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Demystifying IRS Q1 2011: HTML/HMVL gain, DBCL/JAGP steady. Our analysis of IRS
(Indian Readership Survey) Q1 2011 reveals (1) continued growth in readership of Indian
print media, (2) robust gains for HTML (English daily Hindustan Times and business daily
Mint) and subsidiary HMVL (Hindi daily Hindustan) as well as (3) steady performance of
DBCL and JAGP (survey period of Jan-Dec 2010 does not capture expansions). Reiterate BUY
on DBCL/JAGP/HMVL given (1) structural advertising growth in Hindi/regional print (closing
gap with English) and (2) penetration opportunity in Tier-II/III towns. Reiterate ADD on HTML
led by HT Delhi/Mint; cost of HT Mumbai expansion exceeds benefits, thus far.
Strong gains for HTML/HMVL across English (Mumbai) and Hindi (UP-Bihar) markets
The average issue readership (AIR) of English dailies increased ~4% yoy (Q1 2011 over Q1 2010)
to reach 17.5 mn (see Exhibit 1). HTML’s English daily, Hindustan Times (HT), remains joint leader
with Times of India (TOI) in the Delhi market (see Exhibit 2). HT also consolidated its runners-up
position in Mumbai with ~12% qoq gain but readership growth in DNA rebounded (~13% qoq);
HT remains far behind TOI Mumbai and thus, advertising growth is likely to be back-ended. HT cut
its subscription scheme offering to Rs149/year from Rs199/year recently; the cost of HT Mumbai
expansion continues to exceed benefits, thus far. The AIR of HTML’s business daily, Mint, increased
18% yoy to reach 221K, consolidating its runners-up position.
The AIR of Hindi dailies increased ~7% yoy to reach 62.9 mn (see Exhibit 3) reflecting the relatively
robust environment for print media in Hindi/regional markets. HMVL’s Hindi daily, Hindi Hindustan
(HH) consolidated its leadership position in key BJH (Bihar-Jharkhand) market though competition
also gained driven by cover price action across the market. The AIR of HH increased ~3% qoq to
reach 11.8 mn led by market share gains in UPU (Uttar Pradesh-Uttaranchal) market. HT as well as
HH is ~43% of leaders in the expansion markets (see Exhibits 4-5); HH benefits from presence of
rational (DJ) and troubled (AU) competition versus HT, which faces aggressive (TOI) and potential
irrational (DNA) competition, thus impacting breakeven/returns.
Robust performance by DBCL in home Madhya Pradesh market despite new entrants
The AIR of DBCL’s Hindi daily, Dainik Bhaskar (DB), increased ~5% yoy to reach 14.0 mn (17.8 mn
including Gujarati daily Divya Bhaskar). DB consolidated its position in the home MPCG (Madhya
Pradesh-Chhattisgarh) market with ~3% qoq growth despite rising competition led by new
entrants (Nai Dunia and Patrika, see Exhibit 6). DB has preemptively launched hyper-local editions
in MPCG to protect its market share (readership as well as advertising) and raise entry barriers for
competition, a strategy that seems to be working. Additionally, DB consolidated its lead over
Dainik Jagran in Punjab with ~7% qoq gains. DBCL’s overall steady performance was understated
due to IRS limitations, as Jharkhand expansion is not included yet.
Headline numbers understate JAGP’s steady performance in home Uttar Pradesh market
The AIR of JAGP’s Hindi daily, Dainik Jagran (DJ), declined ~2% yoy to reach 15.9 mn (16.6 mn
including Hindi tabloid I-Next). DB conceded modest market share to runners-up Amar Ujala (AU)
and HH in the home UPU (Uttar Pradesh-Uttaranchal) market (see Exhibit 7); DJ has been behind
the curve in re-investing in core markets post the robust recovery in advertising environment.
However, we highlight (1) headline numbers understate DJ’s steady performance in UPU market,
where it has successfully retained its urban market share (see Exhibit 8) and (2) JAGP’s renewed
circulation investments starting from 2HFY11 (double-digit growth in circulation), which is not
included yet due to IRS limitations, resulting in understated performance.
