Sameer Manchanda is a football buff, so it is no surprise that he is rather taken by Paul the octopus and its uncanny forecasting skills. “An investment banker told me that all MBAs and finance guys should leave their jobs, and hire an octopus to determine what stock to invest in,” he jokes. Of course, Manchanda, chairman and managing director of Den Networks, a cable distribution company, has done well for himself without the help of a forecaster. His 53.70 per cent stake in the company (plus his investments in IBN18) — worth Rs 1,469 crore as on 31 March 2010 — has already made him a rupee billionaire many times over.
A qualified chartered accountant, Manchanda’s association with the media started in the mid-1980s when he joined NDTV, serving on the board of directors. In 2005, he along with Rajdeep Sardesai, Raghav Bahl and Harish Chawla set up IBN18. He continues to serve as joint managing director of IBN18.
The launch of Den Networks in 2007 was the result of Manchanda’s observation of the transformation of television viewing in India from one staid, state-run channel (Doordarshan) to a bewildering array of private channels over two decades. “While the market was exploding, distribution was lacking in pace of growth and reforms,” he says. It took a long time to put thought into action, though, and it was only in 2007 that he launched Den Networks along with Bahl and IL&FS as early investors with an initial funding of Rs 300 crore. In a space of three years, Den has established operations in 75 cities by acquiring existing small MSOs (multi system operators), and claims a subscriber base of 11 million, which is 13 per cent of the 85 million cable and satellite homes in India. Den offers analogue as well as digital cable services (the latter offered under the brand name Digitelly).
What helped push growth was Den’s 50:50 joint venture with Star India, set up in January 2008, called Star Den Media. This is a content aggregator that leverages Den’s distribution network and distributes leading channels of the Star TV Group and other broadcasting houses. This tie-up, and the commission that comes with distributing Star’s channels, has helped Den improve financials. Revenues rose from Rs 719 crore in FY2008-09 to Rs 926 crore in FY2009-10, and net profit doubled to Rs 30 crore. Den Networks’s IPO in November 2009 mopped up Rs 350 crore.
Manchanda has interesting plans. “In the next two years, we want to digitise our 11 million analogue subscriber base, and increase those numbers to 20 million,” he says. The shift to digital is being pushed by competition from direct-to-home (DTH) players, which have been gaining ground on the basis of better quality broadcasts and competitive pricing. Manchanda acknowledges the threat, but is firm in his belief that cable TV will prosper. “I am a strong believer in cable,” he says. “It has lots more to offer, lots of services yet to come in.”
Even on the cable front, Den Networks is up against more established companies such as Wire and Wireless, Hathway, Incablenet and Sumangali Cable, which continue to draw in subscribers. Manchanda, 49, will have his hands full in keeping the growth engine going.
(This story was published in Businessworld Issue Dated
26-07-2010)
A qualified chartered accountant, Manchanda’s association with the media started in the mid-1980s when he joined NDTV, serving on the board of directors. In 2005, he along with Rajdeep Sardesai, Raghav Bahl and Harish Chawla set up IBN18. He continues to serve as joint managing director of IBN18.
What helped push growth was Den’s 50:50 joint venture with Star India, set up in January 2008, called Star Den Media. This is a content aggregator that leverages Den’s distribution network and distributes leading channels of the Star TV Group and other broadcasting houses. This tie-up, and the commission that comes with distributing Star’s channels, has helped Den improve financials. Revenues rose from Rs 719 crore in FY2008-09 to Rs 926 crore in FY2009-10, and net profit doubled to Rs 30 crore. Den Networks’s IPO in November 2009 mopped up Rs 350 crore.
Manchanda has interesting plans. “In the next two years, we want to digitise our 11 million analogue subscriber base, and increase those numbers to 20 million,” he says. The shift to digital is being pushed by competition from direct-to-home (DTH) players, which have been gaining ground on the basis of better quality broadcasts and competitive pricing. Manchanda acknowledges the threat, but is firm in his belief that cable TV will prosper. “I am a strong believer in cable,” he says. “It has lots more to offer, lots of services yet to come in.”
Even on the cable front, Den Networks is up against more established companies such as Wire and Wireless, Hathway, Incablenet and Sumangali Cable, which continue to draw in subscribers. Manchanda, 49, will have his hands full in keeping the growth engine going.
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