Q1 21/22

Jul 19, 2021

Ladies and gentlemen, good day and welcome to the Q1 FY 'twenty two Earnings Conference Call of PDP L Hathaway, hosted by MK Global Financial Services Limited. Call. We have with us today Mr. Anuradha Singh Theresa, Kamuda and Managing Director Mr. Rajan Gupta, Chairman and Non Executive Director, Mr. Pankaj, Business Head, PA TV and Chief Strategy Officer I'm Nathaniel Goza, Chief Financial Officer. As a reminder, All participant lines will be in the listen only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Please note that this conference is being recorded. I now hand the conference over to Mr. Nawal Seth of MT Global. Thank you, and over to you, sir. Thank you. Good evening, everyone. I would like to welcome the management and thank them for 20. I shall now hand over the call to the management for their opening remarks. Over to you, sir. Thank you, Naval. Good evening, everyone. A warm welcome to all of you to the conference call of Jitutel Hatwell Limited to discuss financial and operational performance of quarter 1 2022. G2PIL Hathaway continued to deliver on key KPIs during quarter 1 2022. GTG has further reduced its debt by $168,000,000 in quarter 1, 2022. Earnings. Jitin will continue to march forward on its stated strategic roadmap by coming up with interesting and new products and services, enhancing customer experience, strengthening its digital infrastructure and capability and escalating its footprint in the existing and new market. With that, I hand over to Mr. Piyush Pankaj, who can take you through the business and financial aspect of the company. Thank you, Mr. Jadeja. Good evening, everyone. I hope all of you are safe and healthy. 20. BTPL Hathaway is one of the few consistently profit making cable TV and broadband company in India. 20. Our business model is quite robust and then can explore multiple growth opportunity that this sector has the potential to offer. 20. Our broadband subscriber base has mirrored a significant growth of 3.6x to reach 0.7000000. 20 in the last 5 years and have returned the money to shareholders in the form of regular dividends. I'm happy to share with you that GTPL Limited has been recognized as one of India's top 500 companies where Dun and Bradstreet ranked 401 on turnover in the listing published for 2021. Additionally, During quarter 1 FY 'twenty two, we have launched GTPL's interactive virtual assistant, Jeeva, to WhatsApp based chatbot for 24x7 customer support for CATV and broadband businesses. Let me now share the performance highlights for the quarter. As on June 30, 2021, 20. Our active TV subscribers stood at 8,000,000. JTPL's digital CATV services now reaches 1,000 plus towns spread across 15 states in India. The company is expanding aggressively in Maharashtra, andhra Pradesh, Telangana, Tamil Nadu and the North of States. DTPL's CATV platform services own and operate 48 channels across over 6 channels. The CTV industry offers an underlying growth opportunity Call. For an organized and seasoned player like Digital Headway, our CATV business expansion will gain momentum with organic and inorganic growth in the coming quarters. The Indian wireline broadband sector is a sunrise industry with huge untapped growth potential. It accounts for a meager 6% penetration of the total household segment 20 as against 80% in Japan, 70% in Eurozone and 50% 55% in China. This represents call. A huge opportunity for growth for us. In the broadband segment, we added 2 lakh 30,000 new home pass in quarter 1 FY 'twenty two and taking the total home pass as on June 30, 2021 to 4,100,000. 20. During the quarter, DTPL added 55,000 net broadband subscribers, taking the total net broadband subscribers as of June 30, 2022, was 6 lakhs 90,000. The broadband ARPU for quarter 1 FY 'twenty two grew by 4% YOY to rupees 4.40 per month. GTPL looks forward to expanding its broader business by leveraging its existing base of 10 +1000000 CATV subscribers and attracting new broadband subscribers through business partners. Let me now move to our financial performance. On our consolidated business, excluding EPC contract. During quarter 1 FY 2022, VCTL's consolidated revenue Grew by 24 percent, 22 percent, y o y, 25,843,000,000. The CATV subscription revenue stood at INR 2641 million. The broadband revenue for the quarter grew by 74% y o y to INR 918 million, to INR 1362,000,000 with a margin of 23.3%. On our consolidated business, Including UPC contract, during quarter 1, FY 'twenty two, UTPL's consolidated revenue grew by 22% to INR RMB 6,106,000,000 EBITDA for the quarter increased by 7% YOY to INR 1380 1,000,000 with a margin of 22.6%. PAG for the quarter surged by 16% Y o Y On our standalone business, excluding EPC contract, during Q1 FY 2022, the company's revenue grew by 14% YOY to INR 3740 million. The company reported EBITDA of INR 778,000,000 with an EBITDA margin of 20.8%. On our stand alone business, including APC contracts, During quarter 1 FY 'twenty two, the company's revenue surged by 14% Y o Y to INR 4003 million. EBITDA stood at