Zee, Sun, and TV Today expect their QoQ ad revenues to rise by 8.5%, 9%, and 12.4% respectively: Elara Capital

Box office revenue is expected to recover 85 per cent to pre-covid19 levels in Q3FY23.

Mumbai: Television was the first traditional medium to report higher advertising revenue versus pre-covid-19 levels last year, says a recently released report by Elara Capital on revenue growth in television, radio, and cinema. It further cited that while radio is still struggling to reach pre-pandemic levels, exhibitors in the cinema business are looking to perform better sequentially.


The third quarter of fiscal year 2023 has been relatively muted, with revenues declining five per cent- six per cent year-on-year (YoY) versus pre-covid19 levels, despite the positive festive impact.

The revenue decline in TV is primarily due to lower spends by new age/e-commerce companies (which cut advertising budgets by 30 per cent-40 per cent YoY) and muted growth in the FMCG vertical due to rising inflationary pressures, the report said.

Zee, Sun, and TV Today's ad revenues are expected to increase by 8.5 per cent, nine per cent, and 12.4 per cent, respectively, QoQ. 

Since the holiday season is driving this expansion, Zee, Sun, and TV Today, on the other hand, are expected to decline by 12.8 per cent, one per cent, and eight per cent, respectively, due to a higher base (TV medium surpassed pre-covid levels last year).

Elara Capital forecasts flat subscription revenue for Zee and a six per cent QoQ increase for Sun, owing primarily to the uncertainty surrounding NTO implementation. Elara anticipates that subscription revenue will increase by eight per cent-10 per cent in the near term, aided by price increases as NTO 3.0 will be implemented by February 2023.

Sun TV's lack of IPL and other operating revenue (movie segment revenue - no major releases this quarter) will result in total revenue of Rs 8,563 million, a 17.1 per cent decrease year on year and a 5.1 per cent increase over pre-covid levels in FY20.

Zee's revenue is expected to be flat year on year but up three to four per cent quarter on quarter/pre-covid.

TV Today's revenue is expected to fall by four per cent YoY due to a high base in Q3FY22, it is expected to rise by 17 per cent/11.5 per cent QoQ/pre covid, driven by the festive quarter.

According to reports, "Ebitda (earnings before interest, taxes, depreciation, and amortisation) margins are expected to grow 80 bps/down 90 bps/up 350 bps QoQ, aided by higher ad spends; however, margins are expected to decline 722 bps/487 bps/1720 bps YoY for Zee/SUN TV/TV Today, respectively, due to pressure on content costs (TV and digital) and lower ad spends."

It further added, "Expect PAT to decline 53 per cent/ eight per cent/ 51 per cent YoY and grow 25 per cent/five per cent/ 54 per cent sequentially (decline 59 per cent/up 13 per cent/down 19 per cent vs pre-covid levels) for Zee/SUNTV/TVT respectively."


Radio has grown slowly in comparison to other forms of media, while there has been a significant shift in consumer preference toward digital, according to the report.

According to the report, Elara Capital anticipates entertainment network and music broadcast revenue growth/decline of 14 per cent/7 per cent YoY (down 40 per cent/20.4 per cent vs Q3FY20 - pre-pandemic levels).

Elara expects the non-radio segment of ENIL to recover at around 83 per cent (compared to pre-pandemic levels), aided by the normalisation of events/activities/concerts. According to the research firm, ENIL's non-radio business will continue to gain traction in the near term. ENIL/MBL is expected to report an Ebitda margin of 20.6 per cent/12 per cent in Q3FY23.


Exhibitors are expected to perform better sequentially, led by the strong performances of films such as Avatar-The Way of Water, Drishyam 2, Kantara, and Vikram Vedha, while other big budget films such as Cirkus, Ram Setu, Thank God, and Bhediya have underperformed expectations.

According to the report, the festive season contributed to a healthy sequential performance in Q3FY23, but growth was muted when compared to Q1FY23. Box office revenue is expected to recover 85 per cent to pre-covid-19 levels in Q3FY23. PVR and Inox box office revenues are expected to grow 18 per cent sequentially but decline 15 per cent compared to pre-covid-19 levels.

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