore. Net profit grew 10.1% to Rs. 254.9 crore.

Ten Sports Network made an operating profit of Rs. 7.7 crore on revenue of Rs. 141.1 crore. It had made a loss in Q-3 last year.

ZEEL is now selling TEN Sports to Sony Pictures Networks India for $385 million. The deal has been approved by the CCI.


DOT RESTRAINED FROM ENCASHING SITI BG

The TDSAT has issued an interim order restraining the Department of Telecom (DoT) from encashing Siti Network's Performance Bank Guarantee (PBG) of Rs. 1 crore.

Siti had received communication from DoT on 7 December after it had failed to extend the validity of the PBG dated 31 December 2015 following the expiry of its ISP license in December 2013.

Siti counsel Navin Chawla highlighted that, according to the license condition no. 10.5.4, the PBG was supposed to be returned to the licensee within 6 months after the termination of the license and after all dues were paid. There were no dues payable by Siti but DoT had not returned the PBG.

DoT has been directed to file its reply by mid-January 2017. The matter will be heard 'for orders' on 23 January.

Siti, meanwhile, has already secured a unified licence (UL) from the DoT. n