INR796,000,000 with an EBITDA margin of 19.9%. PAG during the quarter stood at INR305 1,000,000. This is all from my side. Thank you, everyone, for your attention. We can now begin with the questions and answer sessions. Thank you very much. We will now begin the question and answer session. Single question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Satish Sabhar from Equita. Please Go ahead. Thank you for the opportunity, sir. Okay, my first question is if you could tell us for cable TV, what is the RO in this quarter? And if you could explain the subscriber decline that we had and how do we see things currently? Hi, Pradeep Shah. Hi. This quarter, the ARPU remained same. This quarter. This quarter we have a test as the year opens and the COVID 21, everyone, for every business. We face that in cable also. We try to maintain our subscriber basis. The main hit has come from the corporate subscribers, which was we are seeing that in the last quarter of Last year, the corporate subscribers started coming back to our fold. And in April May, We have seen that they have gone away again. And in June, some of them have returned back. We are hopeful that as the situation will improve, we will get back our corporate subscriber base, and again, we will bounce back. So that's why you have seen that there is 200 ks subscriber base down. Some effect has come because of 21st cyclone, which is South Bay, cyclone, which has helped with Gujarat and Maharashtra. And there is a Yash Cycla, which has entered into the West Bengal market. It's still some of the subscriber base, which we have, which is still to come from because of these cyclones. So we are expecting that in the quarter 2, As the situation will improve, we will get back the these subscribers who are still not back after the cycle and plus the corporate subscriber. Okay. So did we have any, on non corporate side, retail side, did we have any US additions for this quarter. Yes. If I talk about, we lost around 350 ks, $375,000 in the corporate side. The retail side has gone up by around $150,000 to $175,000 between that, and the net figure is 200,000 Okay. Understood. Okay. And this time, we've seen a pay channel cost as a percentage toward in our so cable TV revenues have gone up substantially. So is there any change in our commercial arrangement with the broadcaster or buyback. The picture here you have to see the general cost in connection with our On the gross margin due to the pay channel. Okay. Understood. On the broadband front, I We've seen some decent growth on HomePass additions this time. So do we expect like the trajectory to continue? Yes. We are trying to continue this trajectory. This quarter was difficult for us on the ground, But still we managed to do that to 30 a home passes, and We are going to continue that. And on the subscriber addition front, do we see the growth rate increasing? Or How do we look at subscriber addition and broadband for this year, the remaining? As in the last call also, we have given that we were going to add between 50 ks to Erno. This quarter, we added 55 ks. So we are hopeful that the projections on which We are working or we have given. We are going to continue on that basis. Okay. Understood. And, any update on the litigation front? Which litigation you're talking about? DOT. Oh, okay. No, there is no update on the AGR side. There was quote was not into the order. So, no clearing has happened on those. So no So when is our gearing schedule, sir, right now? Rajan, sir, do you have the update on this? There is no update as of now. I think you can offline update them as and when the developments happen. Yes. Okay. And, sir, on the EPC, I think, can you assume that now all the revenue recognition for the EPC contract, excluding The O and M is revenue recognition and expenses bandwidth? Almost 98% is done. Okay. Okay. All right. Now there are a couple of data points, if you could share it, the position as on June and the CapEx plan for the remaining of the year. The receivables position is 3.52 crores. If you see, quarter 4, we were at around 3.83 crores. The receivable has come down by 30 crores. This is at INR 352 crores around this quarter. And on CapEx, This quarter, we did INR 82 crores of CapEx, which INR 49 crores of CapEx is in the broadband And 33 crores of CapEx is in the CABP. Okay. Sir, how much of the receivables would be from broadcasters? How much would be for EPC? But after this, around INR 1.55 crores and EPC is around INR 120 crores. And are we facing any issues in receivables from the for the EPC contract? No. We have not facing any issues. If you see, last quarter, we have given that we have INR 226 crore of UPC project receivables. Now it has gone it has reduced to 1.20 crores. Okay. And sir, CapEx guidance remains the same for the full year. CapEx, the projections which we have given that we are going to do between 50 crores to 400 crores that is going to be remain same right call. All right, sir. Thank you, sir. Thank you. The next question is from the line of Dixit Doshi from