Media and Entertainment Track

Transcription

1 1 2 T H 2 6 T H O C T 1 2 R e s e a r c h 4 I n d i a U p d a t e o n t h e I n d i a n M & E I n d u s t r y In The Spotlight Contents Bring On H2FY13!!! The first half of FY13 looks better than expected, as per the results that have come so far. The listed leader Zee grew 34% in second quarter and 27% in the first half boosted equally by advertising and subscription revenues. While the subscription growth was expected on account of ongoing digitisation 85% achieved in metros, the robust growth in advertising revenues reflects well for the industry overall. In fact most of media stocks have reported a growth in revenues in H1. Zee also reported a healthy growth in profits, though Print continues to struggle. Latest CII-PwC report has pegged industry s growth over next five years at a CAGR of 17% driven by advertising spend, consumer spend, infrastructure and policy support. Among the top corporate advertisers, HUL, Dabur and Colgate have declared their results. All three have increased their advertising and promotion expenses, boding well for the media sector which is still dependent on advertising for more than half of its revenues. Advertising/ Publicity expense H1 FY13 Increase YoY As a percent of sales H1FY12 H1FY13 HUL 24% 11.5% 12.5% Dabur 47% 11.3% 13.7% Colgate 27% 10.4% 11.1% The optimism was shared by investors in the sector when a lacklustre September was followed by 5 PE deals and 3 M&A deals in October, with a disclosed amount of over $169mn. Watch out for this space as further story unfolds on the year gone by. News of the fortnight 1 Investment Activity 2 News Update 4 Stock Market Updates 6 Peer Benchmarking 6 About Four-S Services 7 About Research4India Research4India is the research services arm of Four-S Services Pvt Ltd. Here we provide regular research reports on key sectors of the Indian economy, and large unlisted companies in these sectors. These reports will be available on our upcoming site as well as from leading international research sellers like Thomson Reuters, Bloomberg, Research and Markets, CapitalIQ etc. Research4India is the research services arm of Four-S Services Pvt Ltd, a leading provider of high-end research, financial consulting and Investment banking services. For subscription / custom queries, please contact Seema Shukla at seema@four-s.com

2 Investment Activity PE Deals in M&E in 2012 Date Investor Target Stake Amount Strategy (%) ($mn) 25-Oct Nokia Growth Partners, Ojas Venture Vizury Interactive NA 9.0 Growth Partners and Inventus Capital Partners 11-Oct Standard Chartered Private Equity Prime Focus PIPE 11-Oct Everstone Capital S. Chand & Company Growth 3-Oct Intel Capital Hungama.com NA NA Late 24-Sep Navis Capital Reliance Mediaworks NA Growth Malaysian exhibition biz 23-Aug Accel Partners Big Tree Entt. NA 18.0 Growth (BookMyShow) 24-Aug JAFCO Asia Bubble Motion NA 5.0 Early 9-Aug Das Star Ventures SideFX Entertainment NA 1.0 Early 7-Aug Mercatus Capital, Hub Media PurpleStream NA NA Early 1-Aug L Capital PVR, subsidiary NA 19.6 PIPE 16-Jul Indian Angel Network, Blume HashCube Technologies Early Ventures NA NA 11-Jul Jungle Ventures, Others Mobikon Early NA Jul Matrix Partners Twist Mobile India NA NA Early 26-Jun Nalanda Capital DB Corp PIPE 12-Jun Norwest Venture Partners,Helion Komli Media NA 39.0 Growth Venture Partners, Draper Fisher Jurvetson, and Western Technology Investment 6-Jun August Capital, Draper Fisher Pubmatic NA 45.0 Mezzanine Jurvetson, Nexus Venture Partners, Helion Ventures and Silicon Valley Bank 9-May IndoUS Ventures Magzter NA NA Early 26-Apr Mumbai Angels, Blume Ventures, United Mobile Apps NA 1.0 Early India Venture Partners (Mauritius), Christopher Preinz Associates (EU) 18-Apr Future Ventures Amar Chitra Katha 9.8 NA Late 27-Mar Nirvana Ventures Advisors Games2win 10.0 NA Late 13-Mar Providence Equity, Macquarie Bank Hathway Cable Late 20-Feb Ojas Venture Partners BrizzTV Media Lab NA NA Early 17-Feb Updata, WestBridge & Intel Capital July Systems NA 15.0 Late 15-Feb Cisco Systems Qyuki Early 8-Feb Indian Angel Network Gamiana Digital Gaming NA 1.0 Early 31-Jan Ojas Ventures Venturenet Partners Pvt NA NA Early Ltd 27-Jan NA InRev NA NA Early 19-Jan CCube MyAdCorner.com NA NA Early 19-Jan Sequoia Capital Knowlarity Communications NA 6.6 Growth The space saw 29 deals till date raising a total disclosed amount of $319.7mn. Research4India 2

