Sun TV promoter has no plan to divest or dilute stake, says Group CFO

The company expects higher growth in subscription with implementation of Phase III and IV of cable TV digitisation

Kalanithi Maran-promoted Sun TV Network has reiterated that the promoter has no plan to divest or dilute his shares in the company. The company is expecting the subcriptions to go up with the Phase III and IV of the TV digitisation happens, said S L Naranayan, group CFO of Sun TV.

Speaking to reporters in the sidelines of Sun TV Network's Annual General Meeting in Chennai, he said, "The promoter has no plan to either divest or dilute his stake in the company".

There has been reports about rumours in the market that the promoter may look at selling the shares, in the wake of the Ministry of Home Affairs' alleged objection in giving security clearance to the Group's television channels as the promoter is facing charges in the alleged Aircel-Maxis deal. The company, earlier also denied any such move to dilute the promoters' stake substantially.

The company is also expecting its subscription to see a higher growth with the proposed implementation of Phase III and IV of cable television digitisation. The revenues from subscription has grown up after the implementation of cable TV digitisation. The subscription income for the year ended March 31, 2015 was Rs 738 crore as compared to Rs 644 crore during the previous year. The subscription income has grown up from around Rs 340 crore during the pre digitisation era, to the current level, which shows that the digitisation has increased the subscription revenue of the company.

He said that the digitisation brings in clarity on the distribution in the last mile, which is not possible in the analogue network.

The company's advertising income witnessed a growth of 6.5% during the year ended March 31, 2015, to Rs 1,136.09 crore, compared to Rs 1,067.04 crore during the year ended March 31, 2014. The broadcast fees has seen a drop of around 10% to Rs 114.64 crore as compared to Rs 127.34 crore during the previous fiscal year. The international subscription revenue has seen a growth of around 10% during the year ended March 31, 2015, at Rs 137.72 crore as against Rs 124.97 crore during the previous fiscal year. The income from movie distribution has seen a drop to Rs 10 lakh from Rs 14.57 crore during the previous fiscal year.

The income from Indian Premier League (IPL), in which the company owns the Hyderabad Franchisee which manages the team Sun Risers Hyderabad, has seen a decline of 5% to Rs 100.20 crore during the fiscal year 2014-15 as against Rs 105.53 crore during the fiscal year 2013-14, according to the company's annual report.

The company have to pay license fee of around Rs 85 crore in the next two years to BCCI and later on will be sharing a fixed percentage of revenue to BCCI, he told the shareholders during the AGM.