White Stone Financial Advisors. Please go ahead. Yes. Thanks for the opportunity. Some of my questions have been answered. Just a couple of things. Firstly, if I see the Cable TV segment wise result on a consolidated basis. Year on year, the revenue has gone up. Even quarter on quarter, it has gone up. But cable TV, PBT has not gone up in that proportion. In fact, quarter on quarter, it has come down by almost 5% or 10%. So what led to that? Is there any one off or any cost increase? VBT, if you talk about at that time, you were going to see that depreciation is going up As you are doing more and more investment, and one of the reason is whatever increase we are taking in 20. Our revenues and all, that is coming down with the depreciation. So one factor is the depreciation. As you see, EBITDA has increased. If I compare it with the Last year, Q1 FY 'twenty one, if you talk about that is from 5.75 crores, On the consolidated basis, if you see, the quarter 1 FY 'twenty one ex EPC, the PBT was at 56 Crore. And if you compare it with the quarter 1 FY 'twenty two ex PPC, we will be at 7.7 to 7.32 crores. Yes. But predominantly, this increase was due to the broadband business. I'm talking just about the cable TV business. Call. So if I see, there was almost 15%, 17% jump in the cable TV revenue year on year, But PBT in cable TV business has gone up hardly anything like couple of crores. And in fact, quarter on quarter, it has come down, cable TV cable TV. You have to see in a different way Because the subscription of CABV is flat from last year. It was at 1.83 crore last year. This quarter also earnings. But still, your PBT has increased by around INR 6 crores from INR 35 crores to INR 42 crores in the from the quarter to Y o Y basis. So the contribution on the PBT is happening. But, yes, the revenue side you talked about, it has gone from 3.27 to 3.74, but cost side also has gone up from 2.48 to 3.96. You have to see the business in the basis of clubbing placement and key channel together and see the net margin increase on that. So pure on subscription, it is it was it is flat from last year. But on PBT, We are getting around INR 6 crores of the PBT. So PBT is increasing. Still, the revenue is same. Okay. In terms of cable TV subscriber, so this year, obviously, due to the pandemic in Q1, it has come down. But Over, let's say, next couple of years or 3 years, what kind of gross what kind of net cable TV subscriber addition we can expect Thank you, guys. So we are planning our planning is obviously coming 3 years almost 20. Close to around 3,000,000. Each year, we wanted to plan to roll out 1,000,000. But yes, because of this pandemic, it's It's Ashish, but our projection is year on year it's 1,000,000 every year. Okay. Okay. And last question from my side is, was there how much we did spend on this 20. You know, appointing Baman Irani and this new campaign launch, how much we would have extra spend during this quarter? Meeting. It's Haji, it's 0.5% of the revenue which has gone into that. Okay. Group. And any update on hybrid box launch? Yes. Yes. Hybrid box, we are Launching somewhere in August right now. Hybrid Box is already with us. It has got delayed because of the pandemic and because the shipment has got delayed. We got the shipment in the mid of July NOW. And we are planning to launch in August. Everything is completed for testing with Goldman. Okay. Okay. That's it for my attention. Thank you. The next question is from the line of Subsidy Sathir Jagadish from Central PMS. Please go ahead. 20 Most of the questions have been answered. On the broadband side, the ARPU has been INR440, slightly around INR5 lower than last quarter. Call. Whereas like we have expected trend to be higher because of April upgrading the plans. So if you can give some color on that front. No, broadband, I think as far as ARPUs are concerned, I mean, they had been pretty stable. And I think more than ARPU, we have been anyway indicating that earnings. There is no plan to ARPU increase. So ARPU will remain broadly speaking stable and quarter to quarter they will keep on increasing INR5 or decreasing INR5 based on the fact mix change. I think a bigger picture which we have to see on broadband is GTPL is in a very sweet spot which we have been updating you for last many quarters, okay, In a state where only BSNL is a major competition, and nobody has this kind of network. The amount of investment we have done in earnings. We have done in network in terms of upgradation from MEs to GPON and the kind of service improvement which we could exhibit both in terms of speed quality and overall network quality, segment. Okay. We are kind of in a sweet spot. That's where you are seeing this kind of results in a quarter on quarter in terms of increase in revenue, subscriber numbers, You know, EBITDA is and without any disruption because of any other competition actually. A, because ARPUs are low and B, EBITDA levels are very healthy. No, you have seen the EBITDA levels upwards of 40 percent EBITDA with this kind of ARPU. So essentially