Category: Local Cable Operators

Q3-2016: Ortel Communications’ YoY revenue up 22%

BENGALURU: The Bibhu Prasad Rath led regional cable television and broadband internet player Ortel Communications Limited (Ortel) reported YoY revenue (Total Income from Operations or TIO) of 21.8 per cent at Rs 48.03 crore in the current quarter (quarter ended 31 December, 2015, Q3-15) as compared to Rs 39.44 crore and 4.9 per cent QoQ growth as compared to Rs 45.79 crore.

The company reported PAT in Q3-2016 at Rs 3.89 crore (8.1 per cent margin) as compared to a loss of Rs 0.1 crore in Q3-2015 and 37.5 per cent higher QoQ PAT as compared to Rs 2.83 crore (6.2 per cent margin).

Ortel provides services in the Indian states of Odisha, Chhattisgarh, Andhra Pradesh, Madhya Pradesh and West Bengal.

Notes: 100,00,000 = 100 lakh = 10 million = 1 crore

The numbers mentioned in this report are standalone.

The company’s cable segment reported 17.3 per cent YoY growth in revenue at Rs 31.99 crore in the current quarter as compared to Rs 27.27 crore and 3.4 per cent QoQ growth as compared to Rs 30.93 crore. This segment reported 46.6 per cent YoY growth in operating profit of Rs 13.61 crore in Q3-2016 as compared to Rs 9.28 crore and 4.1 per cent QoQ growth as compared to Rs 13.08 crore.

Ortel’s broadband segment reported 16.3 per cent higher revenue at Rs 8.28 crore as compared to Rs 7.12 crore in the corresponding year ago quarter and 1.7 per cent more than the Rs 8.14 crore in Q2-2016. The broadband segment reported an operating profit of Rs 4.78 crore in the current quarter as compared to Rs 4.52 crore in Q3-2015 and 9.1 per cent higher than the Rs 438 crore in Q2-2016.

Ortel president and CEO Rath said, “I am delighted to share that our key strategy of LCO buyout is receiving huge response in our markets. Healthy addition to RGUs has led to strong growth of 38 per cent in bottom-line on a Q-o-Q basis. Given the strong pipeline of RGUs yet to be integrated, we are confident of improving upon this solid performance in the coming quarters.”

“Broadband business continues to do well and remains a key focus area for us. We are working towards delivering notable growth in subscriber base, which would further augment our performance and overall profitability,” he added.

“FY2016 will be one-of-the-best-years in the history of Ortel Communications backed by record RGU additions and solid visibility for LCO buyouts in the coming year. With more than 90 per cent subscribers on ‘last mile,’ we remain committed to this model and strongly believe it will create tremendous value for all stakeholders going forward,” Rath said.

Ortel’s YoY revenue generating units (RGU) grew 19 per cent to 626,475 as compared to 526,551 and increased 9.6 per cent QoQ as compared to 571,834 in Q2-2016.

Cable TV RGUs increased 19.3 per cent YoY in Q3-2016 to 558,766 as compared to 468,274 and increased 10 per cent as compared to 508,171 in Q2-2016.

Ortel’s YoY primary digital cable RGUs grew 33.9 per cent to 127,098 in Q3-2016 as compared to 94,926 and grew 8.3 per cent QoQ to 117,401. The company says that its Cable TV penetration stood at 23.7 per cent and penetration in the current quarter.

Broadband customers in the current quarter grew 16.2 per cent YoY to 67,709 as compared to 58,277 and grew 6.4 per cent QoQ as compared to 63,663.

Ortel reported a slight drop in digital and analogue cable ARPUs in the current quarter. Digital cable ARPU in Q3-2016 was Rs 181; in Q3-2015 it was Rs 186 and Q2-2016 it was Rs 183. Analogue cable ARPU in Q3-2016 was Rs 141, in Q3-2015 it was Rs 147 and in Q2-2016 it was Rs 143. Broadband ARPU in Q3-2016 was higher at Rs 396, while in Q3-2015 it was Rs 394 and in Q2-2016 it was Rs 395.

