Market Research Report : FM Radio broadcasting market India 2013 by Netscribes, Inc.

FM Radio Broadcasting Market in India February 2013

Executive Summary

Market

 FM Radio Broadcasting, a sub‐set of Media and Entertainment is slated to grow at y1% y‐o‐y  The radio sector consists of ‐ private FM radio stations over and above the public service broadcaster All India Radio  Government’s recent approval of introducing Phase III auctions has opened avenues for more private channels to operate in this space

Drivers Drivers & Challenges

Trends

Challenges

E L P M

– Increase in FM penetration – Increase of advertising – Increase in usage of mobile phones – Demographical alterations – Political advertising – Introduction of new performance measurement tool

 Distribution of radio sets coming under welfare schemes  FM radios increase ambit to broadcast news  Rise of internet radio

– Lack of content differentiation – Presence of few channels

 Government to monitor content  Radio forms a part of religious missions across the country  FM radio in DTH services

Major Players

Competitive Landscape

Company 1

Company 2

Company 3

Company 4

Company 5

Company 6

FM RADIO BROADCASTING MARKET IN INDIA 2013.PPT

•Introduction Parent Industry FM Radio

•Market Overview •Phase III •Rural Scenario •Drivers & Challenges •Government Regulations •Trends •Competitive Landscape •Strategic Recommendations •Appendix FM RADIO BROADCASTING MARKET IN INDIA 2013.PPT

FM broadcasting is deemed as a highly profitable sector in the …

SAMPLE

FM Radio Broadcasting – Indian Market Overview (1/2) FM Radio – Market Size & Growth • The radio sector consists of ‐ private FM radio stations over and above the public service broadcaster All India Radio • AIR boasts of having the highest network of ‐ broadcasting centers with ‐ medium frequency (MW), ‐ high frequency (SW) and ‐ FM transmitters • Embargo on broadcasting news and current affairs has also been lifted • Limit for Foreign Direct Investment has also been raised from the earlier a1% to that of a2%

INR bn g a

2011

2012

2013e

FM Radio – Geographical Coverage

2014e

2015e

2016e

Private FM Stations – Growth

l h

2009

2010

2011

p1 0 2008 FM RADIO BROADCASTING MARKET IN INDIA 2013.PPT

Grant of FM radio channels has certain financial parameters that need to be adhered to

SAMPLE

Minimum Net Worth required as per city category in each region

m10

m11

m12

FM RADIO BROADCASTING MARKET IN INDIA 2013.PPT

… riding high on the adoption of mobile phones across the rural communities

SAMPLE

FM radio penetration in rural areas has been conditioned by prominent adoption of mobile phones • The penetration of mobile phones in rural market has ushered in a new lease of life to FM stations of All India Radio • Listeners’ base has been steadily increasing in the last 4‐5 years ever since mobile phone started having radio as an option • Apart from adding to the numbers, phones also created provisions for a two‐way communication between listeners and organizers during times of live phone‐in programmes Rural Wireless Subscribers in India (2012) mn

x y

Sep 2012

Oct 2012

A significant move in this respect will be the emergence of community radio that is designed to be for and by the community present across the rural boundaries in the country

FM RADIO BROADCASTING MARKET IN INDIA 2013.PPT

Drivers & Challenges – Summary

Drivers Increase in FM penetration Increase of advertising

Challenges

Increase in usage of mobile phones

Lack of content differentiation

Demographical alterations

Presence of few channels

Political advertising Introduction of new performance measurement tool

FM RADIO BROADCASTING MARKET IN INDIA 2013.PPT

Radio is considered to be a cheap medium of advertising as compared to print and electronic media Increase of advertising

Impact

• Radio advertising is considered as a cheap mode of advertising having several advantages • Advertising in radio is less expensive as compared to that of advertisements in newspapers or even television commercials • Radio carries a distinct benefit as compared with electric or branded advertisements since listeners attach a lot of importance owing to the incidence of repetition • Radio being the best local media available to connect with people even in far‐flung areas has made it a preferred medium for political parties • Gradual emergence of radio as an effective advertising medium has led to the growth of the FM broadcasting on the whole