that means that VITIQL can keep on spending more and more in within Gujarat itself, okay, and it's a very large state at a very affordable price point of 400 to 500 And keep on growing for many, many quarters to come. So I think that's a better way to look at it. Quarter on quarter, yes, there will be INR 5 rupee variations here and there in the ARPU. There is no change in plans or there is no drop in pricing, it has happened. Sure, sir. So that will basically are we talking about expanding in market share out of this 170,000,000 paying subscribers, right? So From whom we are expecting to gain market shares and majorly in which states, if we can classify? We are expanding very fast in Maharashtra, Andhra, Telangana, Tamil Nadu and Northeast, plus We will add more stakes going forward. And this will come from majorly or which competitors maybe in the like DTH or mostly our MSOs only? It is going to be mix of that. We have, as it's as in earlier calls, we have seen that we have started the programs and Through marketing, through direct selling, everything to tap the DTS market and bring back them to the table. That is already going on in the strategy. Plus there is going to be a strategy of consolidating the market going forward in the Q80. Sure, sir. Very helpful. And is it possible to give any color on the hybrid plans like what kind of ARPUs, margins, anything on that front, anything? 20. Yes. We are going to launch very soon. It is hardly now 15 to 20 days, 2 to 3 weeks. I think it will be colored every day. So I will say that wait for 2 to 3 weeks Sure, sir. Thank you. I will come back in the queue. Thank you. The next question is from the line of Ghosh Kanjal from Care PMS. Please go ahead. Hi. So most of my questions have earnings. Just last, so with the current AGR case going on, recent. I think yesterday, there was some hearing regarding some mathematical errors. Does that impact us? If you and just highlight on that. No, that is for telecom, not service. It will not impact us. Okay, okay. Sure. Okay. That's it. Thank you. Thank you. The next question is from the line of Nikhil Jain from Jai Lakshmi International. Please go ahead. Yes, sure. Thank you. Thanks for the opportunity. Just one question Actually, so fundamentally, our revenues from if you look at YOY, our revenues have increased by more than 20%. However, our PBT has increased by only 7%. So what would be the major reason for that? So that was 1. And second, Is there any kind of indication or guidance from the management for the rest of the year? Let's say, what kind of EBITDA margins We can manage. So whatever we are having now, would there be sustained or there can be a potential increase in the change given the benefit of operating leverage. These are my questions. Thank you. Yes. You're right that our total income has increased by 72% y o I, but from 1.26 crores. It has gone up to 1.26 crores. And that's why you are seeing that In the PBT, it has increased by around 30% from INR 56 crores to INR 73 crores Y o Y. 20. So these are the figures, and it's a consistent one. As you see that EBITDA growth, 20, which is happening Y o Y is between 8% to 10%. And as we are reducing our finance costs Substantially, we are getting the gain in the PBT. So that is reflecting here that PBT has gone up by 30% y o y earnings. Right. So the point was that, see the finance cost is a limit, right? So we are already down to So we have reduced that significantly. So we can obviously looking to reduce it further and it will go down further. 20. But the point was that the EBITDA growth is going to be 8% to 10% in the business, which can be potentially, let's say, having good operating leverage. So I just wanted to And is there any specific reasons? So what are the other activities that we are doing which are, let's say, taking of reducing our EBITDA growth as compared to the top line. So that's what because finance costs will have a yes. Yes. That's right. So I will not go to Google here then. I will say that we are in the expanding mode, as you know, in the broadband business also and in the cable business also. When you are expanding, then you have to do some extra expenses, which you have to take out, establish the market. You have to enter into the new market, establish the whole thing. So your cost increases at that point of time for, you can say, till this substantial number you gain, So that your 1st sub cost goes down on those markets. So that is where we have to go ahead. We are going aggressive in our new markets I'm bringing down because there is a fixed cost. As the number of subscribers will grow, we will get the more contribution towards your EBITDA. So that's what's the way we have to go, and we are doing them that way. As far as concern about the EBITDA margin, We are at around 43% EBITDA margin and this will be maintained. Okay. Okay. Thank you. Thank you. The next question is from the line of Neeru Rasa from R and D. Please go ahead. Hello? Can you hear me? Yes, yes, please. Can you hear that? I can hear you. Yes. Acquisition, especially