Investment Ideas -------- BUY DISH TV

Dish TV is India’s largest DTH service provider and a strong brand name, with a 33% share of the 23 mn
DTH subscriber base at end June 2010. The Company has a vast distribution network of about 1400
distributors & 55,000 dealers that spans around 6600 towns across the country.
Investment Argument :  Dish TV is a play on India’s growing DTH subscriber base. According to FICCI-KPMG report, 2010, DTH sub numbers will rise at a CAGR of 22% for 2009-14 as
consumers are likely to prefer better quality digital platform.
At the CMP of Rs 63, the stock is trading at EV/EBIDTA of 12.9x its FY12E earnings which is reasonable
given the huge growth potential in the industry. BUY
 Operating leverage is expected to set in as the Company has achieved critical mass in sub base which
is expected to improve the operating margins substantially from 10.3% currently to 27.3% in FY12E.
 We forecast programming and other costs to decline to 30% of total revenue in FY12 as significant
proportion of these costs now not linked to subscriber base and have become fixed in nature.

At the CMP of Rs 63, the stock is trading at EV/EBIDTA of 12.9x its FY12E earnings which is reasonable given the huge growth potential in the industry.