Post on 08-Jul-2020
DEN Networks Limited
Disclaimer
2
These presentation materials have been prepared by DEN Networks Limited (“DEN”) solely for use at this presentation and have not been
independently verified. This presentation material is highly confidential, is being presented solely for your information and may not be copied,
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hereof. No representations or warranties, express or implied, are made as to, and no reliance should be placed on, the accuracy, fairness or
completeness of the information presented or contained in this presentation. The information presented or contained in this presentation is current
as of the date hereof and is subject to change without notice.
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identified by the use of forward-looking terminology such as “anticipate,” “believe,” “considering,” “depends,” “estimate,” “expect,” “intend,” “plan,”
“planning,” “planned,” “project,” “trend,” and similar expressions. All forward-looking statements are the current expectation of future events and are
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presentation should not be construed as legal, tax, investment or other advice. Caution should be taken with respect to such statements and you
should not place undue reliance on any such forward-looking statements.
Certain data in this presentation was obtained from various external data sources, and DEN has not verified such data with independent sources.
Accordingly, DEN does not make representations as to, and assumes no responsibility or liability for, the accuracy or completeness of that data, and
such data involves risks and uncertainties and is subject to change based on various factors.
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as amended, or pursuant to an exemption from registration therefrom.
Contents
3
DEN’s Strategy
Digitisation in Indian Cable
DEN Networks – An Overview
Financials
The Indian Television Market – A Snapshot
4
Current Indian TV Market Cable & DTH: Household Break-up
Total Households
TV Households 162 mn
Cable Homes 98 mn
DTH subscribers
(Gross) 46 mn
262 mn Total Cable & DTH
Households 144 mn
Source: MPA Estimates (MPA Asia Pacific Pay-TV & Broadband Markets, 2012)
Forecasted market size for 2013
Phase 1 Deadline:
Oct 31, 2012
Phase 2 Deadline:
Mar 31, 2013
Phase 3 Deadline:
Sep 30, 2014
Phase 4 Deadline:
Dec 31, 2014
5
The Indian Cable Digitisation Law: A Four Phase Conversion of Analog to Digital
4 Metros
Delhi, Mumbai,
Kolkata, Chennai
38
1 Million+
Population Cities
All Other Urban
Areas
Rest of India
Phase 1 & 2 Covers
India’s Largest Cities
* Note: Forecasted cable TV homes for 2015. Assumed to by fully digitised (Source: MPA Asia Pacific Pay-TV & Broadband Markets 2012)
The Indian Cable Market in 2015
Digital Cable subscribers*: 101 mn
6
Phase 2: Pace of Digitisation – Cable vs DTH Cable Dominates Digital Conversions
DTH (subs added)
Cable (STBs installed)
470,000
5.28 mn
Note: Figures – approximate to nearest 10,000.
Source: Derived from Ministry of Information & Broadcasting, Govt. of India data available on pib.nic.in and www.digitalindiamib.com
Cable digitised at >11x
the pace of DTH during
the last 2 months
Phase 2 - Digitisation in 38 Cities (Feb 8 – April 12, 2013)
7
Phase 1: Pace of Digitisation – Cable vs DTH Similar Trends were Observed in Phase 1
DTH (subs added)
Cable (STBs installed)
171,000
1.75 mn
* Excludes Chennai as national MSOs are absent in the city.
Note: Figures – approximate to nearest 10,000.
