Indian DTH platform Videocon D2H is hoping to launch its IPO before the end of its financial year, which ends on 31 December, a company director was quoted as saying.
Saurabh Dhoot, head of corporate affairs at Videocon Industries, told the Press…
Indian DTH platform Videocon D2H is hoping to launch its IPO before the end of its financial year, which ends on 31 December, a company director was quoted as saying.
Saurabh Dhoot, head of corporate affairs at Videocon Industries, told the Press Trust of India (PTI) that the company has mandated Axis Capital as one of its advisers to work on the process.
Both Videocon and Axis were not immediately available to comment on the report.
A listing of around 25% of its equity has been on the cards ever since the company failed to sell a stake to private equity in 2011.
In March 2013, Videocon Industries, the pay TV operator’s parent, received approval from the market regulator to go ahead with its proposed Rs7bn (US$117.2m) IPO but the process was put on ice because of poor market conditions.
At the time, Videocon outlined in a draft prospectus a number of factors that would make the flotation high risk for investors. These included the indebtedness of the company and intense competition in the Indian DTH market.
“We compete directly with other pay DTH operators, as well as indirectly with cable operators, IPTV operators and free-to-air television,” said Videocon in the prospectus. “Competition in the Indian pay DTH market is intense, and we cannot guarantee that we will be successful in generating sufficient subscriber revenue in light of the competition we face.”
Its DTH competitors are Tata Sky, Dish TV, Sun Direct, DD Free Dish, Airtel Digital TV and Reliance Digital TV, several of which have been looking to bring in new investors to remain competitive in such a crowded market.
Analysts were expecting a great deal of foreign investment in these companies following the government’s decision in 2012 to increase the foreign direct investment (FDI) limit in satellite pay TV companies from 49% to 74%. However, the predicted influx of foreign money has yet to take place.
According to the Telecom Regulatory Authority of India (TRAI), the number of DTH subscribers in the country stood at 63 million as of December 2013, including 36 million active subscribers.
