Siti Networks Limited · NSE:SITINET
Siti Networks — SITI Cable Network — Investor Presentation (February 2015)
35 slides from Siti Networks's investor presentation, February 2015
Slide 1: SITI Cable Network Limited Investor Presentation
SITI Cable Network Limited Investor Presentation February 2015 1 SITI Cable Network Ltd. Confidential
Slide 2: Disclaimer
Disclaimer Some of the statements made in this presentation are forward-looking statements and are based on the current beliefs, assumptions ,expectations, estimates, objectives and projections of the directors and management of SITI Cable Network Limited (SITI Cable) about its business and the indu
Slide 3: Disclaimer
Disclaimer This presentation is strictly confidential and may not be copied, published, distributed or transmitted. The information in this presentation is being provided by Siti Cable Network Limited (also referred to as ‘SITI’ or ‘Company’). By attending the meeting where this presentation is bein
Slide 4: Contents
Contents Slno Section Pg no 1 Industry Overview 5 2 Digitization Overview 11 3 Broadband Overview 15 4 Company Overview 19 5 Financial Highlights 27 6 Growth Strategy 30 4 SITI Cable Network Ltd. Confidential
Slide 5: Industry Overview
Industry Overview 5 SITI Cable Network Ltd. Confidential
Slide 6: India: A billion+ consumers, a USD1.7 trillion economy
India: A billion+ consumers, a USD1.7 trillion economy India's GDP expected to expand 5.6% in 2014 and 6.4% in 2015 with CPI inflation expected to fall further , leading to increased consumer spending Per capita income at current prices during 2013-14 was ~INR74,920 as compared to INR67,839 duri
Slide 7: The Indian Media & Entertainment Industry is projected to grow rapidly
The Indian Media & Entertainment Industry is projected to grow rapidly Industry size and projections , INR Bn 307 265 223 200 220 The Media & Entertainment Industry is 188 158 158 181 343 374 expected to grow at a CAGR of 14.2% 133 138 313 114 112 125 264 287 between CY13 & CY18 224 243 479 567 67
Slide 8: TV: Subscription revenue is expected to grow at a 17.6% CAGR between 2013-18
TV: Subscription revenue is expected to grow at a 17.6% CAGR between 2013-18 TV Industry size, INR Bn Incremental Revenue addition CY18 vs CY13 253 Value, INR Bn Percentage 221 195 Subscription revenue 351 75% 172 152 Advertisement revenue 117 25% 136 125 551 632 Total 468 100% 477 395 281 327 245
Slide 9: Current Pay TV Market in India
Current Pay TV Market in India Indian Pay TV industry is undergoing a massive transformation through the government mandated digitization process Digitization: ~90 m analog cable subscriber base is up for conversion by CY2017E TV Subscriber ARPU in India is ~USD4, much less than USD10-25 for other A
Slide 10: Distribution Platform: Digital Cable is the way forward
Distribution Platform: Digital Cable is the way forward Digital Cable, owing to its two way communication capability, localized nature of service and immunity to weather conditions is well placed to serve Indian households Digital Analog Parameter DTH HITS IPTV Cable Cable Broadband 0 4 0 4 4 Cost o
Slide 11: Digitization Overview
Digitization Overview 11 SITI Cable Network Ltd. Confidential
Slide 12: Current Status of Digitization
Current Status of Digitization Phase Area Total Analog Implementation Status Subscriber Base Date (~150 mn) Phase 1 4 metros – Mumbai, ~6 31st Oct 2012 (Delhi Mumbai , Delhi , Kolkata – Delhi, Kolkata, Chennai and Mumbai) Complete 15th Feb 2013 Chennai - still underway, given (Kolkata) legal issues
Slide 13: High analog mix and ongoing churn expected to aid expansion of Digital Cable
High analog mix and ongoing churn expected to aid expansion of Digital Cable Subscriber Growth Trends (Mn) 9 9 9 9 Incremental Subscriber addition CY13 vs CY17 9 9 77 Analog (55) 44 59 69 8 34 37 Digital Cable 50 31 19 25 30 DTH 40 6 59 Other Digital - 67 75 74 69 68 Total C&S HHs 35 65 30 20 13 Whi
Slide 14: MSOs focusing on ARPU improvement & package-wise billing
MSOs focusing on ARPU improvement & package- wise billing ARPUs will be driven by channel packs, ARPU Trends (INR per month) premium content channels, VoD and other value added services Package wise billing leading to increased negotiation ability for MSOs 301 225 248 273 Phase III/IV digitiza
Slide 15: Broadband Overview
Broadband Overview 15 SITI Cable Network Ltd. Confidential
Slide 16: India still has a low internet penetration of 19% indicating huge growth potential
India still has a low internet penetration of 19% indicating huge growth potential Internet penetration (As a % of total population) Projected Connections Growth (Mn) India has ~19.4 Internet users per 100 people 47 41 36 19 31 416 351 86% 87% 295 79% 233 237 60% 49% 44% 19% As on 31st Mar. 2015E 20
Slide 17: Cable has ~5% wireline share currently
Cable has ~5% wireline share currently India: 252 Mn Internet connections, 31st Wire line subs mix March 2014 4.8% 1.1% 19, 8% 6.5% 46, 18% 16.7% 187, 74% 71.0% Wireline 2G Wireless 3G/4G Wireless DSL Wireless/WiFi Ethernet Cable Modem Others DSL: Digital Subscriber Line [DSL] Internet Subscribers a
