Sun TV to invest Rs 150 cr for movie content business

Sun TV Network is planning to launch five more channels this fiscal. The Kalanithi Maran-run network is also planning to invest Rs 150-160 crore on acquiring movie content. Meanwhile, the company has set a target to increase its advertisement revenues 12-15 per cent during the present fiscal.

While addressing analysts, Sun TV’s management said the company has got license to launch a dozen channels and during the current fiscal five or six channels will be launched, focussing mainly on Southern languages, including one kid channel for Malayalam audience. Presently, the network has 20 channels across four south Indian languages of Tamil, Telegu, Kannada and Malayalam.

While ruling out a foray into Hindi general entertainment channel (GEC), the company has said it may look at other regions if it gets a good opportunity.

During the quarter-ended June 30, 2011, company’s revenue grew 3.08 per cent to Rs 453.99 crore as against Rs 440.44 crore, driven by revenues through advertisements. It may be noted, the company has increased advertisement rates by 12 per cent with effect from April 1, 2011.

“Though, during the first quarter non-GEC did not do well, in terms of advertisement revenues, pressure was more on those channels, we will continue to launch such channels. It is just taking a long time,” said the management.

Commenting on the company’s capex plan, the company it would invest Rs 150-160 crore on acquiring satellite rights for around 300 movies of which 30 per cent would be Tamil, said V C Unnikrishnan, chief financial officer, Sun TV.

The company noted, on an average around 100-110 movies are released in Tamil every year.

On the movie distribution, through the company’s arm Sun Pictures, the company said before September it would release two movies and another three or four movies in the next nine months. Revenue from the movies business dropped to Rs 22 crore from Rs 48 crore, a year ago.

“This was mainly due to a decrease in the number of movies and a reduction in ticket size of the movie,” said the management.

Meanwhile, the company has set a target of around Rs 80 crore of revenues this fiscal from abroad, which was around Rs 69 crore last fiscal. “We have gone for multi arrangements in countries like Sri Lanka, US, Canada and in West Asia, which would help increase revenues,” said the management.