NDTV has earned consolidated revenues of Rs 128 crore during the second quarter ended September 30 in FY09, as compared to Rs 77.50 crore during the corresponding of the previous fiscal, a growth of 65 per cent year-on-year. However, the media conglomerate has reported a net loss of Rs 119 crore on account of the entertainment side of the business being in its early growth phase. Last year’s figures for the same are not comparable.
It may be recalled that on October 1, 2008, the NDTV Board had decided to split NDTV into two groups of companies – one group of companies would carry out ‘News and other businesses’, while the other group of companies would carry out ‘Entertainment and specified allied businesses’.
The demerger will allow shareholders increased choice and flexibility to own either of these businesses or both. More importantly, no regulatory restrictions on FII/ FDI investment in the entertainment media will enable the company to bring in strategic partners for businesses in any/all the non–news businesses.
On the news front, NDTV claims to have maintained leadership in English news genre and grown in revenue. A company release states that NDTV 24x7 and MetroNation Delhi continue to enjoy leadership positions in their respective genres, while NDTV Profit has maintained its market share despite more competition in the segment.
The company expects some amount of consolidation going forward in the news genre, coupled with a slowdown in ad revenue growth linked to the macro environment. NDTV has also embarked on a cost cutting and rationalisation exercise in its news operations.
On the entertainment front, NDTV Imagine Films is in the process of developing and producing various scripts. NBC Universal’s films division is a potential partner for this venture going forward.
The company has observed that there is considerable churn in the GEC space. Traditional leaders have witnessed a significant drop in ratings. Consequently, the market is now shifting from the earlier structure of a dominant player with a distinctly high rating to many players having ratings in the similar broad range.
Other channels in focus are GEC NDTV Imagine and Bollywood-focused channel NDTV Showbiz, which was launched in August this year.
NDTV Board approves demerger of news business