Den Booked ₹86 Crore of Subscription Income, ₹162 Crore of Channel Cost. What Covers the Rest?

The idea in one sentence

At Den Networks and GTPL Hathway, which reported on 13 October, the subscription income each company books is about half of its channel cost (53% and 44%, our arithmetic) and smaller than the fees it earns from broadcasters. At Den the cable and broadband segments made a combined loss, so the quarter's profit before tax rests on other income.

One caution first. These are figures the companies book. The filings do not say what a home pays or what the local cable operator keeps, so a home may pay more than the company books.

The fact that makes a reader stop

If you pay a cable bill every month, you might assume the cable company lives on it. The filings cannot trace your bill. They show something narrower: the subscription income these two companies book is the smallest of three large lines in their accounts.

Den Networks and GTPL Hathway are multi system operators, or MSOs. An MSO takes channels from broadcasters and sends them to homes, largely through local cable operators. GTPL's auditors refer to its agreements with "local cable operators (customers)" [GTPL-AR]. Both filed September-quarter results on Tuesday [DEN-P] [GTPL-P].

Group (consolidated) figures, limited-reviewed, a lighter check than an audit. Neither auditor's conclusion is modified. Den: slide 10, in whole crores. GTPL: slides 22 and 23, converted from ₹ million.

• Subscription. GTPL's line is cable TV only. Den's slide has one line for the whole group. In FY26 the group's ₹396.5 crore was ₹374.18 crore of cable subscription and ₹22.31 crore of broadband [DEN-AR, pages 3 and 25], so we read the ₹86 crore as cable and broadband together. On that split about ₹5 crore would be broadband, and cable alone near 50% of channel cost (our estimate; Den does not give the quarter's split).
• EBITDA. Den's leaves out other income but includes ₹2 crore of activation income. GTPL's includes its ₹3.4 crore of other income and ₹4.6 crore of activation income, less a ₹1.0 crore foreign exchange loss.
• Profit. GTPL's ₹3.5 crore loss is the whole group's. After the minority holders' share and other comprehensive income, its own "PAT" line is a ₹0.5 crore loss [GTPL-P, slide 22].

A year earlier subscription was 66% of channel cost at Den and 49% at GTPL. Over full years, cable subscription fell from 76% of the group's content cost (which also covers broadband) in FY25 to 60% in FY26 at Den, and from 59% to 51% at GTPL. But fees from broadcasters rose, so channel cost after fees fell: from ₹95.05 crore to ₹72.58 crore at Den and from ₹503.93 crore to ₹497.57 crore at GTPL (all our arithmetic) [DEN-AR, page 25 and consolidated accounts] [GTPL-AR, consolidated notes].

One broadcaster on both lines

Who pays placement income? Den's auditors checked it against "underlying agreements/ contracts entered with broadcasters of Parent Company" [DEN-AR]. GTPL recognises it "based on agreements with the concerned broadcasters on completion of the performance obligations" [GTPL-AR, note 1.5]. So the broadcaster pays, and the income is booked as payment for work done.

The notice for Den's annual general meeting sets out its dealings with one broadcaster, Jiostar India [DEN-AR, pages 197 and 198]. The group's related party note shows the same FY26 amounts, so we set them against group totals.

• In FY26 Den paid Jiostar ₹333.60 crore in subscription charges "for carrying its various television channels through digital cable distribution network of the Company". That equals 54% of the group's content cost (our arithmetic).
• In FY26 Jiostar paid Den ₹206.96 crore. The notice says: "Jiostar pays fees to the Company for various services (which are commonly provided by Multi System Operators in the industry)". That equals 21% of the group's revenue from operations (our arithmetic).
• In April to June 2026, Den paid Jiostar ₹93.40 crore and Jiostar paid Den ₹93.73 crore. The notice sets these out as two separate arrangements, each with its own limit, and does not say they are set off against each other.

The notice does not say which lines of the accounts hold these amounts, or how the fees divide into placement, marketing and carriage.

On 2 September shareholders approved a higher yearly limit on these fees: ₹429 crore for FY27 and ₹703 crore for each of FY28 and FY29, up from ₹207 crore [DEN-AGM]. The notice gives its reason as "the increase in the scale of business operations and higher anticipated transaction volume", and calls the FY27 figure "The estimated transaction value". The ₹714 crore limit on what Den pays Jiostar did not change.

