Category: Financials

FY-2016: TV18 income from operations up 10.8 per cent

BENGALURU: The Mukesh Ambani group owned TV18 Broadcast Limited (TV18) reported 10.8 per cent increase in consolidated net total income from operations (TIO) in the current year (year ended 31 March 2016, FY-2016 ) at Rs 2,568.97 crore as compared to the Rs 2,318.39 crore in the previous year. TIO in Q4-2016 (quarter ended 31 March 2016, Q4-2016) at Rs 671.34 crore was 6.6 per cent higher YoY as compared to Rs 629.75 but 3 per cent lower QoQ as compared to Rs 624.42 crore in Q3-2016.

Note: The unit of currency in this report is the Indian rupee – Rs (also conventionally represented by INR or ₹). The Indian numbering system or the Vedic numbering system has been used to denote money values in this report. The basic conversion to the international norm would be:

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

(b) 10,000 lakh = 100 crore = 1 billion = 1 arab.

TV18’s PBDIT on a consolidated basis stood at Rs 252.5crore, same as last year. Q4-2016 consolidated operating PBDIT stood at Rs 99.4crore, up by 20.3 per cent YoY, from Rs 82.6 crore in Q4-2015.

Let us look at some of the other numbers reported by TV18

Consolidated total expenditure (TE) in FY-2016 at Rs 2,366.96 crore (92.1 per cent of TIO) was 12.4 per cent higher than the Rs 2,105.87 crore (90.8 per cent of TIO) in FY-2015. TE in Q4-2016 at Rs 587.04 crore (87.4 per cent of TIO) was 5.7 per cent higher YoY as compared to Rs 555.18 crore (88.2 per cent of TIO), but was 2.4 per cent lower QoQ as compared to Rs 601.19 crore (86.8 per cent of TIO).

TV18’s reported 2.5 per cent increase in programming cost in FY-2016 at Rs 776.46 crore (30.2 per cent of TIO) as compared to Rs 757.52 crore (32.7 per cent of TIO). Programming cost in Q4-2016 declined 20.4 per cent YoY to Rs 161.70 crore (24.1 per cent of TIO) as compared to Rs 203.26 crore (32.3 per cent of TIO) and declined 24.6 per cent QoQ as compared to Rs 214.36 crore (31.0 per cent of TIO).

Employee Benefit Expense (EBE) in FY-2016 increased 21.3 per cent to Rs 493.99 crore (18.8 per cent of TIO) as compared to Rs 399.05 crore (17.2 per cent of TIO). EBE in Q4-2016 increased 35.9 per cent YoY to Rs 138.38 crore (20.6 per cent of TIO) as compared to Rs 101.86 crore (16.2 per cent of TIO) and increased 21.1 per cent QoQ as compared to Rs 114.29 crore (16.5 per cent of TIO).

TV18’s marketing, distribution and promotional (Marketing) expense in FY-2016 increased 12.3 per cent to Rs 505.23 crore (19.7 per cent of TIO) as compared to Rs 449.78 (19.4 per cent of TIO) in the previous year, Marketing expense in Q4-2016 increased 12.2 per cent YoY at Rs 129.44 crore (19.3 per cent of TIO) as compared to Rs 115.37 crore (18.3 per cent of TIO) and increased 14.7 per cent QoQ as compared to Rs 112.89 crore (16.3 per cent of TIO).

Segment Revenue

Two segments contribute to TV18’s TIO – Media Operations (Media Ops); and Film Production and Distribution (Films).

Media Ops reported 8.6 per cent increase in segment revenue for the current year at Rs 2,477.78 crore as compared to the Rs 2,281.35 crore in FY-2015. For Q4-2016, the segment reported a 5.5 per cent increase in YoY revenue of Rs 663.71 crore as compared to Rs 628.95 crore but a 2.7 per cent QoQ decline in revenue as compared to Rs 681.85 crore.

Media Ops reported a 6.6 per cent decline in operating results for FY-2016 at Rs 206.56 crore as compared to Rs 221.17 crore in FY-2015. The segment’s operating result for Q4-2016 was 12.0 per cent higher YoY at Rs 86.05 crore as compared Rs 76.81 crore, but declined 7.5 per cent QoQ as compared to Rs 93.06 crore.