Slide 18: Key Drivers for Cable Broadband
Key Drivers for Cable Broadband Projected Exponential increase in Significant divergence in data rates 1 2 demand for Data Currently, 1 GB of data on a 3G Network costs In India, internet traffic is expected to grow 5.5- ~INR225 vs. ~INR45 on DOCSIS 3 (Data over Cable fold from 2013 to 2018, at a CA
Slide 19: Company Overview
Company Overview 19 SITI Cable Network Ltd. Confidential
Slide 20: A Pioneer in Indian Cable TV Distribution
A Pioneer in Indian Cable TV Distribution A listed company, Incorporated in 1994, Headquartered in Delhi- NCR , with a professional board Cable TV Multi-System Operator (MSO) providing digital/ analog cable TV and broadband services A group company of “Essel Group” a leading media conglomerate
Slide 21: Promoter Group - Corporate Structure
Promoter Group - Corporate Structure Launched in 1976, the Parent Group (“Essel Group”) is one of India’s leading business houses, with a dominant presence in Media One of India's leading vertically integrated media and entertainment group, and also one of the leading producers, content aggregat
Slide 22: SITI Cable: A pan India presence
SITI Cable: A pan India presence Uttar Pradesh / Uttranchal Jharkhand / Bihar Kanpur Jamshedpur Greater Noida Patna Varanasi Dhanbad Punjab Noida Deoghar Ludhiana Allahabad Hazaribagh Haryana Chandigarh Ghazipur Hissar Amritsar Basti Rohtak Jalandhar Mughal Sara
Slide 23: Evolution of Business Model
Evolution of Business Model Past Present Future Analog: Focus on enhancing Aggressive roll out of productivity of existing Digital services network Shifting of analog LCOs received feed from Intensified relationship customers towards WWIL (now SITI Cable) and building to grow the digital
Slide 24: Technology Partners
Technology Partners 15 Digital headends, 56 Analog headends Intra-city OFC and Coax Network of ~14,000 kms covering 130 cities across India. Transport of Digital CATV signals on STM5 links (775 Mbps) across the country DOCSIS 2/3 Technology to offer Cable Broadband services 2 call centers,
Slide 25: Board of Directors: Key Members
Board of Directors: Key Members Mr Subhash Chandra, Chairman & Promoter – Parent Group Mr Chandra is the promoter of the Parent Group. His industry leading businesses include television networks and film entertainment, cable systems, satellite communications, theme parks, flexible packaging, family
Slide 26: An Experienced Management Team leads the Company
An Experienced Management Team leads the Company Mr. V D Wadhwa – Executive Director and CEO Mr. Wadhwa is an Alumnus of Harvard Business School & a fellow member of the Institute of Company Secretaries of India. He has over 30 years of work experience including over 20 years in multinational compan
Slide 27: Financial Highlights
Financial Highlights 27 SITI Cable Network Ltd. Confidential
Slide 28: SITI Cable - Financial Snapshot
SITI Cable - Financial Snapshot FY Consolidated Revenues (INR Mn) Revenue Split by services, FY14 6.4% 7,103 6,583 11.3% 2.5% 4,837 47.8% 3,643 32.0% Subscription Carriage Advertisement FY12 FY13 FY14 9MFY15 Activation Other income Quarterly Revenue Trends (INR Mn) Revenue Split by Business , OND14
Slide 29: SITI Cable - Financial Snapshot
SITI Cable - Financial Snapshot FY EBITDA (INR Mn) Quarterly EBITDA (INR Mn) 1,363 1,259 501 458 870 350 363 279 (48) FY12 FY13 FY14 9MFY15 OND'13 JFM'14 AMJ'14 JAS'14 OND'14 EBITDA Margins for FY14 stand at 17.7%, an expansion of 1326bps (FY14 vs.FY11) EBITDA Margins for OND14 stand at 22.4%, a
Slide 30: Growth Strategy
Growth Strategy 30 SITI Cable Network Ltd. Confidential
Slide 31: Key Differentiators
Key Differentiators Part of a USD8 Bn Promoter entity is India’s leading Media conglomerate with interests spanning across Group, India’s broadcasting (One of India’s largest network of Hindi GEC and entertainment channels), leading Media distribution (India’s first and largest DTH TV business) an
Slide 32: SITI Cable Growth strategy
SITI Cable Growth strategy 1 Analog subscribers in Phase 3 & 4 cities are being proactively seeded with STBs Increase Digital Looking to increase subs base to 15mn with inclusion of phase 3 & 4 at completion of Subscriber base Digitization Looking to scale up presence from 130 cities to ~200 c
Slide 33: SITI Cable looking for major expansion in the Broadband Space
SITI Cable looking for major expansion in the Broadband Space 1 Higher Sustainable EBITDA Margins Broadband provides higher sustainable EBITDA margins 2 Increased Customer Stickiness Bundling of broadband with Cable would lead to increased retention rates, lower churn and better negotiating power wi
Slide 34: Roadmap for SITI Cable Broadband Business
Roadmap for SITI Cable Broadband Business Enter markets where SITI Initial Cable is No. 2 expansion in Use DOCSIS 2/3 or 3/ Markets DAS1 & DAS2 technology with low Cities competitive intensity Timeline Activity Location Current state / Target • Launched Broadband with Ethernet on Mar. 2012 Kolkata •
Slide 35: Thank You!
Thank You! www.siticable.com 35 SITI Cable Network Ltd. Confidential
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