WIP Draft

Noida Software Technology Park Limited

Information Memorandum

July 2015
Strictly
confidential

Disclaimer
This note is prepared exclusively for the benefit and internal use of [xxxx] and their affiliates in
relation to any proposed transaction in the Indian Media & Entertainment industry. This note does
not carry any right of publication or disclosure to any other party. Neither this note nor any of its
content may be used for any other purpose without prior written consent of Noida Software
Technology Park Limited (NSTPL or Company).
The information in this note reflects prevailing conditions and our view as of this date, all of which
are, accordingly, subject to change. In preparing this note we have relied upon and assumed,
without independent verification, the accuracy and completeness of information obtained from
public sources and the management. Accordingly, neither NSTPL nor any of its employees can be
held liable for any error or misrepresentation in any such information.

Pg 2

Strictly
confidential

 Executive Summary
Corporate Overview
Business Segments
Future Strategy and Financial Projections

Pg 3

Strictly
confidential

NSTPL: Indias leading digital video infrastructure company

Incorporated in 1999 and based in New Delhi, Noida Software Technology Private Limited (NSTPL or Company) is:

engaged in delivery of video & broadband solutions over satellite

only licensee of HITS in India

NSTPL focus areas:

1
1

2
2
Service
Service ranges:
ranges:
B2B
B2B and
and B2B2C
B2B2C

6
6

3
3

Garner
Garner significant
significant
share
share of
of
broadband
broadband over
over
satellite
satellite

5
5

Source: Company reports

Create
Create aa lead
lead
product
in
product in every
every
category
category and
and
market
market with
with no
no
alternative
alternative

Ensure
Ensure largest
largest
share
of
share of pie
pie
through
through 3-tier
3-tier
strategy
strategy

Focus
Focus on
on
unpenetrated
unpenetrated
markets
markets

4
4
Become
Become aa key
key
facilitator
facilitator for
for
Digital
India
Digital India

Pg 4

Strictly
confidential

 and the only one with infrastructure in place to tap the untapped
India: large MSOs focused mainly on Phase 1&2 markets
Subscriber Base (mn)
Company

Phase 1 & 2
34

Phase 3 &4
105

Phase
1&2

Phase
3&4

Total

Hathway

6.8

5.1

11.9

Siti Cable

3.6

6.8

10.4

IMCL

2.3

6.2

8.5

Den

6.0

7.0

13.0

Phase 1 & 2 areas

Digicable

[2.5]

[7.5]

10.0

Phase 3 & 4 areas

Total (Large Players)

21.2

22.6

43.8

Others

12.8

82.4

95.2

Grand Total*

34.0

105.0

139.0

Potential catchment areas for NSPTL

o Phase 3 & 4 provide enormous opportunity, however digitization requires huge
capex from national MSOs as they do not have significant presence in these areas
o NSPTL is the only company in India with infrastructure in place to tap this
opportunity
o NSPTL plans to reach ~ 7,000 urban locations & 500,000 villages surrounding
these locations

Source: FICCI Frames 2015, Company reports. * Total C&S subscribers (includes DTH customers)

Pg 5

Nonexclusive
solution

Consumer

Exclusive
solution

Service
Provider

Bulk Service
Provider

Strictly
confidential

NSTPL: Business Segments

Managed Services for Broadcasters

Cable

Broadband

First private sector teleport operator in

India
Currently has 3 teleports
Capabilities to support global distribution
of 500 + channels over TV and mobile
devices
Aims to become the backbone for video
distribution for all major MSOs and Telco
players
Supports over 50 broadcast services for
uplink & 250 for cable managed services
In talks with most major cable players /
MSOs in India for leasing its
infrastructure. Has received term sheet
from four large players

The only licensee of HITS in India

Category A ISP license holder

Provides technology, content, billing,

subscriber
management,
customer
support services and full license and
regulatory cover

Aims to supply broadband and related

products and value added services to
small and medium cable companies
through hybrid, satellite & terrestrial
networks

Source: Company reports

Aims to create 5000 cable partners

across 672 districts of India
Currently tied-up with 300 cable TV
franchisee with an existing analog
subscriber base of 2 mn+
Offers both, B2C and B2B2C cable
services