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
Demystifying IRS Q1 2011: HTML/HMVL gain, DBCL/JAGP steady. Our analysis of IRS
(Indian Readership Survey) Q1 2011 reveals (1) continued growth in readership of Indian
print media, (2) robust gains for HTML (English daily Hindustan Times and business daily
Mint) and subsidiary HMVL (Hindi daily Hindustan) as well as (3) steady performance of
DBCL and JAGP (survey period of Jan-Dec 2010 does not capture expansions). Reiterate BUY
on DBCL/JAGP/HMVL given (1) structural advertising growth in Hindi/regional print (closing
gap with English) and (2) penetration opportunity in Tier-II/III towns. Reiterate ADD on HTML
led by HT Delhi/Mint; cost of HT Mumbai expansion exceeds benefits, thus far.
Strong gains for HTML/HMVL across English (Mumbai) and Hindi (UP-Bihar) markets
The average issue readership (AIR) of English dailies increased ~4% yoy (Q1 2011 over Q1 2010)
to reach 17.5 mn (see Exhibit 1). HTML’s English daily, Hindustan Times (HT), remains joint leader
with Times of India (TOI) in the Delhi market (see Exhibit 2). HT also consolidated its runners-up
position in Mumbai with ~12% qoq gain but readership growth in DNA rebounded (~13% qoq);
HT remains far behind TOI Mumbai and thus, advertising growth is likely to be back-ended. HT cut
its subscription scheme offering to Rs149/year from Rs199/year recently; the cost of HT Mumbai
expansion continues to exceed benefits, thus far. The AIR of HTML’s business daily, Mint, increased
18% yoy to reach 221K, consolidating its runners-up position.
The AIR of Hindi dailies increased ~7% yoy to reach 62.9 mn (see Exhibit 3) reflecting the relatively
robust environment for print media in Hindi/regional markets. HMVL’s Hindi daily, Hindi Hindustan
(HH) consolidated its leadership position in key BJH (Bihar-Jharkhand) market though competition
also gained driven by cover price action across the market. The AIR of HH increased ~3% qoq to
reach 11.8 mn led by market share gains in UPU (Uttar Pradesh-Uttaranchal) market. HT as well as
HH is ~43% of leaders in the expansion markets (see Exhibits 4-5); HH benefits from presence of
rational (DJ) and troubled (AU) competition versus HT, which faces aggressive (TOI) and potential
irrational (DNA) competition, thus impacting breakeven/returns.
Robust performance by DBCL in home Madhya Pradesh market despite new entrants
The AIR of DBCL’s Hindi daily, Dainik Bhaskar (DB), increased ~5% yoy to reach 14.0 mn (17.8 mn
including Gujarati daily Divya Bhaskar). DB consolidated its position in the home MPCG (Madhya
Pradesh-Chhattisgarh) market with ~3% qoq growth despite rising competition led by new
entrants (Nai Dunia and Patrika, see Exhibit 6). DB has preemptively launched hyper-local editions
in MPCG to protect its market share (readership as well as advertising) and raise entry barriers for
competition, a strategy that seems to be working. Additionally, DB consolidated its lead over
Dainik Jagran in Punjab with ~7% qoq gains. DBCL’s overall steady performance was understated
due to IRS limitations, as Jharkhand expansion is not included yet.
Headline numbers understate JAGP’s steady performance in home Uttar Pradesh market
The AIR of JAGP’s Hindi daily, Dainik Jagran (DJ), declined ~2% yoy to reach 15.9 mn (16.6 mn
including Hindi tabloid I-Next). DB conceded modest market share to runners-up Amar Ujala (AU)
and HH in the home UPU (Uttar Pradesh-Uttaranchal) market (see Exhibit 7); DJ has been behind
the curve in re-investing in core markets post the robust recovery in advertising environment.
However, we highlight (1) headline numbers understate DJ’s steady performance in UPU market,
where it has successfully retained its urban market share (see Exhibit 8) and (2) JAGP’s renewed
circulation investments starting from 2HFY11 (double-digit growth in circulation), which is not
included yet due to IRS limitations, resulting in understated performance.
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