3 Mergers & Acquisitions in M&E in 2012 Date Acquirer Target Stake (%) Amount ($mn) 25-Oct Sun TV Network Hyderabad IPL team franchise NA 80 Domestic 10-Oct Kamla Landmarc Deccan Chargers NA NA Domestic 03-Oct What s On India What s On Arabia NA NA Outbound Type Digital Domain and Mothership Outbound 24-Sep Reliance Mediaworks 29-Aug Dentsu Inc. Taproot India Communication 51 NA Inbound 23-Aug Spade Financial Services Connectindia.in 100 NA Domestic 09-Aug Aegis Group Communicate 2 Pvt Ltd 100 NA Inbound 07-Aug Publicis Groupe Resultrix Media Pvt Ltd 100 NA Inbound 31-Jul InMobi Metaflow Solutions 100 NA Outbound 25-Jul Platinum Rye Entertainment Globosport Brand Advisory 50 NA Inbound 17-Jul Information TV Media NewsX NA NA Domestic 13-Jul InMobi MMTG Labs 100 NA Outbound 2-Jul Disney Interactive Media Gameshastra - studio NA NA Inbound 27-Jun ValueFirst Messaging mginger 100 NA Domestic 15-Jun Sony Pictures Multi-Screen Media Inbound 13-Jun JWT Singapore Hungama Digital Services Private Limited 51 NA Inbound 07-Jun NewsCorp ESPN Star Sports 50 NA Inbound 05-Jun ValueFirst Messaging Indyarocks.com NA NA Domestic 25-May Essel Group Diligent Media Corp - DB 50 NA Domestic Corp's stake 23-May ValueFirst Messaging Way2SMS NA NA Domestic 19-May AV Birla Group India Today 27.5 NA Domestic 17-May Trivone Digital Chakpak NA NA Domestic 26-Apr CA Media, Zodius Advisors Only Much Louder NA NA Inbound 26-Apr CA Media Endemol India 49 NA 25-Apr Eros International Plc B4U Television Network Domestic 24-Apr Publicis Groupe Indigo Consulting NA NA Inbound 05-Apr Tyroo media, Inflection Digital DGM India Domestic 02-Apr Jagran Prakashan Nai Dunia Media Pvt Ltd NA NA Domestic 30-Mar Inox (Gujarat Fame India Domestic Fluorochemicals) 30-Mar Affle, D2 Communications MobiMasta NA NA Inbound 21-Mar Gruner + Jahr NetworkPlay 70 NA Inbound 15-Mar Ver Se Innovation Eterno Infotech NA NA 13-Mar Pubmatic MobiPrimo 100 NA Domestic 29-Feb Komli Media AdMax Network NA NA Outbound 10-Feb GigaOM Guardian News & Media - NA NA Inbound PaidContent, other assets 03-Feb Persistent Systems Openwave Location Business 100 NA Domestic 02-Feb Walt Disney UTV Software NA 430* Inbound 25-Jan Gujarat Telelinks V&S Jan Reliance Strategic DEN Networks 1.1 NA Domestic Investments 04-Jan Way2Online 160by2 100 NA Domestic 03-Jan Network 18 Group Eenadu NA 395 Domestic 02-Jan Undisclosed buyer Balaji Telefilms - education/ NA 1.6 Domestic mobile *Estimated. The space saw 43 deals till date with a total disclosed amount of $1,266mn. Research4India 3