Pg 6

Presently tied-up with 60 broadband

partners with a subscriber base of
~50,000 subscribers
Only non-government network project in
India, targeting 7,000 urban locations
and 500,000 villages surrounding these
locations

Strictly
confidential

Transaction: Overview and Process

Transaction

Growth Capital Infusion (INR 2,500 mn)

Instrument

Equity Shares

Structure

Investment in NSTPL

Use of Proceeds

Investing in current and future businesses

Capital expenditure
Working capital requirements

Process

Source: Management discussion

Sharing of Information Memorandum to potential strategics

Non-binding Indicative Offers
Short listing of Offers
Due diligence
Transaction Structuring
Definitive Agreements
Regulatory approvals
Financial Closure

Pg 7

Strictly
confidential

 Executive Summary
Corporate Overview
Business Segments
Future Strategy and Financial Projections

Pg 8

Strictly
confidential

NSTPL: Overview
Overview

Incorporated in 1999 and based in New Delhi, NSTPL is a digital video infrastructure company

Engaged in delivery of video & broadband solutions

Promoted and 100% owned by Jain TV Group, New Delhi

Organized into 3 business verticals:

o

Managed services for Broadcasters: operates 3 Teleports, collectively supporting over 50 broadcasters currently

Cable: only license holder of HITS technology in India, the most efficient mode of delivery of digital signals

Broadband: supplies broadband and related products through hybrid satellite and terrestrial networks

Plans to launch a mobile app to deliver its content directly to users

Plans to deliver 500 TV channels in India

o

Current list of channels includes Neo Sports, Aastha, Sanskar, Sadhna and foreign channels like NHK (national broadcaster of Japan) and
KBS (national broadcaster of Korea)

Employee strength of more than 150

Teleport
Teleport Operations
Operations

Source: Company reports

DSNG
DSNG Operations
Operations

Integration
Integration
Services
Services

Digital
Digital Cable
Cable
Distribution
Distribution (HITS)
(HITS)

Pg 9

Broadband
Broadband Services
Services

Strictly
confidential

NSPTL: Key Milestones

TDSAT restores the
HITS license
Digitization becomes
mandatory

Secured the ISP A

Class
Nationwide
License with Internet
Telephony (VOIP)

NSTPL incorporated

2000

2007

2003

Secured
the
first
Teleport License in
India
Secured the first HITS
License in India

Incorporation

Source: Company reports

Signed a multi-year
and
multitransponder
deal
with Intelsat
Signed
a
JV
agreement to launch
another teleport in
Hyderabad

Regulator
y Events

2009

2011

Launched ISP services

in India
Uplinking of more than
30 channels

Company
Offerings

Launched HITS platform

for B2B infra sharing &
JAINHITS for B2B2C
cable managed services
in India

2012

2014

Uplinking
of
50+
channels from both the
teleports
Announced launch of
HITS platform

Signed ARRIS (erstwhile

Motorola) as technology
partner for HITS platform

Key
Partners

Pg 10

Strictly
confidential

NSPTL: Promoter Group

Promoter
Group

Dr. JK Jain
Group Chairman

Education

Media
Digital
Digital Video
Video
Infrastructure
Infrastructure

Media
Media

Incorporated in 1991
Listed company
First 24 hour news channel
in India
Also provides studio and
equipment on rent

Education
Education

Provides
courses
in
Business
Management,
Mass
Communication,
Healthcare Management
and Technology
Offers full time programs at
both the Under Graduate
and Post Graduate levels
~ 950 students

Source: Company reports, *- Information, Education & Communication

Age: 70
Education: MD, Surgeon
Experience: Founder of Jain Group
and pioneer of satellite TV era in India.
Other Affiliations: Former member of
Parliament (Rajya Sabha)

Pg 11

Healthcare
Healthcare

Incorporated in 1991
Currently
provides
healthcare services to the
low and middle income
group located in the far
flung inaccessible rural
parts of India
Company also conducts
IEC*
activities
for
preventive health efforts of
the Government

Strictly
confidential

NSTPL: Organization Structure

Board of Directors

Managing Director
(Ankur Jain)

Executive Director
(Sadhana Bharadwaj)

Managed Services for Broadcasters

(Jeet N Singh)

Network
Operations

Satellite

HITS

Product
Development

Tech Lab

Teleport

Cable
(Rakesh Gupta)

