Hong Kong-based Media Partners Asia, a research and market analysis company, estimates that the operating income in FY 2004 should be in the region of $57 million versus $8 million in FY 2003.

Star Group's revenues grew an estimated 20 per cent Y/Y to $408 million. Subscription remained robust, again led by India, although a rate freeze in the market (instituted in January 2004) looked likely to impact growth in the second half of 2004.

But, according to MPA estimates, Star still managed to increase subscriber declarations (to at least 13 million versus 10.8 million a year earlier) and squeeze more revenues from the fragmented cable TV distribution chain.

In its financial reportings, News Corp has indicated that in Q4 of FY 2004, operating income at Star grew 52 per cent on the back of 18 per cent Y/Y revenue growth.

"On a full-year basis, we estimate that Star derived more than $80 million in operating income from India although these earnings remain diluted by an estimated $10-15 million in operating losses from China (including start up general entertainment channel Xing Kong), which may break even over the next two years," MPA has stated.

At present, Star is in the midst of expanding its programming bouquet with the launch of new channels (it launched free-to-air Utsav in June) in order to secure advertising from regional and national brands in India and generate more subscription, despite current rate restrictions.

Star plans to offer a new Hindi pay channel (tentatively called Star One) and ramp up its market share in South India by bolstering Vijay TV (now completely owned by Star) and potentially acquiring or launching another new channel.

Ownership of a distribution platform currently remains out of reach as Star's $350 million JV with the Tatas (Star owns a 20% direct interest) to launch KU-band DTH services in India and potentially acquire up to 10 million subscribers over the long term, has been kept on hold as both parties wait for a license.

(Data courtesy Media Partners Asia, Ltd)