DTH Business Report healthy Numbers - Airtel / Videocon

Both Videocon DTH and Airtel DTH reported healthy quarterly numbers over the last couple of days. We look at the metrics and some read-through for Indian cable/satellite space, including Dish.

VDTH added 0.43m subs in the December quarter, increasing net subs by ~15% yoy. The comparable number for Airtel DTH was 0.53m subs, increasing net subs by ~13% yoy. While both VDTH and Airtel
DTH also benefited by sequentially lower churn, underlying momentum in the market remains strong - we expect Dish to add 0.40m subscribers in the quarter.

The trend on ARPUs remains healthy (VDTH: ~8% yoy, Airtel DTH: ~7% yoy) - this is a result of price
hikes taken in the recent past, HD adoption (trends do vary from quarter to quarter though) and increasing value added services. For Dish TV, we model in ~5% increase in ARPUs for FY16 yoy.

With attractive content deals and operating leverage continuing to play, the sector continues to deliver good EBITDA margin expansion. Both VDTH (~390 bps yoy) and Airtel DTH (~600 bps yoy) reported healthy margin expansion resulting in EBITDA growing ~42%/45% yoy respectively.