"We have put our plans for an IPO on hold" : Ravi Gupta CEO B4U Worldwide

It has been a relatively quiet period at B4U Television Networks since last October when its B4U Entertainment was relaunched as B4U Movies. B4U has been in the news again though, after it secured the terrestrial telecast rights for the recently-concluded Fifa World Cup from rights holder Taj Entertainment Network.

As the channel prepares the ground for its next leap forward - going pay - catches up with B4U Worldwide CEO Ravi Gupta, who is in India for a short while, for a lowdown on his plans for the channel.


You?d said earlier that you were looking at an IPO (initial public offering) probably some time in September and hoping to raise Rs 1000 million. Considering current market conditions that doesn?t look like happening does it, not even by the end of the year?

No, we have put our plans for an IPO on hold. Our fund managers JP Morgan Stanley and ICICI Securities have informed us accordingly.

When we feel that the conditions are better we might get back to them to re-evaluate the situation.

Since an IPO is out you will need to look for fresh partners who would be willing to take an equity stake in the company. Even that does not look like happening any time soon. How do you respond to talk in the industry that unless fresh partners are roped in before the year is out you will face severe cash flow problems?

That is incorrect. In fact our cash flow situation has improved significantly. We have been consistent in increasing our revenues month on month. It is true though, that major new initiatives in terms of acquisitions would require additional investment.

We have already achieved operating profits and by next year we are on target to declare net profits. Our year-on-year revenue growth stands at an average 35 per cent.

The major part of your revenues come from international operations. Last year you said that the ratio was 70:30 per cent. Is that still the case?

Currently it is 65 per cent from overseas and 35 per cent out of India. Once we go pay we expect it should be 60:40.

When are you going pay?

We will begin a dual illumination feed from mid-July. We are targeting becoming an encrypted pay service by 31 July. All the technical parameters are in place. But it still may take till end-August.

"I prefer to wait for a time when I will be able to offer my channel non-exclusively to all the bouquets."

Aren?t you looking at joining any platform? Zee, Star, Sony?

We will be going it alone. All of the big bouquets have been talking to us but none of them have offered terms that are attractive to us.

But you will be the first channel that is going pay as an independent, without the backing of one or other independent? Isn?t this going to make things difficult for you?

The response that we have got from the cable trade certainly has not been negative. And while not being part of one platform or the other does make things tougher as far as pushing the channel goes, it?s a short term way of looking at the issue. The reason to go it alone is because of the price sensitivity of the market. We believe that especially in the non-metro markets there are operators for whom a single channel option like B4U is good.

I do not want to tie up with any one at the present juncture. I want to keep my options open. I prefer to wait for a time when I will be able to offer my channel non-exclusively to all the bouquets. And we will be constantly tracking developments. Being independent allows us the freedom to take a call on it when we feel it is advantageous for us.

And this market is still to mature. Take the UK for instance. We are on all the three main platforms - Cable & Wireless, NTL and Telewest.

What can you tell me about your international operations. Any new developments?

Well we have launched services in North Africa in Tunisia, Algeria and Morocco as I?d told you earlier we would be doing (in February Gupta had told that B4U would be launching in that region within three months).

Also, in Europe, where we were on cable earlier, now we?ve launched on a DTH platform as well. We are the only ones after Zee to be on DTH. Star and Sony are still on cable.

When you announced that B4U had secured the terrestrial broadcast rights for the Fifa World Cup, it came as quite a surprise. At the end of it all are you satisfied with the purchase of the property? Was it a financial success for you or not?

Firstly, we were not looking at it so much from the profit angle as a brand building exercise. In any case, we made a profit from it so we are fully satisfied with the way it all went.

How much did you make on the World Cup finally?

We managed revenues of Rs 2 crore (Rs 20 million).

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