Films segment reported more than double (2.53 times) the revenue in FY-2016 at Rs 129.20 crore as compared to Rs 50.96 crore in the previous year. In Q4-2016, the films segment reported almost five times (4.87 times) revenue at Rs 23.41 crore as compared to the Rs 4.80 crore in Q4-2015 and more than double (2.21 times) the revenue of Rs 10.57 crore in the immediate trailing quarter.

Films segment reported positive operating result at Rs 1.34 crore in the current year as compared to an operating loss of Rs 6.44 crore in the previous year. For Q4-2016, the segment reported a lower operating loss of Rs 0.68 crore as compared to a loss of Rs 2.44 crore in Q4-2015 and an operating loss of Rs 1.22 crore in Q3-2015.

April 20, 2016
FY-2016: TV18 income from operations up 10.8 per cent

BENGALURU: The Mukesh Ambani group owned TV18 Broadcast Limited (TV18) reported 10.8 per cent increase in consolidated net total income from operations (TIO) in the current year (year ended 31 March 2016, FY-2016 ) at Rs 2,568.97 crore as compared to the Rs 2,318.39 crore in the previous year. TIO in Q4-2016 (quarter ended 31 March 2016, Q4-2016) at Rs 671.34 crore was 6.6 per cent higher YoY as compared to Rs 629.75 but 3 per cent lower QoQ as compared to Rs 624.42 crore in Q3-2016.

Note: The unit of currency in this report is the Indian rupee – Rs (also conventionally represented by INR or ₹). The Indian numbering system or the Vedic numbering system has been used to denote money values in this report. The basic conversion to the international norm would be:

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

(b) 10,000 lakh = 100 crore = 1 billion = 1 arab.

TV18’s PBDIT on a consolidated basis stood at Rs 252.5crore, same as last year. Q4-2016 consolidated operating PBDIT stood at Rs 99.4crore, up by 20.3 per cent YoY, from Rs 82.6 crore in Q4-2015.

Let us look at some of the other numbers reported by TV18

Consolidated total expenditure (TE) in FY-2016 at Rs 2,366.96 crore (92.1 per cent of TIO) was 12.4 per cent higher than the Rs 2,105.87 crore (90.8 per cent of TIO) in FY-2015. TE in Q4-2016 at Rs 587.04 crore (87.4 per cent of TIO) was 5.7 per cent higher YoY as compared to Rs 555.18 crore (88.2 per cent of TIO), but was 2.4 per cent lower QoQ as compared to Rs 601.19 crore (86.8 per cent of TIO).

TV18’s reported 2.5 per cent increase in programming cost in FY-2016 at Rs 776.46 crore (30.2 per cent of TIO) as compared to Rs 757.52 crore (32.7 per cent of TIO). Programming cost in Q4-2016 declined 20.4 per cent YoY to Rs 161.70 crore (24.1 per cent of TIO) as compared to Rs 203.26 crore (32.3 per cent of TIO) and declined 24.6 per cent QoQ as compared to Rs 214.36 crore (31.0 per cent of TIO).

Employee Benefit Expense (EBE) in FY-2016 increased 21.3 per cent to Rs 493.99 crore (18.8 per cent of TIO) as compared to Rs 399.05 crore (17.2 per cent of TIO). EBE in Q4-2016 increased 35.9 per cent YoY to Rs 138.38 crore (20.6 per cent of TIO) as compared to Rs 101.86 crore (16.2 per cent of TIO) and increased 21.1 per cent QoQ as compared to Rs 114.29 crore (16.5 per cent of TIO).

TV18’s marketing, distribution and promotional (Marketing) expense in FY-2016 increased 12.3 per cent to Rs 505.23 crore (19.7 per cent of TIO) as compared to Rs 449.78 (19.4 per cent of TIO) in the previous year, Marketing expense in Q4-2016 increased 12.2 per cent YoY at Rs 129.44 crore (19.3 per cent of TIO) as compared to Rs 115.37 crore (18.3 per cent of TIO) and increased 14.7 per cent QoQ as compared to Rs 112.89 crore (16.3 per cent of TIO).

