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| NDTV: Cost side story |
| Shobhana Subramanian / Mumbai Sep 03, 2009, 00:54 IST |
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Broadcaster NDTV has been in news of late with reports that the promoters may dilute their stake doing the rounds. The stock has been somewhat volatile — after rising more than 150 per cent from the lows of March to Rs 184 in June, it moved down all the way to Rs 104 before recovering to Rs 181 in mid-August. Of course, the fact that the June quarter numbers came above the Street’s expectations has helped sustain the stock at Rs 150 levels.
 While consolidated revenues were up 9.4 per cent to Rs 130 crore, some serious checks on expenses helped the company restrict its operational losses to Rs 58 crore — the losses in the corresponding period last year were Rs 92 crore. The company is expected to further trim costs — analysts expect expenses for news operations to be lower by about Rs 50-60 crore a quarter.
With general elections having been held during the quarter, the news operations were expected to do well and the business posted an operating profit, though at the net level there was a loss of Rs 24 crore. While the Hindi news channel, NDTV India, did gain from election spends, it operates in a crowded segment.
As for the English news genre, the competition between the top three channels, CNN IBN, Times Now and NDTV 24x7, remains keen and therefore the performance of NDTV 24 x7 isn’t likely to be too exciting going ahead. The story is pretty much the same for the English business news segment, especially with the entry of ET Now; in any case, NDTV Profit was already feeling the pressure from CNBC TV 18. The Hindi general entertainment channel, NDTV Imagine, would have been impacted somewhat by the IPL cricket tournament as were its competitors such as Zee Entertainment.
Although viewership for the channel has improved — gross rating points(GRPs) are up at 125 points-plus — the channel remains way behind the top three, which manage to command GRPs of over 200 points. As such, it could be a while before NDTV Imagine starts making money.
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