E L P M A S

Radio Advertising in India – Growth INR bn x1 m

Radio Advertising Volume – Growth

r %

0 2011

2012e

2013e

2014e

2015e

2016e

Metros

FM RADIO BROADCASTING MARKET IN INDIA 2013.PPT

Non‐Metros 8

Government Participation – Summary

Ministry of Information and Broadcasting

Initiatives

Telecom Regulatory Authority of India

FM channels are warned against airing vulgar content

FM RADIO BROADCASTING MARKET IN INDIA 2013.PPT

Ministry of Information and Broadcasting forms the apex body that governs this sector

SAMPLE

Ministry of Information and Broadcasting • The Ministry of Information and Broadcasting plays a significant role in disseminating free flow of information through mass communication media comprising radio, television, films, press, publications, advertising and traditional mode of dance and drama • It forms the apex body for formulation and administration of rules and regulations and laws related to information, broadcasting, press and films • Is also responsible for international co‐operation in the field of mass media, films and broadcasting as also interacts with its foreign counterparts on behalf of the Indian Government

VISION O B J E C T I V E S

• Xx • Xx • Xx • Xx • Xx • Xx

• Yy • Yy • Yy • Yy • Yy • Yy • Yy

FM RADIO BROADCASTING MARKET IN INDIA 2013.PPT

Trends – Summary Distribution of radio sets coming under welfare schemes

FM radios increase ambit to broadcast news

Rise of internet radio Key Trends `

Government to monitor content

Radio forms a part of religious missions across the country

FM radio in DTH services FM RADIO BROADCASTING MARKET IN INDIA 2013.PPT

A latest concept that is slowly getting popularized is the emergence of internet radio

SAMPLE

Rise of internet radio • The internet radio has emerged as one of the fastest growing medium in the country as almost every medium hankers to get into the digital bandwagon • The rise of internet and mobile has compelled FM radio to look beyond their existing ambit and spread wings online • Internet radio comes as a huge relief from lack of content differentiation as it promises variety in music and non‐music content

• p3

• p1

• p2

• p4

• However, a big reason of concern for internet radio is the access to bandwidth • Since broadband connection is always is needed for internet radios and while it can work on computers, it cannot work too well on mobile devices FM RADIO BROADCASTING MARKET IN INDIA 2013.PPT

SAMPLE

Public: Domestic Company – Company 1 (1/4) Company Information

Offices and Centres – India

Corporate Address Tel No. Website Year of Incorporation Ticker Symbol Stock Exchange India Head Office

Products and Services Category

Products & Services

Products/Services

Key People Name

Designation

Person 1

Person 2

Person 3

D3 Note: The list of products and services is not exhaustive

FM RADIO BROADCASTING MARKET IN INDIA 2013.PPT

SAMPLE

Public: Domestic Company – Company 1 (2/4) Financial Snapshot

Key Ratios

Total Income

Revenue INR mn

Profit INR mn

Net Profit/Loss m

0 2009

2010

Financial Summary

2011

2012

• The company incurred a net profit of INR x1 mn in FY 2012 and INR x2 mn in FY 2011 • The company reported total income of INR x3 mn in FY 2012, registering a decrease of x4% over FY 2011 • The company earned an operating margin of x5% in FY 2012 an increase of x6 percentage points over FY 2011 • The company reported debt to equity ratio of x7 in FY 2012, a decrease of x8% over FY 2011

Key Financial Performance Indicators Indicators Market Capitalization (INR mn) Total Enterprise Value (INR mn) EPS (INR) PE Ratio (Absolute)

Value (dd/mm/yyyy) ‐ ‐ ‐ ‐

Particulars

y‐o‐y change (2012‐11)

2012

2011

2010

2009

Profitability Ratios Operating Margin Net Margin Profit Before Tax Margin Return on Equity Return on Capital Employed Return on Working Capital Return on Assets Return on Fixed Assets

