MUMBAI: There will be a new chief to handle the cable TV and headend-in-the-sky (HITS) businesses of the Hinduja Group as Tony D’Silva ends his innings at the organisation tomorrow.
D’Silva was the common head for IndusInd Media & Communications Ltd (IMCL) and Grant Investrade Ltd (GIL), the company that houses the HITS business. With his contract ending, the new chieftain will need to further synergise operations between the two outfits.
“I decided not to renew my contract. I have worked across the value chain in the broadcast sector and want to take it easy now,” D’Silva said.
Remarking on his achievements, D’Silva said: “IMCL has become a viable organisation, we have brought in operational changes and introduced prepaid. We launched HITS and have sold 800 pieces of COPE (cable operators’ premise equipment). We will be touching 1,000 and there is huge potential to grow the HITS business.”
An official announcement of the new head is expected soon. Various names have been floating, including those from outside and inside the Hinduja Group.
“With the merger of the HITS business with IMCL on, there is need to have a new head soon. This could be from within the Hinduja Group company or an external person,” a source said.
The Hindujas have already started the process to obtain regulatory approvals to move the HITS business from GIL to IMCL, the company under which the cable TV business is run. As part of the plan, GIL, a wholly owned subsidiary of Hinduja Ventures Ltd (HVL), will demerge its HITS business. It will be merged with IMCL to create a consolidated powerhouse. The HITS licence, held by GIL, will also move to IMCL.
For D’Silva, who served as MD and CEO of IMCL and MD of GIL, it hasn’t been a smooth ride. The HITS project, running under the NXT Digital brand, hit a rough patch due to the delay in implementation of digital addressable system (DAS) in Phase III as a result of court cases filed by the cable operators in different parts of the country.
Speaking earlier to TelevisionPost.com, D’Silva had bemoaned the unfair treatment meted out by broadcasters, who charge unrealistic rates from NXT Digital for digitising while multi-system operators (MSOs) pay analogue rates to digitise their networks.
For the fiscal year ended 31 March 2016, GIL posted a net loss of Rs 32.71 crore (Rs 327.1 million) on a revenue of Rs 22.40 crore (Rs 224 million) and expenses of Rs 47.09 crore (Rs 470.9 million). The delay in DAS Phase III implementation played a major part in GIL’s performance.
After DAS, IMCL has also not been able to grow as large as the other national MSOs like Hathway Cable & Datacom, DEN Networks and Siti Networks. After the completion of the four phases of DAS, IMCL is expected to have a digital cable TV base of seven million customers. This is far below the other national MSOs, who have expanded to have a subscriber base of over 10 million.
In FY16, IMCL narrowed its net loss by almost 53% to Rs 112.77 crore (Rs 1.13 billion) compared to Rs 239.19 crore a year ago. Revenue from operations slid 4.58% to Rs 434.4 crore from Rs 455.27 crore in the trailing fiscal. Total expenses fell 13.62% to Rs 594.55 crore from Rs 688.37 crore.
The focus of the Hindujas has been to aggressively expand in Phase III and IV areas through HITS. In Phases I and II, the MSO business has around three million digital subscribers. By housing both these entities under a single roof, the company hopes to drive in synergies and cost efficiencies.
Diluting stake in IMCL in a series of small transactions, HVL has ensured that the valuation of IMCL, its cable TV subsidiary, is set at Rs 3,444.06 crore. Along with the proposed merger of the HITS business with IMCL, the new moves could be seen as a precursor to an initial public offering (IPO) of the merged entity.
Prior to the Hinduja Group, D’Silva was working in the Sun Group. He played a key role in setting up Sun Direct, the DTH business of Kalanithi Maran. Later, he was made Sun Group CEO.
In the past, D’Silva has held key management positions in the distribution business for broadcasters like Star and Zee. While heading Modi Entertainment, he was handling ESPN.