on the cable side of the business since you said you are looking at consolidation in that market? IRN. Increase our sub base in our clinically and operational support. So yes, we are working on the acquisitions also. The next question is from the line of Dixit Doshi from Whitestone Financial Advisors. Yes. Thanks for the opportunity again. Just one question. One of our the competitor, Next Digital, they have this HITS model, head into satellite model. And recently, they have got the approval from the ministry that They can give these services to others as well. And they were mentioning that it reduces the connectivity So the MSO where there is a density of the population is very low. So they are targeting in the interior. So call. How does this can impact our business? It will also be that we are also trying to expand through by acquiring the more and more MFOs. So basically, we are not in hits model, Pali. As you said, 20 Down the line, lease cost variation, we are not going ahead with this hits. But yes, now everywhere, even though under this Digital India Bharatnet projection. All everywhere fiber availability is there, all new facilities are there. So everywhere is now ruler parties also recovered everywhere. Madam sir? Yes. I don't know why I just want to add to it. So ladies and gentlemen, first, let's understand which is not a new technology. It is not as if 1st year it has come. It has been existing for many years. And in spite of that, Digital is only MSO which is double its pace, Okay. As far as cable TV sensor. Okay. Secondly, as a part of our business, we are obviously, we have this whole convergence kind of as a part of the plan, okay. And with the kind of fiber we have in Gujarat and in many other states, specifically in Gujarat, Obviously, it makes sense to keep on expanding broadband home passes and make sure consumer get both the services, okay, And because obviously, future is convergence. So while we keep on evaluating every technology and there is no permanent note to any technology, okay, But as of now, we are fairly confident. We'll keep on repeating the past market share gains and focus will be more on convergence And keep on taking broadband to more and more kind of homes in Gujarat and other states as well. And yes, it's a one way technology. Okay. Okay. Okay. That's it for me. Thank you. Call. The next question from the line of Tarun Kumar from OSCM. Please go ahead. Yeah. Hi. Can you hear me? Yes, Tarun. Yes. Hi. I actually wanted to ask about the satellite broadband that is coming in as a new technology. Recently, there have been some articles about the same, and maybe Airtel is trying to do something in this space. So just wanted to have your understanding about this technology and the potential that it has and maybe if we can tap into it. Rajvind sir? So again, satellite broadband, whatever information we have currently available in public domain or otherwise, okay, It's for a very niche kind of area. It's for the areas where the regular fiber broadband is not easily reachable, okay? And because of kind of economics today fiber broadband has, as I keep on repeating, GTPLAY is able to give INR 500 pricing per month Without any investment from consumer, consumer has to literally invest INR 0 And Sundarvan can pay INR 5,000,000 and get a 100 Mbps unlimited broadband, okay. As for our evaluation, no technology currently beats That's kind of no, it's not possible to any other technology. So satellite broadband is a niche, okay. The kind of pilots also whichever happened across the world, We're happening more for niche areas, areas where fiber connectivity is not easily reachable and giving consumers access to high speed broadband in those areas. And we are quite certain that the kind of value for money this whole fiber broadband or applicator technology offers, That's not applicable currently by any department. Okay. So basically, right now you're saying that what we have like The fiber broadband on a cost basis is continuing to be superior than even the satellite broadband that is That they might be able to launch at the price difference, right? And most, you know, it's not that everyone is a recurring charges per month. 2nd is the device charges. If you study, like, I don't want to waste time of everybody on this call. That's a separate topic actually. We can spend couple of hours understanding that The kind of consumer premises equipment satellite needs. Okay? Okay. So it's not equipment, just like the HITS technology earlier they mentioned. Okay. And here, we are giving every day thousands of connection without any installation charges or deposit, anything from consumer. Consumer can pay and get INR 500, 100 MBAs. That's simply not possible. There you have to put lot of equipment at the consumer place And there are a lot of one time charges, etcetera. So basically, the technology is not meant for mass markets like India or whatever. Yes, there will be a lot of use cases which will come And but that will be for any niche areas. Our focus in VTTL is obviously