6.84

20.93%

14.09%

‐1.10%

‐13.55%

13.67

17.37%

3.70%

‐3.56%

‐13.60%

15.75

24.56%

8.81%

‐4.52%

‐16.49%

5.51

8.76%

3.25%

‐3.74%

‐14.47%

‐1.65

14.96%

16.61%

‐1.15%

‐12.08%

10.69

20.03%

9.33%

‐14.82% ‐45.34%

7.12

10.77%

3.65%

‐2.64%

69.87

95.26%

25.39%

‐11.15% ‐37.35%

‐7.62

78.26%

85.88%

101.12% 114.08%

14.96

29.74%

14.77%

15.01%

22.14%

‐0.76

0.00%

0.76%

3.17%

3.92%

‐8.93%

Cost Ratios Operating costs (% of Sales) Administration costs (% of Sales) Interest costs (% of Sales)

Liquidity Ratios Current Ratio Cash Ratio

48.67%

5.07

3.41

1.62

1.75

137.44%

3.32

1.40

0.36

0.51

‐22.87%

0.13

0.17

0.41

0.62

N.A.

0.08

0.23

N.A.

18.49

‐0.35

‐3.59

‐22.93%

5.28

6.85

3.08

2.64

‐39.39%

0.60

0.98

0.73

0.63

‐49.94%

0.89

1.78

1.57

1.37

‐55.93%

1.11

2.52

4.09

3.21

‐44.65%

0.49

0.88

1.03

1.02

Leverage Ratios Debt to Equity Ratio Debt to Capital Ratio Interest Coverage Ratio

Efficiency Ratios Fixed Asset Turnover Asset Turnover Current Asset Turnover Working Capital Turnover Capital Employed Turnover

Improved

FM RADIO BROADCASTING MARKET IN INDIA 2013.PPT

Decline

SAMPLE

Public: Domestic Company – Company 1 (3/4) Key Business Segments

Key Geographic Segments

b1 c1

b2 c2

b3 c3

2009

2010

2011

2012

2009

2010

2011

2012

Key Recent Developments (1/2) Description

Details

Overview

• Operates under y1 and was founded when y2FM frequencies in y3 cities of India were auctioned by the Government • Has presence in y4cities across India including y5, y6, y7, y8 • Has posted a net profit of INR y9 mn for the quarter ended Sept2012 as compared to the net profit of INR y10 mn earned in the corresponding period a year ago

FM RADIO BROADCASTING MARKET IN INDIA 2013.PPT

SAMPLE

Public: Domestic Company – Company 1 (4/4) Key Recent Developments (2/2) Description

Services

Recent Update

News • Besides operating as a terrestrial radio station, it has ventured into internet radio through a partnership with y11, the online music portal of y12 • Have also earned a name in being the leaders in awareness and recall in Dubai, Abu Dhabi, Sharjah and Al Ain as per their internal research • Has hosted a premiere night of y13 and y14 which is one of India’s biggest hunts for aspiring DJs  The contest aims at bringing the best out of DJs as they are required to mix beats in a thematic contest

FM RADIO BROADCASTING MARKET IN INDIA 2013.PPT

SAMPLE

Private: Domestic Company – Company 2 (1/3) Company Information

Offices and Centres – India

Registered Address

Tel No. Website Year of Incorporation Registered Address

Products and Services Category Services

Products/Services FM Broadcasting

Key People Name

Designation

Person 1

Person 2

Person 3

FM RADIO BROADCASTING MARKET IN INDIA 2013.PPT

SAMPLE

Private: Domestic Company – Company 2 (2/3) Financial Snapshot Total Income INR mn e

Key Ratios

Total Income Profit / Loss f

Profit INR mn

Particulars

y‐o‐y change (2011‐10)

2011

2010

2009

2008

Profitability Ratios Operating Margin Net Margin Profit Before Tax Margin Return on Equity Return on Capital Employed Return on Working Capital Return on Assets Return on Fixed Assets

6.57

7.99%

1.42%

‐3.38%

‐0.93%

7.31

3.82%

‐3.49%

‐8.02%

‐3.93% ‐3.48%

7.31

3.82%

‐3.49%

‐7.37%

56.86

26.41%

‐30.45%

‐59.46% ‐16.85%

25.31

33.16%

7.85%

‐31.97% ‐13.67%

34.30

20.07%

‐14.24%

‐41.18% ‐26.34%

12.71

6.62%

‐6.09%

‐15.69%

59.56

33.66%

‐25.89%

‐59.81% ‐26.22%

‐6.57

92.01%

98.58%

103.38% 100.93%

N.A.