Segment Revenue

Two segments contribute to TV18’s TIO – Media Operations (Media Ops); and Film Production and Distribution (Films).

Media Ops reported 8.6 per cent increase in segment revenue for the current year at Rs 2,477.78 crore as compared to the Rs 2,281.35 crore in FY-2015. For Q4-2016, the segment reported a 5.5 per cent increase in YoY revenue of Rs 663.71 crore as compared to Rs 628.95 crore but a 2.7 per cent QoQ decline in revenue as compared to Rs 681.85 crore.

Media Ops reported a 6.6 per cent decline in operating results for FY-2016 at Rs 206.56 crore as compared to Rs 221.17 crore in FY-2015. The segment’s operating result for Q4-2016 was 12.0 per cent higher YoY at Rs 86.05 crore as compared Rs 76.81 crore, but declined 7.5 per cent QoQ as compared to Rs 93.06 crore.

Films segment reported more than double (2.53 times) the revenue in FY-2016 at Rs 129.20 crore as compared to Rs 50.96 crore in the previous year. In Q4-2016, the films segment reported almost five times (4.87 times) revenue at Rs 23.41 crore as compared to the Rs 4.80 crore in Q4-2015 and more than double (2.21 times) the revenue of Rs 10.57 crore in the immediate trailing quarter.

Films segment reported positive operating result at Rs 1.34 crore in the current year as compared to an operating loss of Rs 6.44 crore in the previous year. For Q4-2016, the segment reported a lower operating loss of Rs 0.68 crore as compared to a loss of Rs 2.44 crore in Q4-2015 and an operating loss of Rs 1.22 crore in Q3-2015.

April 20, 2016
FY-2015: Nestle ups marketing spends to Rs 525 crore

BENGALURU: That the Maggi fiasco was going to cost Nestle India Limited (Nestle India) dear was a given. Post the relaunch of one of the most staple dishes of modern India, the company had to follow up with a massive damage control and marketing push. Not only has the company had to pay more towards marketing, for the first timein this century, it has reported a drop in revenues. Also for the first time in this century, profit margin in terms of profit after tax (PAT) as percentage of total revenue from operations (TIO) has slipped down to a single digit. Further, in September 2015, the company completed 100 years in India. In its corporate campaign, the Swiss major conspicuously avoided mention of its biggest brand Maggi noodles while mentioning features of its other brands such as Nescafe and KitKat .

Nestle India hired McCann World Group for the Maggi Noodles relaunch, with the agency’s India unit chief executive Prasoon Joshi in charge of the creatives for the campaign. Reportedly the largest food company in the world, Nestle India kicked off there launch campaign in October 2015 with a print advertisement that said: ‘Your Maggi is safe, has always been.’ The ad went on to explain that around 3,500 samples of the noodle brand were put to rigorous test in India and in places such as the USA, Canada, UK, Australia, New Zealand and Singapore.During the Maggi noodles recall and ban, the brand’s past and present endorsers, including actors Madhuri Dixit, Amitabh Bachchan and Priety Zinta, were served notices by the Uttarakhand Food and Drug Administration for making false claims.Further, since a court case had been filed against the brand’s ambassadors in Uttar Pradesh for their endorsement of Maggi, the relaunch communications did not carry any brand ambassadors.

As is known, Maggi noodles were banned by the Food Safety and Standards Authority of India (FSSAI) and the commissioner of Food Safety, Maharashtra (FDA) in June 2015, mainly due to the allegation that they contained higher than the permissible limits of the metal lead. The company had to stop production of Maggi noodles, recall existing stocks of the noodles from the market and destroy them.The company says that it conducted extensive tests of over 3,500 samples representing over 200 million (20 crore) packets of Maggi Noodles in both national and international accredited laboratories. It said that all the results showed that the levels of lead were below permissible limits The company~~also~~ claimed that several other countries also found Maggi noodles safe after testing samples of the product exported from India.

Court orders directing fresh testing of samples from three national laboratories, while revoking the ban on Maggi noodles, were issued. Nestle India says that all the results from three National Accreditation Board for Testing and Calibration Laboratories (NABL) said that 100 per cent of samples were clear, with lead within the permissible limits. Manufacture of Maggi noodles was recommenced from November 2015 onwards. FSSAI has challenged the judgement that lifted the ban on Maggi noodles and the matter is still in court.