in the mass market. Correct. Correct. So whatever market we are targeting, it's going to be unlikely that satellite broadband competes as well, right? Absolutely. Okay. Thank you, sir. Thank you. Thank you. The next question is from the line of Nikhil Jain from Dara Laxmi International. Please go ahead. Yes. Thank you. Thank you for the opportunity again. Couple of questions. So one was, let's say, the organization is owned 37% by Hathaway, which in turn is owned by Reliance, right? So is there any kind of arrangement that we have for let's say any kind of and compete in the same markets and is there any benefit that is coming in from the commissioning only or the business model? So that's the question 1. Yes. So, DTPL right now is going ahead on their own strategy and own brand. And the benefits you can talk about, the best part is all the benefits GDPL is getting, Whether it is vendor negotiations, whether it is content launch strategy, whether it is content side, whether it is knowledge sharing and all, But yes, GTPL is working as independent on their own brand and own strategy. And 20. There is understanding on the ground that we are as a group company, we are going to complement each other in the market, And we maintain that. Okay. So does that mean that, let's say, call. Is there some kind of arrangement on the ground that, okay, we will not be competing or maybe competing as aggressively as we compete, let's say, with DHL or Distributed subscribers and other people. No. We are competing in the market, but we are not disturbing each other. If we have to do some work in the ground, we will do in the joint strategy against the 3rd player, and we will help each other to grow. So that is the understanding and that is the market understanding on which we are working. Okay. Thank you. So that was first question. The second, I just wanted to understand if what are the let's say, and which it can be sent offline also, that is fine. What are the broadband customers and cable TV customers that we have on a statewide basis. Because I was just looking at it and we have now present both Cable TV and brought on in let's say around 8 states and then another 5 or 6 states. So we are present either through broadband or through Cable TV, Which let's say is we are coming into the most popular 13, 14 states of the country, right? So 20. So I just wanted to understand that has management thought that what is the strategy of expansion for the management? So do we want to go into good number of states Or do we want to consolidate our presence? Do we want to be as strong, number 1? Number 2 in many other states or do we want to open more states, let's say. So 20 1 of the strategy of choosing the going to the market. GDPL always believe that whether it is cable or whether it is broadband, it's a density market, the way of density market business. So whichever whichever city or whichever area you are go, You have to be the dense subscriber base on those areas. See, in the cable, you can go on the strategy basis of the whole state. You can go on the strategy basis on 5 cities or you can go on the strategy of having 10 districts. But whichever way you go, you have you should have the density, and you should be number 1, number 2 player in those areas, on those districts, in those state on those levels. So state comes in the last. You have to 20. Understand that when you are entering into a new state, first, you have to go for 2, 3 districts, and you will make yourself number 1 on those districts first. And then you expand in other districts, and slowly, you become number 1, number 2 in the home state. Because cable or broadband is a local business, you can say. It's call. Not like global debt. Why? That's how you have created one infrastructure, and it is whole for the state. No. You have to incrementally create your infrastructures and go for the business. But yes, this is sure that wherever GCPL is going, We go in the way that we should be number 1, number 2 in the short period and we start making money on those markets. No worries. So that's the right thing actually. So that is what I also believe because somewhere when I look at a number of states and these are very popular from very big states. I get a feeling that, okay, are we studying ourselves too thin? But thank you for the clarification. So call. Can I assume then that when we are going in Umbra or we are going in Telangana or in Maristo or any new state, we are focusing on a district by district and trying to make money and Trying to consolidate ourselves in that before expanding to the entire state, right? Yes, that's right. That's why I'm giving that every time the statement But we are expanding very aggressively in Maharashtra, Telangana, Amra, Tamil Nadu, Northeast, Because we have still to cover a lot of districts on those states. So that's why we are 20. Expanding aggressively on those markets. If you talk about Gujarat, we are already in all the statistics in Gujarat, earnings. Already present except 1 or 2, which we are going to expand small