Cable TV

“Further price freeze will stall growth” – Jayaraman

Published

21 years ago

October 7, 2004

It has been the worst period of inactivity in the cable TV industry. Since the price freeze on subscription rates imposed by the Telecom Regulatory Authority of India (Trai), there has been very little fresh capital infusion into the sector.

Already, multi system operators (MSOs) have spent an estimated Rs 8 billion to make their networks conditional access system (CAS) ready. This followed the government‘s decision to mandate CAS in the four metros of Mumbai, Delhi, Kolkata and Chennai.

Subsequent retractions on the implementation of CAS have hit cable networks hard. Only Chennai was made a CAS market, and even there consumers have shown poor response. The government asked the Trai to look into the complex issue of CAS and come out with recommendations. The first thing the broadcast and cable TV regulator did was to freeze rates with effect from 26 December, 2003.

So what has been the focus of MSOs? A look at how a few MSOs have managed their businesses in a year where CAS remained in limbo and subscription prices stayed frozen. And the plans they have set out for the near term.

Hathway Cable & Datacom

The sense in Hathway Cable & Datacom is growing that it needs to do something to beat the status quo.

First, it wants to launch its digital cable TV service in Mumbai, Delhi and Bangalore. There are 185,000 digital set-top boxes (STBs) lying idle. The plan is to push them for sale by October-end.

“We can‘t afford to wait for mandated CAS,” says Hathway Cable & Datacom chief executive officer K Jayaraman.

Having invested Rs 1 billion for CAS, Hathway has to turn things round fast. Some of the rival MSOs have already put their STBs for consumers to buy. The lure: additional channels and a whole new digital experience.

Hathway‘s offer is 140 channels. For the STBs, consumers will have to pay Rs 3,150 (plus local taxes). There is no rental scheme. “We feel eight per cent of our total cable TV subscribers will switch over to the digital service as we have a strong presence in upmarket areas,” says Jayaraman.

That may be a tall hope. Consumers aren‘t particularly enthusiastic to buy. But it is a step Hathway has to take to be in line with competition and secure its network by putting up its STBs in consumer homes first. An additional investment of Rs 70 million is something that Hathway can well afford.

Second, Hathway needs the price freeze out. Of course, the outgo towards pay TV broadcasters this year has been almost flat. This has helped the MSO focus on other related business areas like Internet over cable. But, as Jayaraman says, the other costs are due for renewal. “The price freeze provided us short term relief, particularly when we had no implementation of CAS. But now it is beginning to hurt.”

What Hathway has been trying to do during this nine-month period is to improve bill collections, minimise overheads and focus on Internet and local cable channels.

Recovery of money from the franchise operators was difficult, particularly in the absence of unity among the MSOs and the practice of poaching from rival networks. But the promise of mandated CAS – and the mess that followed it – forced MSOs to sit together on a common cause. They broadly agreed not to get into each other‘s territories. This helped them improve collections from franchise operators.

“Our recovery from current billings has gone up, from 60-70 per cent to 80 per cent,” says Jayaraman. Hathway charges a monthly fee of Rs 150 a month per subscriber from its franchisees.

The recovery rate was higher in cities like Mumbai than in Delhi and Bangalore. With a high percentage of independent cable operators, poaching was still a practice in Delhi and Bangalore. In contrast, Mumbai is largely an MSO market. Admits Jayaraman, “There was some fight for market share in certain territories. But among the MSOs, there was very little attempt to poach.”

Hathway also spent its energy in growing revenue streams outside the traditional income from cable transmission. Cable over Internet was a big area of focus and Hathway was the most aggressive among all the MSOs to push this segment. During the year, Hathway lowered cost of cable modems (Rs 2,999, from Rs 3,999), launched more competitive entry packages (Rs 300 a month, down from Rs 650), and introduced high speed packages (256 kbps, from 64 kbps). Also on offer was broadband Internet service through ethernet to go more mass. Hathway could, thus, start offering its Internet services in areas where it was taking time to build the cable network for two-way capability.

There was a thrust to increase revenues from CCC (a cable movie channel), ITV (dial-in music channel) and local cable channels across different locations. To increase penetration, CCC was made available in non-Hathway cable networks as well.