Cable Subscription, Connection and Channel carriage fees

The company’s cable subscription fees in Q3-2016 increased 6.5 per cent to Rs 21.2 crore as compared to Rs 19.9 crore and was 3.2 per cent more than the Rs 20.6 crore in Q2-2016. Connection fees increased 32.7 per cent to Rs 1 crore as compared to Rs 0.70 crore and increased 33.8 per cent as compared to Rs 0.7. Channel carriage fees in the current quarter increased 48.3 per cent to Rs 9.8 crore as compared to Rs 6.6 crore in Q3-2015 and increased 1.4 per cent as compared to Rs 9.7 crore in Q2-2016.

Let us look at the other numbers reported by Ortel:

Total Expenditure in Q3-2016 increased 16.2 per cent YoY Rs 39.78 crore (82.8 per cent of TIO) as compared to Rs 34.24 crore (86.8 per cent of TIO) and was 2.8 per cent more than Rs 38.72 crore (84.6 per cent of TIO) in Q2-2016.

The company’s programming cost in the current quarter increased 9.7 per cent to Rs 9.1 crore as compared to Rs 8.3 crore in Q3-2015, but declined 3.3 per cent as compared to Rs 9.44 crore in Q2-2016.

Bandwidth cost in Q3-2016 increased 25.4 per cent to Rs 2.1 crore as compared to Rs 1.7 crore and increased 9.1 per cent as compared to Rs 1.92 in Q2-2016.

Employee Benefits Expense in the current quarter increased 31.6 per cent to Rs 5.7 crore as compared to Rs 4.3 crore in Q3-2015 and increased 0.6 per cent as compared to Rs 5.64 crore e in Q2-2016.

Lower interest costs

SREI Equipment Finance Limited, the largest lender of the company, extended a prompt payment rebate (PPR) of one per cent on the company’s borrowings with effect from 1 October, 2015. This is in addition to the earlier rebate of 0.75 per cent, which would bring down the effective interest rate to 14.25 per cent.

January 27, 2016
Ortel offers special value added Wi-Fi public hotspot service

MUMBAI: Ortel Communications has introduced Wi-Fi public hotspot services for its broadband subscribers as a special value added service. The service is being offered in the busiest locations of the state of Bhubaneswar.

Customers can access the Hot Spot services by using their existing internet account. They can use the broadband services in the public Hot Spot Wi-Fi location and can also access the primary wired broadband connection at home.

Without the requirement of any other additional hardware like modem or a dongle neither a software installation, the subscribers can use the service through their smartphones, tablet PCs and laptops.

Ortel is the first MSO and ISP to offer an additional wireless broadband service at public places in Bhubaneswar for its wired broadband subscribers without any additional charges. These services will be extended to other markets very soon.

Ortel Communications president and CEO Bibhu Prasad Rath said, “We are happy to launch wireless broadband access at public areas through Wi-Fi Hotspots for our existing and new broadband subscribers. This will allow our wired broadband subscribers to access internet using their existing Ortel Broadband connection outside their homes at places where most of them visit very frequently. Ortel has been one of the pioneers in the Cable TV and Broadband industry and it is our constant endeavour to provide unique and path-breaking services to our subscribers. The Wi-Fi Hot Spot is yet another value-added service which will enable our broadband subscriber’s to access internet on-the go through their internet-enabled devices.”

Ortel is also focused in the states of Odisha, Chhattisgarh, Madhya Pradesh, Andhra Pradesh, Telengana and West Bengal.

January 12, 2016
NXT Digital signs RIO deal with Taj Television

MUMBAI: The Hinduja Group’s Headend In The Sky (HITS) service under the brand name NXT Digital has finally struck a reference interconnect offer (RIO) deal with Zee Entertainment’s distribution subsidiary Taj Television India, by virtue of which it will be able to include Zee Entertainment Enterprises Ltd (Zeel) and Turner International India’s channels in its bouquet of offerings.

As was reported earlier by Indiantelevision.com, the matter was with the Telecom Disputes Settlement and Appellate Tribunal (TDSAT) and the two companies informed the Tribunal that Taj Television will provide its signals to Hinduja Group’s Grant Investrade as soon as an inter-connect agreement was signed.