Den's annual report lists Reliance Industries Limited under "Enterprises exercising control" and Jiostar among Den's fellow subsidiaries. The notice says the two hold no shares in each other, and that Den's related party transactions are "at arm's length and in the ordinary course of business", reviewed by an independent chartered accountant firm and approved by the audit committee. Nothing we read tests the prices either way, and we draw no conclusion about them.

GTPL's annual report shows the same broadcaster on both lines, in group figures. In FY26 its pay channel cost with Jiostar was ₹1,178.50 crore, about half of the group's total. Its placement income and marketing incentive from Jiostar was ₹867.62 crore, 47% of the total (shares our arithmetic). GTPL lists Jiostar under "Fellow Subsidiaries of Entities having significant influence over the Parent".

The mechanism: three lines, and booked subscription is the smallest

Why is booked subscription smaller than channel cost? The regulator's rules explain two features of this trade, but not the gap.

The distributor's share of a channel's price is limited. The interconnection regulations of the Telecom Regulatory Authority of India (TRAI) say: "Every broadcaster shall declare a minimum twenty percent of the maximum retail price" of a pay channel as the distribution fee, which is the distributor's share. Discounts may add up to 15%. As notified in 2017, the two together could not exceed 35% [TRAI-17, regulation 7]. The distributor then shares with the local operator. Where they cannot agree, "the network capacity fee amount and the distribution fee amount shall be shared in the ratio of 55:45" [TRAI-17, regulation 12]. The home pays the network capacity fee and the prices of the pay channels it chooses. The broadcaster pays the distribution fee.

The fees a distributor earns are partly negotiated. TRAI caps the carriage fee, which a broadcaster pays only for carrying its channel: the rate "shall not exceed twenty-five paisa" per channel, per subscriber, per month [TRAI-24]. Placement, a chosen position in the channel guide, is different: a broadcaster may "pay the mutually agreed fee". On marketing fees TRAI says "there cannot be a specific parameter for regulating such fee". It treats both as payments for services, wants the agreements reported to it, and says placement agreements "shall also be non-discriminatory" [TRAI-17, paragraphs 99 and 101].

Neither rule explains the gap. Our reading: a distributor that collected a channel's full price and kept 20% to 35% would pay the broadcaster less than it collected. Here channel cost is about double the booked subscription. The gap may arise because each company books only its own share of what homes pay. The filings neither confirm that nor rule it out. They do not say how either company books channel cost against the distribution fee and discounts, or whether it books subscription before or after the local operator's share.

The accounts do show three large lines. Channel cost is the largest, and the broadcaster sets its price. Fees from broadcasters come next, and are agreed with them. Booked subscription is the smallest. Channel cost after fees is the small difference between the first two: ₹21 crore at Den and ₹158.5 crore at GTPL. Operating profit is what booked subscription and the smaller revenue lines leave after that, and after staff, network and other costs.

GTPL lists scale as a strength: "Better Negotiation Power backed by largest subscriber franchise" [GTPL-P, slide 9]. Our test, which no filing sets: if that power is real, channel cost after fees should fall as a share of subscription income as the company grows.

The record is mixed. Over FY26 that share fell at Den, from 21% to 19%, and edged up at GTPL, from 40.9% to 41.9%. This quarter it rose at GTPL, to 45.9% from 42.2% a year earlier and 41.0% in the June quarter (all our arithmetic). Subscription income grew 14% over the year and active subscribers reached 11 million, from 9.5 million. GTPL also bought a cable business with "approximately 6 lakh subscribers" for ₹35.55 crore, effective 1 July, about ₹590 each (our arithmetic) [GTPL-MR] [GTPL-ACT] [GTPL-R]. The results do not say how many of them are in the 11 million. EBITDA was ₹110.3 crore, against ₹110.1 crore, on revenue from operations ₹184 crore higher (our arithmetic).

After depreciation, Den's cable segment lost ₹8.0 crore and its broadband segment ₹0.7 crore. Other income was ₹60.7 crore and profit before tax ₹48.9 crore [DEN-R]. Den reports "Zero Gross Debt" and ₹3,417 crore of cash and equivalents [DEN-P, slide 7]. Its half-year cash flow statement shows ₹100.9 crore of interest income. Other income for the half year was ₹116.1 crore, and the results do not break it into parts.

Where this breaks

The fees are for services. Both companies and TRAI describe these fees as payment for work the distributor does: carrying, placing and promoting channels. On that view the fees are ordinary income, not a refund of channel cost, and subscription was never meant to pay for channels alone. Our comparison is one way to read the accounts, not the only one.

