Sea TV Network Limited – IPO

Business of Sea TV Network

Sea TV Network is an Agra based company which is in the cable TV business and is a Multi System Operator. A Multi System Operator or MSO is a company which operates multiple cable TV systems and serves many localities.

Sea TV Network is one of the two existing MSOs in Agra which provides services to various local cable TV operators of Agra. Sea TV also has its own TV channels, which focus on the city and state news and events and the content of this is created in house. The company provides these channels free to their subscribers.

Sea TV now wishes expand its presence and emerge as an All India MSO and also has expansion plans which focus on setting up network for CAS, complete IPTV solution, underground optical fibre network throughout agra and adjoining areas and setting up 20 branch offices in Agra in order to reach directly the end customers and reducing their dependence on the local cable operators.

Financials of Sea TV Network

The revenues for the year ended 2005 was Rs.1.46 lakhs, for 2006 it grew to Rs.175.05 lakhs and for 2007 it was Rs.453.13 lakhs. The profit after taxes for the year ended 2006 was Rs. 2.31 lakhs and the year ended 2007 it was Rs. 18.07 lakhs.

The EPS for the last three years starting from 2007 was Rs.30.25, 4.65 and (0.12) respectively.

Key Risks

There are certain income tax litigations against the directors of the company and in case they are decided against them there could be adverse impact on the business.

Delay in project implementation could cause adverse impact on the business as there are significant capital expenditures which have been planned by the company and the company needs statutory approvals in order to commence laying underground optic fibre. Therefore there are financial risks with implementation delays and there are external factors which could cause these delays.

Inability to manage the growth of the business is another key risk. The promoters have been in this line of business for close to 15 years however they do not have prior experience in managing the kind of growth that is being envisaged by the company.

The current premises from which the company operates are residential premises and if the state government takes any action in terms of sealing the property it would cause disruption of business for the company.

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