The company Asianet Satellite Communications Limited is coming up with an IPO of INR 765 crores. The offer consists of an offer for sale of INR 465 crores and a fresh issue of equity shares worth INR 300 crores. The company intends to utilize the raised funds towards repayment of borrowings of the company and subsidiary and to fund the capital expenditure towards continued expansion. 

Asianet Satellite Communications Ltd IPO – Important Details

Asianet Satellite Communications Ltd IPO – Company Profile

The company is one of the leading internet service providers offering broadband internet service and multi-system operator (MSO) offering digital cable television services. They are predominantly present in Kerala, amongst other southern states. Asianet was among the top three fixed broadband providers in the Kerala market and had a market share of approximately 19% in fiscal 2021.

The company is also into the cable television business, which is carried out by Asianet Digital Networks Pvt. Ltd. ( wholly-owned subsidiary).

Established in 1992, Asianet started its business as an MSO offering cable television services. Leveraging the strong foundation experience as a cable network, they started to offer broadband services in 2000. 

Asianet Satellite Communications Ltd IPO Fundamental Analysis

Revenue Growth: There’s a consistent growth in revenue over the three years, from ₹4,139.86 million in 2019 to ₹5,100.68 million in 2021, indicating a positive trend in the company’s top-line performance.

Profitability: The Profit After Tax (PAT) shows a significant improvement in 2021 (₹323.89 million) compared to a low of ₹4.46 million in 2020. This is a strong indicator of the company’s ability to generate profits and could be a positive sign for potential investors.

Return on Net Worth (RoNW): The RoNW has significantly improved from 0.16% in 2020 to 14.62% in 2021, which is a good sign of the company’s improving efficiency in generating profits from its equity.

Earnings Per Share (EPS): The diluted EPS has increased from 0.03 in 2020 to 3.08 in 2021, which is a positive indicator of the company’s earning potential on a per-share basis.

Net Asset Value (NAV) per Equity Share: The NAV per equity share has also gradually increased over the years, indicating a growth in the company’s intrinsic value.

Asset and Liability Management: The total assets have been growing steadily, while the liabilities have also increased but not at an alarming rate. The equity has also increased, which is a positive sign.

Expense Management: The expenses have been growing at a slower pace compared to revenue, which is a good sign of expense management.

Summary: The improving profitability, consistent revenue growth, and better expense management of Asianet Satellite Communications Ltd are positive indicators. However, it’s crucial also to consider the company’s long-term sustainability, the competitive landscape, and other macroeconomic factors. It would be advisable to consult with a financial advisor to understand the risks and rewards better before making an investment decision.

Asianet Satellite Communications Ltd IPO Financial Information

Asianet Satellite Communications Ltd IPO Peer Comparison

Asianet shows decent profitability with a positive EPS and RoNW, unlike Siti Networks, Nxtdigital, Bharti Airtel, and Vodafone Idea, which have negative EPS indicating losses. The wide range in total incomes highlights different scales of operations within this sector.

Asianet Satellite Communications Ltd IPO Objective

Asianet Satellite Communications Ltd plans to allocate INR 160 crores from its IPO to repay or pre-pay certain borrowings. An additional INR 75.04 crores will be invested in expanding network infrastructure. The remaining funds are earmarked for general corporate purposes like IT advancements and business expansion.

1. Repayment or pre-payment of certain secured borrowing: The company and its subsidiary M/s.Asianet Digital Network Private Limited has entered into various financing arrangements, which include working capital facilities and term loans. Out of the said arrangement, INR 236.19 crores is outstanding as of 30th  November 2021, and the company intends to use the raised funds to the extent of INR 160 crores to repay the borrowing. 
2. Funding of capital expenditure: As a part of the growth strategy, the company envisages investing in network infrastructure and expansion of its fiber network. The company intends to utilize INR 75.04 crores for the expansion purpose.
3. General corporate purpose: The company plans to deploy the balance funds towards the general corporate purpose, which is not limited to meeting expenses incurred in the ordinary course of business such as strategic initiatives, including the advancement of information technology, meeting future branch and business expansion, etc.

Asianet Satellite Communications Ltd IPO Risks And Challenges

Asianet is highly dependent on Kerala for 94% of its revenue, making subscriber retention in this region crucial. The rapid technological evolution in its industry poses a risk of obsolescence. Failure to adapt to these tech advancements could adversely affect Asianet’s financials and growth.

• Dependency Risk: The company’s subscriber base is highly concentrated in the state of Kerala. Almost 94% of the revenue is generated from the state of Kerala. Asianet’s inability to retain and grow its subscriber base in the state of Kerala may adversely affect our business, results of operation, and financial condition.
• Risk of technology obsolescence: The industry in which the company operates is characterized by rapidly changing technology and industry standards, new products and services, evolving customer demands and services with increasingly short life cycles. If the company cannot respond to technological advances and evolving industry standards successfully, the company’s business, financial condition, results of operations, and prospects could be adversely affected.

Asianet Satellite Communications Ltd IPO – Industry & Market Potential

The Internet has played a very significant role in technological advancements across the globe. With the advent of the internet, there has been easy access to the various technologies and processes.

Covid-19 has pushed the increased usage of fixed broadband connections due to remote work

and at-home education. Also, with the advent of higher video and music consumption through OTT platforms, there has been more demand for high-speed internet. In the long term, CRISIL expects the wired-broadband subscriber base addition to sustain even after the pandemic is contained, as private players continue to expand home passes, given the increase in last-mile fiber connectivity investments undertaken amid the pandemic.