4 Corporate News Update Sun TV buys Hyderabad IPL team The Sun Television Network has won the bid for Hyderabad IPL team franchisee for a fee of $16mn p.a. for the first five years. The deal marks Sun NW s entry into a national sports property, it already has national presence through its FM network. The erstwhile Deccan Chargers team was on sale as a result of liquidity crisis of its previous owner Deccan Chronicle Holdings. Deccan Chronicle had bid $107mn for 10 years for the team in Deccan Chronicle had sold the franchise to Kamla Landmarc in early October, post which BCCI had cancelled the franchise and invited bids. The only other bidder was PVP Ventures at ~$13mn p.a. Vizury Interactive gets $9mn in Series B Vizury Interactive has raised $9mn in Series B funding from Nokia Growth Partners, Ojas Venture Partners and Inventus Capital Partners. Vizury is a Bangalore based digital marketing technology company with global presence across 14 countries and has leading e- commerce and online travel firms as its clientele. The funding would be used to further strengthen its global presence and into R&D. Vizury had raised angel round in 2009 and Series A round in CCI nod to Fame-Inox merger. The Competition Commission of India (CCI) has approved the merger of Fame India and its three subsidiaries with Inox Leisure Ltd. CCI termed the deal as internal restructuring. Inox has 70.69% stake, and its parent company Gujarat Flurochemicals Ltd has 3.68% stake in Fame India. Inox had used the March 2012 rights issue of Fame India to increase its stake. CII-PwC: Industry Indian News M&E Update to be Rs1.75tn by 16 India s M&E is the fastest growing in the world at a CAGR of 17% and would touch Rs 1.75tn by 2016 according to the latest Media Outlook report by CII-PwC. In its last year s report, it had pegged growth at a CAGR of 13.2%. PwC expects the internet to outshine print by 2014, being the fastest growing segment with 57% growth in Advertising contributed 35% in 2011, but ad Spend as a percent of GDP remain very low at 0.3% compared to other countries. The average annual spend per capita is also a low of $7 versus $22 in China and $65 in Brazil. 85% digitisation in metros 85% digitisation has been achieved in four metros according to the Information and Broadcasting Industry. Mumbai leads with ~100% digitisation, followed by Delhi at 83%, Kolkata at 82%, and Chennai at 61% digitisation. These figures are only of the cable households, and if DTH is included, overall digitization is higher at 90%. I&B Ministry also said that in the last week to the digitisation deadline, number of Set Top Boxes installations in four metros has risen to ~50,000 boxes per day and that of DTH connections has risen to 8,000 boxes per day. However, cable operators challenged the figure, and said the subscriber base was lowered to show a higher penetration level. Meanwhile ratings agency TAM has suspended its reports for two months from October 7- December 8 in the switchover period. FICCI-Deloitte: South India M&E over Rs 360bn by FY16 A FICCI-Deloitte report on South India s M&E industry pegs it to be Rs 360bn by FY16 growing at a CAGR of 14% and accounting for 36% of India s M&E industry. Tamil Nadu is the biggest market with 36% share, followed by Andhra Pradesh (31%), Karnataka (19%) and Kerala (14%). Among segments, Television leads with 58% share, followed by print (30%), film (11%) and radio (2%). Radio would be the fastest growing segment at 22% CAGR. Research4India 4

