GTPL Hathway Ltd

NSE:GTPL

Earnings Call Transcript 2023-Q3

[Operator]

Ladies and gentlemen, welcome to the Q3 FY'23 Results Conference Call of GTPL Hathway hosted by Emkay Global Financial Services. [Operator Instructions] Please note that this conference is being recorded. I would now like to hand the conference over to Mr. Pulkit Chawla, Emkay Global Financial Services. Thank you, and over to you.

[Pulkit Chawla, analyst]

Thank you, Don, and good evening, everyone. I would like to welcome the management and thank them for this opportunity. We have with us today Mr. Anirudhsinh Jadeja, Promoter and Managing Director; Mr. Piyush Pankaj, Business Head CATV and Chief Strategy Officer; and Mr. Anil Bothra, Chief Financial Officer. Without further delay, I shall now hand over the call to the management for their opening remarks. Over to you, gentlemen.

[Aniruddhasinhji Jadeja, executive]

Thank you, Pulkit. Good evening, everyone. I'm pleased to welcome you all to our quarter 3 and 9 months ended December 2022 early conference call. We continue to be the #1 MSO in Indian constantly growing our subscriber base both in digital cable TV and broadband segments.

Before I provide business update, let me use this opportunity to announce that we recently changed our brand identity to encompass, entertain and connect in order to communicate the wide range of products and services offered by us, including entertainment from cable TV and OTT and connectivity in the form of high speed broadband as well as new products and services to be launched soon.

Coming back to the business update. I'm extremely pleased and excited to announce to launch GTPL Genie+, an OTT aggregation product, which offers subscription to the wide choice of OTT application in convenient pocket-friendly packs. It's an off to sell product that can be used by cable or broadband customer of GTPL. The digital push in India provides immense opportunity on the broadband front.

We plan to be a front-runner of push Internet service in existing and new geography by providing value-added service at cost of effective trade by-product following a customer centric approach. I now hand over to Mr. Piyush Pankaj, who will take you through business and financial aspect of the company.

[Piyush Pankaj, executive]

Thank you, Mr. Jadeja. Good evening, everyone. I am pleased to announce the business and financial performance of GTPL Hathway, the largest MSO in India as per TRAI's performance indicator report. On the basis of our strong foundation and past performance, I'm pleased to announce that we have entered three new states for our digital cable TV business: Delhi, Haryana and Uttarakhand and other state, Uttar Pradesh, we have entered two quarters back. We are receiving positive response from these geographies and are planning to build on this to grow and penetrate our presence in the states.

This is testament to the quality of services that we provide and the customer-centric approach that we follow. We are constantly exploring new opportunities in the digital cable side by expanding into new geographies where we can expand on a large scale on back of our expertise and experienced team. We have launched GTPL Genie+ and OTT apps aggregation product, which offers subscription to a wide choice of OTT applications in convenient pocket-friendly packs. This pack will be available in 1 month, 3 months, 6 months and annual subscriptions. GTPL Genie+ will provide access to up to 15-plus leading apps and will also offer up to 80% saving compared to MRP of these OTT apps.

In addition, we also provide savings to the customer in the form of 100% guaranteed cash back. Our digital cable TV subscriber base, as on 31st December 2022, stands at 8.90 million. Paying subscribers for digital cable TV stands at 8.30 million. On 9-month Y-o-Y basis, the increase in active and paying digital cable TV subscriber is 700,000 and 800,000, respectively. Subscription revenue increased by 3% Y-o-Y.

In the broadband business, we added 130,000 new subscribers, an increase of 17% on a Y-o-Y basis. home-pass subscribers stood at 5.15 million as on 31st December 2022, of which 75% are available for FTTX conversion. The broadband ARPU for quarter 3 FY'23 stood at INR 455, an increase of INR 10 on a Y-o-Y basis. The average data consumption per customer per month stood at 310 GB a 28% increase Y-o-Y.

The broadband segment provides immense opportunity, and we plan to capitalize on this by providing value-added services and the launch of GTPL Genie+ will help us to expand our broadband services and in retention of customers. Moving on to the financial performance on a consolidated level. Excluding EPC contract, in quarter 3 FY'23, revenue grew by 15% Y-o-Y to INR 7,050 million. The digital cable TV subscription revenue stood at INR 2,775 million, up by 3% Y-o-Y.

