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Videocon d2h re-files for an IPO to raise up to Rs 700 crore

Videocon D2H Logo

Direct-to-home (DTH) service provider Videocon d2h has re-filed (pdf) its Draft Red Herring Prospectus (DRHP) with the market regulator Securities and Exchange Board of India (SEBI) for an initial public offering (IPO).

The starting price or the number of shares being offered is yet to be disclosed, however the company has informed that it is raising up to Rs 700 crore through this offering. Seven banks including Axis Capital, Edelweiss, ICICI Securities, IDBI Capital, UBS, SBI Capital Markets and Yes Bank have been appointed as joint book runners.

In the filing, Videocon d2h also notes that it is looking to raise up to Rs 50 crore through a pre-IPO placement of up to 5 million shares (5,000,000 equity shares) with a face value of Rs 10 each.

It’s worth noting that Videocon d2h had previously filed for an IPO in December 2012 and had also received SEBI approval in March 2013. However, it hadn’t gone ahead with the offering due to unfavourable market conditions.

Use of Net Proceeds: Of the Rs 700 crore, Videocon d2h intends to use Rs 350.8 crore to buy standard definition and high definition set-top boxes, outdoor units and accessories, and Rs 175 crore to repay certain debt, and the remaining for general corporate purposes like working capital requirements, capex and brand building exercises.

Videocon started its DTH operations the country in July 2009 and, as of June 30, 2014, it has 11.21 million gross subscribers with a market share of 16.2% of the gross DTH subscriber base across India. It offers 495 national and international channels, which includes 27 HD channels and 41 audio & video active music channels.

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Financials

Videocon d2h reported a total income of Rs 1,760.8 crore for the year ended March 31, 2014, up from Rs 1,120.5 crore in the previous year. The losses however has moderately improved to Rs 469.4 crore for the year, as compared to Rs 515.1 crore in the previous year.

For the quarter ended June 30, 2014, Videocon d2h posted total revenues of Rs 537.7 crore and a net loss of Rs 78.1 crore.

Videocon Financials 1

Videocon Financial 2

Shareholding

Prominent shareholders in Videocon d2h are Synergy Appliances with 19% stake, Solitaire Appliances with 19% stake, Greenfield Appliances with 19% stake, Platinum Appliances with 4.98% stake, Shree Dhoot Trading and Agencies with 19% stake, and Dome-Bell Electronics India with 19% stake.

Videocon noted that promoter Saurabh Pradipkumar Dhoot does not directly hold any equity Shares, while Videocon Group Director Anirudha Dhoot holds a 0.02% stake and Videocon Industries chairman & managing director Venugopal Dhoot holds a negligible stake in the company.

Videocon D2H Shareholding

With this IPO, Videocon d2h will be the second company from the Videocon group to go public, after Videocon Industries which is listed on BSE and NSE and has a market cap of Rs 5,377.46 crore at the day’s close today.

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It will also be the second standalone DTH company to go public after Dish TV which currently leads the DTH market. Other DTH players include Airtel Digital TV, Tata Sky, Reliance Digital TV and Sun Direct.

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