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Hindustan Media Ventures announces IPO; to raise Rs 300 cr from the market

Hindustan Media Ventures announces IPO; to raise Rs 300 cr from the market

Author | Preeti Hoon | Friday, Apr 30,2010 8:10 AM

Hindustan Media Ventures announces IPO; to raise Rs 300 cr from the market

Hindustan Media Ventures Ltd (HMVL), one of India’s leading print media companies with publications such as ‘Hindustan’, has announced its IPO. Speaking to exchange4media, Benoy Roychowdhury, Executive Director, Hindustan, said, “We are planning to raise around Rs 300 crore through this IPO. We have already filed a draft Red Herring prospectus and are in the process of sharing the same with the Securities and Exchange Board of India (SEBI). The moment we get the clearance, we would enter the market in around the next two months when the IPO would be officially announced.”

The money raised from the IPO would be used to clear company’s liabilities, while the rest would be kept aside for investment purpose.

“Part of the money will be used to retire our debt of near about Rs 135 crore and thereby we will become a totally debt-free company. A bit of it will be invested in expanding the existing markets and rest to enter new markets,” Roychowdhury informed.

On being asked why an IPO at this point of time, Amit Chopra, CEO, Hindustan, replied candidly, “We need funds and I think markets are tracking well. The business is at a pretty good position at this point of time and we will be able to accelerate our growth. Two and a half months, when we launch the IPO, are subjected to markets remaining on track.”

The company will focus on north India, as according to their studies, there is still a lot to be tapped and the market potential is vast.

Said Chopra, “North India, especially Delhi and NCR, continues to grow well, maybe not as fast as other Hindi heartland markets, but it has a sizeable advertising market, which is about Rs 1,200 crore or more. In terms of readership, the number of English newspapers is higher, however, Hindi continues to grow and is quite a large market.”

Hindustan Media Ventures Ltd also owns, a Hindi news portal that reaches a selective audience. On how the company plans to use that sphere, Chopra explained, “ is a news portal. As of now, the business opportunity is limited due to its single language proposition, that is, Hindi, and there’s no language website, which is very large at the moment. But we are there in that space and we have the capability to scale it up further. We recognise that in the times to come, it will become important and we will ramp up accordingly. We know the future lies there, but at this point of time, the opportunity is in growing our print product.”

Hindustan is the third largest daily newspaper in India with a readership of 9.3 million (Source: IRS, R2 2009). Hindustan Media Ventures Ltd also publishes two Hindi magazines – ‘Nandan’, a children’s magazine, and ‘Kadambini’, a general interest magazine.

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