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Dish TV – (DITV IN, INR 68, Buy)
n Dish TV expands channel capacity 50 % by acquiring additional transponders
Dish TV has signed a long term contract for additional transponders on Asiasat with
‘Antriksh’. The total transmission bandwidth has increased from 432 MHz to 648MHz. The
increased transponder capacity will enable Dish TV to increase its standard definition
channel capacity to over 320 and High Definition capacity to over 30. The new
transponders are located close to the current transponders allowing channels beamed
from it to be available to existing customers as well. This increased channel capacity will
help Dish TV enhance its service offerings providing it a competitive edge over the other
DTH service providers.
n Subscriber addition picks up further
Dish TV has added half a million subscribers in November and it is on track to add over
one million subscribers in Q3FY11. It is also expected to benefit from the cricket heavy
season in the fourth quarter. Dish TV seems well on track to achieve 3 mn plus
subscriber acquisition target for FY11.
n Q2FY11 performance was well above expectations
The Q2FY11 revenues stood at INR 3,261 mn, up 26.7% Y-o-Y. ARPU per month stood at
INR 139. Dish TV hiked prices across two popular packs towards the end of Q2FY11, the
impact of which would be visible in the forthcoming quarters. EBITDA margins expanded
sharply from 10.6% in Q1FY11 to 15.3% in Q2FY11 on the back of operating leverage
benefits, arising from fixed content cost deals and robust subscriber additions. Content
cost (as a percentage of subscription revenues) dropped to an all-time low of 39%.
Selling and distribution expense (as a percentage of sales) declined 160bps Q-o-Q.
Subscriber acquisition cost (SAC) is down to INR 2,083 in Q2FY11 from INR 2,147 in the
previous quarter. Losses at the PAT level in Q2FY11 stood at INR 452 mn against INR
632 mn in Q1FY11.
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