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According to the international media research agency, Media Partners
Asia (MPA), the Indian DTH industry is set to add ~3.2mn subscribers in
Q3FY12 vis‐à‐vis ~4.5mn subscribers in Q3FY11 – down ~30% YoY. In
Q1FY12 and Q2FY12, the industry had added ~2.9mn and ~2.3mn
subscribers respectively. Major reasons attributed to the slowdown are
hike in prices of set top boxes, slowdown in TV sales, reduced
promotions, lowering of trade margins and hike in price of basic channel
packages. However, a likely silver lining could be incremental subscriber
additions in Feb and March in Q4FY12 due to the digitization mandate.
DTH subscriber addition to fall ~30% YoY in Q3FY12
The DTH industry is likely to add ~3.2mn subscribers in Q3FY12 vs ~4.5mn in Q3FY11.
While ~13.5mn subscribers were added in FY11, ~11‐12mn are likely to be added in
FY12. As per MPA, at the end of November, the gross DTH subscriber base stood at
around 44mn with Dish TV retaining lead with a ~28% market share followed by Tata
Sky with ~20% and Airtel and Sun Direct with ~16% each. The industry added ~1.6mn
subscribers in the festive month of October with Dish TV bagging ~0.435mn and
Videocon d2h and Airtel adding ~0.4 mn subscribers each. In November, the DTH
industry added ~0.88mn even as the growth has slowed considerably (due to the full
impact of price hikes) in December with the addition of just ~0.7mn subscribers. As per
our channel checks with retailers, this slowdown is being felt for the past six weeks or
so. We see the slowdown in other consumer durables like TV, fridge and ACs now
stretching to DTH.
Price hikes, reduced promotions lead to slowdown
Ostensibly, the slowdown is the result of a hike in set top box prices (from ~INR1000 to
~INR1400), slowdown in TV sales, reduced promotions, lowering of trade margins and
higher price of basic channel packages. However, quality of subscribers is expected to
improve which will result in lesser churn rates and better yields over the long term.
Dish TV looking forward to digitization to meet FY12 guidance
DTH companies are facing the heat due to the rupee depreciation that has escalated
the cost of set top boxes. We feel that given the current slowdown in subscriber
additions, Dish TV will add ~2.8mn subscribers in FY12 against the earlier lower end
guidance of ~3mn additions. Though the Phase 1 deadline is Q1FY13‐end, Dish TV
expects to see incremental subscriber additions in Feb and March (of Q4FY12) due to
the digitization mandate.
Top picks
Dish TV, Zee Entertainment Enterprises
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
According to the international media research agency, Media Partners
Asia (MPA), the Indian DTH industry is set to add ~3.2mn subscribers in
Q3FY12 vis‐à‐vis ~4.5mn subscribers in Q3FY11 – down ~30% YoY. In
Q1FY12 and Q2FY12, the industry had added ~2.9mn and ~2.3mn
subscribers respectively. Major reasons attributed to the slowdown are
hike in prices of set top boxes, slowdown in TV sales, reduced
promotions, lowering of trade margins and hike in price of basic channel
packages. However, a likely silver lining could be incremental subscriber
additions in Feb and March in Q4FY12 due to the digitization mandate.
DTH subscriber addition to fall ~30% YoY in Q3FY12
The DTH industry is likely to add ~3.2mn subscribers in Q3FY12 vs ~4.5mn in Q3FY11.
While ~13.5mn subscribers were added in FY11, ~11‐12mn are likely to be added in
FY12. As per MPA, at the end of November, the gross DTH subscriber base stood at
around 44mn with Dish TV retaining lead with a ~28% market share followed by Tata
Sky with ~20% and Airtel and Sun Direct with ~16% each. The industry added ~1.6mn
subscribers in the festive month of October with Dish TV bagging ~0.435mn and
Videocon d2h and Airtel adding ~0.4 mn subscribers each. In November, the DTH
industry added ~0.88mn even as the growth has slowed considerably (due to the full
impact of price hikes) in December with the addition of just ~0.7mn subscribers. As per
our channel checks with retailers, this slowdown is being felt for the past six weeks or
so. We see the slowdown in other consumer durables like TV, fridge and ACs now
stretching to DTH.
Price hikes, reduced promotions lead to slowdown
Ostensibly, the slowdown is the result of a hike in set top box prices (from ~INR1000 to
~INR1400), slowdown in TV sales, reduced promotions, lowering of trade margins and
higher price of basic channel packages. However, quality of subscribers is expected to
improve which will result in lesser churn rates and better yields over the long term.
Dish TV looking forward to digitization to meet FY12 guidance
DTH companies are facing the heat due to the rupee depreciation that has escalated
the cost of set top boxes. We feel that given the current slowdown in subscriber
additions, Dish TV will add ~2.8mn subscribers in FY12 against the earlier lower end
guidance of ~3mn additions. Though the Phase 1 deadline is Q1FY13‐end, Dish TV
expects to see incremental subscriber additions in Feb and March (of Q4FY12) due to
the digitization mandate.
Top picks
Dish TV, Zee Entertainment Enterprises
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