DTH
Recalibrating India’s DTH sector after Airtel DTH-Warburg Pincus deal
MUMBAI: For long, investors have given India’s DTH sector a pass-by saying the TV distribution sector (read cable TV) is rickety and has been digitised in a hurry to meet government mandates without too much thought and planning of the back end. Often times, DTH players have been bundled with the cable TV lot and considered a not-a-very-attractive investment.
That was until last week. The announcement that Warburg Pincus was picking up 20 per cent stake in Airtel Digital TV (DTH) -with around 14 million subscribers – for a staggering $350 million at a valuation of $1.75 billion or Rs 11,204-odd crore should surely come as a shot in the arm for those distributing TV and running DTH platforms.
Right now, there are six of them: Tata Sky, Dish-Videocond2h, Airtel Digital TV, Sun Direct, DD Free Dish, and the floundering-now-waiting-to-be-resuscitated Reliance Big TV.
Most of them have been burning cash. Folks have been saying there are too many DTH operators in India. They have pointed towards the UK that has one, the US that has just two. And questions have been asked if India has too many vanity plays in both television and distribution.
A senior investment analyst unwilling to be identified says last week’s Warbug Pincus vote of confidence in DTH highlights how upbeat the sector looks as an investment destination and how different it is from India’s cable TV scattered majors.
It also raises questions around whether the Videocon management could have got a better deal when it decided to merge Videocon d2h with DishTV. Was Videocon d2h a tad undervalued? After all, the difference in EBITDA between Airtel and Videocon d2h alone runs into Rs 170-odd crore only. For FY 2016-17, Videocon d2h had an EBITDA of Rs 1018.1 crore as against Airtel DTH’s Rs 1222 crore. For fiscal 2017-18, Videocon d2h’s half yearly EBITDA stood at Rs 529.5 crore as against Airtel’s Rs 681.7 crore. Dish TV’s EBITDA for FY 2016-17 was Rs 972.8 crore, while it’s half yearly EBITDA for fiscal 2017-18 was Rs 417.3 million.
At the time of the merger, the combined entity’s valuation was placed at $2.7 billion for around 27 million subscribers of Dish TV and Videocon d2h. Combined the two would account for 16 per cent of the total 175 million hoseholds in India with around 2.80 million HD household and a combined proforma EBITDA of Rs 1826.2 crore. Going by the Airtel-Warburg numbers, the value of Dish TV-Videocon d2h should have been closer to $4 billion.
Another senior industry observer opines that the Airtel-Warburg Pincus deal has opened up investors’ eyes all over the world about the growth potential in India’s DTH vertical. The deal is probably one of the first-ever major large-ticket private equity placement deals in Indian DTH.
What has changed in the past one year? And what is exciting investors to look at the sector differently?
FreeDish to go away
Indications are that the DD Free Dish threat is dissipating with the implementation of the new policy that the government has put in place with no renewals of slots taking place for private players. Industry professionals point out that the government is seeking to enhance the reach of its own channels on Free Dish.
“It had deviated from its mandate–which was to reach out to all the rural areas where there are no transmitters and make the government’s voice reach those people. DD National was hurt because they gave slots to private GEC channels. The national channel’s viewership and revenue have since plummeted,” says one of them. “From Rs 1,400 crore in ad revenue, the figures came down to Rs 500-600 crore, out of which Rs 400 crore is from government enforced spending on the pubcaster. Its ad revenue is a measley Rs 200 crore and no private producer wants to produce for DD as it does not have the reach. With DD FreeDish likely to stop trading in bandwidth and not airing GECs, a window of opportunity for private DTH players to offer another option to rural and smaller town audiences will open.”
Cord cutting – a hyped-up phenomenon
Another senior industry researcher says that the phenomenon of cord-cutting has been hyped up by new entrants in the OTT space such as Netflix and their backers from the analyst community and investors in both the US and India.
“Comparing the US and India is absolutely fraught with disaster. Even in cord cutting,” she says. “India has a very deep urban population and a very deep rural populace. The TV in the living room is still the centre piece of Indian homes; it is also moving into the bedroom. There will be no cord cutting; we will have both in India, the Netflixes as well as TV subscriptions. Jio, too, has expanded the consumption of mobile bandwidth and nowhere is it posing a threat of cord cutting.”