Zeel and Turner International were the only major broadcasting networks that were missing from the service’s bouquet. This deal will see NXT Digital, the rapidly growing platform in phase III areas, having a wholesome catalogue to offer to the operators, as well as reach a larger audience.

Speaking on the signing of the new deal, a source from close to development told Indiantelevision.com, “The channels will be available on an ? la carte basis. And we are certain that this deal will help NXT Digital garner an enhanced reach.”

This gives a definite edge to NXT Digital, which is the second HITS player in the country, the first being Jain HITS NXT Digital was launched earlier this year with state of art technology. On the other hand, Jain HITS is currently in the process of upgrading its technology.

Also read:

Taj TV to supply signals to Grant Investrade after signing ICA

December 23, 2015
Tamil Nadu cable TV industry incurs Rs 25 crore loss due to floods

MUMBAI: ’Twas Mother Nature’s fury at full throttle when the state of Tamil Nadu was flooded by the heaviest rainfall it has been privy to in the last century. Many lives were lost even as over three lakh people became homeless.

While the southern state is slowly inching back to normalcy from the unprecedented rains and floods, which engulfed whatever came in its way, the natural disaster had a massive impact on the media and entertainment industry as well. The entire cable TV ecosystem was brutally affected by the calamity. It may be recalled that for the last couple of weeks, the Broadcast Audience Research Council (BARC) India hasn’t received television ratings data from the region too.

In the light of this disaster, a senior cable federation member from Chennai estimates the overall loss suffered by the cable industry to be close to Rs 25 crore. “We have done an on-ground survey and after a thorough analysis, we came to the estimate. Local cable operators (LCOs) will have to bear the majority of the loss as most of the fibre amplifier devices, which were damaged belong to them,” he adds.

While industry body ASSOCHAM estimated the overall financial loss from the torrential rains and floods in Tamil Nadu to be in excess of Rs 15,000 crore, the Rs 25 crore loss to the cable industry may even be a conservative one. The on-ground reality indeed paints a grim picture.

“Thousands of fibre amplifiers got affected. The LCOs are trying their level best to restore services but the damage is so massive that it will take at least a week or 10 days more to get things back on track,” added a senior official from the cable fraternity.

A fibre amplifier, which is located in the operating room of cable operators, costs around Rs 3500 and a large number of them were totally destroyed as they immersed in the flood water. Fortunately, no instance of head-end damaged could be traced.

An independent multi system operator (MSO), who was also affected by the natural calamity, said, “The head-ends are generally placed at a good height and hence they got saved. But my transmitter is totally damaged. The flood has damaged cable operations brutally, and to restore services it will take me more than 15 days at least.”

“The transmitter costs Rs 50,000 and I have to invest in a new one,” he adds.

The other equipment that was damaged in the flood and needs serious investment is Erbium Doped Fiber Amplifier (EDFA), which is an optical repeater device used to boost the intensity of optical signals being carried through a fiber optic communications system. “I need to invest Rs 1.5 lakh in my EDFA and there are many other such operators who will have to change their EDFA,” said an LCO.

While some equipments may be under warranty, it is unlikely that the warranty applies in the case of natural disasters. A looming question is also that of insurance. All said and done, many LCOs and MSOs affected severely by the flood will have to bend over backwards in order to get their system back on.

December 22, 2015
Q2-2016: Ortel YoY revenue up 24.6 percent, PAT more than doubles

BENGALURU: The Bibhu Prasad Rath-headed regional cable television and broadband internet player Ortel Communications Ltd (Ortel) has reported a 24.6 percent growth in revenue from operations (TIO) at Rs 45.79 crore as in the quarter ended 30 September 2015 (Q2-2016, current quarter) as compared to the Rs 36.74 crore in the corresponding year ago quarter. TIO in the current quarter was also higher by 12.8 percent as compared to the Rs 40.6 crore in the immediate trailing quarter. Ortel provides services in the Indian states of Odisha, Chhattisgarh, Andhra Pradesh, Madhya Pradesh and West Bengal,

Notes: 100,00,000 = 100 lakh = 10 million = 1 crore

The numbers mentioned in this report are standalone.