We see -- we saw a consistent growth in our broadband segment. Broadband revenue increased by 18% Y-o-Y and revenue stood back INR 1,243 million. This was driven by a healthy subscriber addition as we are on track to reach 1 million subscriber base by the end of this session. Consolidated EBITDA for the quarter stood at INR 1,314 million with a margin of 18.6%.

PAT for the quarter stood at INR 376 million. We are a net debt-free company, generating free cash flows and paying dividend history of last 6 years. Thank you, everyone. We can now begin with the question-and-answer session.

[Operator]

[Operator Instructions] The first question is from the line of Parth from Alpha Plus Capital.

[Parth Kotak, analyst]

Firstly, congratulations for a decent growth in the broadband active subscriber base. Sir, even in the last quarter, we had talked about this, that our ARPU on CATV business is actually coming down, which seems to be the case even this quarter, and it has come down substantially. So if you could throw some color on the same?

[Piyush Pankaj, executive]

Yes, Parth. Actually, as you know, that we are entering into a new market. As you know, we have given that from last 1, 1.5 years, we have gone into the south market, mainly Tamil Nadu. And then we have entered into Odisha some of the [ markish ] market. And now we are going into the big way in the north market. What is happening that the new subscribers, which are coming to us, they are coming at the lower to the average ARPU of our [ aiyer ] market. So we are dominant in Gujarat, we are dominant in West Bengal. We are dominant in Andhra Pradesh. We are dominant in Maharashtra. So all these markets, we are maintaining our ARPU or increasing our ARPU as we are dominant in those markets. As you go into the new market, you have to start from the -- a bit lower ARPU.

And then you have to wrap it up with the time as you become dominant #1 and #2, which is the endeavor on which we become in every market #1 and #2 within 2 to 3 years. So that is happening. Like in Tamil nadu, we are already crossing now 800,000 subscriber base, in the Tamil Nadu closing to 1 million. So we are looking forward that we will take the ARPU of over there. Same is happening in [ markish ] market as we entered in the last year, and now we are becoming #1, #2 player over there. So slowly, you will see that whenever you do the expansion at that time, you have to take a bit of hit in the ARPU. And we are -- we have to increase our ARPU at all the places as we talked in the earlier call also, right now, we are waiting because we have to see if there is any regulatory change, which is on the door, if it is coming, then we will do it at that point. Otherwise, we are going to take the call in the first quarter of FY'24.

[Parth Kotak, analyst]

Fair enough. That's great. Sir, also, if you could help me with if -- on the ARPU side, if this is the ARPU that would be the lowest or we could see even lower ARPUs going ahead. And you also mentioned that as we get into newer geographies, which is understandable ARPU would be slightly lower. But so is that the case that the new additions would be primarily from new geographies?

[Piyush Pankaj, executive]

Yes. That is what is happening, Parth, that the new additions are coming from the new geographies. As you already, like in Gujarat, if I talk about I'm a dominant player having 80% of the market. So here, I'm just adding every year 2%, 3%. But if I'm going into the new market, there I'm adding at 10%, 15% on that bid. So yes, the subscriber base is coming from the new market. We are making the strategy that how we are going to ramp up our ARPU. As from last two calls, we are talking about that. And we will take some steps in FY'24 regarding that.

[Parth Kotak, analyst]

Fair enough. Sir, that was really helpful. Sir, last question on the margin front, we've seen margin come down a little bit from a normal level. Is this the reason for the margin drop is the same, whereby penetration into newer geographies, will probably also lead to lower ARPU plus have some additional cost? Or is there some other factor which is probably leading to the margin compression?

[Aniruddhasinhji Jadeja, executive]

So if we talk about -- we have gone into the north market, the whole of the North market, and we don't have any establishments over there. In other markets, if we go, we have some establishments. So there, we have to start from the scrap. We have to create the whole establishment and everything and then started doing the acquisitions and adding the subscriber base. So all the cost has increased a bit in this quarter because of -- we entered into the new market and built the establishments from scratch.

