Tata Sky eyes stock market listing, set to file IPO prospectus with SEBI: Report

The IPO could possibly be launched before the end of this fiscal

by exchange4media Staff
Published: Aug 4, 2021 2:02 PM | 2 min read

Direct to home (DTH) operator Tata Sky, which is jointly owned by the Tata Group and Walt Disney, is planning to list on the bourses. According to a news report, the DTH company will soon file its IPO prospectus with Securities and Exchange Board of India (SEBI) by next month. The IPO could possibly be launched before the end of this fiscal.

The report further stated that the IPO size will be between Rs 2,000-3,000 crore which includes a mix of primary capital raising and secondary share sales by existing investors. The IPO will provide an exit route to Disney which is not keen on continuing in the TV distribution business.

According to Telecom Regulatory Authority of India (TRAI), Tata Sky had dominant share of the active pay DTH subscribers at 33.03% followed by Dish TV (25.45%), Bharti Telemedia (25.17%), and Sun Direct (16.35%), as of December 2020. The active pay DTH subscriber base stood at 70.99 million for the quarter ended 31st December 2020.

As reported earlier, Tata Sky had reported a net loss of Rs 234 crore in FY20 compared to a net profit of Rs 364 crore in FY19. The DTH platform's operating income in FY20 stood at Rs 4691 crore. In the previous fiscal, the operating income was Rs 6113 crore.

The revenue for FY20 is lower than the previous fiscal due to netting off of broadcaster payout since the content cost is a pass-through under the new TRAI new tariff order (NTO), and hence will not be comparable to FY19.

Tata Sky commenced operations in 2004 as an 80:20 joint venture between Tata Sons and Network Digital Distribution Services FZ-LLC (NDDS), the investment arm of 21st Century Fox, which has been acquired by Disney. Tata Group, Disney and Temasek own 60%, 30%, and 10% stakes in Tata Sky respectively.

In fiscal 2008, Baytree Investments (Mauritius) Pte Ltd (Bay Tree), an affiliate of Temasek Capital (Pvt) Ltd acquired 10% of Tata Sky's equity shares. In fiscal 2010, TS Investments Ltd (TSIL) acquired 20% equity stake in Tata Sky. In fiscal 2013, Tata Opportunities Fund, through Omega FII Investments Pte Ltd (Omega), and Tata Capital Ltd acquired equity stake in Tata Sky.

Tata Sons, NDDS, TSIL, Baytree, Omega, and Tata Capital Ltd presently hold 41.49%, 20.0%, 20%, 10%, 7.8% and 0.71%, respectively, of Tata Sky's equity share capital.