The company reported more than a doubling of PAT (up 2.3 times) to Rs 2.83 crore (5.9 percent margin) as compared to the Rs 1.23 crore (3 percent margin) in Q2-2015, and 15.9 percent more than the Rs 2.44 crore (5.7 percent margin) in the immediate trailing quarter.

Ortel President and CEO Rath said, “I am glad to report a strong operational and financial performance for the quarter ended September 30, 2015. Performance during the quarter was driven by healthy addition in revenue generating units (RGUs) which stood at 571,834. We are witnessing encouraging traction to our LCO buyout strategy in emerging markets like Andhra Pradesh and Chhattisgarh, and I am confident that this would sustain going forward. Going forward, we would continue with our strategy of aggressive LCO buyouts across all our markets and diligently integrate the new subscribers into Ortel’s last mile network. Healthy contribution from new RGUs along with ongoing focus on the high margin Broadband business would enable us to deliver strong financial performance in the forthcoming years.”

The company’s EBIDTA (TIO plus Depreciation and Amortisation plus Other Income plus Fixed assets written off minus Total Expenditure) increased 31.3 percent to Rs 17.29 crore (37.8 percent margin) in the current quarter as compared to the Rs 13.17 crore (35.8 percent margin) and increased 8.8 percent as compared to the Rs 15.89 crore (39.1 percent margin) in Q1-2016.

Ortel’s YoY RGUs grew 9.2 percent to 571,834 in Q2-2016 from 523,833 in Q2-2015 and increased 5.5 percent from 542,217 in Q1-2016.

Cable TV RGUs’ increased 9 percent in Q2-2016 to 508,171 from 466,305 in Q2-2015 and grew 5.6 percent from 481,317 in Q1-2016.

Ortel’s YoY primary digital cable RGUs grew 33.2 percent to 117,401 in Q2-2016 from 88,106 and grew QoQ to 4.5 percent from 112,296 in Q1-2016. Analogue cable RGUs’ increased to 330,739 from 322,175 in Q2-2015 and from 307,923 in Q1-2016. The company says that its Cable TV penetration stood at 23.7 percent and penetration in select 10 towns where company offers digital services stands at 71 percent.

Broadband customers grew 8.9 percent to 63,663 in the current quarter from 57,528 in Q2-2015 and grew 4.5 percent from 60,900 in Q1-2016.

The company has reported a slight drop in digital and analogue cable and broadband ARPUs’ in the current quarter. Digital cable ARPU in Q2-2016 was Rs 183 in Q2-2016; Rs 187 in Q2-2015 and Rs 185 in Q1-2016. Analogue cable ARPU in Q2-2016 was Rs 143; in Q2-2015 it was Rs 147 and in Q1-2016, it was Rs 144. Broadband ARPU in Q2-2016 was Rs 183, in Q2-2015, it was Rs 187 and in Q1-2016, it was Rs 185.

Cable Subscription, Connection and Channel carriage fees

The company’s cable subscription fees in Q2-2016 increased 4 percent to Rs 20.6 crore as compared to the Rs 19.8 crore in Q2-2015 and increased 3 percent as compared to the Rs 20 crore in Q1-2016. Connection fees declined to Rs 0.70 crore in the current quarter from Rs 1.1 crore in Q2-2015 and remained flat as compared to the Rs 0.7 crore in Q1-2015.Channel carriage fees in the current quarter increased 44.9 percent to Rs 9.7 crore from Rs 6.7 crore in Q2-2015 and increased 23.8 percent from Rs 7.8 crore in the immediate trailing quarter.

Let us look at the other numbers reported by Ortel

Total Expenditure in Q2-2016 increased 13.3 percent to Rs 38.72 crore as compared to Rs 34.17 crore in Q2-2015 and increased 12.5 percent as compared to the Rs 34.42 crore in the immediate trailing quarter.

The company’s Programming cost in the current quarter increased 7.2 percent to Rs 9.44 crore from Rs 8.81 crore in Q2-2015 and increased 5.9 percent from Rs 8.91 crore in Q1-2016.

Bandwidth cost in Q2-2016 increased 19.3 percent to Rs 1.92 crore from Rs 1.61 crore in Q2-2015 and increased 7.9 percent from Rs 1.78 crore in Q1-2016.

