GTPL Hathway ltd

Please find below mentioned short term fundamental stock for delivery purpose.

 

Company	CMP	Target	BSE Code	NSE Code
GTPL Hathway Ltd	76	85	540602	GTPL

 

Fundamental :-

• Market Cap:  862.03 Cr.
• Current Price:  76.65
• 52 weeks High / Low  92.35 / 32.35
• Book Value:  64.76
• Stock P/E: 5.74
• Dividend Yield: 1.30 %
• ROCE: 18.22 %
• ROE: 4.55 %
• Sales Growth (3Yrs): 19.16 %
• Listed on BSE and NSE
• Company Website
• Face Value:  10.00

GTPL Hathway Limited is one of India’s largest Multi System Operator (MSO). The Company is engaged in cable TV and high-speed broadband service distribution, along with its subsidiaries, reaching an estimated 9.50 Million households. GTPL offers both Standard Definition (SD) as well as High-definition (HD) digital cable TV services to its customers. The transmission is done from its stateof-art head-end set-up at Ahmedabad with 4 support head-ends for disaster management. The Company offers its services across all parts of India. It has major presence in Gujarat and West Bengal with 67% and 24% market share, respectively. Acacia Banyan Partners has the highest individual holdings at 3.41%. The company’s market cap stands at RS862.59 crore.

 

Investment Rationale

 

Broadband business gaining traction due to increased ARPU: GTPL's broadband registered a robust subscriber growth in the recent quarter. The company saw an increase in total homepasses with half of the subscriber were able to convert to fibre-to-the-home connection, resulting in higher ARPU. The company has 3.51 Mn Home Pass; 65% Home Pass available for FTTX conversion. The company has devised a strategy to grow business which includes cable and broadband offerings, leading to increased subscribers across the broadband business and improving ARPUs on account of  these  bundled service offerings. The company has started leveraging on Reliance Jio's fibre infrastructure to provide cable and broadband services to its consumers, potentially improving its stability in turn leading to improved efficiencies and improvement in the EBITDA margins.

 

PIA for Bharat Net Phase –II - The Company has been appointed as the Project Implementation Agency (PIA) of Package B for implementation of BharatNet Phase - II Project in Gujarat by the Gujarat Fibre Grid Network Limited (GFGNL). The prestigious Rs1,246 crore EPC-based project involves survey, designing, planning and executing with active/passive (OSP + Electronics) components and commissioning of complete network. The company has Polycab India Limited as consortium partners to jointly implement this project. Through this project, it is expected to connect 3,767 Gram Panchayats by implementing endto-end Optic Fibre Cable and digital infrastructure. The contract value includes capex and three years operation & maintenance services.

 

Robust quarter – The Company reported a robust quarter as it has been a beneficiary of extended lockdown result of which most of its subscriber subscribed to higher bandwidth resulting in much better ARPU for its business. Active subscribers crossed 450K; increase of 50K in Q1FY21. The company reported a PAT of ₹ 409 Mn in Q1 FY21; ₹ 114 Mn increase Y-o-Y. Besides, average Data Consumption per Customer stood at 162 GB / Month as on Jun-20; Up by 35% annually, from 120 GB / month in Jun-19. The stock is currently trading at a 1-Yr forward PE of 5.8x. We recommend BUY.