“We expect a 30 per cent revenue growth this year from our Internet business and 10-12 per cent from local channels,” says Jayaraman.

On the expenditure side, Hathway has tried to reduce overhead costs. “Because of our CAS investment and a price freeze on subscription rates, we have completely curtailed our capital expenditure. There is no point in expanding the network under the current scenario,” says Jayaraman.

But that can‘t be the growth strategy, even though the payout cost to broadcasters will see a marginal rise this year (In 2003-04, it rose 33 per cent to Rs 1.07 billion). “Though content costs are not up, we have our overhead costs. This way, there can be no growth in the industry. It is not an ideal situation to be in for the medium and long term,” says Jayaraman.

The fact is that Hathway had ambitious plans in a CAS regime and even had assigned Fitch to rate a proposed Rs 50 million commercial paper (short term debt). Having loose agreements with local cable operators and investment exposures to some loss-making subsidiaries, CAS, in fact, was expected to improve Hathway‘s liquidity position and increase its revenues. The MSO had plans to raise Rs 250 million if expansion was necessary in a CAS scenario.

Such fund-raising plans are not necessary now. “CAS would have at least brought transparency. A new business model would have come,” says Jayaraman. Until that happens, Hathway will try to push its digital STBs, focus on broadband and cable channel businesses, and hope for a lift in the price freeze on subscription rates.

Related Topics:analogue Broadcast cable TV CAS Digital Hathway MSOs STBs Trai

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Cable TV

Den Networks Q3 profit steady despite revenue pressure

Published

1 month ago

January 19, 2026

indiantelevision.com Team

MUMBAI: When margins wobble, liquidity talks and in Q3 FY25-26, cash did most of the talking. Den Networks Limited closed the December quarter with consolidated revenue of Rs.251 crore, marginally higher than the previous quarter but down 4 per cent year-on-year, even as profitability stayed resilient on the back of strong cash reserves and disciplined cost control.

Subscription income softened to Rs.98 crore, slipping 3 per cent sequentially and 14 per cent from last year, while placement and marketing income offered some cheer, rising 15 per cent quarter-on-quarter to Rs.148 crore. Total costs climbed faster than revenue, up 7 per cent QoQ to Rs.238 crore, driven largely by higher content costs and operating expenses. As a result, EBITDA dropped sharply to Rs.13 crore from Rs.19 crore in Q2 and Rs.28 crore a year ago, pulling margins down to 5 per cent.

Yet, the bottom line refused to blink. Profit after tax stood at Rs.40 crore, up 15 per cent sequentially and only marginally lower than last year’s Rs.42 crore. A healthy Rs.57 crore in other income helped cushion operating pressure, keeping profit before tax at Rs.48 crore, broadly stable quarter-on-quarter despite the tougher cost environment.

The real headline-grabber, however, sits on the balance sheet. The company remains debt-free, with cash and cash equivalents swelling to Rs.3,279 crore as of December 31, 2025. Net worth rose to Rs.3,748 crore, while online collections accounted for 97 per cent of total receipts, underscoring strong cash discipline across operations, including subsidiaries.

In short, while Q3 showed signs of operating strain, the financial backbone remains solid. With zero gross debt, steady profits and a formidable cash war chest, the company enters the next quarter with flexibility firmly on its side proving that in uncertain markets, balance sheet strength can be the best growth strategy.

Cable TV

Plugging along as Hathway tunes in steady profits this quarter

Published

2 months ago

January 17, 2026

indiantelevision.com Team

MUMBAI: In a quarter where staying connected mattered more than moving fast, Hathway Cable and Datacom kept its signal steady. The cable and broadband major reported a net profit of Rs 21.7 crore for the December 2025 quarter, marking a clear improvement from Rs 13.6 crore a year earlier, even as pressures persisted in parts of its operating portfolio.

For the quarter ended December 31, 2025, revenue from operations stood largely flat at Rs 536.6 crore, compared with Rs 511.2 crore in the same period last year. Including other income of Rs 21.1 crore, total income rose to Rs 557.7 crore, reflecting incremental gains despite a competitive media and connectivity landscape.

