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Media and Entertainment Track Research4I nd ia Updat e o n t he I nd ian M&E Indus t r y

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In The Spotlight Contents

Good times ahead for Distribution

This fortnight infused a fresh life into Indian economy

as well as Indian media sector, with the Government

executing much delayed positive reforms.

The Government has hiked FDI in DTH, Cable and

other broadcasting services including mobile TV to

74% from existing 49%. The move will provide a

boost to digitisation process, with MSOs benefitting

most from the revised FDI limits. The first deadline

for Digitisation in four metros is 31st October, 2012.

However, the industry had mixed response to the

hike, many desiring more liberalised policies like

lower taxation and more conducive business

environment for the limit increase to actually be

utilized.

Digitisation would be a transformative trigger for

Indian broadcasting industry. In a recent release,

UBS estimates subscription revenues to grow at a

CAGR of 16% over 2012-17 due to digitisation.

FICCI-KPMG had estimated TV subscription revenues

to grow at a CAGR of over 18% from 2011-16 to

reach Rs 505bn in 2016.

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

www.research4india.com, as well as

from leading international research

sellers like Thomson Reuters,

Bloomberg, Research and Markets,

CapitalIQ etc.

Media and Entertainment Track

Research4India 2

Investment Activity

PE Deals in M&E in 2012

Date Investor Target Stake (%)

Amount ($mn)

Strategy

23-Aug Accel Partners Big Tree Entt. (BookMyShow)

NA 18.0 Growth

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

Ventures

HashCube

Technologies NA NA

Early

11-Jul Jungle Ventures, Others Mobikon NA 1.7

Early

6-Jul Matrix Partners Twist Mobile India NA NA Early

26-Jun Nalanda Capital DB Corp 1.09 7.3 PIPE

12-Jun Norwest Venture Partners,Helion

Venture Partners, Draper Fisher

Jurvetson, and Western

Technology Investment

Komli Media NA 39.0 Growth

6-Jun August Capital, Draper Fisher

Jurvetson, Nexus Venture

Partners, Helion Ventures and

Silicon Valley Bank

Pubmatic NA 45.0 Mezzanine

9-May IndoUS Ventures Magzter NA NA Early

26-Apr Mumbai Angels, Blume Ventures,

India Venture Partners

(Mauritius), Christopher Preinz

Associates (EU)

United Mobile Apps NA 1.0 Early

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 17.3 72.0 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 17.0 5.5 Early

8-Feb Indian Angel Network Gamiana Digital

Gaming

NA 1.0 Early

31-Jan Ojas Ventures Venturenet Partners

Pvt Ltd

NA NA Early

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 24 deals till date raising a total disclosed amount of $237.7mn.

Media and Entertainment Track

Research4India 3

Mergers & Acquisitions in M&E in 2012

Date Acquirer Target Stake

(%) Amount ($mn)

Type

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 32 271 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 Corp's stake

50 NA Domestic

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 76 53.1 Domestic

24-Apr Publicis Groupe Indigo Consulting NA NA Inbound

05-Apr Tyroo media, Inflection Digital

DGM India 94.6 0.7 Domestic

02-Apr Jagran Prakashan Nai Dunia Media Pvt Ltd NA NA Domestic

30-Mar Inox (Gujarat Fluorochemicals)

Fame India 18.7 18.2 Domestic

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 - PaidContent, other assets

NA NA Inbound

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 51 0.2

19-Jan Reliance Strategic Investments

DEN Networks 1.1 NA Domestic

04-Jan Way2Online 160by2 100 NA Domestic

c03-Jan Network 18 Group Eenadu NA 395 Domestic

02-Jan Undisclosed buyer Balaji Telefilms - education/ mobile

NA 1.6 Domestic

*Estimated. The space saw 40 deals till date with a total disclosed amount of $1,177mn.

Media and Entertainment Track

Research4India 4

Essel Group to raise $500mn

Essel Group would be raising close to $500mn

to fund its growth and reduce debt. The funds

would be used for Dish TV, Siticable Network

and its education entity Zee Learn Ltd.

Indian Television industry is at an exciting

juncture with the Government working towards

pan India digitisation. Siticable, formerly known

as WWIL, will raise Rs 3.24bn from promoter

firms through convertible warrants. Essel

International and Essel Media will invest the

amount in tranches with the first tranche being

25 per cent of the issue price on allotment of

warrants on a preferential basis.