Employee Benefits Expense in the current quarter increased 45.5 percent to Rs 5.64 crore as compared to the Rs 3.88 crore in Q2-2015 and was 15.4 percent more than the Rs 4.89 crore in Q1-2016.

Last quarter, Ortel announced that it had introduced free broadband option for all Ortel Cable TV subscribers in the states of Odisha, West Bengal and Chhattisgarh as a complimentary special value added service in order to target to deeper penetrate into markets by making internet affordable. Ortel says that its offer includes a free data limit every month for a year. The subscriber will be charged a nominal amount after exceeding the free data usage for the month.

October 20, 2015
Hinduja Ventures’ NXT Digital receives operating licence for HITS

MUMBAI: Grant Investrade Limited (GIL), a subsidiary of Hinduja Ventures, has crossed the final hurdle to start operations of NXT Digital – its headend in the sky (HITS) service. The company has received Wireless Operating License (WOL) from the Wireless Planning & Coordination Wing of the Ministry of Information & Communications Technology.

The WOL is the final regulatory step before making HITS operational, in accordance with the terms and conditions stipulated in the Letter of Intent (LOI) issued by the Ministry of Information & Broadcasting to GIL last year.

“We are delighted to confirm receipt of the WOL for us to commence operationalisation of the HITS service in India. The launch of NXT Digital is in line with the Government’s objective of making India ‘digital’ and we’re proud to be a part of this national initiative,” said GIL chairman AK Das.

“NXT Digital has received an overwhelming response from the distribution fraternity in Phase III & IV markets in India. Our broadcast centre and our backend systems are fully operational; our broadcaster relationships have been formalised, we’ve already rolled out our COPE mini-headend systems and STBs and we’re ready to go ‘live’ shortly,” added GIL managing director Tony D’Silva.

It may be recalled that the government recently ruled out the extension of the DAS phase III deadline of 31 December, 2015. In view of this, NXT Digital is being viewed as the enabler for the cable fraternity go digital as per government mandated standards and within the deadline.

September 8, 2015
Multiple unregistered cable operators: A case of ignorance or mutual offence?

MUMBAI: More than 50 per cent of cable operators in the Pune district are found to be operating without the necessary registration. A special drive conducted by the Pune district entertainment department discovered that 500 out of the 960 cable operators in Pune do not possess postal registration, which is mandatory as per norms set by the Telecom Regulatory Authority of India (TRAI).

“It has come to light that more than half of the existing cable operators are operating without following the TRAI guidelines. The operators were given two months to register themselves with the head post-office. But after regular inspection, it was found that the operators continued to evade registering with the post offices and notices have been issued to these operators. The issue has been pending for the past two years,” an official was quoted as saying by The Indian Express.

Tax evasion can be one of the biggest reason behind this irregularity in registration. “These cable operators extract tax from people and do not deposit the same to the department. With the TRAI rules, we are getting to know about the evasions and the entertainment department has been asked to meet the target and get all the registrations,” added the official.

However, when contacted by Indiantelevision.com, a senior official in the cable fraternity was loathe to accept the quoted number of operators, who were operating without the necessary registration. “What we came to know so far is that the operators of few fringe areas, which merely has a subscriber base of 25 – 50 may not have registered. It’s impossible that the number is so high. Moreover, what we are looking to find out is if those operators were charged entertainment tax. Our sources tell us that these operators have been paying entertainment tax. If that is true, then a pertinent question to ask the authorities is how taxes were charged to illegal operators.”

For city areas the tax per consumer is Rs 24 while the rural areas pay Rs 15.

According to TRAI guidelines, it is mandatory for cable operators providing services via digital addressable systems (DAS) to register with the head post office before offering services. Cable operators are also required to enter into inter-connection agreements with multi-system operators (MSOs) whose signal they carry.

While the issue has come to light in Pune as of now, it is a matter of major concern as to how many other cities and districts have a similar problem. Given the vast length and breadth of the country, the task at hand is onerous to say the least.

