Blackstone, the US private equity firm, has been bullish on the growth of the non-English print media in India. Its earlier attempt to buy stake in Ushodaya Enterprises, owner of the Telugu newspaper, Eenadu, could not materialise. It has now announced its plan to invest $50 million (Rs 225 crore) in the holding company of the Hindi daily, Dainik Jagran’s publisher. This would take Blackstone’s total investment in India to $1 billion, encompassing a portfolio of 10 companies.
Akhil Gupta, chairman and managing director of Blackstone Advisors India, spoke to Abhineet Kumar on the investments. Edited excerpts:
What keeps you so hooked to print media? The Indian story is all about personal consumption. If the per capita keeps growing at 6 to 6.5 per cent, then the advertising intensity will go up. People will move from consuming the basic stuffs to the things that are advertised to them. Media is fuelling personal consumption.
But, why is it that regional media and not the English media has been on your radar for over three years? Statistics show the regional media is growing much faster than (the) English (one). People want to first read in their own language. That is the reason we have been keen to invest in this growth story and Jagran has scale that others cannot match. So, we are very pleased with this investment.
You have been criticised earlier for having deals at high valuations.
What about this deal? There has been uninformed criticism. We are very happy with all our 10 investment decisions. This deal is still awaiting requisite approval; hence, we have not disclosed the exact stake that we plan to pick up. But, we are happy at the valuations, keeping in mind the growth prospects.
But, generally valuations are going up now. So, is it a good time for such deals? When valuations are down, then the outlook is also bleak. When the outlook is bright, then valuations also go up. So, a fine balance has to be found. Only when one keeps in mind the long-term growth is achieving such a balance possible.
Do you expect the PE industry to have a busy time ahead this year? In the last five years, I have never been as busy as I am today. There is such a robust deal pipeline. The industry is definitely going to have a good number of successful PE transactions this year. Individual performances cannot be predicted till the deals happen.