Source: Derived from Ministry of Information & Broadcasting, Govt. of India data available on pib.nic.in and www.digitalindiamib.com
Cable digitised at 10x the
pace of DTH in the last 45
days before the deadline
Phase 1 Cities – Digitisation in 3 Metros*
(Delhi, Mumbai & Kolkata)
Sep 17 - Nov 1, 2012
Phase Total Digital
Cable & DTH
STBs Seeded
DTH
Subscribers
Digital Cable
STBs installed
Digital Cable
Market Share
(%)*
Phase 1** 8.7 mn 2.2 mn 6.5 mn 75%
Phase 2 13.6 mn 4.4 mn 9.2 mn 68%
Total 22.3 mn 6.6 mn 15.7 mn 70%
8
Government Data on Digitisation in Phase 1 & 2 Cities
* Digital cable market share = Digital cable STBs ÷ Sum of Digital Cable & DTH subscribers
** Phase 1 data corresponds to Delhi, Mumbai & Kolkata. Excludes Chennai as national MSOs are absent in the city
Source: Phase 1 data as per MIB Press Release (Nov 1, 2012); Phase 2 data as per MIB Press Release (April 12, 2013)
Cable & DTH in Phase 1 & 2 Cities Cable Becomes Largest Digital Platform
Approx. 3 mn cable
homes yet to be
digitised in Phase 2
How Digitisation is Set to Transform Indian Cable…
9
All Consumers
Paying
All Cable TV consumers paying the last mile operator (LCO)
• ARPUs in the range of $3-$4(a)
• Digitisation targets 100% transparency of sub. base by LCO
• Government – Higher tax revenues
• MSOs & Broadcasters – Legitimate share of subscription
• LCOs – Medium to Long Term Gains
‒ From transparency of multiple TVs
‒ Higher ARPUs from more channels
‒ Share in VAS (VOD/ PPV) & Broadband revenues
Stage Set for
Transformation
• More Channels
• ARPU Growth
• Broadband & Triple Play
• Consolidation in Cable
India’s Cable TV Industry Likely to Resemble
Mature Markets Like the US
All Stakeholders
Stand to Gain
(a) Source: MPA Asia Pacific Pay-TV & Broadband Markets 2012
…Early Signs of That Transformation Already Evident
10
New Channel
Launches
DTH platforms taking up their entry pack pricing:
• July 2012: Rs 180 Rs 200
• March 2013: Rs 200 Rs 220
ARPUs Rising MSOs’ current packaging and pricing already
indicating a rise in ARPUs
• Star Sports 2, Ten Golf
• HBO Hits & HBO Defined (Ad-free pay channels)
New channels, including niche & subscription
only channels being launched:
Early Indicators of Digitisation Driven Transformation
Contents
11
DEN’s Strategy
Digitisation in Indian Cable
DEN Networks – An Overview
Financials
DEN: Leader in Indian Cable
12
Pan-India presence in
11 million analog
homes;
Digital base of 4.1mn
Strategic Content J-V –
exclusive distributor of
all Star, Zee & Other
channels in India
EBITDA positive in 1st
full year of operations;
PAT positive for 3 years
in a row
India’s
Largest* Cable
Distribution
Company
Star DEN & MediaPro
Strategic J-V With
Star & Zee
Strong Financials
* As per MPA Asia Pacific Pay-TV & Broadband Markets 2012 in terms of subscribers
Pan-India Presence in Important States & Cities
13
Delhi
Mumbai
Bangalore Mysore
Kolkata
Strong Nationwide
Presence in 150+ Cities
across 13 States
3 Metros
24 One mn+ cities
123+ Other cities &
towns
DEN’s Presence Spans
India’s Economically
Important Urban
Landscape
Metros
1 Million+ Cities
Other DEN Cities
DEN States
Map not to scale
6 DTH
Platforms
DEN – Digitisation in Phase 1 Cities DEN Alone Rivals All DTH Platforms Put Together
Delhi
Mumbai
Kolkata 300,000
300,000 +
~ 320,000
~ 753,000
1.02 million
2.0 Million 2.1 million Total
STBs Installed/ Subscribers
Note: DTH data is as of Oct 30, 2012 (Ministry of Information & Broadcasting, Press Release dated Oct 31, 2012)
DEN data corresponds to STBs installed, as of March 2013
1.4 million+
14
June 6 2012 October 29 2012 April 5 2013
DEN: Rapid Digital Scale Up Driven by DAS
15
DEN Digital Base (STBs installed in millions)
Over 2 mn
conversions
in 158 days
1 mn
conversions
in 145 days 1 Million
2 Million
4.1 Million
DAS: Digital Addressable Systems
State Cities Estimated Seeding in Phase 2
Uttar Pradesh
Karnataka
Rajasthan
Gujarat
Maharashtra
Others
7
2
3
2
6
4
1.3 mn
0.3 mn
0.3 mn
0.2 mn
0.6 mn
0.3 mn
Total 3.0 mn
DEN – Phase 2 Cities
Digitisation in Full Swing
24
2.0 million STBs
already
deployed in
Phase 2 cities
16 STBs: Set top Boxes
4 million
DEN – Phase 3 & 4 Cities
17
Significant Scope to Increase Subscribers Through Further
Consolidation
Uttar Pradesh
Karnataka
Rajasthan
Gujarat
Maharashtra
Bihar
Haryana
West Bengal
Kerala
Madhya Pradesh
Jharkhand
Uttarakhand
Phases 3 & 4: DEN Presence Spans
120 + Cities Across 13 States...