‐0.74

4.18%

4.91%

3.99%

2.54%

‐8.04%

Cost Ratios 2008

2009

2010

2011

Financial Summary

Operating costs (% of Sales) Administration costs (% of Sales) Interest costs (% of Sales)

• Company incurred a net profit of INR ‐ mn in FY 2011, as compared to net loss of INR ‐ mn in FY 2010

Liquidity Ratios

• It reported total income of INR ‐ mn in FY 2011, registering a decrease of ‐% over FY 2010

Leverage Ratios

• Earned an operating margin of ‐% in FY 2011, an increase of ‐ percentage points over FY 2010 • The company reported a debt to equity ratio of ‐ in FY 2011, a decrease of ‐% over FY 2010

Current Ratio Cash Ratio Debt to Equity Ratio Debt to Capital Ratio Interest Coverage Ratio

‐3.51%

1.57

1.62

1.48

1.36

46.55%

0.94

0.64

0.51

0.54

‐25.34%

2.98

4.00

2.79

1.09

‐6.36%

0.75

0.80

0.74

0.52

561.51%

1.91

0.29

‐0.85

‐0.37

Efficiency Ratios Fixed Asset Turnover Asset Turnover Current Asset Turnover Working Capital Turnover Capital Employed Turnover

18.98%

8.82

7.41

7.46

6.68

‐0.42%

1.735

1.742

1.96

2.05

21.46%

1.90

1.57

1.67

1.76

28.96%

5.26

4.08

5.14

6.71

‐20.61%

6.92

8.72

7.42

4.29

Improved

FM RADIO BROADCASTING MARKET IN INDIA 2013.PPT

Decline

SAMPLE

Private: Domestic Company – Company 2 (3/3) Key Recent Developments Description

News • Is an undertaking of the g1 and started off initially as a talk‐based FM Radio Channel in India

Overview

• Formerly it was known as g2 which broadcast in major cities namely g3, g4 • Sept ‐ witnessed the change of its name to g5 as also to a different format

Services

• Boasts of being ahead than Big FM in terms of the latest RAM ratings in Delhi

Recent Update

• Has tied up with g6 that provides shelter to unprivileged girls and has managed to organize events wherein Bollywood actors have participated • Has also launched a Bollywood based content segment designed especially for fans who are foodies named g7 • Has recently started its hunt to find the new voice of Mumbai wherein it is providing a platform for fresh radio talent to demonstrate their wit, communication skills and entertain the city through the g8 in Mumbai  The winner of this RJ Hunt will be provided with an opportunity to become a professional RJ with g9

FM RADIO BROADCASTING MARKET IN INDIA 2013.PPT

SAMPLE

Regional Players (2/4) Company 3

Key People

Corporate Information

Name

Registered Address Tel No.

Designation

‐

Website Year of Incorporation

Business Highlights • Is a commercial FM wing of the media conglomerate of z1 • Is available in the frequency of z2 and has presence in z3 states of z4, z5, z6, z7 • Follows the format of CHR (Contemporary Hit Radio) format wherein it focuses on belting out the latest and best commercial hits  The playlists include Bollywood, Bhangra and hit local music

• Has also launched a reality show z8 across its nine stations wherein it looks at finding potential singers of tomorrow

FM RADIO BROADCASTING MARKET IN INDIA 2013.PPT

SAMPLE

Other Players (1/4) Company

Company 4

Company 5

Company 6

Company 7

FM Frequency

No. of Stations

Business Description

• It broadcasts in ‐ • It also offers – • It is promoted by ‐publications in ‐

• It is based in ‐ • Its on‐air presentation language of the station is in ‐ and is the only private station to do so • All the radio content are based on extensive research from local research studies and its ‐ pre launch campaign

• ‐ started its service on ‐ • It is a private FM radio station for the state of ‐, operated by the ‐ • Services in ‐, ‐

• It is an educational FM radio station in several cities of India • Operate as ‐ with day‐to‐day programmes contributed by educational institutions, NGOs, government and semi‐ government organizations, UN agencies, Ministries • Medium of broadcast is English, Hindi or regional language • Broadcasts through radio network of ‐

FM RADIO BROADCASTING MARKET IN INDIA 2013.PPT

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