here. But if we talk about Maharashtra, Telangana, 20. Amra, Tamil Nadu, Northeast. Still lot of districts are there where we can expand and that's why the statement is that We are aggressively expanding in these markets. Right. Thank you. So just one last one maybe from 20. Just pardon me if it is not so correct. But the point is that should we not actually go one step by one step, Now should we actually go competitively or together in 5 steps or 6 steps? Or maybe we'll move that to you. Right? There's a strategic question. So this is a strategy question. Sorry. Right. Thank you, sir. Thanks. Thank you. Participants in a press star and want to ask a question. The next question is from the line of Redeema Chandak from RoHA Asset Managers. Please go ahead. Thank you for the opportunity, sir. So my question is on the CATV side. So basically, in this quarter, what leads to the reduction in the COATV EBIT margins on a Q o Q and a Y o Y basis, both even after increasing revenue. Session. Yes. So if you talk about such as ATV, We are down by around 1 crore at the EBITDA level from a Y o Y basis, And that is mainly because the subscription CATV is a bit down. And The second is your activation revenue. The deferred revenue of activation is reducing, And that's why we see there are a INR 6 crores of impact on the activation revenue, but Innovator, the impact is just INR 1 crore. Okay. Is there any pressure on the pricing also, Nothing like that? No. No pressure on the pricing. As I stated that we will the ARPU is maintained. And whenever we get the situation improves in the market, then we are going to increase the ARPU. Okay. Thank you so much. Thank you. Ladies and gentlemen, you may press star and 1. The next question is from the line of Mitesh Lania from Saxon Capital. Please go ahead. Good afternoon, sir. Mitesh here. 20. Just wanted to understand, in terms of the incremental home pass that we are doing now, where is the proportion of overlap on our cable business. So I think you answered this last time, but are we deviating on that at all or no? 20. No, no. We are not deviating. Our stand is as we think it is clear from the beginning that for doing the better ROI, We are riding on our cable businesses, but we need to be broadband services. And we are expanding wherever Our broadband business our cable business is there, back to being the broadband also. And you don't see that changing for the next 3 years at least? 20. I mean you will keep on doing an overlap with your cable business? Yes. We are going to do the scope of overlap. We are going to come with the broadband through partners. That strategy is under DPS and the pilot is over, And we are going to launch that, but we are going to do through partners on our network only, on our cable network only. So effectively no greenfield area for broadband is being targeted? Greenfield area is together we are targeting for the cable and broadband. It's like new building is coming, Erno. New areas are getting developed. Like the same state or same district or same town. Yes. Okay. So you may be in in in the process also expanding your geographical territory of your cable business. That's what you're trying to say? That's right. That's that's already that's already we are doing. We are doing it in our current states also and our new states also. Broadband. By looking at the numbers, we can get a fair sense. But if we were to just simply look at incremental EBITDA margins For a new subscriber added on the existing Home Pass that would be at what number, sir? If you talk about EBITDA, because it's not CapEx, CapEx is different. On EBITDA, if you see, so it's around 42%, which is we are getting straightway incremental in our EBITDA. That would be on the whole base per se, right? But on an incremental basis, it will be higher than $14,000,000 Yes. On incremental basis, If you talk about that I am adding subscriber base, we are already I have subscriber base. Then Vince, you're talking about we have created the past In existing markets, essentially gross margin. So gentlemen, if your question is in existing home passes, where already for example 15% penetration is there And if we add another 3% penetration, how much will be the addition to the margin? Because fixed cost is already there in those market. So it will be basically gross margin is what will go to the kind of profit line, obviously, below EBITDA, whatever lines are there, deficit and etcetera that will come. The gross margin is what will get added to EBITDA and gross margin is typically most of the markets more than 30%. I mean finally above gross margin you have passed up only bandwidth and money if you pay to channel partners in terms of the distributor commission or partner commission. So 70 is the number. Got it. Understood. Thank you. That answers call. Thanks, Smriti. Thank you. Before we move to the next question, a reminder to the participants, Anyone who wishes to ask a question, please press star and one now. Good. Thank you. The next question is from the line of Dhruv Shah from Amrika