Broadband

Business
Development

National Sales &

Channel Mgmt

Broadband
(Ravi Ailawadhi)

Marketing
Communication

Billing

Partnership & Key

Accounts

Finance
(Sunil Malhotra)

Fund Raising
(Ranbir Das/Gagneet
Ahuja)

Legal & Regulatory

(Devinder Singh)

Secretarial and
Compliance
(Satyendu Patnaik)

QOS

Customer Service

Customer
Care

Logistics

IT
(Amitabh Mishra)
Accounts &
Taxation
(Ajit Sinha)

Business Planning
(Vivek Garg)

Source: Company reports

Pg 12

Strictly
confidential

NSTPL: Board of Directors

Ankur Jain
Managing Director

Bharti Jain
Whole-time
Director

M.D Asthana
Whole-time
Director

Source: Company reports

Age: 42 years
Education: MS in Communication from Johns
Hopkins University, Baltimore, USA.
Experience: Worked with the group in various
professional capacities for the past 16 years and
areas of expertise include media and telecom
Responsibility: Leads group's overall strategic
expansion. Oversees financial management,
business development and legal affairs

Age: 42 years
Education: MBA in Marketing
Experience: Management professional with 16+
years of experience in marketing and company
administration
Responsibility: Works closely with the
government and is part of start-up projects
within the group

Age: 73 years
Experience: Retired IAS officer. He has served
in the Agriculture, Rural Development and Food
Departments in various capacities and retired as
Principal Advisor to Planning Commission in
December 2000

Age: 72 years

R N Agarwal
Independent
Director

Vishnu Bhagwan
Independent
Director

Experience: Former Chairman of Radio

Regulation Board ITU and presently acts as
Chairman of APG (APT) and President of ITUAPT foundation of India

Age: 74 years
Experience: Retired Civil Servant (IAS) and has
worked in various positions in the State
Government as well as in Central Government
and retired as Chief Secretary of Government of
Haryana in December 2000

Age: 72 years
Experience: Retired Civil Servant (IAS) and has
worked in various positions in the State
Governments as well as in Central Government
and retired as Secretary of Government of
Haryana in December 2001

Anil Kumar
Independent
Director

Pg 13

Strictly
confidential

NSTPL: Management Team

Sadhna Bharadwaj
Executive Director

MBA
More than 23 years experience with a
national TV platform, KPO platform and a
Rural marketing business
In charge of the go to market strategy and
implementation

Rakesh Gupta
Head- Jain Hits
Business

Sunil Malhotra
Executive DirectorFinance

Devinder Singh
Head- Regulatory

Ravi Ailawadhi
CEO & Head- Broadband
Business

Ajit Sinha
CFO

Source: Company reports

CA
More than 33 years experience in PSUs
In charge of the overall finance, planning and
fulfilment functions of the group

BE (Telecom Engineering)
More than 35 years experience
Department of Telecommunications
Reliance communications

Jeet Narayan Singh

Head- Broadcast
Infrastructure Business

with
and

BE (Electronics & Telecommunications)

More than 34 years experience in senior
management positions and has served as
Group CEO for Shyam Group
Has also worked with Alcatel Lucent for 18
years
CA
More than 17 years of experience in
accounts, taxation & audit
Prior to NSPTL, worked with Fibcom India

ICWA & CS
More than 24 years experience in senior
management
positions
with
various
companies

Cost Accountant and a Post Graduate

Diploma holder in Marketing and Business
Strategy
More than 30 years experience in companies
such as Rattan Vanaspati, Ranbaxy Labs,
Sona Steering, and Hero Honda

Vivek Garg
VP Business Planning

Pg 14

Electronic & Telecom Engineer from Pune

University
More than 11 years experience in
broadcasting & technology industry
Prior to NSTPL, worked in Conex , a world
leader in CAS

Ranbir Das
VP Finance

Gagneet Singh Ahuja

AVP - Finance

MBA
More than 15 years experience in Broadcast,
Satellite and Cable TV industry
Has architected the HITS opportunity from
beginning and is responsible for its
operational implementation