September 7, 2015
NXT Digital organises roadshows for LMOs across 19 cities

MUMBAI: Hinduja’s headend in the sky (HITS) platform NXT Digital is looking at a smooth rollout when it launches by this month end. In keeping with the launch timeline, the platform is talking to the last mile owners (LMOs) across the country directly to help them understand the functioning of the system as well as the advantages of moving from the current multi system operator (MSO) to the HITS platform.

Over the last 11 days, NXT Digital has covered 19 cities including Delhi, Mumbai, Goa, Bhubaneswar and Kolkata among others through its roadshows. The final destination will be Visakhapatnam, where the HITS player will meet city LMOs on 10 August.

Through the initiative, NXT Digital has met close to 6000 LMOs so far. Additionally, as part of the training, the HITS player will run a live demo van covering 10 states.

As reported earlier by Indiantelevision.com, NXT Digital has signed up as many as one million analogue TV households in phase III markets in a span of three weeks.

Grant Investrade Limited managing director Tony D’silva said, “The fraternity is extremely excited about NXT Digital. In just over three weeks since NXT Digital was announced, it has already been signed up to reach one million analogue TV households in phase III markets through LMOs and MSOs who have opted for our services.”

“NXT Digital will empower and enable the distribution fraternity including LMOs and MSOs to offer a world of exciting digital services to their end-subscribers in all the analogue households across markets. Crucially, NXT Digital will not only help the LMOs and MSOs go digital as per government mandated standards and within the set deadlines, but, throughout the process, help them be independent and retain the ownership of their network,” added D’silva.

August 8, 2015
NXT Digital to use Thomson Video Networks’ compression technology

MUMBAI: Hinduja Group’s headend in the sky (HITS) platform NXT Digital will use Thomson Video Networks’ compression technology.

Thomson Video Networks has provided a wide range of equipment and solutions for the broadcast centre and master headend platform, including its Vibe SD and HD broadcast encoders and its multiplexing and network management system.

“We designed our HITS system to deliver best-in-class picture quality with a robust architecture and the highest level of uptime. To make that design a reality, we needed a world-class digital delivery platform to reach the network operators across India from a centralised location, and Thomson met our requirements,” said Grant Investrade managing director Tony D’Silva.

“NXT Digital is here to help the distribution community in analog markets make a smooth and timely transition to digital, and we are hopeful it will help write what could perhaps be the biggest chapter in the ‘Made in India’ story,” he added.

“Thomson Video Networks’ compression technology with advanced statmux features will give us pristine broadcast picture quality at lower bandwidth consumption. The solution is flexible and future-proof, and Thomson Video Networks has a strong local presence, which is an important requirement of the project,” said Castle Media executive director Vynsley Fernandes.

NXT Digital is scheduled to roll out pan-India services in 2015, and tests of various components of the business are underway.

“The Hinduja Group is one of the leading business houses in India and one with a global footprint. GIL’s selection of our compression chain will increase Thomson Video Networks’ market share in the satellite segment in India, push the company to among the top compression vendors in the region, and also boost overall market share substantially. This significant project will further strengthen our presence in Southeast Asia,” said Thomson Video Networks vice president, worldwide sales Eric Louvet.

July 30, 2015
Q1-2016: Ortel PAT at Rs 2.44 crore; on track for 1 million RGUs target

BENGALURU: The Bibhu Prasad Rath led regional cable television and high speed broadband services provider Ortel Communication Limited (Ortel) reported profit after tax (PAT) of Rs 2.44 crore (six per cent margin) in the quarter ended 30 June, 2015 (Q1-2016) as compared to a loss of Rs 1.16 crore in the corresponding year ago quarter. However, the company’s Q1-2016 PAT was less than half (lower by 56.8 per cent) the PAT of Rs 5.65 crore (12.6 per cent margin) in the immediate trailing quarter.

Ortel reported 20.5 per cent growth in Total Income from Operations (TIO) at Rs 40.60 crore in Q1-2016 as compared to the Rs 33.69 crore in Q1-2015, but 9.6 per cent lower than the Rs 44.91 crore in Q5-2015.

Notes: 100,00,000 = 100 lakh = 10 million = 1 crore

The numbers mentioned in this report are standalone.

