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India Equity Research Reports, IPO and Stock News
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We hosted PINC Media & Entertainment Conference on 28th Feb, 2012. Players from across the platforms of media
participated in the event. Sony Entertainment, Industry Experts, Media planners and unlisted players helped us
understand better about the Industry scenario and the competitive landscape of the respective segment. The
conference clearly elucidated short term apprehensions and integral long term growth story.
Given below are the key highlights of the conference.
Broadcasting: Not a great year but an exception for few
The year started on a positive note, however slowdown in the economy and high inflationary environment resulted in ad
budgets being hampered and hence only necessary advertising was done especially for second rung channels and regional
players like Sun TV. However, lead channels like Sony Entertainment and Star Plus performed well. TV advertisement
registered growth of 9% in 2011. In 2012 Television is expected to maintain a marginal growth rate of 10%.
Print: Regional outperformed English
The Print advertising segment grew at 8% in 2011. The growth rate was down mainly in English press advertising (regional
print revenue in double digits, however English Print grew at low single digit rate) which led to slow growth in the entire print
segment. Advertisers, specifically from BFSI and telecom spent cautiously on print in the second half of the year. No big
IPOs and no big launches impacted the advertising revenues. The entire focus was on regional consolidation with existing
players launching new editions into existing and new markets. Print media advertising is expected to reflect a growth of 6%
in 2012.
Radio: Bleak performance
Radio advertisements grew marginally by 2% in 2011 owing to lack of innovation in the medium. The only happening factor
was Phase III policy announcement by the government. Radio advertisement growth rate in 2012 is expected to be better at
5% mainly because of Phase III.
Outdoor: Blank period
Outdoor advertising revenue fell 10% in 2011 with its share in the total ad pie falling from 6.1% in 2010 to 5.1%. Spends on
outdoor have decreased in the major metros but some respite is seen on the back of rising spends in Tier II and Tier III cities.
2012 is expected to see some revival with a modest growth of 5%.
Cinema: Blockbuster year
The segment performed exceptionally well on account of blockbuster releases like – Ready, Bodyguard, Dabaang, Don 2,
RaOne, Rockstar etc. The Ad revenue grew 18% in 2011 pocketing Rs1.4bn revenues. Cinema advertising is expected to
increase its contribution in 2012 to 0.6% of the total ad pie from the current 0.4%.
Our View:
We reiterate that regional players will be better placed during the current economic slowdown. Despite slowdown in national
advertising, local spending (Automobile, FMCG, Clothing) will provide support to the regional players. Rising newsprint cost
for print players and surging content cost for broadcasting players remain a concern. With mandatory digitisation we expect
MSOs and broadcasters to gain immensely on account of increase in the declared subscriber base and higher subscription
revenue.
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
We hosted PINC Media & Entertainment Conference on 28th Feb, 2012. Players from across the platforms of media
participated in the event. Sony Entertainment, Industry Experts, Media planners and unlisted players helped us
understand better about the Industry scenario and the competitive landscape of the respective segment. The
conference clearly elucidated short term apprehensions and integral long term growth story.
Given below are the key highlights of the conference.
Broadcasting: Not a great year but an exception for few
The year started on a positive note, however slowdown in the economy and high inflationary environment resulted in ad
budgets being hampered and hence only necessary advertising was done especially for second rung channels and regional
players like Sun TV. However, lead channels like Sony Entertainment and Star Plus performed well. TV advertisement
registered growth of 9% in 2011. In 2012 Television is expected to maintain a marginal growth rate of 10%.
Print: Regional outperformed English
The Print advertising segment grew at 8% in 2011. The growth rate was down mainly in English press advertising (regional
print revenue in double digits, however English Print grew at low single digit rate) which led to slow growth in the entire print
segment. Advertisers, specifically from BFSI and telecom spent cautiously on print in the second half of the year. No big
IPOs and no big launches impacted the advertising revenues. The entire focus was on regional consolidation with existing
players launching new editions into existing and new markets. Print media advertising is expected to reflect a growth of 6%
in 2012.
Radio: Bleak performance
Radio advertisements grew marginally by 2% in 2011 owing to lack of innovation in the medium. The only happening factor
was Phase III policy announcement by the government. Radio advertisement growth rate in 2012 is expected to be better at
5% mainly because of Phase III.
Outdoor: Blank period
Outdoor advertising revenue fell 10% in 2011 with its share in the total ad pie falling from 6.1% in 2010 to 5.1%. Spends on
outdoor have decreased in the major metros but some respite is seen on the back of rising spends in Tier II and Tier III cities.
2012 is expected to see some revival with a modest growth of 5%.
Cinema: Blockbuster year
The segment performed exceptionally well on account of blockbuster releases like – Ready, Bodyguard, Dabaang, Don 2,
RaOne, Rockstar etc. The Ad revenue grew 18% in 2011 pocketing Rs1.4bn revenues. Cinema advertising is expected to
increase its contribution in 2012 to 0.6% of the total ad pie from the current 0.4%.
Our View:
We reiterate that regional players will be better placed during the current economic slowdown. Despite slowdown in national
advertising, local spending (Automobile, FMCG, Clothing) will provide support to the regional players. Rising newsprint cost
for print players and surging content cost for broadcasting players remain a concern. With mandatory digitisation we expect
MSOs and broadcasters to gain immensely on account of increase in the declared subscriber base and higher subscription
revenue.
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