Hathway Cable shares zooms 16 per cent, as RBI increases FII limits

The Shares of Hathway Cable & Datacom (HATHWAY), surged above 16 per cent on Thursday (27th August). In reponse to the Reserve Bank of India (RBI's) approval to increase the Foreign Investment Limit for Foreign Institutional Investors (FIIs) / Registered Foreign Portfolios Investors (RFPIs),etc. and Removal from the RBI Ban List. The stock closed at Rs 40.40 on Wednesday (26th August) and touched a day high of Rs 46.90 on Thursday in the Bombay Stock Exchange (BSE).

According to the letter dated August 26, 2015 of RBI, the company received approvals for increase in the Foreign Investment Limit under the Portfolio Investment Scheme (PIS) route for Flls, RFPIs, etc. from 49 per cent to 74 per cent of Issued and fully paid up share capital. RBI also removed the Company from RBI Ban List of GDR/ADR/FDI/NRI/PIO/FII/RFPIs. This move is positive for HATHWAY as it can now attract higher investment from the foreign institutional investors.

Earlier on August 13, 2015 HATHWAY informed BSE that they had applied for approval of Foreign Investment Promotion Board (FIPB) for the revision in limits and in this regard, FIPB have approved the above increase for FMs and FPIs under Portfolio Investment Scheme vide its letter dated August 3, 2015.

HATHWAY recently declared its June quarter results and the company reported a 5.67 per cent year on year increase in revenue to Rs 264.41 crore in Q1FY16 against Rs 250.22 crore in Q1FY15. While, its net loss increased to Rs 43.91 crore in Q1FY16 compared to a loss of Rs 0.55 crore in Q1FY15.

HATHWAY's shareholding pattern indicates that FII holdings contracted by 1860 basis points to 14.54 per cent and DII holdings expanded by 2408 basis points to 38.54 per cent during Q1FY16 as compared to the same period in the last year.

HATHWAY's Cable operations straddle across key Indian geographies and offers cable television services across 140 cities and towns and high-speed cable broadband services across 21 cities. The company holds a PAN India ISP license and is the first cable television services provider to offer broadband Internet services. It is currently India’s largest cable broadband services provider, with approximately 1.4 million two-way broadband enabled homes. Its subscriber base constitutes approximately 52 per cent of the total cable broadband market in India.