5 Stock Market Update Share Price Performance As on 26th Oct 2012 Market Cap Price Percentage Change (%) P/E Top 20 media stocks (In ` mn) (In ` ) 1W 1M 3M 6M 12M (ttm) Zee Entertainment 1,75, % 0% 15% 48% 56% 27.4 Sun TV Network 1,25, % -6% 22% 13% 25% 18.8 Dish TV India 77, % -11% 7% 19% -4% NM TV18 Broadcast* 45, % 14% 54% 14% -34% NM DB Corp 38, % 6% 6% 3% -5% 19.9 Hathway Cable 32, % 4% 24% 43% 96% NM JagranPrakashan 31, % 10% 14% 1% -7% 16.0 Den Networks 24, % 12% 55% 68% 128% 96.6 HT Media 23, % 10% 20% -22% -30% 16.5 Eros International 14, % -1% -1% -13% -38% 9.5 ENIL 11, % -5% 16% 11% -9% 18.6 Siti Cable 9, % -1% 19% 111% 156% NM Hindustan Media 9, % -2% 3% -12% -9% 13.7 Prime Focus 7, % -9% 12% -2% -12% 7.6 PVR 6, % 19% 39% 51% 77% 36.8 INOX Leisure 4, % 21% 45% 40% 39% 47.7 TV TodayNetwork 4, % 10% 33% 29% 25% 43.2 NDTV 4, % -3% 38% 60% 41% NM Balaji Telefilms 3, % 10% 37% 15% 62% 16.4 Reliance Broadcast 3, % -16% 1% -16% -37% NM Nifty % 0% 12% 9% 9% Sensex % 0% 12% 9% 8% Financial Benchmarking Quarter ending 30 th September, 2012 Revenue EBITDA PAT Q2FY12 Q2FY13 YoY Q2FY12 Q2FY13 YoY Q2FY12 Q2FY13 YoY Zee Entertainment 7,128 9,535 34% 2,020 2,176 8% 1,598 1,877 17% Dish TV* 4,849 5,336 10% 1,317 1,557 18% NM DB Corp 3,509 3,784 8% % % Jagran Prakashan* 3,054 3,221 5% % % HT Media 4,889 5,107 4% % % SitiCable % % NM Hindustan Media 1,528 1,592 4% % % INOX Leisure 1,140 1,371 20% % % * Standalone results Figures in Rs.`mn Research4India 5

6 Half-year ending 30 th September, 2012 Revenue EBITDA PAT H1FY12 H1FY13 YoY H1FY12 H1FY13 YoY H1FY12 H1FY13 YoY Zee Entertainment 14,112 17,965 27% 3,582 4,509 26% 2,935 3,458 18% Dish TV* 9,483 10,536 11% 2,541 3,212 26% NM DB Corp 7,481 7,553 1% 1,678 1,629-3% 1, % Jagran Prakashan* 6,101 6,396 5% 1,617 1,570-3% 955 1,252 31% HT Media 9,834 10,006 2% 1,602 1,234-23% 1, % SitiCable 1,691 2,051 21% % NM Hindustan Media 3,009 3,187 6% % % INOX Leisure 2,143 2,550 19% % % * Standalone results Figures in Rs.`mn Trailing twelve months ending 30 th September, 2012 Revenue (ttm) EBITDA (ttm) PAT (ttm) Company Q2FY12 Q2FY13 YoY Q2FY12 Q2FY13 YoY Q2FY12 Q2FY13 YoY Zee Entertainment 30,315 34,258 13% 8,045 8,323 3% 6,752 6,415-5% Dish TV* 17,545 20,632 18% 4,111 5,655 38% -1,492-1,447 NM DB Corp 14,137 14,587 3% 3,622 3,299-9% 2,236 1,934-13% Jagran Prakashan* 11,787 12,740 8% 3,230 2,879-11% 1,889 1,984 5% HT Media 19,090 20,187 6% 3,323 2,501-25% 1,996 1,435-28% SitiCable 3,321 3,788 14% % NM Hindustan Media 5,586 6,160 10% % % INOX Leisure 3,812 4,503 18% % % * Standalone results Figures in Rs.`mn Research4India 6

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