And we have opened a number of offices over there. We did recruitments over there. And all the backbones, we have what we have to make there on the fiber and all we did it. And we are going on aggressive basis on the acquisition fronts also, and the strapping or you can say the -- taking the customers -- direct customers also. So both are going on. The revenue will follow on those basis. This is, I will say, one of the partner where the blip has come because of the high cost of establishments and all. We are going to, again, on the track as we are doing in the last 5 to 6 years, and we are going to maintain our budget.

[Operator]

The next question is from the line of Vinit Manek from Karma Capital Advisors.

[Vinit Manek, analyst]

For this opportunity. So again, a similar question from the previous partnership you entered that we have seen a significant increase in our other expenses, excluding the pay channel and the employee cost. So is this a sustainable number going forward? Or was an extraordinary during this quarter, and we might see the cooling off of this number in the coming quarters? So how should we look at that expense line item going forward?

[Piyush Pankaj, executive]

Other expenses, this is exceptional quarter for us also as we decided to enter into new markets. And there, we have to do all the establishment from the scratch as I told. This is an exceptional quarter, I will say on that basis. Whatever cost we have to incur for the establishments for creating my networks and everything has already been done in this quarter. We have started acquiring customers salary around more than 1 lakh customers have come from those markets. But yes, their revenues have taken a little blip in this quarter, their revenue will start from the next quarter. We will start seeing that the revenue will follow this cost, and this cost will remain at this level only.

[Vinit Manek, analyst]

Okay. Okay. And also coming down to the subscription income. So we have almost added 0.5 million subscribers this year. And we are aiming to add 1 million kind of a subscriber by the end of this year, but our average growth for 9 months within the subscription income has been closer to 2.5% kind of a number. And with the NTO 2.0 clarity coming in now, how are we seeing the growth in the subscription income going forward? So can we expect a high single-digit kind of a subscription growth coming in from next year? Or a similar kind of a number with the aggressive customer acquisition strategy will be there in the coming year?

[Piyush Pankaj, executive]

No, we are keeping that strategy in-fact that we are going back to the double-digit growth. the number of acquisitions as we will increase, as I said that we are expanding right now and just started expanding on the acquisition basis. There is an effect on the ARPU side. Those will get stabilized as we go forward. I would say, into the next 2 quarter. And you will see that consistent ARPU is going to be there. Plus, there is a plan to increase the ARPU as the plan is there. We have delayed that because of NPC implementation and all, and we have not taken [indiscernible]. But whatever will happen, we are willing to take that call in the first quarter of FY'24. And there you will see that the ARPU is also increasing and subscriber which is also increasing, and we are keeping our target that we will go to the debt revenue side.

[Vinit Manek, analyst]

Okay. Okay. Okay. Also coming on the broadband side. So we had a good addition this quarter, but it is very similar to the previous quarter's run rate. And I think on the previous call, you mentioned that the large part of this addition is coming from the B2B side of it and the B2B addition was slow over the last two quarters. So was it a very similar kind of situation this quarter also, for the broadband? And how are you seeing the more accelerating? Because I think we are a little bit behind our targets and our aspirations about the broadband subscriber addition. So how should we look at that going forward?

[Piyush Pankaj, executive]

Yes. This part is also the addition -- whatever addition has happened around 25,000. This is pure B2C addition. Still B2B has not started contributing to us. B2B has in the last quarter also we said that we are ready, around 60,000 subscriber is already in the pipeline and which is getting integrated with our system. A bit delay has happened on that because of the technical unsimilarity between the network, but [indiscernible]. And we are hopeful that as we talk, that integration is happening. So by January end this 60,000 subscribers will get onboarded, and we will start getting the revenue from there. So B2B contribution, if I will say, it has not happened until time whatever 130,000 subscriber in last 1 year we added, that is all the B2C subscribers. But as we started doing this, as we get the experience of onboarding and everything. We are hopeful that B2B onboarding and B2B subscriber base. Will start getting addition every quarter in a good numbers and therefore will start giving us the revenue side also and subscriber side also.

[Vinit Manek, analyst]

Okay. Okay. Okay. And just last question from my side. So what was the 9-month CapEx that we have already incurred? And what is the remaining target for the quarter that we are intend to spend?

