Business Standard

Times Group may go for an IPO 'in the long run'

Group needs money to grow TV, internet businesses, Vineet Jain tells Newyorker

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Bennett, Coleman and Company (BCCL), the media conglomerate that owns The Times of India and several other properties across the print and electronic media, may go public to grow its television and internet business, one of the group’s promoters told The New Yorker.

“In the long run, we might go public and use the funds to acquire TV stations,” Vineet Jain, Managing Director, BCCL told the US magazine.

“We don’t need the money to grow publishing, but we do to grow television and internet,” Jain was quoted as saying.

In response to an email seeking comments, Satyan Gajwani, CEO, Times Internet said, "There is no such plan at the moment." An email sent to  Ravi Dhariwal, CEO-publishing, BCCL did not elicit any response.

The New Yorker profile titled “Citizens Jain”, a take on Citizen Kane, a 1941 Hollywood classic on media baron William Randolph Hearst by Orson Welles offered a first glimpse into the financials of the privately-held behemoth.

The article also analyses the Times Group’s innovative business model which involves the advertorial supplements, ad for equity deals and aggressive ad sales. “Sameer and Vineet Jain make no pretense that what they do is a public calling. Rather than worry about editorial independence and the wall between the news room and the sales department, they propose that one secret to a thriving newspaper business lies in dismantling that wall."

The article put the annual revenues of the group at over $1.5 billion (around Rs 8,000 crore today), making it by far easily the largest media company in the country. “…The pre-tax profit margin of BCCL’s newspapers is a remarkable twenty five to thirty per cent. The company commands half of all English language print advertising …a third of TV-news channel ads and almost a quarter of all radio and web ads,” the article said .  

“The company has no debt ,” the profile added.

In comparison, Subash Chandra-promoted ZEE group’s flagship Zee Entertainment clocked revenues of Rs 2,204 crore and a net profit of Rs 489 crore.  ZEE Entertainment had a market capitalization of Rs 18,700 crore, a valuation of around 8.5 times the revenues.  

Assuming BCCL gets a similar multiple as ZEE in the stock market, it could be valued at least around Rs 70,000 crore.  A 10 per cent stake sale should fetch around Rs 7,000 crore. Only a handful of private companies such as DLF, Reliance Power and TCS have raised over Rs 5,000 crore through an in the Indian market.

A group company named Entertainment Network (India) Ltd, which operates the radio business, with a market cap of Rs 1,136 crore.

However, the rare opening up and profiling by the magazine, whose readership is based largely in America suggests that the public issue could be at an exchange which values internet and new media businesses better, say analysts.

Sans serif, a blog that tracks media developments, said, “ The New Yorker  profile provides sufficient indication that the is poised for its long-promised Initial Public Offering, probably on NASDAQ.”

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