Dish TV Q1FY18 Concall Summary

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 Financial Highlights

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  • 165 thousand net subscribers added during Q4FY17, and the net subscriber base of the company has increased to 15.5 million
  • The momentum that the industry had during the last fiscal year was hit due to demonetization. TheIndustry de-grew slightly in term of customer acquisition despite the implementation of digitization
  • The company minimized impact & focused on potential long-term advantages through online recharges, and despite demonetization, the company managed to increase reach and subscriber base
  • Revenue was hit due to demonetization, particularly in customers from DAS-III and DAS-IV regions and dealers found it difficult to route money through banking channels
  • There was some downtrading in HD subscribers due to demonetization
  • A one time cost of Rs. 31 crores, which was reclassifiedas subscription cost to other operating income
  • The HD customer base declined by 100,000
  • Gross debt was Rs.1,140 crores, and net debt was Rs.685 crores
  • COGS has gone up. The exceptional costs were Rs. 9.5 crores of foreign exchange loss and Rs.15 crores of one-time transponder cost.
  • The churn rate was .9% which was slightly higher than the third quarter churn rate.The quarter had two to three days less since Feb. had only 28 days which also affected revenue
  • 55-60 million subscribers not yet digitized in Phase-IV,themajority of which are in DAS-III or DAS-IV cities
  • License valid till 31st Dec. 2017 and cabinet note on license renewal soon to go to cabinet
  • EBITDA per customer to be around Rs. 35-40 or lower. EBITDA per customer has come down from Rs. 60 to Rs. 37 in the fourth quarter
  • EBITDA margin dipped due to a dip in revenue and a one-time cost of Rs. 25 crores
  • The revenue split for this quarter was:  subscription revenue-620 crores, lease rental-2 crores, teleport-5.5 crores, bandwidth-30 crores, advertisements-16 crores, other operating incomes-33 crores
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  • Application to NCLT for merger made hoping for approval by Sep. or Oct. 2017
  • After merger the joint venture to have synergies on account of purchase of set-top box, joint content negotiation, reduction in cost of services and advertisement income
  • Merger will have a positive impact on EBITDA and PAT margins and the merged entity to provide returns FY18 onwards
  • CCI approved amalgamation of Videocon D2H with Dish TV in FY18


  • 18% GST rate & entertainment tax & service tax removed
  • GST to effect licensing fee which would go down from 10% to 8% according to the market
  • GST to have two benefits: Vat benefit and SAD benefit of a total around 160-170 crores


  • ARPU was not negatively affected since most customers are rural centric
  • Annual ARPU was Rs.154 against Rs.157. ARPU for the fourth quarter was RS. 135
  • Next year ARPU growth to be 3%-4%. ARPU to return to Rs. 150-155 by the third quarter
  • ARPU was not affected much since demonetization occurred in the 4th quarter and Dish TV calculates ARPU for 120 days

Dish TV V/S Competitors

  • Airtel having annual revenue growth of around 10% and Dish TV down by 13%
  • Jio launching its DTH service has affected business
  • This difference has occurred in the last two years. Also,around 55%-60% of Dish Tv subscribers are from rural areas which were the worst hit due to demonetization
  • In the fourth quarter, Dish Tv revenue went down by 45-50 crores
  • Launched a pack of Rs.99 last year where the pull is much higher than competitors
  • Competitors are able to deliver revenues close to Rs. 230

Future Guidance

  • Guidance for content costs for next year to be 6%-7%
  • Revenue growth for the year to be around 7%-9%
  • For FY17 the CAPEX was 745 crores and is expected to be 750-800 crores for next fiscal
  • Customer addition estimated to be around 1.2-1.3 million
  • Margins expected to be around 32% this year(last year it was 35%)
  • Dish Tv to launch its own OTT platform for services
  • Last quarter customer acquisition cost was Rs.1,680 which was down from last year cost of Rs.1,850 and the company hopes to reduce this cost to around Rs.1,500