Print and radio ad revenues to grow 17.5% and 25% YoY respectively, led by election campaigns: report

As per Elara Capital’s latest report shared by Senior VP - Research Analyst, Karan Taurani, the overall ad revenue growth has been on a downward trend, primarily impacted by sectors such as telecom, education, and eCommerce, while FMCG stands out as a beacon of respite.

Zee Entertainment (Z IN) and Sun TV (SUNTV IN) are anticipated to experience contrasting trajectories, with a projected 2% YoY dip for Zee Entertainment and a 1% YoY decline for Sun TV in Q4FY24E. However, TV Today (TVTN IN) is expected to buck the trend with an 8% YoY growth, attributed to a surge in Election ad spend.

While subscription revenue for ZEE and SUNTV is expected to witness moderate growth, the absence of movies will likely impact theatrical revenue for both entities. Cost-cutting initiatives at Zee Entertainment and Sun TV's focus on specific genres are projected to influence EBITDA margins positively.

According to Taurani, the quarter Q4FY24 marked a significant shift for PVR Inox (PVRINOX IN) post-COVID, with smaller and medium-budget Hindi films gaining traction. Films like Hanuman, Article 370, Teri Baaton Main Aisa Uljha Jiya, and Crew collectively contributed to approximately 35% of box office collections, showcasing a promising trend.

Taurani also mentioned in the report that the firms expects to print ad revenue and radio ad revenue to grow 17.5% and 25.0% respectively, due to a boost from the Election campaigns. Digital revenue is likely to decline by 21.5% YoY due to high-effect base. 

Despite challenges in English and regional content, PVR Inox is expected to witness a 13.3% YoY growth in box office revenue and a 20.8% YoY surge in food and beverages revenue. 

Furthermore, Zomato (ZOMATO IN) is expected to continue its growth trajectory in Q4FY24, with a projected 54% YoY revenue increase. The company's dominance in delivery services, coupled with strategic pricing initiatives, is expected to drive significant revenue growth, particularly in the food delivery segment.

DB Corp (DBCL IN) anticipates a mixed revenue performance in Q4FY24E, with a notable uptick in print and radio ad revenue attributed to Election campaigns. The expected expansion in EBITDA margin reflects the company's adeptness in navigating market dynamics.

The report states that despite the prevailing challenges, the media and entertainment industry exhibits resilience and adaptability, leveraging strategic initiatives to navigate evolving consumer preferences and market dynamics. The forthcoming quarters are poised to witness further innovations and strategic maneuvers as companies strive to capitalize on emerging opportunities and mitigate potential risks.