Financial. Please go ahead. Yes. Hi, team. Good evening. So I just have one So I have a couple of questions linked to the one thing. How many of our 4.1 home passes would be coming from Gujrat? Call Pass is around 90%, 90%, 90% -ninety two percent from the Gujarat. Okay. Understood. The reason why I'm asking that question, sir, is because apart from Gujarat, your plans for broadband doesn't seem to be anywhere competing other likes, right? Because if you see your likes, your offering in Hyderabad, You are charging 100 Mbps for almost close to INR 850, whereas Jio is charging only INR 6.99. So apart from Gujarat, why are offering really not competitive? So basically, majorly, our focus on B2C isn't only on Gujarat. Other states, our plan to go ahead with our business partners, Like our joint venture partners or our LTO partners and all. Hyderabad market, it's a B2B, yes, it's B2C subscribers are less over there. So still, we are working with our business through partner business partners. And, surely, we will duplicate what we are doing within Gujarat. So that will happen. Even if you work with your business partners, but we don't have any say in the kind of offering we have because if you see in Nagpur, our Maximum offering is 50 MBPS and that too is a 15 month period and INR 4.80 per month. Whereas So Conference. So, Piyush, I'll take this question. So, gentlemen, some of our colleagues here in the call itself spoke about focus, right? Guidance. So if you see last 12 quarters, what we have been talking about here in this call that we are limited capital. We'd like to use that capital in areas where we get getting back to ROI, okay. So around 12 quarters back, we identified Gujarat as the market where we have dominant leadership in cable, where we have excellent trade relationships, where we saw a sweet spot that apart from BSN No, the large telco is able to do any substantial wireless broadband business, okay. And we all agreed that right from doing IPO times that this business makes only money if you are number 1 or number 2 and below a particular volume threshold in a particular market, okay, Which is where we said, we've set a huge amount of home parks available, okay. And the way our unit economics work, even at the average RTO of 4.50, we make greater than 40% Okay. Which is where and to offer 100 mbps, you will first upgrade the network from MEN to GPON FTTH. And every quarter, like some of us spoke about additional depreciation, etcetera, because every quarter we have been spending money on our bleeding network as well as creating new home parcels in Gujarat market. We haven't even exhausted that, okay. So you're right, one can go to Nagpur, one can go to Hyderabad. Hyderabad already has 3 players with a very developed market where no net adds at market level are getting added. Hyderabad already has more than 11 lakh, 12 lakh wireline broadband consumers who are getting at a very affordable price 100 Mbps fees. Okay. Now identifying through our channel partners some gaps, for example, say, Outstart Hazebat or Singaporeanagar where quality broadband service is not available Over a period, we can develop that franchise as Piyush is rightly mentioning. But frankly, our prime focus will be on markets where we can be number 1 player, Okay. And where we are the 1st entrant? And that's where you can make even at a 4.50 price point, better than 40% EBITDA. So while some work here or there will keep on happening, pricing as a strategy itself, the focus is on Gujarat at least for next Q4. There is still a lot of meetings there. So we can go anywhere, but it's more like management decided to kind of focus on areas where first we can be market leader, we can be the one who creates the market and then we can kind of be a dominant leader there. Right. So apart from Gujarat, so if you can just elaborate on that, Which is the other stage which you're looking to expand apart from Gujarat? Right now, 20. Major focus is in Gujarat. We are present in Pattana, Varanasi, Jaipur, Nagpur, Pune and Hyderabad, But these are the small operations. We are going to concentrate on these markets and develop these markets as as as the CapEx and all those things permits us. But, yeah, these are the fixed focus market right now where we have entered and we are going to go aggressively and we are back with the time. Okay. And so my next question is, Is there any inorganic opportunity in the broadband space? You have alluded to the fact that you were looking for inorganic opportunity in cable TV, but are there any opportunity on the broadband 20 Thank you. Session. As there are no further questions, I would now like to hand the conference over to the management for closing comments. Thanks, everyone, for joining the earnings call of FY 'twenty two quarter 1 of GDPL Hetzel Limited. Call. Be safe and healthy. We will meet again on the next quarter earnings call. Thanks a lot. Thank you. On behalf of MK Global Financial Services Limited. That concludes this conference. Thank you for joining us, and you may now disconnect your lines.