Profitability improved on the back of disciplined cost control and higher contribution from associates. Profit before tax increased to Rs 28.2 crore, up from Rs 19.1 crore in Q3 FY25, aided by Rs 3.9 crore in share of profit from associates and joint ventures. After tax, earnings for the quarter climbed nearly 60 per cent year-on-year.

Over the nine months ended December 31, 2025, Hathway reported a net profit of Rs 71 crore, compared with Rs 57.7 crore in the corresponding period last year. Total income for the nine months came in at Rs 1,677.3 crore, up from Rs 1,599.8 crore, while profit before tax rose to Rs 94.7 crore from Rs 84.2 crore.

A closer look at the segments shows a familiar split story. The cable television business remained under pressure, reporting a segment loss of Rs 11.4 crore for the quarter, though this narrowed sharply from the Rs 16.6 crore loss seen a year ago. In contrast, the broadband business returned to the black, delivering a modest but positive contribution of Rs 4.2 crore, helped by associate income. Dealing in securities continued to be a bright spot, generating Rs 14.7 crore in quarterly profits.

Costs stayed broadly contained. Pay channel costs, the single largest expense, rose to Rs 287.4 crore, while depreciation and amortisation stood at Rs 74 crore. Finance costs remained negligible at Rs 0.2 crore, keeping leverage risks in check.

Hathway’s earnings per share for the quarter improved to Rs 0.12, up from Rs 0.08 a year ago. The company maintained a strong balance sheet, with total assets of Rs 5,302.4 crore and total liabilities of Rs 848.9 crore as of December 31, 2025.

While structural challenges persist in the traditional cable business, the numbers suggest Hathway is slowly recalibrating its mix trimming losses where needed, leaning on associate income, and keeping the broadband engine ticking. For now, the company may not be racing ahead, but it is clearly staying tuned in to profitability.

Cable TV

Signal drop Tejas Networks’ numbers stay patchy in a volatile quarter

Published

2 months ago

January 10, 2026

indiantelevision.com Team

MUMBAI: In telecom, even the strongest signals face interference and Tejas Networks Limited’s latest numbers show just how noisy the airwaves remain. The Tata Group-backed networking firm reported unaudited standalone revenue of Rs 305.72 crore for the quarter ended December 31, 2025, up sequentially from Rs 261.37 crore in the September quarter, but sharply lower compared with the Rs 2,642.05 crore clocked in the year-ago period. The topline recovery, however, was overshadowed by a pre-tax loss of Rs 303.20 crore, widening from a Rs 473.03 crore loss in the previous quarter, and reversing a Rs 211.06 crore profit reported in the December 2024 quarter.

After tax, the company posted a loss of Rs 196.89 crore for Q3 FY26, compared with a loss of Rs 307.17 crore in Q2 FY26 and a profit of Rs 165.42 crore a year earlier. For the nine months ended December 31, 2025, Tejas Networks reported revenue of Rs 769.02 crore and a loss after tax of Rs 697.97 crore, a sharp swing from a Rs 512.67 crore profit in the corresponding nine-month period last year. The numbers reflect a year marked by execution challenges rather than demand collapse.

Costs remained the dominant spoiler. Total expenses for the December quarter stood at Rs 616.50 crore, driven by elevated material costs, employee expenses and provisioning. The company also flagged several one-offs and adjustments: a Rs 9.85 crore provision linked to the implementation of new labour codes, ₹24.35 crore in warranty provisions, and reversals related to inventory obsolescence. Earlier quarters had already absorbed heavy charges tied to contract manufacturing losses, design changes and write-downs, the hangover from which continues to weigh on profitability.

Tejas reiterated that it operates as a single reportable segment focused on telecom and data networking products and services, offering little insulation from sector-wide volatility. While revenue momentum has stabilised sequentially, the contrast with the previous financial year remains stark. For context, the company closed FY25 with audited standalone revenue of Rs 8,915.73 crore and a profit after tax of Rs 450.66 crore, underscoring how sharply the operating environment has shifted in FY26.

The results were reviewed by the audit committee and approved by the board on January 9, 2026, but they leave investors with a familiar question: when does recovery turn structural rather than episodic? For now, Tejas Networks appears to be in reset mode, balancing execution clean-up with cost discipline. In a sector where margins can be as fragile as fibre strands, the next few quarters will matter as much as the signals the company sends to the market.