The DTH player is not looking to tap equity markets, and intends to reduce its debt
Mumbai: India’s first-and-only direct-to-home (DTH) company to post net profit, Dish TV, is expecting its capital expenditure (capex) requirement to be around ₹ 850 crore in FY17, as it is eyeing a big share of the remaining 45-50 million analogue TV homes in phase III and IV of the government-mandated digitisation pro g ramme, Digital Addressable System (DAS). The company is not looking to raise money through equity markets, a top executive told ET.
“In FY16, capex was around ₹ 775800 crore. For FY17, requirement will be ₹ 850 crore. But, we will not raise any money through equity or markets and the debt level will remain same or go down because of the free cash flow,” said Arun Kapoor, CEO of Dish TV.
Dish TV, which turned profitable in the last fiscal, had turned free cash flow positive in FY12. It claims
a net subscriber base of 12.9 million as of FY15. Kapoor, who joined Dish TV as CEO in November last year, considers phases III and IV of DAS as big opportunities. According to him, Phase III momentum was stalled because of the court cases after the sunset date.
“Phase III started off well and December was good. But then it got stalled. I believe it is just a matter of time and in couple of months the cases will get settled,” Kapoor said. “It is also a reality that while there has been a break in the momentum, the seeding of boxes continues.”
The sunset date for Phase III was December 31, 2015. The same for Phase IV (rural India) is December 31, 2016. As per market estimates, total TV homes in phase III are 50 million, out of which cable and DTH together have already digitised 25-30 million, while DAS IV areas have another 25-30 million analogue TV homes.
Sensing the opportunity, Dish TV introduced ‘Dish99’ pack across phase III & IV markets in November.
Kapoor said that Zing, a low-cost product from Dish TV specifically for regional markets, is contributing 20% of current acquisitions. “Dish 99 is getting us close to 30% of new subscribers, Zing and HD clients are 20% each, while the remaining 30% are the SD subscribers.”