[Piyush Pankaj, executive]

Yes. So total CapEx, which has happened in the 9 months is INR 3 crores -- INR 355 crores, on which CATV CapEx is INR 180 crores and broadband CapEx is INR 175 crores. The guidelines, which we have given, that we are going to be close to INR 450 crores CapEx this year. We are sticking to that for the last quarter that INR 100 crore more CapEx will happen and that will be 50% to 50% in CATV and broadband. So this is the situation right now.

[Operator]

[Operator Instructions] The next question is from the line of Yash from Sushil Finance.

[Unknown Analyst]

I had a question regarding the CATV business. My first question is, do we expect going forward in, let's say, next 2 to 3 years after acquiring substantial market share in the new territories, the margins to expand and reaching the levels of 12%, 10%, which we were doing previously, 2 years back? Or how is it?

[Piyush Pankaj, executive]

Yes, Yash. That's the expectation. As you know, we are going aggressive in the acquisition mode right now. And if you see one of the strategy which we locked on the IPO time is the consolidation of industry, and we wanted to do it from 2020 works, but we have not started that due to COVID and everything. Now we have started. So we are going on an aggressive way for the consolidation of the acquisitions. And as we go forward, as we get to more and more subscribers, we become dominant in those markets, the revenue and ARPU will follow. And the double-digit growth, which we were doing from till last year, that you will see that it is back to bail. So that's the way we are making it. And that's the strategy on which we are working.

[Unknown Analyst]

My second question is with respect to the GTPL Genie+, which was launched, I think, 10, 15 days back. So as I can see on your website, there are four different packages which are offered. So could you just throw some light as to how much would be the margin which we can expect from these plans and going forward, I'm not able to see like a prominent name Netflix being an OTT being offered to us. to the customers. So do we have any plan of onboarding them? And lastly, it recently announced that IPL would be on JioCinema. So what are your views on that? Do we doing some partnerships with them as well? Or how is it for the OTT plan?

[Piyush Pankaj, executive]

So first, on the Genie+, Genie+ product we have launched, which is more of an app aggregator and available to all CATV and broadband subscribers, existing and new of GTPL. It is off-the-shelf product, which customers can go directly and purchase it at a very competitive price. And we have made it available in 1, 3, 6, 12, all type of periods. Plus there are four packs of different choices of -- for the customer. The customer can have whatever [indiscernible] according to their choice, they can pick and take it. Yes, if I talk about Netflix, when we launched our hybrid box, Netflix was integrated on that -- in that. But yes, we are in touch with Netflix to provide us the app, which Netflix has promised. There's still some negotiations that are going on, but as we wanted to launch Genie+ and all other apps where app already we have closed.

So we have gone ahead and announced. We are hopeful that Netflix will also come into the fold very soon, and we will start providing access to all our subscriber base to our customers. Genie+ as you can say, on the margin side are now, yes, there is a margin. But we are more looking towards it for the stickiness and the retention of the customer and it is available for our all 10 million customers, including CATV Plus broadband. And we are looking forward that this is going to increase the stickiness, plus all the choices of content, which are households are required, that is we are offering. There is going to be a margin and the margin in such a way that it is not going to impact my EBITDA margin, it will be at the same level. And -- but yes, that is the case. Coming to the Jio side that JioCinema and IPL. So overall, it's good for the customers, the viewership is increasing...

[Unknown Executive]

It is part of our OTT.

[Piyush Pankaj, executive]

Yes, it is part -- this is going to be part of our OTT application also that is going to happen. But there, it is good for the industry and our viewership is going to increase, but TV is going to be there throughout in the houses. The connection is going to be there throughout the household as we understand and act on the analysis and all. And somewhere Disney and Hotstar is also including their marketing and everyone, which is good for the industry.

[Operator]

[Operator Instructions] The next question is from the line of Raj Ojha from JB Capital.

[Unknown Analyst]

So I have two sets of questions from my side. The first one is, sir, what are the growth triggers or the growth drivers point for our broadband business? And do we see any uptick in ARPU?

