TV18 Broadcast Limited - Q3FY2023 REVIEW

TV18 Broadcast Limited reported net revenue of ₹1768 crores for the quarter ended December 31, 2022, compared to ₹1,567 crores for December 30, 2021. Profit After Tax was ₹38 crores for the quarter ended December 31, 2022, compared to ₹311 crores during the corresxponding quarter of the previous year, respectively.

STOCK DATA

TV18 Broadcast Limited - OVERVIEW

• On April 27, 2022, Reliance and Viacom18 announced a strategic alliance with Bodhi Tree Systems, a platform of James Murdoch's Lupa Systems and Uday Shankar, to create one of India's biggest TV and digital streaming businesses. To invest Rs 13,500 crore in Viacom18 and to pioneer the change of the Indian media landscape to a "streaming-first" strategy, Bodhi Tree Systems is spearheading fundraising with a group of investors. The goal of the fundraise is to develop India's top entertainment platform.

• Viacom18 announced that it had purchased the rights to digitally stream Indian Premier League games on the Indian subcontinent for the seasons 2023 to 2027 on June 15, 2022. Moreover, it has been awarded digital rights for 18 titles in a unique package for India.

SHAREHOLDING PATTERN (%)

BENCHMARK COMPARISON

BUSINESS

• One of India's most diversified media and entertainment(M&E) conglomerates, Network18 Group, owns TV18 Broadcast Limited (TV18), which has interests in television, digital content, filmed entertainment, e-commerce, print, and related businesses. Network18 Group is a subsidiary of Network18 Media & Investments Limited (Network18 Group).

• With 14 channels across India, including a joint venture called News18-Lokmat, TV18 runs the country's largest news network, including business news (4 channels), general news (1 channel each in English and Hindi), and regional news.

• This news collection includes the leading brands of the company, such as CNBC-TV18, News18 India, and CNN News18. News18 International provides authoritative Indian news for people throughout the world and the Indian diaspora.

• The subsidiary firm of TV18, Viacom 18 (a partnership with Paramount Global), runs a variety of television entertainment channels as well as a digital platform. Sports, English entertainment, youth, and music programming, kids' programming, and general entertainment channels are all included in the TV portfolio. These channels are also available in Hindi and other regional languages. Among this portfolio's top brands include Colors, MTV, and Nickelodeon.

• Moreover, Voot, an OTT (Over the Top) platform run by Viacom 18, provides premium and unique programming in addition to catch-up TV for on-demand watching. Via its studio, Viacom 18 Motion Pictures, the Group is also active in the movie production and distribution industries. A+E Networks and TV18's infotainment division, AETN18, runs the fact-based entertainment channel History TV18.

• IndiaCast, a joint venture between TV18 and Viacom 18, is a multi-platform content asset monetisation organisation that distributes high-quality Indian content to audiences throughout the world. It also drives content syndication for the Group's channels and content in both local and foreign markets.

• In order to comply with the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations 2011 and acquire control of the Company during the year 2014, Independent Media Trust (IMT), of which Reliance Industries Limited is the sole beneficiary, made an open offer to the Company's shareholders. This offer was accepted during the following year, 2015.

• The Company's Board of Directors approved a composite merger and arrangement between Den Networks Limited, Hathway Cable and Datacom Limited, Network18 Media & Investments Limited, Media18 Distribution Services Limited, Web18 Digital Services Limited, and Digital18 Media Limited, as well as each of their respective shareholders and creditors, at its meeting on February 17, 2020.

SWOT ANALYSIS

STRENGTH

• Company with low debt

• Experienced Management

• Diversified content offering with a dominant position.

• Comfortable capital structure.

WEAKNESS

• Highest fall from 52 weeks.

• The decline in quarterly net profit with falling profit margin.

• Increase in the expenditure of the company.

OPPORTUNITIES

• The parentage of the strong and resourceful Reliance group.

• The strategic importance of the media and entertainment business.

THREAT

• Volatility in advertisement revenue.

• Inherent working capital-intensive operations.

MEDIA AND ENTERTAINMENT INDUSTRY ANALYSIS

• Audiences of all ages and demographics consume media through a variety of channels, including television, movies, out-of-home (OOH), radio, animation, and visual effects (VFX), as well as through music, video games, digital advertising, live events, filmed entertainment, and print.

• India is ranked fourth for "ICT Services Exports." The OTT, gaming, animation, and VFX sectors are predicted to drive India's Media & Entertainment sector's 10-12% CAGR growth to $55-70 Billion by 2030.

• There is an increasing need for local content. By 2025, it is anticipated that regional programming would make up 60% of TV and 50% of OTT consumption, respectively.

• Indian media and entertainment income is projected to increase by 12–14% to Rs. 1.6 lakh crore in FY24.

• Digital channels, followed by TV and print, will see the fastest rise in advertising income for the Indian media and entertainment (M&E) industry. Given its close relationship to economic activity, advertising income, which makes up 55% of the sector's revenue, will increase by 14%. Also, a rise in ad expenditure is anticipated in the last quarter of the next fiscal year due to the general elections anticipated in mid-2024. Subscription income, which would rise at a slower rate of 12%, would account for the remaining 45%.

• The Indian government has undertaken several initiatives, including digitizing the cable distribution industry to attract more institutional funding, raising the FDI ceiling in cable and direct-to-home (DTH) satellite platforms from 74% to 100%, and giving the film industry status to facilitate easy access to institutional financing.

• The Government of India's Ministry of Information & Broadcasting established the Film Facilitation Office (FFO), which serves as a single point of contact for producers and production firms to receive the necessary filming licences.

• From $ 21.4 Billion in the FY 2020–21 to $ 44.4 Billion in the FY 2021–22, the export of petroleum products climbed by 107.47%. Additionally, petroleum product exports from April to December 2022 were $70.28 billion, up 52.15% from the $46.19 billion exported from April to December 2021.

TV18 Broadcast Limited - FINANCIAL OVERVIEW

QUARTERLY SUMMARY

TV18 Broadcast Limited - PROFIT AND LOSS STATEMENT (₹ in Crores)