|
| STAR India's revenue growth high but disappointing, says survey |
| Ashish Sinha / New Delhi Aug 22, 2009, 01:05 IST |
|
Which says it also remains quite profitable, with good medium-term prospects.
In what is considered a tough year for all broadcasters, STAR TV India, the media arm here of Rupert Murdoch’s
News Corporation, is estimated to have made revenue of around Rs 2,200 crore in the 2008-09 financial year, says a report prepared by Media Partners Asia (MPA), the international media research agency. STAR India follows a July to June calender.
This, according to industry sources gives STAR India a growth of 10 per cent in 2008-09. In 2007-08, it is said to have registered over 20 per cent growth. “MPA estimates indicate STAR India posted operating income of around $80 million (about Rs 400 crore) in the last fiscal year (2008-09) on sales of close to $440 million (about Rs 2,200 crore),” says the report.
The report terms STAR India’s growth as “disappointing” over the past year. “STAR’s India operations have been hit by intense competition in Hindi entertainment and an overall slowdown in the ad market, whose near-term recovery could be checked by a depressing monsoon season,” it says. According to MPA, STAR India’s operating income in 2007-08 was close to $95 million.
When asked, Uday Shankar, the STAR India CEO, declined to comment on the specific numbers. However, he said: “The year 2008-09 has been a tough year for everyone. There was negative subscription growth from analog cable, with the only silver lining coming in from the healthy growth of subscription revenue from the new Direct to Home platforms. However, even in a bad year we have seen growth.”
News Corporation recently announced the restructuring of its Asian operations into three distinct units — STAR India, STAR Greater China and Fox International Channels. STAR India is said to be the most profitable venture for Murdoch. After the restructuring, STAR India will operate 19 channels in eight languages.
According to industry sources, the overall advertising revenue of STAR India may have declined by around 7-8 per cent in 2008-09. However, its subscription revenue registered a high double-digit growth.
A STAR India insider says the company would have earned around Rs 850 crore-plus from subscription revenue in 2008-09, compared to around Rs 550 crore-plus in 2007-08, a jump of over 55 per cent, while maintaining its overall ad revenue for the 2009 fiscal.
The subscription revenue of rival firm Zee Entertainment Enterprises (ZEEL) for 2008-09 stood at Rs 904 crore, while it earned Rs 1,059 crore from advertising revenue. ZEEL follows the April to March financial year. Overall, the total revenue for ZEEL in 2008-09 stood at Rs 2,177 crore, a 19 per cent jump from 2007-08, thereby outperforming several media firms even in a tough year, says a media analyst.
According to Vivek Couto of MPA, “STAR India remains a highly profitable business, with decent growth exposure as it secures a national footprint with the launch of new regional entertainment channels. MPA analysts suggest that STAR India could be worth more than 1.6 billion in Ebitda (earnings before interest, taxes, depreciation and amortisation) by the financial year ending June 2013.”
This, according to Couto is based on more funding for its movie venture, Fox Star Studios, in India. MPA also predicts STAR India’s home shopping joint venture with Korea’s CJ Group will take shape, where both parties will invest $27.5 million each over three years.
|
|
|
|
|
|
|
|
|
|
 Read Business news in |  |
|
|
|
|
|
|
Advertisements |
|
|
|
|
|
|
|
|
|
|
Content Guide