Phase 3
2 million Phase 4
Est. Subscriber Base
Phase 3 + 4 =
6 million
NCR of Delhi
MediaPro: Exclusive Distribution J-V for all Star, Zee,
Turner & NDTV Channels
18
50%
50%
DEN is the Only Major Cable TV Company in India to have a
Strategic Stake in a Large Pay Channel Distribution Entity
DEN holds an
effective stake of
25% in MediaPro
MediaPro: A Content Distribution Powerhouse
19
FOX
NatGeo Others
Star
Unrivalled Collection of 70+ Leading Television Brands Under One Roof
NDTV
Zee Turner
List of channels not exhaustive
Contents
20
DEN’s Strategy
Digitisation in Indian Cable
DEN Networks – An Overview
Financials
DEN: Strategy Growth with Digitisation
Digitisation Broadband Consolidation
Digitisation of
Current Analog
Subscriber Base
Consolidate
Fragmented Cable
Players and Digitise
Launch and Scale
up Broadband
Service
21
Growth Verticals Over the Next 2-3 Years
Cable: Large Consolidation Opportunity in Phase 3 & 4
Cities
22 Source: Derived from Indian Cable Industry – A Digital Evolution, January 2013 report and MPA Asia Pacific Pay-TV & Broadband Markets 2012
50% 50%
Top 6
players
Others
Indian Cable Market (Market Shares %)
Small, Independent MSOs, mainly in Phase 3 & 4 Towns Who
Control nearly 50% of the Market – Not in a Position to Digitise...
...These markets ripe for expansion through organic & inorganic
routes while Digitisation is playing out
Broadband: The Next Wave of Growth in Cable
23 Source: Forecasted cable TV homes for 2013 (MPA Asia Pacific Pay-TV & Broadband Markets, 2012)
TRAI Recommendation Paper on National Broadband Plan, Dec 2010
Unrivalled Last-Mile Presence High Bandwidth Platform .
DEN’s Strong Presence Across India’s Urban, Affluent
Landscape Offers a Great Opportunity to Become One of the
Largest Wired Broadband Platforms Following DAS
98 million Indian homes on cable
Other wired platforms (fixed phones)
limited last mile presence
78 mn broadband connections after
completion of DAS (TRAI)
Broadband through the existing cable
last mile
Existing backbone & last mile network with
some upgrades can offer DOCSIS enabled
broadband
Cable’s Inherent Strengths Likely to Make it One of the
Largest Broadband Platforms…
Contents
DEN’s Strategy
Digitisation in Indian Cable
DEN Networks – An Overview
Financials
24
Strong financials
25
(a) Includes other non-operating income; (b) Calculated as Profit before tax plus finance cost plus depreciation; (c) PAT after minority interest ; (d) Does not include minority interest; (e) Calculated as long term
borrowings plus short term borrowings plus current portion of long term debt ; (f) From 1 April 2012, Media Pro Enterprises, a indirect JV of DEN, in its standalone financial results has started reporting Net revenues
(Gross revenues less cost of distribution right), hence the prior periods are not comparable; (g) Total long term borrowings + Short term Borrowings as per balance sheet as of December 31, 2012;
Note: Period ending December 2012 financials are limited reviewed and are provisional
9,256 10,581
11,566
6,588
FY10 FY11 FY12 9MFY13
962
1,264
1,093
1,501
FY10 FY11 FY12 9MFY13
301
375
143
429
FY10 FY11 FY12 9MFY13
7,410
7,746
8,046
8,554
Mar-10 Mar-11 Mar-12 Dec-12
1,750 1,573
2,582
4,362
Mar-10 Mar-11 Mar-12 Dec-12
– 1.5x growth in revenues in just 2 years
EBITDA positive in 1st full year of
operation; PAT positive in 2nd year
– India’s only listed PAT positive cable
or DTH company
– Low debt & debt-equity ratio as on
December 2012
Total Income (INR mn)(a)(f) EBITDA (INR mn)(b)(f) PAT (INR mn)(c)
Shareholder’s equity (INR mn)(d) Total debt (INR mn)(e)
(g)