The combined shareholding of Essel

International and Essel Media will rise to 29.99

per cent post issue and the total promoter

holding will increase to 73.08% from the

existing 63.43%.

Star India: Asianet IPO, MCCS Stake sale

plans

Asianet Communications Ltd (ACL) plans to

launch an IPO, though the date has not been

yet finalized. Star India holds 86% stake in

ACL, whose flagship channels include Vijaya TV

and Suvarna.

In another development, Star India plans to sell

its 26% stake in Media Content &

Communications Services (MCCS) to Ananda

Bazar Patrika (ABP) Group. ABP at present

holds 74% in the Joint venture.

MCCS operates three news channels – Star

News, Star Ananda and Star Majha. MCCS had

revenues of Rs 2.6bn in FY12. This stake sale

will mark the exit of Star from news

broadcasting in India. Star and ABP have parted

ways since April this year, and subsequently the

use of brand name Star has been removed from

its news channels.

Deccan Chronicle liquidity crisis

The troubles continue for DCHL. Cash strapped

DCHL’s Market Cap declined 19% in last one

week. DCHL had a debt of Rs 32 bn on its

books. The Group has mortgaged its publishing

trademarks – Deccan chronicle, The Asian Age,

Andhra Bhoomi and Financial Chronicle. Its

financial viability is being scrutinized by lenders,

which recently decided against Corporate Debt

Restructuring. In another development, BCCI

has terminated Deccan Chargers. Earlier DCHL

had rejected the bid of Rs 9bn from PVP

ventures to buy the franchises.

FIPB nod to DB Corp, WSJ

The Foreign Investments Promotion Board

(FIPB) has permitted increase of foreign equity

participation in DB corp from the present 20%.

FIPB has permitted Wall Street Journal

Publishing to make a change in the foreign

collaborator by way of overseas merger within

group companies.

Digitisation deadline looks feasible

68% digitisation has been achieved in four

metros according to the Information and

Broadcasting Industry. Mumbai leads with 95%

digitisation, followed by Kolkata at 67%, Delhi

at 53% and Chennai at 49% digitisation. The

I&B Ministry also revealed that TV penetration

in four metros is at 80%. Meanwhile, the Indian

Broadcasting Foundation (IBF) has decided to

postpone India TV Fest 2012, earlier scheduled

in 1st week of November to 2013.

Media FDI up 72% in FY12

Buoyed by the Disney-UTV deal, Indian Media

sector has received Foreign Direct Investments

of Rs 32.64 bn, an increase of 72% from 2010-

11.

Corporate News Update

Industry News Update

Media and Entertainment Track

Research4India 5

Share Price Performance

Quarter ending 30th June, 2012

* Standalone results Figures in Rs.`mn

As on 14th Sep 2012 Market Cap Price P/E

(In ` mn) (In ` ) 1W 1M 3M 6M 12M (ttm)

Zee Entertainment 1,62,125 170.0 0% -1% 26% 25% 50% 26.4

Sun TV Network 1,21,319 307.9 0% 0% 18% -5% 6% 18.1

Dish TV 81,591 76.7 5% 5% 35% 36% 1% NM

DB Corp 34,466 188.0 -5% -1% 3% -14% -17% 18.7

Hathway cable 31,221 218.6 5% 18% 23% 29% 171% NM

Jagran Prakashan 28,954 91.6 1% 1% 7% -12% -14% 15.7

HT Media 20,470 87.1 1% 2% -9% -37% -39% 13.2

Den Networks 20,182 152.1 10% 22% 53% 47% 236% 80.8

Eros International 14,698 160.2 -4% -8% -7% -18% -32% 9.3

ENIL 11,045 231.7 1% 4% 10% 8% -8% 18.3

TV 18 Broadcast 8,111 22.4 22% 18% 18% -8% -39% NM

Prime Focus 7,242 48.7 1% 7% 0% 0% -16% 7.7

PVR 4,728 182.2 1% -4% 21% 33% 53% 27.0

Onmobile 4,455 39.1 3% -9% 4% -41% -37% 5.6

Reliance Broadcast 3,953 49.8 0% 8% 12% -11% -40% NM

Reliance Mediaworks 3,051 66.2 1% 7% 21% -25% -33% NM

Balaji Telefilms 2,882 44.2 8% 9% 26% -1% 49% 18.1

Deccan Chronicle 2,278 10.9 -19% 3% -64% -75% -81% 3.8

Nifty 5577.7 4% 4% 10% 2% 11%

Sensex 18464.3 4% 4% 11% 3% 11%

Percentage Change (%)

