Cable TV Powered by

HSBC raises Hathway’s target price to Rs 432

http://www.indiantelevision.com/sites/default/files/styles/smartcrop_800x800/public/images/cable_tv_images/2014/11/26/Priority%203_1.jpg?itok=UpeS2xPX

MUMBAI: HSBC Securities and Capital Markets’ latest report on multi system operator (MSO) Hathway Cable & Datacom has improved its rating from ‘normal’ to ‘overweight’.

While it continues to value Hathway using a DCF based approach, it has raised the target price from Rs 276 to Rs 432. This is on the assumption of 12.5 per cent WACC, cost of equity of 13.5 per cent and cost of debt of 11 per cent.

One of the main reasons for this is the expectation of increase in Average Revenue Per User (ARPU). HSBC expects gross billing to increase in phase I markets by around 15 per cent and phase II by around 10 per cent over the next two quarters. Gross ARPU is estimated to grow at 16 per cent CAGR from its earlier 8 per cent.

Increase in ARPU would mean a near 10 to 20 per cent rise in cost, despite the incentives that are being offered by Star’s new RIO deals. The report also says that moving to prepaid would be necessary, even if it is restricted to Star  channels for now as in the long run it would allow MSOs to scale up to full prepaid gradually over the next 18-24 months.

“LMOs will need to move to a prepay backend. Both these factors are positive for the sector and in our view build a long-term case for ARPU improvement, fewer bad debts, reducing friction between MSO and LMO relations, improving the industry structure and allowing the industry to benefit from sector consolidation,” it states.

The report also highlights that if Star is successful in reaping benefits out of its new RIO policy, other big networks may follow suit, though not in the immediate 12 months.

This apart, HSBC also sees broadband ARPUs increasing with a more robust DOCSIS 3.0 platform but with a slight concern on the slow pace of subscriber net addition. The delay in digitisation is positive for cable TV industry to consolidate market share in the first two phases. Side by side, issues such as revenue share and prepaid billing can be sorted and easily applied in phases III and IV.

HSBC has raised its medium- term EBITDA estimates by 11 per cent (FY16e-21e CAGR of 13.5 per cent), cable TV ARPU assumptions by 12 per cent (FY16e-21e CAGR of 11 per cent) and broadband ARPU by 8 per cent for the same period.

Latest Reads

http://www.indiantelevision.com/sites/default/files/styles/340x340/public/images/tv-images/2019/01/18/tv.jpg?itok=aKmemHAu
Karnataka may face day-long cable TV blackout on 24 January

Karnataka cable TV users are likely to face a blackout of TV channels on 24 January if the Karnataka State Cable Television Operators Association goes ahead with its intention to protest against the Telecom Regulatory Authority of India’s (TRAI) new tariff order. The state has 60 to 70 lakh cable...

Cable TV Local Cable Operators
http://www.indiantelevision.com/sites/default/files/styles/340x340/public/images/tv-images/2019/01/16/den.jpg?itok=X8UT9TVb
Den reports lower numbers for third quarter

BENGALURU: Indian cable distribution network and broadband internet services (broadband) provider Den Networks Ltd reported 6 per cent drop in consolidated operating revenue numbers for the quarter ended 31 December 2018 (Q3 2019, quarter or period under review) as compared to the corresponding...

Cable TV Local Cable Operators
http://www.indiantelevision.com/sites/default/files/styles/340x340/public/images/tv-images/2019/01/15/TrueVisions.jpg?itok=LjG9wHP8
Thailand's largest pay-TV operator TrueVisions extends partnership with Synamedia

LONDON and SINGAPORE, 15 January 2019 – Synamedia, the largest independent video software provider, today announced it has extended its seven-year partnership with TrueVisions, Thailand’s leading pay-TV operator.

Cable TV Local Cable Operators
http://www.indiantelevision.com/sites/default/files/styles/340x340/public/images/tv-images/2019/01/09/si.jpg?itok=pJrF_1gx
SITI Networks launches My SITI mobile app

SITI Networks Limited (BSE: 532795, NSE: SITINET), an Essel Group company, has launched My SITI mobile app for its customers.

Cable TV Multi System Operators
http://www.indiantelevision.com/sites/default/files/styles/340x340/public/images/tv-images/2019/01/08/tv.jpg?itok=_Ehkuf0S
Pay TV subs show first ever decline globally

MUMBAI: The third quarter of 2018 saw a slight fall in pay TV subscribers, making it the first ever marked changed and probably a point of worry for cable and DTH operators world over. The decrease was by 0.11 million, down by 0.02 per cent, as per informitv’s Multiscreen Index reported by Advanced...

Cable TV Local Cable Operators
http://www.indiantelevision.com/sites/default/files/styles/340x340/public/images/tv-images/2019/01/02/tv.jpg?itok=0MVLLQW9
Hathway, DEN, Siti reveal packs under new TRAI tariff order

Major DTH players and MSOs have started updating new channel and package pricing as per the new TRAI tariff order. Soon after major broadcasters announced new rates, DPOs are taking swift action making it easier for consumers to choose their desired channels. Last month, TRAI gave an additional one...

Cable TV Local Cable Operators
http://www.indiantelevision.com/sites/default/files/styles/340x340/public/images/tv-images/2018/12/27/tv.jpg?itok=DAGo6DKa
Maharashtra stares at possible 3-hour cable TV blackout today as LCOs flex muscle

Cable operators across the country, and particularly in Maharashtra, seem to have upped the ante in their confrontation with the Telecom Regulatory Authority of India (TRAI) over the new tariff order that will be applicable to the broadcast sector from 29 December 2018. At a protest gathering in...

Cable TV Local Cable Operators
http://www.indiantelevision.com/sites/default/files/styles/340x340/public/images/tv-images/2018/12/18/ortal.jpg?itok=FwRrOvsd
Ortel loss mounts: NCLT orders insolvency process

Ortel Communications Ltd (Ortel) reported a higher loss for the quarter ended 30 September 2018 (Q2 2019, period or quarter under review) as compared to the immediate trailing quarter Q1 2019 and the corresponding year ago quarter Q2 2018. On 27 November 2018, the National Company Law Tribunal,

Cable TV Local Cable Operators
http://www.indiantelevision.com/sites/default/files/styles/340x340/public/images/tv-images/2018/12/06/vbs.jpg?itok=MdZkrwW8
The challenge of DD FreeDish and new tariff order for DPOs

With the emergence of a large number of OTT platforms and cord-cutting globally, the future of pay-TV looks bleak. The talk of the town is how pay-TV industry will manage to survive the crisis. Moreover, the new tariff order (NTO) in India is also set to overhaul the entire ecosystem.

Cable TV Local Cable Operators

Latest News

Load More

Sign up for our Newsletter

subscribe for latest stories