The valuations of Asia's leading pay-TV operators are set to climb strongly amid rapid profit growth over the next five years, according to a study by Media Partners Asia (MPA).
Profit growth of more than 10 per cent each year until 2015 will be driven by an increase in subscribers and higher revenues from a rising take-up of digital and broadband services, according the study.
MPA said that the average valuation of the 10 could rise within a year from eight times forward earnings to almost 11-times â€“ or nearly double that of pay-TV operators round the world.
"Many Asian pay-TV operators are either in the middle or on the cusp of a high-growth phase similar to the one that accelerated both public and private market valuations for cable operators in North America between 1997 and 2005," said Vivek Couto, MPA executive director.
Across the Asia-Pacific region there are 330 million homes with pay-TV, which MPA forecasts will climb to 437 million by 2015. The take-up of digital services over the same period will treble to 350 million. Pay-TV revenues in the region are forecast to double to $60 billion by 2015, with China and India accounting for half of all revenues.
China is expected to end this year with 170 million pay-TV households, although the take-up of high-premium digital services is low. The rising growth rates are expected to tempt some owners of pay-TV providers, which in Asia include News Corp, Telstra and private equity firms, to monetise their investments with stock market listings.