Economy: Ambit's qualitative leading indicators' (QLI) tracker
With qualitative data collected through primary data networks often proving to be a stronger leading indicator of changes in the economy, we collate a weekly tracker that captures these critical qualitative inputs. On the positive front: (1) India's manufacturing PMI jumped to 3-month high on strong demand; (2) Government has decided to allocate Rs250bn extra funds for roads, railways and power over and above the allocation made in the Union Budget for FY17; and (3) Maharashtra has decided to delist fruits and vegetables from the Agriculture Produce Marketing Committee Act (APMC). On the negative front: (1) Core sector growth slowed to 4-month low in May, (2) RBI's Financial Stability Report indicated that NPAs could rise further, and (3) India's fiscal deficit reached 43% of the budgeted amount, higher than 38% from a year ago period. (Ritika Mankar Mukherjee, CFA, +91 22 3043 3175)
Utilities: Weekly tracker
In this weekly update, we have compiled the key news flow, regulatory developments and key management/regulator interviews that occurred last week. The positive news: (a) NTPC power generation rises 10% in 1QFY16; and (b) Tata Power's plant to sign PPA for 1GW PPA. The negative news: (a) GERC proposes sharing of wind GBI with discom; and (b) JSW Energy seeks shareholders' nod to dilute equity up to Rs75bn. (Bhargav Buddhadev, +91 22 3043 3252)ANALYST NOTES
Media: DTH's twin volume push; Dish remains our top pick
Discussions with DTH operators point to a two-pronged volume growth strategy. (1) Acquisition of new subscribers in rural markets through distribution expansion – this is symbiotic for the DTH industry as retailers offer multiple brand choices to consumers. (2) Upgrade of existing subscribers from standard definition (SD) to high definition (HD) – this is actively encouraged by operators by offering STB exchange at nominal rates. Also pricing is being made more palatable; Dish TV has followed Airtel DTH in reducing entry prices for HD to Rs75/mo (over and above SD packs), down from Rs165/mo. Lower cost upgrades are possible as operators offer leaner HD packs delinked from SD packs. Hence, volume growth at the lower end via Rs99/mo+topup packages and HD upgrades can coexist for DTH industry. These factors imply that our estimates of 10% subscriber and 2% ARPU CAGR over FY16-18 are conservative for Dish, our top pick in Pay TV. (Vivekanand Subbaraman, CFA, +91 22 3043 3261)
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