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Sun TV sees ad revenue picking up in Q2 of FY21 on improved viewership

The Sun TV channel has seen its gross rating points (GRPs) rise to 1,600 in the Pongal festival in January, from less than 1,000 in June 2019

Gireesh Babu  |  Chennai 

Ad revenues, digitisation to drive Sun TV's earnings in next 2 years
Advertisement revenue for the company stood at about Rs 341 crore during the quarter ended December 2019, up from Rs 337 crore during the immediately preceding quarter | File photo

Kalanithi Maran-promoted Network is expecting its to pick up in the second or third quarter of the next financial year. was impacted due to the economic slowdown, among others factors.
Analysts say the viewership share recovery as well as monetisation of the OTT platform, Sun NXT, would be the silver lining amid weak economic growth and uncertainty on subscription numbers.
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The for the company stood at around Rs 341 crore during the quarter ended December 31, 2019. It was around Rs 337 crore during the quarter ended September 2019.
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Commenting on the expectations, the company management, in a recent earnings call with analysts, said the advertisement revenue has been seeing an uptick. This is on the back of improvement in viewership.
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It added that if it is able to maintain the momentum, it would see ad revenue growth.
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Overall, the company is seeing some growth in the spend levels, which should see some positive results in the second and third quarter of the next fiscal year.
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Its Tamil General Entertainment Channel, Sun TV, has seen a growth to around 1,600 Gross rating point or GRPs in January (during the Pongal festival), compared to less than 1,000 points in June 2019.
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Analysts from ICICI Direct have said, “The weak macroeconomic growth clouds the ad growth outlook in the near term. Also, the NTO 2 (the new tariff order) will see some uncertainty on subscription growth. The silver lining, on the other hand, is viewership share recovery as well as SunNXT digitisation.”
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Among positives, the flagship Tamil channel has gained 5-6 percentage points in market share gain in the last seven to eight months to 47 per cent in January, 2020. The company expects benefits of the same to kick in with a lag, said the analysts. It is also aiming at regaining its marketshare in Tamil Nadu, its home turf. It hopes to grow to a market share of over 50-52 per cent in the language in the near future.
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The market share in Tamil has reached 47 per cent in January from below 40 per cent till June, last year.
This is owing to some big festivals where it pushed attractive content and strong movie line up.
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Sun NXT has seen subscriptions reaching about 15 million people and it has started making profits, S L Narayanan, chief financial officer (CFO) of Sun Group, told analysts.
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The company earlier announced plans to invest Rs 150 crore between October 1, 2019, and March 2021 in the platform, but it is yet to start spending from this investment and the current growth is even without this investment.

First Published: Tue, March 10 2020. 17:21 IST
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