GTPL nets the two lines itself. It reports "Operating EBITDA" of ₹103.3 crore, against ₹101.6 crore a year earlier, and a margin of 20% against 22%. That measure includes broadband. GTPL's segment note shows the cable TV business with a loss before tax of ₹9.1 crore, against a profit of ₹0.7 crore a year earlier [GTPL-R].

The fee income is growing. Against the same quarter a year earlier, placement income rose 9% at Den, and GTPL's placement, carriage and marketing line rose 27%. Den's annual report, citing a FICCI-EY report, says "linear pay TV lost 11 million subscriptions in 2025". Our reading: broadcasters with a shrinking paying audience may value distribution more, in which case rising fees would reflect the distributors' position. The filings do not say, and do not separate price from volume.

GTPL singles out part of its loss. Its slide notes a ₹4.5 crore foreign exchange loss on paper (unrealised), which it calls one-time, and ₹3.0 crore of finance cost on seven more transponders, the satellite capacity it hires. Its loss before tax was ₹3.8 crore. The purchase accounting is provisional.

Den's profit also rests on its cash. Den reports no gross debt and ₹3,417 crore of cash and equivalents, which earn interest, and its profit after tax rose 5% over the year. Our reading: that interest says nothing about how the cable business is doing.

Our sample is narrow. Two companies and one quarter, with the same broadcaster a related party of both. No DTH operator, no other MSO, and only two of TRAI's documents.

What follows from the documents

Two things to watch, neither of them a share price.

• Channel cost after fees as a share of subscription income. GTPL prints both numbers each quarter.
• Den's segment result before other income, and how much of its revenue one broadcaster pays.

Back to the monthly bill

The filings cannot say what your bill is. They can say what GTPL books per paying subscriber. It had 10.3 million at the end of September and 8.9 million in June. On the September count it booked about ₹112 a month of subscription income, ₹252 of pay channel cost and ₹201 of fees from broadcasters (our arithmetic; on the June count each figure is about 16% higher). That leaves about ₹60 a month (our arithmetic) towards staff, the network and other costs, which GTPL also carries for broadband; its broadband income is not in these three lines. Booked subscription is the smallest of the three. The home may pay more than ₹112; the filings do not say what the local operator keeps.

Our reading: a cable connection gives the distributor the subscriber. It does not set the price of the channels, and the fees it earns are agreed with the broadcaster, not decided by the distributor alone. For a different kind of distributor, see our August piece on Indraprastha Gas.

Sources

• [DEN-P] Den Networks, investor update for the quarter ended 30 September 2026, filed 13 October 2026 (NSE)
• [DEN-R] Den Networks, unaudited results for the quarter and half year ended 30 September 2026, with limited review reports (NSE)
• [DEN-AR] Den Networks, annual report for FY2025-26 with the notice of the annual general meeting, filed 11 August 2026 (NSE)
• [DEN-AGM] Den Networks, voting results of the annual general meeting of 2 September 2026 (NSE)
• [GTPL-P] GTPL Hathway, results update presentation for the quarter ended 30 September 2026 (NSE)
• [GTPL-R] GTPL Hathway, unaudited results for the quarter and half year ended 30 September 2026, with limited review reports (NSE)
• [GTPL-MR] GTPL Hathway, media release on the results, 13 October 2026 (NSE)
• [GTPL-AR] GTPL Hathway, annual report for FY2025-26, filed 3 September 2026 (NSE)
• [GTPL-ACT] GTPL Hathway, letter on completion of the purchase of the ACT group's cable television business, 15 September 2026 (NSE)
• [TRAI-17] TRAI, Telecommunication (Broadcasting and Cable) Services Interconnection (Addressable Systems) Regulations, 2017, with explanatory memorandum
• [TRAI-24] TRAI, Sixth Amendment to the interconnection regulations, 8 July 2024

Educational research, not investment advice. Every figure above is drawn from the companies' own filings and from TRAI's regulations, read from the primary documents on 14 October 2026; differences, ratios, shares and per-subscriber figures marked "our arithmetic", and our estimate of Den's cable-only share, are ours. The subscription figures are income the companies book; the filings do not state what a household pays for cable or what a local cable operator keeps, so nothing here measures a cable bill. We have not read either annual report in full, and nothing here says whether any transaction between a distributor and a broadcaster was priced fairly or unfairly. No buy/sell recommendations, no price targets, no share prices. Moat & Margin is not a SEBI-registered Research Analyst or Investment Adviser.