BPCL to enter the DTH arena
Our Corporate Bureau
12 July 2005
New Delhi: State-owned Bharat Petroleum Corporation Ltd from has firmed up plans to venture into the direct-to-home (DTH) TV domain. Plans have been finalised for a push into DTH broadcasting services through a 100 per cent subsidiary with an initial paid-up capital of Rs95 crore.
The decision was based on a study by KPMG and later validated by ICICI-Securities.
BPCL wants to float a separate company since its articles of association does not allow a foray into the entertainment business. At a later date, it may induct a joint venture partner too. A financial feasibility study indicates the payback period as 8.5 years and an 11.6 per cent return after 10.5 years, which is expected to go up to 23.5 per cent in 14.5 years. The firm is willing to pump in Rs990 crore to be spent over five years.
Justifying the diversification, BPCL told the board it has commissioned a Ku band transponder-based VSAT hub. Experience on the existing radio frequency system of the VSAT hub can be used effectively while operating DTH platform. BPCL wants to leverage its extensive network and is confident its huge customer base would bring in users.