MBA (Finance)
More than 7 years of experience in Finance &
MIS

Strictly
confidential

NSTPL: Infrastructure and Facilities

Greater Noida

Compression Room

Receives the Pay and FTA (Free

to Air) channels for encoding as
per the format of NSTPL and
Integrates CAS & SMS to manage
channel packages and subscriber
billing
Contains more than 100 critical
equipments such as upconvertor,
encoders and modulators

Source: Company reports

Monitoring Room

Monitors the quality of channel

received as well as uplinked to
ensure the best experience for
users

Has a video wall where 250+

channels are uplinked and
monitored simultaneously

In the process of acquiring a Teleport

catering to IS20 from Hyderabad

The facility also runs a NOC for NSTPLs

national
Broadband
Operation,
interconnected with 7 major telecom
operators including AIRTEL, Reliance,
BSNL, Vodafone, Spectranet, TATA
Teleservices and Aircel

HPA Room

Channel Antennas

Modulated signals from main

compression room comes to HPA
and then HPA sends the
signal
to the satellite through the up
linking antenna

Dish farm with more than 12

multiple downlinking antennae's,
which downlink all TV channels
and 1+1 back-up of very high end
9.3 meters up linking antenna.

HPA plays a critical role in setting

the strength of the satellite signal
at ground.

The
teleport
division
has
downlinking antennas (6 in
number) and 1 up linking antenna

Pg 15

Strictly
confidential

 Executive Summary
Corporate Overview
Business Segments
o Managed Services for Broadcasters
o Cable Services
o Broadband Services

Future Strategy and Financial Projections

Pg 16

Strictly
confidential

Managed Services for Broadcasters is estimated to be an INR 16 bn

opportunity
Large market . but penetration of outsourced services is still low

Potential Market: Managed Services for Broadcasters

In INR mn
39250
%
19
R:
G
CA

16630

CY 12

Managed services for broadcasters market is estimated at ~ INR 16 bn, including

comprehensive solutions across content operations (e.g. content management, enrichment*
and playout) and distribution
o A small portion is outsourced to third party service providers - e.g. ~ 39% of satellite
broadcasting & ~ 12% of playout services
Overall market is expected to grow to 2.4x by 2017 - the market for third party providers is
expected to grow faster due to an increased focus on outsourcing
o Growth to be driven by the increasing number of channels, increased digitization,
rapidly evolving distribution & delivery models and the evolution of content formats
o Market likely to be significantly underpenetrated, with strong further potential to grow

CY 17E

Key Market Segments

Content
Storage
Segment
Classification

Content
enrichment*

Playout

New segments for

Outsourcing

Existing Outsourcing
segments
Playout Outsourcing**

Outsourcing
Penetration#

Satellite

12%
88%

Alternate
New
Functions/Needs

Satellite Broadcast
Outsourcing

39%
61%

In-house
Outsource
d

Note:*- Only technology enabled solutions for content enrichment are included not the actual service provision/ manpower; ** - of non news channels,; # - by Volume

Source: Industry

Pg 17

Strictly
confidential

 driven by rising penetration and new modes of distribution

Satellite broadcasting
20000

In INR mn

100%
14263

15000

%
20
R:
G
CA

10000

75%
50%

5709
5000

25%

0%
CY 12

Potential Market

CY 17E

Satellite broadcasting services: 61% of the work still done in-house, significant potential to
grow going forward:
o Shift from up linking overseas to India
o Growth of HD channels
HD services require more higher bandwidth than SD

In the medium term broadcasters will need to broadcast both SD & HD

versions of same channel
o Outsourcing penetration is still less than 50% as opposed to 90%+** levels in some
developed markets in Western Europe

Current Penetration of Outsourcing*

New modes of distribution (Digital Streaming & Cloud Based Services)

In INR mn

:
GR
CA

23

7044

4068

2530
1200

2976

1330

Column1

CY 12
Cloud Based Services

CY 17E
Digital Streaming

Cloud Distribution
Cloud based distribution enables distribution to countries across the globe, while reducing
the cost of delivery and scale
India has one of the largest diaspora across the globe (~30 mn); serving this large
population with broadcasting content from India provides an interesting opportunity
Digital Streaming
With the rise of multi channel delivery, broadcasters increasingly need to transmit data to
multiple content & delivery partners
This service would also be bundled with custom playout for each mode of delivery as well
as transcoding services for e efficient delivery

