hathway bhawani cabletel datacom ltd share price Management discussions

Global Economy Overview:

On the surface, the global economy appears poised for a gradual recovery from the powerful blows of the pandemic and of Russias unprovoked war on Ukraine. China is rebounding strongly following the reopening of its economy. Supply-chain disruptions are unwinding, while the dislocations to energy and food markets caused by the war are receding. Simultaneously, the massive and synchronous tightening of monetary policy by most central banks should start to bear fruit, with inflation moving back toward its targets. As per latest forecast, global growth will bottom out at 2.8 percent this year before rising modestly to 3.0 percent in 2024. Global inflation will decrease, although more slowly than initially anticipated, from 8.7 percent in 2022 to 7.0 percent this year and 4.9 percent in 2024.

Notably, emerging market and developing economies are already powering ahead in many cases, with growth rates (Q IV Y-O-Y) jumping from 2.8 percent in 2022 to 4.5 percent this year. The slowdown is concentrated in advanced economies, especially the European Union area and the United Kingdom, where growth (also fourth quarter over fourth quarter) is expected to fall to 0.7 percent and –0.4 percent, respectively, this year before rebounding to 1.8 and 2.0 percent in 2024.

Inflation is much stickier than anticipated even a few months ago. While global inflation has declined, that reflects mostly the sharp reversal in energy and food prices. But core inflation, excluding the volatile energy and food components, has not yet peaked in many countries. It is expected to decline to 5.1 percent this year (fourth quarter over fourth quarter), a sizable upward revision of 0.6 percentage point from our January update, well above target.

Source:https://www.imf.org/en/Publications

Indian Economy Overview:

The Indian economy, however, appears to have moved on after its encounter with the pandemic, staging a full recovery in FY22 ahead of many nations and positioning itself to ascend to the pre-pandemic growth path in FY23. Yet in the current year, India has also faced the challenge of reining in inflation that the European strife accentuated. Measures taken by the government and RBI, along with the easing of global commodity prices, have finally managed to bring retail inflation below the RBI upper tolerance target in November 2022. However, the challenge of the depreciating rupee, although better performing than most other currencies, persists with the likelihood of further increases in policy rates by the US Fed. Despite these, agencies worldwide continue to project India as the fastest-growing major economy at 6.5-7.0 per cent in FY23. These optimistic growth forecasts stem in part from the resilience of the Indian economy seen in the rebound of private consumption seamlessly replacing the export stimuli as the leading driver of growth. The uptick in private consumption has also given a boost to production activity resulting in an increase in capacity utilisation across sectors. The rebound in consumption was engineered by the near-universal vaccination coverage that brought people back to the streets to spend on contact-based services, such as restaurants, hotels, shopping malls, and cinemas, among others. The worlds second-largest vaccination drive involving more than 2 billion doses also served to lift consumer sentiments that may prolong the rebound in consumption. Vaccinations have facilitated the return of migrant workers to cities to work in construction sites as the rebound in consumption spilled over into the housing market. This is evident in the housing market witnessing a significant decline in inventory overhang to 33 months in Q3 of FY23 from 42 months last year.

Source : https://www.indiabudget.gov.in/economicsurvey

Indian M&E Sector Overview:

The Indian M&E sector continued its strong growth trajectory. It grew by INR348 billion (19.9%) to reach INR2.1 trillion

(US$26.2 billion), 10% above its prepandemic 2019 levels. The Share of traditional media stood at 58% of M&E sector revenue in 2022 down from71% in 2019

We expect the M&E sector to grow 11.5% in 2023 to reach INR2.34 trillion (US$29.2 billion), then grow at a CAGR of 10% to reach INR2.83 trillion (US$35.4 billion) by 2025

Source:EY estimates

OPPORTUNITIES, THREATS AND BUSINESS OUTLOOK

High end consumers / Nuclear families / Bachelors can move to TV viewing through OTT apps.

