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GTPL Hathway Ltd Q2 FY24 Earnings Conference Call Insights

Key highlights from GTPL Hathway Ltd (GTPL) Q2 FY24 Earnings Concall

  • Financial Performance
    • The company reported strong financial performance for Q2 FY24, beating previous quarters.
    • Revenue grew 19% YoY to INR7,900 million.
    • Consolidated EBITDA was INR1,351 million with 17.1% margin.
    • Profit after tax stood at INR344 million.
  • Subscriber Growth
    • Added 800K digital cable TV subscribers YoY, total now 9.4 million.
    • Paying cable subscribers increased 400K QoQ and 700K YoY, now at 8.70 million.
    • Broadband subscribers reached 990K, up 120K YoY, a 14% increase.
    • Homepass subscribers grew 550K YoY and 150K QoQ, now at 5.55 million.
  • Margin Improvement
    • Margins improved from 16.1% to 17.1% in Q2.
    • Cost increases have stabilized after NTO 3 implementation.
    • Expect to achieve 20% EBITDA margin target by Q4.
    • New projects will help drive margin improvement.
  • Pay Channel Costs
    • Pay channel costs increased in Q1 and Q2 due to NTO 3.
    • These costs have now stabilized and will not increase significantly going forward.
    • Revenue growth expected to outpace any increase in pay channel costs.
  • Broadband Business Growth
    • Broadband revenue was INR1,317 million, up 10% YoY.
    • Average broadband ARPU was INR 460 with 25% higher data consumption YoY.
    • Added 30k broadband subscribers in Q2.
    • 25k were B2C, 5k were B2B.
    • Growth slowed to 10% vs 15-20% previously.
    • Expect growth to return to 15% rate.
    • Focus is on volume gains rather than price increases.
    • ARPU has remained steady around Rs. 450-460 range.
    • Significant headroom for growth in India with low broadband penetration currently.
  • Depreciation and Interest
    • Increase in Q2 due to consolidation of MetroCast.
    • Led to higher depreciation and interest costs.
    • Current levels expected to remain steady going forward.
  • Cable TV Business Growth
    • The cable TV business is still growing for the company even though the industry may be stagnant.
    • The company is consolidating and grabbing market share from smaller MSOs.
    • There is still growth in the TV industry with new TV sales and 100-150 million households without a TV.
    • The company’s cable TV subscription revenue has grown 8% in Q1 and Q2
  • Broadband Outlook and Expansion Plans
    • Broadband subscribers are expected to reach 1.05-1.07 million by year end.
    • New innovative products can attract more customers, especially from social media and the youth demographic.
    • Looking to expand to 1 more state and 2 more union territories in the next 2 quarters for cable business.
    • Main focus for broadband expansion is B2B, looking to expand presence from current 9 states to all states where cable business is present.
    • Specific strategies differ by state based on dynamics, number of players, packages etc.
  • Guidance
    • Aiming to get back to historical revenue CAGR of 18-20% for cable and 15-16% for broadband over next 2 years.
    • Targeting EBITDA growth of 12-13%.
    • Expect to cross 10M cable subscribers this year and add 1-1.5M more over next 2 years.
    • Expect to reach 1.2-1.25M broadband subscribers driven by B2B business.
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