[Piyush Pankaj, executive]

The growth driver as I talked about -- the total households in India is around 310 million and out of that only 30 million is right now are tempered with wired broadband. So we -- all this call this broadband business has a massive business right now. This has increased rapidly. If we talk about Eurozone, they are already cross 60%. China is at 15%. U.S. is at 80% penetration of the wired broadband and somewhere India is going to catch up at those levels with the time. So there is a large opportunity where the customers are there and you just have to reach those customers through infrastructure and start providing the service. So it's just a large market. So the growth driver is that in India, it's a volume growth, which we are looking forward for. Apart from that, value growth, we are looking forward that 2% to 3% will happen every year in the value growth that we are pushing, plus we are going to be the layering of services over the broadband, which will fetch more money from our households. We'll try to do that. And that's the strategy on which we are working.

[Unknown Analyst]

Okay. Okay. That's helpful. And second question is, sir, how is the response in our new states, which we have entered on the cable TV side? So are we planning to scale it up? Or what are our plans to scale up the business?

[Piyush Pankaj, executive]

Yes. So the response is very good, actually being a #1 player in India and having the best quality services established, a lot of responses are coming from those markets. And we have just started around two months back and already got more than 1 lakh subscriber over there. We are looking forward that within 1 year, we are going to cross the 1 million subscriber over north market. And the market is big Hindi speaking good market. The ARPUs are going to be good on those markets. We are expecting that. So yes, so 1 million plus in the next 1 year time in those market.

[Operator]

[Operator Instructions] We have the next question from Richa Meena from ICICI Bank. Ms. Meena, your line has been unmuted. Please go ahead with your question. Ms. Meena, if you have muted your line from your end, please check and go ahead with your question.

[Richa Meena, analyst]

I just want -- I wanted to know if you could throw some light on the high AGR dues that could be seen in the balance sheet?

[Aniruddhasinhji Jadeja, executive]

Come again, please?

[Richa Meena, analyst]

AGR dues? And how are we planning to go about it?

[Aniruddhasinhji Jadeja, executive]

AGR dues?

[Richa Meena, analyst]

Yes.

[Aniruddhasinhji Jadeja, executive]

AGR dues is on the content -- contingent liability side, which is consistent from last 3 years, which is coming into the balance sheet. This is the duty which has given the demand on GTPL Hathway before 2016 when the Internet business and cable business works together. And based on that, they have given the demand on cable business revenues, adding that and which is already contested in the court and according to the laws it's enough, we have a very tangible takes. And already retrospectively, MIB and DOT has given that any revenues coming in the way. MIB licenses perspective, the MSO licenses and all, that is not to be included in the calculation of AGR. So we are very positive that the retrospective they have already given. And for later years, earlier years also a lot of disputes and everything is going on. And it's a public right now is in the court. And we are hopeful that we will come clean out of that.

[Operator]

The next question is from the line of Dharma Venkatesan Individual Investor.

[Unknown Attendee]

So my first question is regarding the increase in the paid channel cost. We have seen almost a 15% increase year-on-year for the 9 months period. And so what is the reason behind this increase? And how do you see that from next month onwards major players have announced the price hike? So whether will you be able to pass on those price hikes or our personal cost is going to get even higher from here and it might have an impact on our margins?

[Piyush Pankaj, executive]

Yes. So I always explained this in my calls earlier calls also that whatever you are looking for the paid channel costs, you have to club it with the marketing and placement income, which is showing in the income because one is that you are paying to the paid channels and second is what you are getting from the paid channels. So you have to go into the -- what is the net increase happening on the outflow side. And if you go on that basis, that you will find that there is not much growth that part. We are -- GTPL being a #1 player, and we have known for the best negotiations in the market. So we always try to keep our cost at least those costs at the power level. And if you combine this too, you will see that there is not much increase in the paid channel cost.

[Unknown Attendee]

Regarding the increase in channel prices that the major players are announced, which will come into effect from 2023 What is your comment sir?