The transformative potential of broadband technology has far-reaching implications for society, industry, government, and economy. Because of its critical role in the operation of modern societies, there has been a global increase in the use of broadband internet during the past decade and growth is expected in the future.

Asianet Satellite Communications Ltd IPO – Type of Offer

The Asianet Satellite Communications IPO comprises a fresh issue and an offer for sale (OFS). Through the fresh issue, the company aims to raise INR 300 Crore for repaying borrowings and funding capital expansion. In the OFS, existing shareholders will sell a portion of their stake worth INR 465 Crore.

• Fresh Issue: The company will issue new shares to raise capital, aiming to collect INR 300 Crore. This fund will be utilized towards repayment of borrowings of the company and subsidiary and to fund the capital expenditure towards continued expansion.
• Offer For Sale (OFS): Existing shareholders, including promoters and early investors, will sell a portion of their stake in the company worth INR465 crores. 

Asianet Satellite Communications Ltd IPO – Offer Size

The offer consists of an offer for sale of INR 465 crores and a fresh issue of equity shares worth INR 300 crores. The company intends to utilize the raised funds towards repayment of borrowings of the company and subsidiary and to fund the capital expenditure towards continued expansion. 

Asianet Satellite Communications Ltd IPO – Allotment Structure

The IPO allotment for Asianet Satellite Communications Ltd reserves 50% shares for Qualified Institutional Buyers, 15% for Non-Institutional Investors investing over Rs. 2 lakhs, and 35% for Retail Individual Investors investing below Rs. 2 lakhs.

• Qualified Institutional Buyers (QIB): As per SEBI regulations, 50% of the shares offered through the IPO will be reserved for Qualified Institutional Buyers. These include entities such as banks, mutual funds, and insurance companies.
• Non-Institutional Investors (NII): 15% of the shares will be reserved for Non-Institutional Investors. These typically include corporate bodies or individuals investing more than Rs. 2 lakhs.
•  Retail Individual Investors (RII): The remaining 35% of the shares will be allotted to Retail Individual Investors. These individual investors apply for shares with a total value of less than Rs. 2 lakhs.

How to apply for an Asianet Satellite Communications  IPO through Alice Blue?

To apply for the Asianet Satellite Communications  IPO through Alice Blue, you would typically follow these steps:

1. Open a Demat and Trading Account: If you don’t have one already, you would need to open a Demat and trading account with Alice Blue.
2. Check for IPO Details: Once your account is active, you can check for the Asianet Satellite Communications IPO details in the IPO section of the Alice Blue platform.
3. Place the Bid: Enter the number of shares you wish to buy and place your bid within the IPO’s price band.
4. Submit the Application: Confirm all your details and submit your application.

You can apply for Asianet Satellite IPO at Alice Blue in just a few clicks!

 Check Allotment Status: Post the allotment process, you can check the allotment status to see if you have received any shares.

 Please note that the allotment of shares is not guaranteed and will depend on the demand for the IPO.

How to Check Asianet Satellite Communications IPO Allotment Status on Alice Blue?

Checking the allotment status of an IPO in Alice Blue is usually straightforward. Please follow these general steps:

1. Log in to your Alice Blue Account: You can do this through the Alice Blue website or their trading app.
2. Navigate to the Portfolio or IPO Section: This might differ based on the layout of Alice Blue’s platform, but generally, you can find the status of your IPO application under the ‘Portfolio’ or ‘IPO’ section.
3. Find the IPO Allotment Status: Look for a sub-section called ‘IPO Allotment Status’ or something similar. This is where you can see the status of the IPOs you have applied for.
4. Select the Asianet Satellite Communications IPO: If you have applied for multiple IPOs, there might be a dropdown menu or a list where you can select the IPO you are interested in. Select the Asianet Satellite Communications  IPO.
5. Check the Status: The status of your application should be displayed here. If the shares have been allocated to you, it would be mentioned here.

 If you face any issues, it’s recommended to contact Alice Blue’s customer support for detailed assistance.

 Apart from Alice Blue, there are other ways to check the allotment status of the Asianet Satellite Communications IPO:

•     Registrar’s Website: Visit the website of Link Intime India Private Limited, the registrar of the Asianet Satellite Communications IPO. On the homepage, look for the ‘IPO Allotment Status’ option. You must enter your PAN and application number or Demat account number to check your allotment status. Click on the ‘Submit’ button to view your IPO allotment status.
•     NSE and BSE: You can also check the allotment status on the official websites of the National Stock Exchange (NSE) and Bombay Stock Exchange (BSE). You would need your application number and PAN to check the status.

 Please note that the allotment status will only be available after the allotment process has been completed, a few days after the IPO window closes.

Asianet Satellite Communications Ltd IPO Offer Registrar

The registrar for the Asianet Satellite Communications Ltd IPO is Link Intime India Private Limited. They are responsible for ensuring the IPO allotment and refund processes are carried out smoothly.

Contact information for the registrar:

Link Intime India Private Limited

C-101, 1st Floor, 247 Park

L.B.S. Marg, Vikhroli West

Mumbai – 400 083, Maharashtra

Phone: 022-4918 6200

Email: [email protected]

Website: www.linkintime.co.in

Asianet Satellite Communications Limited IPO FAQs