DPOs get the benefit of creating tailor made packs as per the overall consumers demand per market requirement

The Company is taking various steps to improve performance by: a) Improving efficiency though combination of strategies such as channel packages, promoting HD and persuading consumers to move towards DPO packs comprised with most viewed channel / content at a reasonably affordable price b) Optimization of overheads by exercising effective control and regular review mechanism c) Increase customer engagement through better regional content

INTERNAL CONTROL SYSTEMS AND ADEQUACY

The Company has proper and adequate internal control system under which management reports on key performance indicators and variance analysis are made. Regular Management committee meetings are held where these reports and variance analysis are discussed and action plan initiated with proper follow up. Operational Reports are tabled at Board Meetings after being discussed in Audit Committee meetings.

BUSINESS PERFORMANCE

The Company is providing Cable Television Network Services which is considered as the only reportable segment. The companys operations are based in the state of Maharashtra, India.

HUMAN RESOURCES

An Orientation has been given to the personnel policy with emphasis on performance. Employee strength was managed at various levels with reallocation of responsibilities for better utilization of resources.

Measures are continuing to facilitate higher levels of output and productivity. Managerial Effectiveness is being improved by appropriate development and training programs, better co-ordination and improvement in communications.

As of March 31, 2023, there were 11 permanent employees on the rolls of the company.

COMPANYS FINANCIAL PERFORMANCE AND ANALYSIS

(Rs. In Lakhs)

Particulars	Year ended March 31		Year ended March 31
	2023	2022	2023	2022
	Standalone		Consolidated
INCOME
Revenue from Operations	305.50	381.59	305.50	381.59
Other Income	6.82	7.72	6.82	7.72
TOTAL INCOME	312.32	389.31	312.32	389.31
EXPENSES
Feed Charges	83.13	94.67	83.13	94.67
Other Operational Expenses	23.36	26.44	23.36	26.44
Employee Benefit Expenses	62.57	61.89	62.57	61.89
Depreciation, Amortization and Impairment	16.44	17.08	16.44	17.08
Other Expenses	93.17	88.92	93.17	88.92
TOTAL	278.67	289.00	278.67	289.00
Profit before exceptional Items and tax	33.65	100.31	33.65	100.31
Share of net Profit / (Loss) of Joint venture	-	-	-8.05	-6.24
accounted for using the equity method
Profit Before Taxation	33.65	100.31	25.60	94.07
Tax Expense
Current tax	-	-	-	-
Deferred tax	8.63	14.36	8.63	14.36
Profit After Taxation	25.02	85.95	16.97	79.71
Other Comprehensive Income	0.60	-0.16	0.60	0.59
Total Comprehensive Income for the year	25.62	85.79	17.57	80.30

Ratio Analysis (Consolidated Basis)

Sr. No.	Particulars	Year Ended March 31, 2023	Year Ended March 31, 2022	% Variance	Reason for Variance
1	Current Ratio	0.23	0.19	18%
2	Debt-Equity Ratio	NA	NA	NA
3	Debt Service Coverage Ratio	NA	NA	NA
4	Return on Equity Ratio	0.10	0.66	-85%	Due to reduction in revenue from operations and Net Profit.
5	Inventory Turnover Ratio	NA	NA	NA
6	Trade Receivables Turnover Ratio	31.45	42.56	-26%	Due to reduction in Revenue from operations
7	Trade Payables Turnover Ratio	3.67	1.67	120%	Due to reduction in trade payables.
8	Net Capital Turnover Ratio	-5.57	-3.50	59%	Due to Decline in the Companys ability to generate Revenue during the financial year.
9	Net Profit Ratio	0.06	0.21	-73%	Due to Decline in Revenue from operations
10	Return on Capital Employed (Excluding Working Capital Financing)	0.16	0.76	-79%	Due to Decline in Revenue from operations
11	Return on Investment	0.04	0.03	30%	Due to Decline in Cash and Cash Equivalents

Operational Review

The financial statements of your company have been prepared on a going concern basis which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. For the year ended 31 March 2023, the Companys total comprehensive Income for the period is Rs. 25.62 Lakhs and Net worth is Positive by Rs. 197.82 lakhs.

CAUTIONARY STATEMENT

Statements in the Management Discussion and Analysis describing the Companys objectives, projections, estimates and expectation may be "forward-looking" within the meaning of applicable laws and regulations. Actual results might differ materially from those expressed or implied.