Note:*- Penetration of Outsourcing is calculated as number of channels utilising outsourced playout solutions in India by total number of active channels broadcast in India; ** - Basis Industry Discussions

Source: Industry

Pg 18

Strictly
confidential

 along with growth in number of channels

Mandatory Digitization ~100 mn New digital homes in Next 5 years

Column1

DTH & Other Digital

Digit al Cable

Analog

Growing Number of Channels

Registered TV Channels

831

828

800

793

With digitization improvements in delivery such as HD, 3D become feasible and a focus area
for broadcasters
o HD is a key trend among Indian broadcasters with over 35 HD channels currently
o HD channels also expand the market as SD & HD channels are expected to co-exist in
medium term
o Introduction of new formats such as UltraHD and 3D are expected to be further add to
the growth

1000
821

826

649
600

524
50

400

HD Channels

40
30

200

20
10
0

0
FY09

FY10

FY11

Source: FICCI report 2015, TRAI

FY12

FY13

FY14 Dec-14

3
2010

22
2011

Pg 19

31

33

34

2012

2013

2014

Strictly
confidential

NSPTL offers end-to-end managed services to broadcasters

TV Channel
Uplinks

Downlink of
International
International
Channel

Digital
Satellite News
Gathering
(DSNG)

Turnaround
services

Playout
Facility

Source: Company reports

Coverage through satellite uplink service of video

& broadcast signals

International
Fiber
Connectivit
y

International fiber optic transmission solutions

enabling broadcasters for global reach

Satellite Space & Uplinking services on MCPC

and SCPC platform

Downlinking services and support in regulatory

assistance, distribution, sales & marketing, feed
sharing, production to international TV channels

Integration of
Teleport,
DSNG and
Studio
Studio

Design and integration of production facilities

including MCR, PCR and studios

Design and integration of teleports, DSNG units,

OB units

Operates a fleet of Digital Satellite

Gathering (DSNG) vans and fly
units providing end to end transmission

News /
Contribution
Contribution
Feeds

Telecast
and
Transmission
services
to
international broadcasters , news agents,
editors from India to any part of world (currently
operational in Delhi only)

End to end solutions in regulatory assistance,

channel packaging, work-flow management,
content
management,
channel
promotion,
distribution, infrastructure development including
MCR, PCR, studio

Full range of production services assisted by a

well equipped studio with latest cameras, sound
systems, lighting systems, production and post
production and live transmission facilities.

News
away

Turnaround services among satellites with Asian,

European, Australian, African and Atlantic
coverage

Fully managed television playout services

expertize and scalable technology

HD channel to a complete multi-channel bouquet

including live programme and studio feeds.

with

Consultancy
for
for operations
operations
and Set-Up

Studio and
Production
Production
Services

Pg 20

Strictly
confidential

NSTPL: Managed Services for Broadcasters - model

Satellite

PLAYOUT
SERVICES

BASEBAND &
UPLINK
SERVICES

Headend

Consumer

IRD at LCO
Premises

NSTPL Infra
3rd Party Infra

NSTPL provides the play-out services

NSTPL provides the Baseband and Uplink services

LCO/MSO downlinks the signal at their premises (through IRD - Integrated receiver/decoder )

Source: Company reports

Pg 21

Strictly
confidential

NSTPL: Managed Services for Broadcasters - key clients*

Source: Company reports, Company website

Note: * Representative list only

Pg 22

Strictly
confidential

NSTPL: Managed Services for Broadcasters - key performance statistics

Numbers subject to final
verification by Co.

Number of Channels*

60
50

46

54

40

Key terms

20

Revenue
Uplinking revenue per SD channel: INR 0.4 mn per month

0
FY 13

FY 14

FY 15

Revenue (INR mn)

310

Costs
Transponder Charges for ISRO: INR 4.5 mn per month
Transponder Charges for Intelsat : USD 40,500 per month for
9 Mhz

301

300

Downlinking revenue per SD channel: INR 0.5 mn per month

Playout revenue for channel: INR 0.8 mn per month

290
280
270

278
271

260
250
FY13

Source: Company reports

* Including uplinking, downlinking and playout

FY14

FY15

Pg 23

Strictly
confidential

Thank you

Pg 24

Strictly
confidential