NDTV posts net loss of Rs 1.19 bn due to entertainment biz

MUMBAI: NDTV has posted a net loss of Rs 1.19 billion (Rs 119 crores) in Q2 FY 08-09 on account of its entertainment business, which is in its early growth phase. The decision to de-merge the news and entertainment business was taken some time back due to this reason.

After the de-merger of the business, every share of Rs 4 face value held in NDTV Ltd by the shareholder will be replaced by one Rs 4 face value share in the news company and one Rs. 4 face value share in entertainment company.
 The demerger will allow shareholders increased choice and flexibility to own either of these businesses or both. Additionally, 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.

NDTV earned consolidated revenues of Rs 1.28 billion (Rs 128 crores) during the quarter compared to Rs 775 million (RS 77.50 crores) during the same quarter in the previous year, thus reporting a growth of 65 per cent YoY.

In the entertainment space, the company is planning to launch a celebrity show and a range of soaps on NDTV Imagine. The company also launched a Bollywood focused channel – NDTV Showbiz in August. As has been already reported by Businessofcinema.com, its 24 hour world cinema channel – NDTV Lumiere was also soft-launched on 10 October.

In the lifestyle genre, NDTV Good Times continues to retain its #1 position. The channel has entered into and continues to further explore international syndication and distribution deals. Its also looking to cement a strategic partnership in the near future.

NDTV Convergence is also exploring various tie-up possibilities to expand its range of services.

NGEN Media Services, the MPO joint venture has started to witness a shift with potential clients moving from the pilot stage to becoming full-fledged paying customers. Highly successful relationships with two large international players have translated into full-fledged revenue generating contracts. Talks to expand the scope of work are on-going. NGEN currently has a strenght of 70 people, and is working on a range of projects: transcription production, creating master files (including sub-titling), end-to-end graphics work for web-sites, and post-production.

Update on the Emerging Markets business includes – the success of Awani channel in Malaysia. Awani’s Malaysian general elections’ coverage was recognized, across the local media as the most credible, in-depth, analytical election coverage ever shown in Malaysia. Consequently, Awani has built a formidable reputation for itself in Malaysia.

As per the company, NDTV Arabia is now amongst the most widely distributed Indian channels in the Middle East and North Africa region, and is available across 90 per cent of the Pay TV platforms in the region.

On the news front, the company currently has Rs 6.6 billion (Rs 660 crores) of cash in its books to meet any business expense requirements. The company expect some amount of consolidation going forward in the news coupled with a slowdown in advertisement revenue growth linked to the macro environment. The company has embarked on a cost cutting and rationalization exercise in its news operations.