Please Share:: 
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
2QFY12 Results
Dish TV’s 2QFY12 operating performance was inline with expectations
with revenue up 5%QoQ and Arpu up 1% at Rs152. Ebitda margins
expanded 100bpsQoQ to 25%, enabling an Ebitda increase of 9%QoQ.
However subscriber additions were lower by 20%QoQ in a sharper than
expected slowdown and foreign exchange loss of Rs304m hiked the
quarter loss to Rs485m ahead of estimates. Meanwhile, there is
regulatory push for digitalisation with an ordinance but time deadlines
are ambitious and implementation remains to be seen. With valuation at
13x FY13CL Ebitda; we maintain Outperform.
Revenue growth of 5%QoQ but 20%QoQ lower subscriber additions
Dish TV’s 2QFY12 revenue increased 5%QoQ and 48%YoY to Rs4.8bn, in line
with estimates of which 86% was direct-to-home (DTH) subscriptions.
However Dish TV’s 575,000 subscriber additions were down a sharper than
expected 20%QoQ and the gross DTH subscriber base stands at 11.7m. The
net subscribers are 9.2m with net additions down even sharper 38%QoQ.
Arpu increased 1%QoQ and 9%YoY to Rs152 and high-definition (HD)
subscriber activations are at 5-6% of monthly net additions. Dish TV quarter
direct and content cost declined 3pptsQoQ to 31% of revenue and 7ppts YoY
aided by fixed fee content interconnect agreements with majority of
broadcasters and also one time adjustments in previous quarter. Margins
aided Dish TV’s quarter Ebitda which increased 9%QoQ however foreign
exchange loss of Rs304m hiked loss to Rs485m.
Ordinance on digitisation but key is implementation
Recently Information & Broadcasting Ministry has made a renewed push for
“Digitalisation” with an ordinance to amend the Cable TV Act. While the
renewed regulatory push is a positive, the time deadlines starting with 31
March 2012 for four metros are ambitious and implementation remains to be
seen. However digitalisation when implemented well could be a significant
catalyst for Dish TV subscriber additions, since it will force households to
choose a set-top box from either DTH or digital cable. Further the first
phase of digitalisation in four metros will also enable ramping up of HD
subscribers. Dish TV HD Arpu is Rs454 nearly 3x the current level. For
now, we forecast Dish TV to reach 17.6million gross and 14.8 million net
subscribers by FY14.
Maintain forecasts and retain Outperform.
With operating performance in line in Dish TV’s quarterly results, we maintain
our forecast of a 54% Ebitda Cagr over FY11-14CL. However the slowdown in
gross and net subscriber additions and likely delay in implementation of
digitalisation are issues. Also the significant regulatory boost from potential
licence-fee reduction via change in accounting from 10% of gross revenue to
adjusted gross revenue (AGR) and/or reduction in licence fees to 6-8% is
awaited. Meanwhile with stock valuation at 13x FY13CL Ebitda; we maintain
Outperform.
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
2QFY12 Results
Dish TV’s 2QFY12 operating performance was inline with expectations
with revenue up 5%QoQ and Arpu up 1% at Rs152. Ebitda margins
expanded 100bpsQoQ to 25%, enabling an Ebitda increase of 9%QoQ.
However subscriber additions were lower by 20%QoQ in a sharper than
expected slowdown and foreign exchange loss of Rs304m hiked the
quarter loss to Rs485m ahead of estimates. Meanwhile, there is
regulatory push for digitalisation with an ordinance but time deadlines
are ambitious and implementation remains to be seen. With valuation at
13x FY13CL Ebitda; we maintain Outperform.
Revenue growth of 5%QoQ but 20%QoQ lower subscriber additions
Dish TV’s 2QFY12 revenue increased 5%QoQ and 48%YoY to Rs4.8bn, in line
with estimates of which 86% was direct-to-home (DTH) subscriptions.
However Dish TV’s 575,000 subscriber additions were down a sharper than
expected 20%QoQ and the gross DTH subscriber base stands at 11.7m. The
net subscribers are 9.2m with net additions down even sharper 38%QoQ.
Arpu increased 1%QoQ and 9%YoY to Rs152 and high-definition (HD)
subscriber activations are at 5-6% of monthly net additions. Dish TV quarter
direct and content cost declined 3pptsQoQ to 31% of revenue and 7ppts YoY
aided by fixed fee content interconnect agreements with majority of
broadcasters and also one time adjustments in previous quarter. Margins
aided Dish TV’s quarter Ebitda which increased 9%QoQ however foreign
exchange loss of Rs304m hiked loss to Rs485m.
Ordinance on digitisation but key is implementation
Recently Information & Broadcasting Ministry has made a renewed push for
“Digitalisation” with an ordinance to amend the Cable TV Act. While the
renewed regulatory push is a positive, the time deadlines starting with 31
March 2012 for four metros are ambitious and implementation remains to be
seen. However digitalisation when implemented well could be a significant
catalyst for Dish TV subscriber additions, since it will force households to
choose a set-top box from either DTH or digital cable. Further the first
phase of digitalisation in four metros will also enable ramping up of HD
subscribers. Dish TV HD Arpu is Rs454 nearly 3x the current level. For
now, we forecast Dish TV to reach 17.6million gross and 14.8 million net
subscribers by FY14.
Maintain forecasts and retain Outperform.
With operating performance in line in Dish TV’s quarterly results, we maintain
our forecast of a 54% Ebitda Cagr over FY11-14CL. However the slowdown in
gross and net subscriber additions and likely delay in implementation of
digitalisation are issues. Also the significant regulatory boost from potential
licence-fee reduction via change in accounting from 10% of gross revenue to
adjusted gross revenue (AGR) and/or reduction in licence fees to 6-8% is
awaited. Meanwhile with stock valuation at 13x FY13CL Ebitda; we maintain
Outperform.
No comments:
Post a Comment