The impact of TRAI’s tariff order, GST and introduction of transparency
The DTH industry has an estimated 90 million subscribers; the net figure is 65 million and the active is 52-55 million. The net sub number includes those subs who have been suspended for up to 120 days for non-payment; whereas actives are those who have subscribed and paid to for between zero and 30 days.
Industry veterans point out that DTH operators are better placed to implement the TRAI’s new tariff regime which has been held up in courts. One of them points out that the higher content costs that they have been paying to broadcasters will simply go away. “Our infrastructure allows us to permit millions of subscribers to unsubscribe online very easily and watch the channels and the shows they want to,,” says he. “Because of transparency our costs will go down with the execution of the tariff order.”
Cable TV content costs, however, he points out are set to go up as under declarations of sub numbers to the tune of 50-60 per cent by LCOs to MSOs have been rampant. “After digitisation and GST, every connection is being reported to the MSO as everybody in the chain has to pay taxes. With this, the broadcaster will understand how many subscribers are actually there and he will charge transparently per sub basis. Based on that the fixed deals will happen,” he says.
That should be good news for industry observers and naysayers who have been waiting like Godot for India’s TV content and distribution to unlock its true potential and value.
Also Read:
Warburg Pincus to buy 20% in Airtel’s DTH arm
Reliance Big DTH to take FTA route under new management?
STB import duty doubled to 20%
DTH
GTPL Hathway posts FY26 revenue growth, Q4 slips into loss
Annual profit at Rs 5.88 crore; Q4 loss at Rs 5.90 crore
MUMBAI: A strong year met a shaky finish as GTPL Hathway closed FY26 on a high note only to stumble at the final hurdle. The company’s latest financials reveal a tale of two timelines: steady annual growth alongside a fourth-quarter dip that nudged it into the red. GTPL Hathway Limited reported total income of Rs 2,472.46 crore for the year ended March 31, 2026, marking a clear rise from Rs 2,223.00 crore in FY25. Revenue from operations stood at Rs 2,450.78 crore, up from Rs 2,193.38 crore a year ago, signalling consistent traction in its core cable TV and broadband business.
Yet, beneath the annual growth narrative, the March quarter told a different story. The company posted a net loss of Rs 5.90 crore in Q4 FY26, a sharp reversal from a profit of Rs 0.91 crore in the preceding quarter and Rs 8.15 crore in the same period last year. Total income for the quarter came in at Rs 618.46 crore, largely flat sequentially but higher than Rs 569.33 crore reported a year earlier.
The pressure was visible across the cost structure. Total expenses for the quarter rose to Rs 620.64 crore, marginally exceeding income and tipping the company into a loss before tax of Rs 7.87 crore. This compares with a profit before tax of Rs 1.22 crore in the December quarter and Rs 11.32 crore in Q4 FY25.
For the full year, however, profitability held firm. GTPL reported a net profit of Rs 5.88 crore in FY26, significantly lower than Rs 47.80 crore in FY25, but still in positive territory despite higher finance costs and operating expenses. Operating expenses alone climbed to Rs 1,884.53 crore for the year, up from Rs 1,603.53 crore, reflecting the increasing cost of running and scaling network infrastructure.
Finance costs also rose notably to Rs 33.57 crore in FY26 from Rs 22.19 crore in FY25, while depreciation and amortisation expenses stood at Rs 189.19 crore, underlining continued investments in assets and technology. Employee benefit expenses, however, declined to Rs 63.42 crore from Rs 77.08 crore, offering some relief on the cost front.
An exceptional item of Rs 5.69 crore during the year also weighed on profitability, compared with Rs 3.79 crore in the previous year. Meanwhile, tax adjustments, including deferred tax movements and prior-year adjustments, played a role in shaping the final earnings outcome.
Despite the quarterly wobble, the broader picture suggests a company still expanding its top line while grappling with margin pressures. With paid-up equity share capital unchanged at Rs 112.46 crore, the focus now shifts to whether GTPL can convert its revenue momentum into more stable, sustainable profitability in the coming quarters.
In short, FY26 may have delivered growth on paper but the closing chapter serves as a reminder that in business, as in broadband, consistency is everything.
