Shares of companies engaged in broadcasting and cable services providers such as Den Networks and Hathway Cable and Datacom have rallied more than 6% each on reports that the government is working on an ordinance to speed up digitisation of the cable and satellite television industry, which accelerating pay-TV revenues for broadcasters and curtailing their carriage costs.
“A draft of the ordinance is being prepared by the Ministry, which would be placed before the Cabinet shortly,” reports suggest.
The ordinance will particularly amend Section 4A of the Cable Television Networks (Regulation) Act 1995 as it curre
ntly does not have any provision for beaming free-to-air (FTA) channels through the set-top box (STB).
The Indian government is expected to issue an ordinance to amend the rules and ensure complete digitisation by December 2014. The government has set March 31, 2012 as deadline for digitisation in the four metros.
The move will not only boost the subscription revenues for broadcasters, but also end the hefty carriage fee they pay to the cable TV operators, the report adds.
Among individual stocks, Den Networks has rallied 23% in past two trading sessions to Rs 67.65 and Hathway Cable and Datacom by 14% to Rs 94.30 on the Bombay Stock Exchange (BSE).