Subscription numbers and ARPU

The company reported a 2.1 per cent growth in cable revenue generating units (RGU) in Q1-2016 at 481,317 as compared to the 471,592 in the immediate trailing quarter. In Q1-2015, the company had 462,328 RGU, hence the number grew by 4.1 per cent in Q1-2016.

Ortel’s q-o-q digital cable RGUs grew six per cent to 1,13,653 in the current quarter from 1,07,175 in Q1-2015, while its analogue cable RGUs grew 0.9 per cent to 3,67,664 as compared to the 3,64,417 in the same period.

The company reported a slight drop in average revenue per user (ARPU) in cable subscription – ARPU for digital cable dropped by Re 1 to Rs 184 and for analogue cable also the ARPU dropped by Re 1 to Rs 144 in the current quarter as compared to the immediate trailing quarter.

Broadband RGUs in the current quarter grew 4.1 per cent to 60900 from 58519 in Q4-2015. Ortel announced the launch of up to 50 Mbps DOCSIS 3.0 Broadband Internet in Odisha. The company’s Broadband ARPU in the current quarter also declined by Re 1 to Rs 393 from Rs 394 in Q4-2015.

LCO Buyout

Ortel signed network buy out agreements with multiple LCOs during the quarter taking the total RGUs to 542,217. The company said that another 33,000 RGUs are in the pipeline and would be added to total RGUs in the forthcoming months.

Company speak

Ortel president and CEO Bibhu Prasad Rath said, “We have begun the year on a healthy note with 25 per cent increase in revenues and 44 per cent improvement in EBITDA during Q1-2016. EBITDA margins enhanced to 37 per cent from 32 per cent in Q1-2015 and profit after tax stood strong at Rs 2.4 crore compared to Rs 5.6 crore reported in full year FY-2015. Thus the trend remains encouraging. Overall growth was delivered on the back of steady contribution from cable TV and broadband segments supported by continued momentum in the infrastructure leasing segment. Significant growth in subscriber base, deeper penetration, enhanced product offerings and a strong team, should enable us to notably improve our performance going forward.

I am also pleased to share that over and above the 542,217 RGUs as on 30 June, 2015, we have signed buy out agreements with multiple LCOs with total estimated RGUs of 33,000, which would be integrated into Ortel’s last mile network going forward. So we remain on track and are confident of achieving our target of one million RGUs (10 lakh) by March 2017 backed by our LCO buy out strategy and focus on organic growth both in broadband and cable TV.”

Let us look at the other numbers reported by Ortel

Total Expenditure in Q1-2016 at Rs 34.42 crore (84.8 per cent of TIO) was 14.8 per cent more than the Rs 29.99 crore (89 per cent of TIO) in Q1-2015 and 4.1 per cent more than the Rs 33.08 crore (73.6 per cent of TIO).

Ortel paid Rs 8.91 crore (22 per cent of TIO) towards programming cost, which was 3.6 per cent more than the Rs 8.60 crore (18.9 per cent of TIO) in Q1-2015 and was 4.9 per cent more than the Rs 8.49 crore (18.9 per cent of TIO) in the immediate trailing quarter.

Bandwidth cost in Q1-2016 at Rs 1.78 crore (4.4 per cent of TIO) was 6.9 per cent more than the Rs 1.67 crore (4.9 per cent of TIO) in the corresponding year ago quarter and was 2.3 per cent more than the Rs 1.74 crore in Q4-2015.

Employee Benefit Expense (EBE) in Q1-2016 at Rs 4.89 crore (12 per cent of TIO) was 19.3 per cent more than the Rs 4.09 crore (9.8 per cent of TIO) in Q1-2015 and was 11.4 per cent more than Rs 4.39 crore (12.2 per cent of TIO) in the immediate trailing quarter.

Ortel has introduced free broadband option for all Ortel Cable TV subscribers in the states of Odisha, West Bengal and Chhattisgarh as a complimentary special value added service in order to target to deeper penetrate into markets by making internet affordable. The company says that its offer includes a free data limit every month for a year. The subscriber will be charged a nominal amount after exceeding the free data usage for the month.

Click here to read the unaudited financial statement

July 27, 2015