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Hero Group-owned Mybox Tech sets ambitious STB manufacturing target

MUMBAI: After offloading majority stake to the Hero Group, set-top box (STB) manufacturer Mybox Technologies has set an ambitious target of selling 1.5 million boxes in FY16.

Hero has bought out electronics manufacturer Dixon Technologies’ stake in Mybox and a portion of Kharabanda family’s holding. The $5 billion Brijmohan Lall Munjal-led Group has become the majority owner of the company, while the Kharabandas still retain a minority stake.

Amit Kharbanda

Amit Kharbanda

Mybox Technologies executive director Amit Kharabanda refused to divulge information about shareholding pattern of the company.

“It’s a majority acquisition. Dixon Technologies, which was an equity partner, is out. Hero Group has bought out Dixon’s stake plus a little bit of our stake,” Kharabanda said.

Backed by a company like Hero, Mybox plans to scale up its volumes in the coming years. The company is close to selling two million STBs in the market.

“In this financial year, we are planning to sell 1.5 million STBs and maybe double that in the next fiscal,” Kharabanda asserted.

“With a partner like Hero, which is a reputed brand and has financial strength, we want to give confidence to Indian operators. Currently, they are working with international manufacturers who are very big.”

The company has set an ambitious target largely due to the opportunity in Phase III of digital addressable system (DAS), which will require nearly 39 million STBs. The company saw decent demand for STBs from Phase II while in Phase I it was not prepared.

“With digitisation, we see a whole new market opening up, so STB is one key area. We will add new verticals later,” he added.

Mybox supplies STBs to Dish TV, In Digital, Hathway and Siti Cable. “If the operators partner with us, we can do a much larger volume under the ‘Make in India’ initiative,” he maintained.

While cable TV and DTH businesses are equally split, Kharabanda expects the DTH side of the business to grow faster.

Although Dixon has exited the company as an equity partner, it will continue to be a manufacturing partner for the company along with Jabil Electronics.

“Earlier, Dixon was our manufacturing partner. Going forward, we will make STBs with Dixon. We have also tied up with Jabil Electronics. These two are big players and with them we can produce good volumes of STBs,” he revealed.

Mybox does complete designing of the product hardware and software. It owns the IPR of the STBs. It works with chip vendors like STMicroelectronics.

“We are designing cable, satellite, targeted advertising, SD as well as HD STBs. Going forward, our volume of HD STBs is going to be far bigger,” he noted.

One major drawback for domestic STB manufacturers has been the lack of availability of vendor financing. Kharabanda feels that with the evolution of the market, a lot financial institutions will come in.

The company will expand into newer territories once it builds its India business. “We want to cater to the Indian market first and then expand into other territories,” he said.

Marking its foray into the electronics sector, the Hero Group has floated a new company named Hero Electronix and Suman Kant Munjal is made the chairman. Mybox will form part of this venture. Hero Electronix has an investment plan of Rs 500 crore (Rs 5 billion) in the next few years.