On Y-o-Y basis, for the quarter ended December 2013, operating revenues grew 52% at Rs 234.78 crore. Subscription revenues grew 287% to Rs 119 crore while placement revenues rose 53% to Rs 73.6 crore. The subscription revenues includes incentives from business partners and pass through content revenues (contracts are centralised now).Excluding these, recurring subscription revenues grew 154% to Rs 78 crore. Broadband revenues grew 11% to Rs 36.6 crore. Activation income was at Rs 2.5 crore. OPM declined by 732 bps at 15.6%. The loss at net profit level increased by 397% to Rs 36.86 crore due to fall in margin and rise in interest cost & deprecation cost.

Standalone Performance

Quarterly Performance (Sequential)

For the quarter ended December 2013, operating revenues grew 7% at Rs 234.78 crore. OPM declined by 179 bps at 15.6% due to rise in pay channel cost by 470 bps to 35.7% of net sales. As a result, the operating profit has declined by 4% to Rs 36.74 crore.

Other income increased by 42% to Rs 2.47 crore. There was forex gain of Rs 2.73 crore. Interest cost was down by 5% at Rs 22.48 crore while depreciation & amortization charge increased 9% at Rs 55.98 crore. The profit before tax and EO has decreased by 14% to Rs 36.52 crore.

There was EO expenses which is prior period adjustments of Rs 0.34 crore. The loss at net profit level has decreased by 17% to Rs 36.86 crore due to forex gain.

Quarterly Performance (y-o-y)

For the quarter ended December 2013, operating revenues grew 52% at Rs 234.78 crore. Subscription revenues grew 287% to Rs 119 crore while placement revenues rose 53% to Rs 73.6 crore. The subscription revenues includes incentives from business partners and pass through content revenues (contracts are centralised now).Excluding these, recurring subscription revenues grew 154% to Rs 78 crore. Broadband revenues grew 11% to Rs 36.6 crore. Activation income was at Rs 2.5 crore.

OPM declined by 732 bps at 15.6% due to rise in pay channel cost by 780 bps to 35.7% and other expense by 290 bps to 42.3% of net sales. As a result, the operating profit inclined by just 4% to Rs 36.74 crore.

Other income increased by 82% to Rs 2.47crore. There was forex gain of Rs 2.73 crore against loss of Rs 1.49 crore in the corresponding quarter of last year. Interest cost was up by 97% at Rs 22.48 crore. The depreciation & amortization charge increased 95% at Rs 55.98 crore due to capex. The loss at profit before tax and EO increased by 671% to Rs 36.52 crore.

There was EO expenses which is prior period adjustments of Rs 0.34 crore. The loss at net profit level increased by 397% to Rs 36.86 crore due to fall in margin and rise in interest cost & deprecation cost.

For the nine months ended December 2013 performance

The operating revenues grew 63% at Rs 687.71 crore. OPM inclined by 307 bps to 22%. The operating profit increased by 89% to Rs 151.24 crore.

Other income has decreased by 25% to Rs 5.16 crore. There was forex loss of Rs 13.1 crore against loss of Rs 1.57 crore in the corresponding period of last year. Interest cost was up by 111% at Rs 67.81 crore while depreciation & amortization charge increased 90% at Rs 148.84 crore. The loss at profit before tax and EO increased by 190% to Rs 73.34 crore.

There was EO expenses of Rs 2.64 crore. The loss at net profit level increased by 203% to Rs 75.99 crore due to forex loss and rise in interest cost & deprecation

The TRAI has mandated introduction of Digital Addressable System (DAS) effective from November 1, 2012 in cites covered in Phase I and from April 1,2013 in cities covered in Phase II. Under the Qualify of Service Guidelines (QOS) issued in this context TRAI has further mandated that MSOs shall be responsible for the generation of bills to be given to individual subscribers.      

Due to resistance from the Local Cable Operators (LCOs), market condition and litigation by LCOs in certain cities, the above mandate couldn't be implemented. Accordingly, in respect of its secondary business, the Company continued to invoice LCOs and recognise subscription income and activation fees on best estimate basis. Such recognition is based on ongoing discussion with LCOs, market trend and considering the collection trend. The management has reasonable certainty of collecting the amount recognized as income. The method of invoicing as well as invoice amount may undergo a change prospectively, once there is understanding among the MSOs and LCOs.      

However, with effect from December 2013, the Company has commenced direct billing on its subscribers in the city of Delhi and provision for share of revenue payable to LCOs has been recognized. Such provision is based on agreements with LCOs or on reasonable estimate basis. In view of this change, Income from operations' and 'other expenses' for the quarter and for nine months period ended is not comparable with respective previous period.  

Shareholding Pattern

The Promoters stake stood at 47.51% for Dec. 2013.

The Promoters has not pledged shares

Valuation

The stock is trading around Rs 254.65 on the bourses.