Hathway Cable to bundle HD with broadband services

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MUMBAI: Hathway Cable & Datacom plans to launch its HD services this month and bundle it with the broadband offering as it seeks to enhance its average revenue per user (ARPU).

The multi-system operator (MSO) is waiting to stitch content deals with the broadcasters for its HD services, a senior officer said.

Hathway is planning to add 150,000 broadband subscribers this fiscal. For the fiscal first-quarter, the company has mopped up 28,000 subscribers at the gross level.

Hathway is working on a digital compression technology that will enable it to boost bandwidth on analogue cable. The MSO is targeting a 15-20 per cent growth in carriage revenue this fiscal.

The company will utilise part of the IPO (initial public offering) proceeds to bring down its debt which stands at Rs 2.12 billion till July-end. The net debt stands at Rs 1.10 billion.

Hathway had a gross debt of Rs 2.89 billion and cash of Rs 1.87 billion till June-end, according to data provided by the company.

For the three months ended June, the company has posted a standalone net loss of Rs 148.02 million compared to Rs 139.28 million a year ago.

Revenue jumped 22.64 per cent to Rs 1.22 billion, as against Rs 999.01 million in the earlier year. Hathway's expenses surged 20.51 per cent to Rs 1.03 billion from Rs 857.71 million.

The payout to pay channels during the three-month period ended 30 June stood at Rs 347.45 million, higher than Rs 279.14 million it paid in the year-ago period.

Hathway's Ebitda stood at Rs 192 million in the quarter, compared with Rs 141 million in the earlier year, registering a 36.2 per cent increase. Ebitda margins improved by 150 basis points from 14.1 per cent to 15.6 per cent.

Hathway Cable & Datacom MD and CEO K Jayaraman said, "Hathway, with its emphasis on digitising its customer base voluntarily in anticipation of mandatory digitisation is well positioned to take advantage of the business environment where there is greater transparency of the subscriber base.Inevitably in a growing economy such as ours consumption of media is bound to take off. This is particularly true of bundled services such as cable and nroadband. Given our significant presence in the Broadband space in addition to our Cable TV services we expect to see an upward trend in ARPU's in the coming years."

Hathway's cable TV business in the quarter under review was stable and significant traction was perceived in the case of broadband. The results of introducing faster and higher bandwidth products (2 Mbps and 5 Mbps) were felt in this period. As more subscribers connected on these services, there was a salutary impact on ARPU, which went up from an average of Rs 284 to Rs 309.

"The company expects to see further improvement in the coming quarters as it recruits a higher proportion of subscribers to the higher ARPU plans. In preparation for eventual digitisation the company also reviewed its cost structure and operational processes. The resulting increasing in productivity and decline in costs is expected to position the company well when digitisation is made mandatory," Hathways said.
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