[Piyush Pankaj, executive]

NTO 3, we are calling it an NTO 3. Yes, we are waiting for the implementation on that side. As you see in NTO 1 -- when NTO 1, 2 happened the industry has lost some of the subscribers recently and then again, they gained it. But NTO 1 is good for everyone, every stakeholder in the industry. We are looking forward that NTO 3 will also happen on that way. We have geared up that there should not be any chaos in the market and all, we are going to control that as we have the experience of NTO 1 and maintain the cost to the consumer on that basis also that their household cost should not increase. So that's the way we are endeavoring, yes, they are coming up with different rates, but we are going to make the things in such a way that the cost would not increase at the consumer level and all other benefits should get passed to the MSOs.

[Unknown Attendee]

And my second question is regarding the new geographies, which we are entering for our cable TV business. So whether you have entered organically or do we have done some smaller acquisitions or consolidated the smaller players and brought it in, anything of that sort or is it full on full organic growth in these new geographies?

[Piyush Pankaj, executive]

No. We go for both strategies inorganic and organic. Yes, as I say that our strategy is going big in inorganic, which we use -- which we're not used to do earlier from last 2 years because of the COVID. But yes, we are going to do inorganic and organic both. Whatever number I have given you 1 lakh plus number in those markets that has come from inorganic and organic. So we are taking up both the strategies and going forward.

[Unknown Attendee]

Okay, sir. And regarding our 4,000 status, the status quo remains the same right? Is there any other further update? Or I mean the same as previous?

[Piyush Pankaj, executive]

On which you're talking about?

[Unknown Attendee]

On the dues, which we have for our cable TV business which was supposed to get done in December.

[Piyush Pankaj, executive]

If AGR you're talking about, yes, the status quo is maintained right now. in this quarter, there is no movement on that.

[Unknown Attendee]

And finally in regarding Genie+. So from whatever your answers were given previously, I understood that. Genie+ is more of a product to make the customers more sticky rather than the product which we upsell so that if we get additional revenue, it's not like that kind of product. The product is to increase the lifetime value or make the customer more sticky. Am I right, sir?

[Piyush Pankaj, executive]

You're right. The margin is there. As I said, that the margin is there, as whatever EBITDA we are maintaining that margin we are getting in. So there is no negative impact on the EBITDA and all that is going to be positive only. But yes, this product is to provide all type of content to our customers. We are becoming content agnostic in that way. Till date, we are providing Star TV, Sony TV providing also OTT. So this is the case, and it is going to increase the stickiness of our customers being on our platforms.

[Unknown Attendee]

And just a small final one. I saw your interview on [indiscernible]. So in that you had mentioned you have think that, that might have possibility of merger with Jio like is it -- so or are we only right now collaborating on a technical and an IP level and we will continue to grow on our own, but what is the end game in this is what I'm really trying to understand.

[Piyush Pankaj, executive]

Very speculative question, but still I'll just say that what are the benefits being a partner, we have to get from the Jio we are getting, and we are really happy with that. Jio being our partners, whatever guidance, knowledge transfer, vendor negotiations, all we are getting, and we are working on our strategy. The freedom is there that we are working on our strategy, our plan and we are growing market, and we are performing. We are giving the dividends. We are net debt free company, consistent performance throughout, subscription -- subscriber base is growing and everything is happening. Yes, we don't know. We have to see how the future unfolds going forward, but we are keeping our strategy intact and going ahead and doing the business.

[Unknown Attendee]

Sir, so to summarize, right now, the collaboration is truly on a technical and knowledge level, as of now?

[Piyush Pankaj, executive]

That's right. That's right.

[Operator]

The next question is from the line of Yash from Sushil Finance.

[Unknown Analyst]

Just a follow-up question. Could you still elaborate a bit on NTO 2.0 and how does it affect us going forward? And what are our ways to tackle the same?

[Piyush Pankaj, executive]

We are calling it NTO 3, Yash. And yes, we are anticipating that not much change will happen. It will give us the opportunity to increase our revenue and bring more transparency in the market about the consumer for every stakeholder. We are trying to keep the cost to consumer at the same level so that there should not be any negative impact on the market on that basis. So we are anticipating that not much will change at the consumer level, and it is going to help us in growing our business.

[Operator]

The next question is from the line of Rama Manohar an individual investor.

