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IMCL pares Hinduja Ventures PAT in FY-2014

BENGALURU: Hinduja Ventures Limited (HVL) has reported consolidated PAT of just Rs.0.20 crore in FY-2014 as compared to the PAT of Rs 80.22 crore in FY-2013. On a standalone basis, HVL reported PAT of Rs 82.03 crore, 6.9 per cent more than the Rs 76.75 crore in FY-2013. Its media and communication segment reported a loss of Rs 197.33 crore in FY-2014 as compared to a profit after tax of Rs 46.88 crore in the previous fiscal. HVL’s diluted EPS (of face value Rs 10) went down to just Rs 0.10 in FY-2014 from Rs 39.03 in FY-2013.

Note: (1) 100,00,000 = 100 lakh = 10 million = 1 crore.

(2) This report focuses more on IMCL/HVL’s media and communication numbers.

(3) All figures are consolidated unless stated otherwise.

HVL operations and investments span over three segments namely media, real estate and treasury. The Company’s principal business investment is in media and communications via its valuable stake in IndusInd Media & Communications Limited (IMCL).

Bad debts and hence HVL’s media and communications segment results have significantly reduced the company’s PAT in FY-2014.

HVL’s media and communications segment

HVL’s media and communications segment reported revenue of Rs 638.84 crore in FY-2014, which was 4.6 per cent more than the Rs 610.63 crore in FY-2013. The capital employed by the segment went up 7.9 per cent in FY-2014 to Rs 1242.12 crore from Rs 1151.12 crore in the previous year.

IMCL, in which HVL owns 61.71 per cent stake, reported loss of Rs 118.84 crore in FY-2014 versus a profit of Rs 36.24 crore in FY-2013, and hence was a major contributor to the loss by HVL’s media and communications segment. IMCL consolidated EBIDTA for the year stood at R 26.07 crore as against R 141.15 crore in the previous year says the company.

IMCL reported revenue of Rs 572.46 crore in FY-2014, which was 4.5 per cent more than the Rs 547.56 crore in FY-2013. The subsidiary’s paid-up capital more than doubled from Rs 73.91 crore to Rs 173.91 crore because of infusion of Rs 100 crore by HVL by way of purchase of 10 per cent, redeemable cumulative preference shares of Rs 10. HVL says that IMCL needs funds for consolidation in phase I and phase II and to digitise network in phase III and phase IV, and hence the fresh investment.

IMCL’s reserves dropped 43.3 per cent to Rs 155.37 crore in FY-2014 versus Rs 274.20 crore in FY-2013. IMCL’s total assets jumped 9.3 per cent in FY-2014 to Rs 1178.50 crore from Rs 1078.62 crore reported last year. IMCL’s liabilities went up 16.3 per cent in FY-2014 to Rs 849.23 crore from Rs 730.51 crore in FY-2013.

Let us look at the other numbers reported by HVL for FY-2014

HVL consolidated revenue went up 10.2 per cent in FY-2014 to Rs 773.49 crore from Rs 701.96 crore in the previous year. 

HVL’s reported 8.7 per cent increase in revenue from cable television transmission in FY-2014 to Rs 620.07 crore from Rs 570.36 crore in FY-2013. Its income from sale of set top boxes/modem’s fell to less than a seventh (fell by 7.28 times) to Rs 2.43 crore in FY-2014 from Rs 17.67 crore in FY-2013. HVL’s advertisement income fell 20.6 per cent in FY-2014 to Rs 4.02 crore from Rs 5.07 crore in FY-2013. The discount from broadcasters fell 37 per cent in FY-2014 to Rs 5.82 crore from Rs 9.24 crore in FY-2013.

Its total expenditure went up 48.4 per cent to Rs 871.52 crore in FY-2014 from Rs 587.38 crore in FY-2013. The company’s depreciation and amortisation went up 80.7 per cent in FY-2014 to Rs 121.84 crore from Rs 67.41 crore in FY-2013. HVL has more than doubled (2.74 times) its provision for bad debts in FY-2014 at Rs 173.63 crore versus Rs 63.36 crore in FY-2013. The company has also made a provision for doubtful advances in FY-2014 at Rs 15.98 crore, versus nil in the previous year. HVL’s finance cost has almost tripled (went up 2.67 times) in FY-2014 to Rs 120.30 crore from Rs 45.14 crore in FY-2013.

HVL’s direct cost and operating expense (DCOE) went up 20.3 per cent to Rs 293.47 crore in FY-2014 from Rs 235.21 crore in FY-2013. A break up of DCOE is: Cable Television Operating expenses went up 20.9 per cent in FY-2014 to Rs 284.46 crore from Rs 235.21 crore; It paid 17 per cent higher bandwidth charges in FY-2014 of Rs 4.4 crore versus Rs 3.76 crore in FY-2013; It paid 8.8 per cent lower lease rental-duct at Rs 4.62 crore in FY-2014 from Rs 5.05 crore in FY-2013.

The HVL board has recommended a dividend payment of R 15/- per equity share (150 per cent dividend on face value of R 10/- per Equity Share) for financial year 2013-14. The dividend will result in a payout of R 36.07 crore including Dividend Distribution Tax, representing 43.98 per cent of the current year earnings says HVL.

Click here to read the annual report

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