Trai Tariff Regime Will Open New Markets for DPOs, Says GTPL Hathway Business Head

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Like we have mentioned before, the new national tariff order (NTO) by the Telecom Regulatory Authority of India (Trai) has had negative and positive effects. For the cable TV service providers and broadband service provider GTPL, the impact of the mandate has mostly been bumpy and troubling. The operators hasn’t seen a good quarter after the implementation of the new tariff regime. But, even then, GTPL Hathway sees a good prospect in consolidation. The service provider is likely to use this opportunity to pave the way for an expanded footprint across the country.

GTPL Sees Good Avenue in Consolidation

GTPL Hathway promoter and managing director Anirudhsinhji Jadeja announced in the earnings call after the Q4 results, “We are also expanding into other markets. Now because of NTO, there is no area demarcation and we can enter all India. So we are planning to consolidate small players also as they are facing a lot of issues because of the new NTO. It is a good opportunity for us.”

It is worth noting that although GPTL Hathway seeded 800,000 STBs in FY19 and the total seeded STBs stood at 9.5 million, the company witnessed a decline of 200,000 subscribers due to the implementation of the new regulatory framework as the entire LCO mode was transformed to auto-dunning mode. GTPL Hathway Piyush Pankaj said in a statement, “Going forward you will see an increase in subscription revenue and in the pay channel cost. By quarter 1, you will see the full implementation and the full effect.” He also said that the full effect of the NTO was not visible in the Q4 as the implementation and migration was still ongoing. He also expects the company EBITDA to rise due to it in the coming times.

GTPL Hathway Eyes Better EBITDA After New NTO

Talking about the benefits of the new order, Jadeja said that it has opened up new avenues for the DPOs as now they will not be restricted to one location. He added that owing to this, markets with significant potential for penetration like Andhra Pradesh, Telangana, Assam, Bihar, Jharkhand etc. will be the focus for further expansion.

Pankaj said that previously they used to bill the LCO based on what was prevailing in the market, but the ways have changed now as the LCO is being charged based on what the consumer is opting. Since now the customers are opting for higher priced channels and subscriptions, LCO outflow and their billing to the LCO has also increased. On the same lines, Jadeja said that in the FY20, they are looking to seed another one million set-top boxes in existing markets along with some new markets. He also said that the company would keep the capex same, but there would be debt reduction of Rs 40 crore to Rs 50 crore in FY20.

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Arpit spends his day closely following the telecom and tech industry. A music connoisseur and a night owl, he also takes a deep interest in the Indian technology start-up scene and spends rest of his time spilling poetry and stories on paper.

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