Q1FY12 Q1FY13 YoY Q1FY12 Q1FY13 YoY Q1FY12 Q1FY13 YoY

Zee Enterta inment 6,982 8,430 21% 1,559 2,333 50% 1,337 1,582 18%

Dish TV* 4,634 5,200 12% 1,225 1,556 27% -183 -323 NM

HT Media 4,945 4,899 -1% 899 669 -26% 515 407 -21%

Sun TV Network* 4,540 4,258 -6% 3,659 3,230 -12% 1,876 1,643 -12%

DB Corp 3,525 3,770 7% 987 765 -23% 611 437 -29%

TV 18 Broadcast 2,638 3,469 32% 222 151 -32% 211 -235 NM

Jagran Prakashan* 3,046 3,175 4% 826 788 -5% 497 557 12%

Den Networks 2,829 1,949 -31% 179 385 116% 18 122 568%

Eros International 1,538 2,570 67% 299 517 73% 217 314 45%

Deccan Chronicle NA NA NA NA NA NA NA NA NA

Rel iance Mediaworks 1,929 2,022 5% -366 -264 NM -1,201 -1,313 NM

Prime Focus 1,675 1,882 12% 460 572 24% 256 210 -18%

Onmobi le 1,364 1,852 36% 271 359 32% 128 95 -26%

PVR 1,174 1,774 51% 205 338 65% 155 76 -51%

Hathway cable* 1,225 1,363 11% 192 238 24% -148 -159 NM

ENIL 687 700 2% 181 205 13% 93 134 44%

Rel iance Broadcast 745 527 -29% -183 -101 NM -291 -287 NM

Bala ji Telefi lms 358 386 8% -67 2 NM 59 14 -77%

Revenue EBITDA PAT

Stock Market Update

Financial Benchmarking

Media and Entertainment Track

Research4India 6

Trailing Twelve months ending 30th June, 2012

* Standalone results Figures in Rs.`mn

**Deccan Chronicle numbers are for FY ending 31st

March.

Company Q1FY12 Q1FY13 YoY Q1FY12 Q1FY13 YoY Q1FY12 Q1FY13 YoY

Zee Entertainment 30,300 31,854 5% 7,907 8,169 3% 6,167 6,136 0%

Dish TV* 15,957 20,145 26% 3,291 5,315 61% -1,448 -1,729 NM

HT Media 18,656 19,968 7% 3,411 2,638 -23% 1,910 1,546 -19%

Sun TV Network 24,675 18,189 -26% 19,438 13,714 -29% 9,574 6,696 -30%

DB Corp 13,200 14,760 12% 3,873 3,125 -19% 2,462 1,847 -25%

TV 18 Broadcast 10,680 14,930 40% 685 -694 -201% 37 -1,184 NM

Jagran Prakashan 15,257 13,685 -10% 4,392 3,130 -29% 2,575 1,843 -28%

Den Networks 13,248 10,513 -21% 1,287 1,170 -9% 394 250 -37%

Eros International 8,608 10,471 22% 1,860 2,342 26% 1,389 1,576 13%

Deccan Chronicle** 10,309 9,147 -11% 3,475 2,121 -39% 1,626 607 -63%

Reliance Mediaworks** 10,290 8,238 -20% -502 -1,342 167% -4,490 -5,292 18%

Prime Focus 6,704 7,926 18% 2,131 2,454 15% 1,017 946 -7%

Onmobile 6,736 6,868 2% 1,480 1,487 0% 1,020 798 -22%

PVR 5,796 5,731 -1% 1,121 926 -17% 237 175 -26%

Hathway cable* 5,964 5,274 -12% 1,091 903 -17% -551 -527 -4%

ENIL 5,323 3,124 -41% 1,197 1,245 4% 265 602 127%

Reliance Broadcast 3,199 2,783 -13% -247 -551 123% -828 -1,126 36%

Balaji Telefilms 2,280 1,906 -16% -64 80 -225% 49 159 228%

Revenue (ttm) EBITDA (ttm) PAT (ttm)

Media and Entertainment Track

Research4India 7

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Media and Entertainment Track

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