[Unknown Attendee]

Just I have one question. See, why not to invest total money in the broadband sector other than cable TV anyhow the business is -- because in metro, many people are cutting off this and moving out from cable TV. So does it make more sense making all the investments in the broadband side? Because even broadband, we have a competition nature in the wireless. If you get 5G, they may introduce maybe some sort of set top box or something else issue the signals that then we will have a competition, right?

[Piyush Pankaj, executive]

A different strategy, which you are talking about, but we'll look forward in this way that cable business has a lot of potential going forward. Still that TV households are increasing. Still, there are very large market of cable, which has to get consolidated. And the third point is the return on cable. ROI is very quick. You can say between maximum between 10 to 18 months, you are getting the ROI back. If I talk about the broadband business, ROI is a bit late, it's 24 to 30 months, which we are going to get back. So still the ROI business, if you say cable business is good. And growth is there, a lot of potential to do in the market right now. As we are starting the convergence of the services, bundling of the services, entertainment plus broadband plus OTT plus we will add more services -- layering of the services on that. So it's good to be in the business and start owning the customers that whatever it wants. We are a pipe, reaching to the customer house. We just have to provide all types of services to the customer to keep customers impact with us and to generate more and more revenue from that households.

[Unknown Attendee]

But still, we are adding very few numbers in the broadband sector, right? I think because the market people, if you are not adding maybe the need connection from Airtel or JioFibre or other things. Seeing that number, 30,000 to 50,000 are very less, I think, considering that we have built a base of around 10 lakh and 5 million home-pass. So is it not a little low?

[Piyush Pankaj, executive]

No. On the extraction level, if you see, we are doing best in the industry because we are operating, if I talk about B2C, as I said, we are just operating in the Gujarat market and six of the cities. And that's the way. If it go on the extraction basis, we are the best in the market right now. So yes, we are starting the B2B in our all cable markets, which still do take off. So we will see that how it unfolds in FY'24, but we are very [indiscernible] on this broadband business, still a lot of potentials in whichever market we are present, and we are going to do excel as we are doing, right?

[Unknown Attendee]

And my last question, do you think these margins are going to improve for the next quarter? Or are they going to be like this only regards to making INR 30 crores -- INR 40 crores profit like this. How it is going to be?

[Piyush Pankaj, executive]

Yes. As I said in the beginning that during the call also that this is an exceptional quarter, where we did the exceptional establishment costs for the new markets as we have huge presence on those markets. So we have to establish [indiscernible], my network, my new manpower, everything, bandwidths, everything you have to do from the scatch. And the customer has to follow that, also the revenues are going to follow that. So yes, this is an exceptional contact. We are looking forward from here onwards, the margins and everyone will going to improve.

[Unknown Attendee]

One last question. Sorry, again, see. Our [indiscernible] company actually backed by Reliance and other things, but why our company's target is building like in a narrow range, maybe even after the 5-year of IPO and our profits are INR 40 crores, and the company has come maybe offer the share at INR 170 something. It has listed was listed. Now it's still trading at INR 130 despite our profits of around INR 200 crores and why our maybe big investors not coming, maybe mutual funds are not showing interest? Are you taking any state that people are not coming to us?

[Piyush Pankaj, executive]

Whatever we have promised as a management, as a Board, whatever we have promised in the IPO, we have made that, but we are going to increase. If you see we have -- on the broadband side, we have increased 5x in the subscriber base. The cable side, we have increased around [indiscernible] of the subscriber base. The revenue has grown fivefold in the last 6 years. We are paying dividend from last 6 years. Last year, 40%. So all those things are happening. We are managing our cash flow much, much better as we have net debt-free company right now. we have paid around INR 400 crores of debt in the last 5 years. Free cash flow generation is happening in the business throughout. So that's from the management side and the Board side, I would say. Share price and all speculation, we can't comment on that.

[Operator]

That will be the last question for today. I now hand the conference over to the management for the closing comments.

[Aniruddhasinhji Jadeja, executive]

Thank you, everyone, for joining the call. Be safe and healthy. We look forward to interact with you with the FY'23 annual results somewhere in April. Good evening, and have a great day.

[Operator]

Thank you. On behalf of Emkay Global Financial Services, that concludes this conference. Thank you for joining us. You may now disconnect your lines.