Dish TV reports Rs 7,486 mn revenues in Q2FY18; EBITDA margin at 29%

Dish TV India Ltd has reported consolidated operating revenues of Rs 7,486 million and EBITDA of Rs 2,161 million for the second quarter ended September 30, 2017. 

Dish TV adopted Ind-AS (Indian Accounting Standards), notified by the Ministry of Corporate Affairs, from Q1 FY18. Consequently, results for the quarter ended September 30, 2017 have been re-stated to comply with Ind-AS to make them comparable. 

Moving further away from the demonetisation era, Dish TV saw a recovery in its EBITDA margins during the second quarter as compared to the preceding few quarters. Operational efficiencies along with some revenue expansion resulting from an improved customer sentiment led to a margin expansion of 170 bps. EBITDA margins during the quarter were 28.9 per cent, as against 27.2 per cent in the previous quarter. 

Subscriber additions at 188,000 were in line, considering the seasonality of the second quarter. 

Subscription revenues recorded 1.9 per cent growth sequentially to close at Rs 7,049 million. Average revenues per user (ARPU) strengthened to Rs 149, while churn rate recovered to close at slightly less than 0.8 per cent per month. 

Amalgamation of Videocon D2h into Dish TV 

The proposed combination of Dish TV and Videocon d2h is expected to create one of the world’s leading DTH platform. 

Jawahar Goel, CMD, Dish TV India, said, “We have been eager to get back to our stakeholders with the news of the successful closure of the merger. With all other approvals in place, the only approval pending is from the Ministry of Information and Broadcasting. We are optimistic about hearing back from the MIB any moment now and hope to close the merger at the earliest thereafter.” 

He further said, “We remain excited about the next phase of growth that the combined entity, Dish TV Videocon Limited, will go through and are committed to make the combination a mega success. On the synergy front, we stick to our guidance of Rs 1,800 million for FY18 and Rs 5,100 million for FY19.” 

High Definition for All 

To further strengthen its high definition (HD) base, Dish TV recently started giving limited period complimentary access to 7 popular HD channels in a scheme called ‘HD for All.’ This limited duration offer has been extended to all Dish TV subscribers who are at an ex-GST price point of Rs 169 per month or above. The scheme is not applicable to South India. 

With ‘HD for All,’ Dish TV looks forward to convert aspiring Indian television households to the Dish TV DTH platform. In addition, the company is also hopeful about converting ambitious standard definition subscribers to high-ARPU HD connections once they experience the five times better picture quality of HD through any of the 7 channels. 

Jawahar Goel added here, “HD has always been considered to be an effective differentiator in an industry that otherwise has little differentiation to talk about. The ‘HD for All’ scheme shall expedite the SD to HD conversion for subscribers who had so far not experienced HD quality and hence, had never considered upgradation.” 

The competitive environment 

According to Dish TV, competition within the industry remained intense, but manageable. Pricing pressure, by way of low ticket pack prices, prevailed. Dish TV followed a similar strategy, but remained conscious of the contribution margins from every pack that it introduced in the market. 

The division bench of the Madras High Court continues to reserve its judgement in the Tariff Order dispute. 

Dish TV, however, had recently, partly adopted TRAI’s new Tariff Order and  had started offering all channels, except Sports and select South channels at affordable ala-carte prices of Rs 8.50 and Rs 17.00 (plus GST) per channel per month for SD and HD, respectively. 

As subscribers opt for ala-carte channels, data surprisingly shows that their choice of channels on the Dish TV platform is in contrast to BARC’s weekly ratings. 

On the Free DTH front, negotiation between the distribution industry and private broadcasters on segregation of free v/s pay content continued. 

Prasar Bharati, meanwhile, has gone back to the drawing board on the auction of slots on the DD Free Dish platform. 10 FTA channels so far, due to their inability to pay high carriage fees, have opted out of the platform. 

Another 5 channels, out of the 10 coming up for renewal in February, are expected to opt out of the Free Dish platform. 

Dish TV continues to keep an active watch on the developments. 

The road ahead for DTH in India 

As India progresses on the path to digitisation, large digital service providers like Dish TV see a significant role to be played by them in the process. 

Dish TV soon aims to connect ordinary television subscribers with the best in class digital entertainment that is going to be over and above traditional TV. The company plans to further enhance its significance by doing things that would leverage the strength of its legacy, reach and customer ownership. 

Dish TV is enthusiastic about its soon to be launched Hybrid Box and OTT app that will give subscribers access to the latest in the world of television entertainment alongside their DTH subscription. Dish TV looks at this, along with HD services, as the ARPU driver of tomorrow. 

Further, government initiatives like Housing for All and electrification of rural areas will help create green-field demand for digital services like DTH. Dish TV gets bulk of its subscribers from non-top, towns and cities in the country.