Telecom Regulatory Authority of India (TRAI) has set RS 160 price ceiling for all channels available on a distributor’s platform as it aims to reduce rising costs for subscribers.
In a statement on January 1, TRAI said that it had decided to modify certain provisions of the new tariff order (NTO), implemented in February 2019, to address the issue of huge discounts offered by broadcasters when channels are sold as a bouquet vis-à-vis sum of the cost of à la carte channels.
“One, the sum of the à la carte rates of the pay channels (MRP) forming part of a bouquet shall in no case exceed one-and-a-half times the rate of the bouquet of which such pay channels are a part; and two, the a la carte rates of each pay channel (MRP), forming part of a bouquet, shall in no case exceed three times the average rate of a pay channel of the bouquet of which such pay channel is a part," Trai said in a statement on Wednesday.
As a result of this new order share price of Sun TV Network and Zee Entertainment Enterprises shed between 2-4 percent in the early morning trade on January 2.
Share price of Sun TV has been under pressure with the stock shedding over 30 percent in the last one year. The stock was quoting at Rs 421.25, down Rs 18.20, or 4.14 percent. It has touched an intraday high of Rs 430.80 and an intraday low of Rs 411.45.
Zee Entertainment share price also shed over 2 percent intraday on January 2 with the stock plunging over 41 percent in the last one year.
Technical Analyst Mitesh Thakkar of miteshthakkar.com has a sell recommendation on Sun TV with a stop loss of Rs 446.5 for target of Rs 431 while
After examining various provisions, TRAI has also reduced the maximum NCF charge to Rs 130 (excluding taxes) for 200 channels.
In addition, it has also been decided that channels declared mandatory by Ministry of Information and Broadcasting will not be counted in the number of channels in the NCF. The sum of the a-la-carte rates of the pay channels forming part of a bouquet shall in no case exceed one and a half times the rate of the bouquet of which such pay channels are a part, the TRAI said.
TRAI also decided that only those channels which have an MRP of Rs 12 or less will be permitted to be part of the bouquet offered by broadcasters.
The new rules are part of the changes the regulator has made to its 2017 tariff order for broadcasting and cable TV services. They will be effective from March 1.
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