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Dish TV India Limited reports first set of merged financials: 4QFY18 Operating Revenues of Rs. 15,324 million

May 30, 2018
Dish TV India Limited (BSE: 532839, NSE: DISHTV, LSE: DTVL) today reported fourth quarter fiscal 2018 consolidated subscription revenues of Rs. 13,771 million and operating revenues of Rs. 15,324 million. Adjusted EBITDA for the quarter stood at Rs. 4,606 million. Adjusted EBITDA margin was recorded at 30.1%.

4Q FY18 Highlights
  • Subscription revenues of Rs. 13,771 million
  • Operating revenues of Rs. 15,324 million
  • Average Revenue Per User (ARPU) of Rs. 201
  • Adjusted EBITDA of Rs. 4,606 million
  • Adjusted EBITDA margin of 30.1%

On March 22, 2018, Videocon D2h Limited had merged with and into Dish TV India Limited with the appointed date of the merger being October 1, 2017.

Financials of Dish TV India Limited for the quarter ended March 31, 2018 thus represent 3 months financial performance each of Dish TV India Limited and Videocon d2h limited. Similarly, financials of Dish TV India Limited for the year ended March 31, 2018 represent 12 months financial performance of Dish TV India Limited and 6 months financial performance of Videocon d2h Limited.

Financial numbers for the fourth quarter and fiscal 2018 are thus not comparable with the corresponding periods last year.

However, presuming that the financials for fiscal 2018 had represented 12 months each of Dish TV India Limited and Videocon d2h Limited, operating revenues of the company would have been Rs. 62,377 million and corresponding Adjusted EBITDA [2] would have been Rs. 19,690 million with an Adjusted EBITDA margin of 31.6%.

Dish TV India Limited adopted Ind-AS (Indian Accounting Standards), notified by the Ministry of Corporate Affairs, from 1Q FY18. Consequently, results for the quarter ended March 31, 2017 have been re-stated to comply with Ind-AS.

The Board of Directors in its meeting held today, has approved and taken on record the audited consolidated financial results of Dish TV India Limited and its subsidiaries for the quarter and financial year ended March 31, 2018.

Beginning of a New Era
Despite all the ups and downs, the coming together of India's two DTH giants is now a reality.

The dichotomy back in November 2016 was such that the date of the merger announcement almost coincided with the announcement of demonetization.

The mega merger couldn't have come at a more appropriate time than now with consumer spending picking up, almost one and a half years post the announcement of demonetization. A new era in fact has begun for both, the Indian economy and Dish TV India Limited as they gear up to ride the consumers increasing propensity to consume.

Revival in rural demand, prospects of a good monsoon and an increase in infrastructure spending is likely to drive a broad growth recovery going forward.

The merged company's subscriber base is a fair mix of urban, semi-urban and rural subscribers that would enable it to benefit from increased discretionary spending across categories. A healthier urban mix would be beneficial to the revenue pool while at the same time a stable, paying, rural base would help buffer the platform from alternate technologies.

Mr. Jawahar Goel, CMD, Dish TV India Limited, said, "There is significant growth potential both in the short and the long term when it comes to acquiring new subscribers. While in the short term, digitization will continue to feed subscriber additions, government schemes focused on bridging the urban/rural divide, increasing farm incomes and electricity connection to rural households will create demand for new televisions and pay-tv connections in the years to come."

Consolidation to Lead to Value Creation

A combined entity with a towering market share and pan India presence, Dish TV India Limited has been adopting best practices of the two merged entities. Three well recognized and powerful brands- Dish TV, d2h and Zing are now being marketed under the Dish TV India Limited umbrella with each being favourably positioned in its key target markets. While Dish TV has always had a high top-of-the-mind consumer brand recall, d2h had the advantage of having high brand loyalty in trade circles. Zing on the other hand has been the undisputed leader when it comes to having tailor-made packages for regional audiences.

Identifying the strengths of each brand, the company has been targeting profitable growth while maintaining healthy competition and encouraging synergy in backend operations.

Separate sales teams with uniform structures are both complementing as well as productively competing with each other in the market.

On the customer service front, the company aims to build a faster, better and efficient service model that no other DTH player can match.

Dish TV India Limited is targeting 450 company owned service centres and around 5,500 company technicians that would be capable of doing more than 1 million home visits every month. Aiming to cross utilize critical infrastructure for synergies, the Company is also confident of a faster turnaround time for customer resolutions in the process.

Revenue, cost and financial synergies to the tune of Rs. 5,100 million are expected in FY19.

Dish TV India Limited - The Road Ahead

Dish TV India Limited and Videocon d2h Limited have merged to form India's largest DTH Company.

The merge co - Dish TV India Limited has a subscriber base of 23 million with a market share of 37%.

With most of the integration work having been done, the new leadership mix comprising of select professionals from both entities will guide a much larger company into its maiden era. Under the guidance of Mr. Jawahar Goel, CMD, Dish TV and the Group CEO, Mr. Anil Dua, the company has commenced its inaugural innings with the determination to grow larger and more profitable than ever before.

Mr. Jawahar Goel, CMD, Dish TV India Limited, said, "It's time to now put all thoughts to action and deliver what is expected from two leading platforms when they come together. I am happy to share that merger integration across functions has been successfully completed and new roles, responsibilities and key deliverables have been well received by our team."

"I see a new sense of passion and urgency all around in the company and believe that we have everything we need to surge ahead," he added.

The year ahead should be positive for Dish TV India Limited as the company expects to outgrow the industry growth rate backed by launch of new set-top-boxes that would be full HD compliant yet would be more economical than the existing consumer premises equipment. The company plans to up its High Definition base so as to ramp up its ARPU in the coming years.

Mr. Anil Dua, Group CEO, Dish TV India Limited, said, "Revenue would be further fortified through Value Added Services, some of which have already been cross rolled-out on all three brands. With demonetization, poor rural demand and merger related distractions behind us, we are confident of a sharp turnaround in our operating and financial performance in this fiscal."

Following the merger, Dish TV India Limited has harmonized the recognition of subscriber churn in line with industry practice. The Company now recognizes churn 60 days past due date, instead of 120 days past due date earlier.

On the regulatory front, the recent ruling by the Honourable Madras High Court on the TRAI Tariff and Interconnection Orders, 2017 should go a long way in ensuring a level playing field in the television distribution space in India.

Dish TV - Customer Offerings

Dish TV was the first in the industry to partially, and voluntarily, roll out the provisions of the Tariff Order by offering a-la-carte channels to its subscribers at affordable prices.

The recently launched fresh and youthful 'Saadhey Aath Mein Jeeto Saare Heart' campaign has been well received by Dish TV India Limited subscribers who can now top-up their base packs with the channels of their choice at just Rs. 8.50 per channel per month. The pay-per channel initiative, allows subscribers to choose any standard definition channel of their choice at just Rs. 8.50 (plus taxes) per channel per month or any high definition channel at Rs. 17.50 (plus taxes) per channel per month.

Along with this campaign, the company has also introduced a new brand tagline, 'Dish nahin Dishkyyaoon'which positions Dish TV as a young and dynamic brand.

The campaign on TV would be accompanied by amplification across touch points including print, online, below-the line marketing and social media.

A total of 2 million subscribers on Dish TV's platform have so far opted for such paid a-la-carte offerings, resulting in incremental revenues for the company.

Working towards increasing customer stickiness and brand loyalty, Dish TV India Limited would be soon launching its fully integrated OTT service that would enable time-shift as well as live TV viewing of television content by Dish TV subscribers while on the go. 

Report By: Hirdesh Agarwal
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