Brand and trust had to be re-built, and is still an on-going process. Nestle India is one of the biggest spenders on advertising in the country. Nestle India’s new chairman and managing director Suresh Narayanan said in a financial release, “I am happy to report that despite the exceptional toll the Maggi noodles crisis took on our financials, our optimism about the future helps us with a healthy dividend payout. The high point of the last quarter has been the return of Maggi noodles to the market and the consumers to whom it rightfully belongs. The sales evolution and reception in the marketplace gives us satisfaction, but we have ambitions ahead to strengthen the brand. Following the reintroduction of the Maggi Masala variant, we have launched another favourite Maggi Chicken noodles. As a team we are committed to serving our consumers with more offerings from Maggi and our other brands by accelerating the pace of innovation and renovation.”

Ad spends and other numbers

Nestle India increased its advertisement and sales promotion (ASP, marketing) spends by 18.9 per cent for the year ended 31 December 2015 (FY-2015, current year) to Rs 525.21 crore (6.42 per cent of TIO) as compared to the Rs 445.47 crore (4.52 per cent of TIO) in the previous year (year ended 31 December 2014, FY-2014).

Note:(1) Nestle India financial year is the calendar year. It reports annual results for the period 1 January to 31 December. Hence FY-2015 represents the period between 1 January 2015 and 31 December 2015.

(2) The unit of currency in this report is the Indian rupee – Rs (also conventionally represented by INR or ).The Indian numbering system or the Vedic numbering system has been used to denote money values in this report. The basic conversion to the international norm would be:

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

(b) 10,000 lakh = 100 crore = 1 billion = 1 arab.

Over a 12 year period starting FY-2004 until FY-2015, Nestle India’s year on year ASP spends had been dropping in terms of percentage of TIO from a high of 5.5 per cent in 2005 to a low of 4.3 per cent in FY-2011, FY-2012 and FY-2013. The previous year saw a slight percentage increase of 20 basis points in ASP to 4.5 per cent, and this year saw a massive 190 basis points increase in ASP as percentage of TIO to the above mentioned 6.4 per cent as compared to FY-2014.

During the 12 year period under consideration, ASP has seen a CAGR of 14.3 per cent from the Rs 251.92 crore (5.4 per cent of TIO) to the above mentioned Rs 525.21 crore in the current year. Until the previous year, ASP at Rs 445.47 crore (4.5 per cent of TIO) had seen CAGR of 13.9 per cent since FY-2004.

The FMCG major’s TIO declined 17 per cent to Rs 8,175.31 crore in FY-2015 as compared to Rs 9,854.84 crore in FY-2014. Please refer to figures 1 and 2 below.

During the same twelve year period under consideration, Nestle India’s TIO has shown a CAGR of 12.5 per cent from Rs2,227.57 crore in FY-2004 to the above mentioned Rs 8,175.31 crore in FY-2015. Last year, the company’s TIO had a CAGR of 16 per cent since FY-2004 with TIO of Rs 9,854.84 crore in FY-2014. CAGR at 16.9 per cent since FY-2004 was even higher in FY-2013, when Nestle India had reported TIO of Rs9,101.05 crore.

Nestle India’sPAT had crossed the Rs 1,000 crore mark in FY-2013, when the company had reported PAT of Rs 1,067.93 crore (12.8 per cent margin) on TIO of Rs 8,334.53 crore.

PAT in the current year declined to less than half – declined by a massive 52.5 per cent to Rs 563.27 crore (6.9 per cent of TIO) as compared to the Rs 1,184.69 crore (12 per cent of TIO) in FY-2014. Please refer to figure 3 below.

In terms of percentage of TIO, Nestle India’s simple avarage PAT between FY-2004 and FY-2014 was 12.3 per cent. This has dropped to 11.8 per cent of TIO between FY-2004 and FY-2015.

Between FY-2004 and FY-2014, Nestle India’s PAT had shown a CAGR of 16.7 per cent growth from Rs 251.92 crore (11.3 per cent of TIO) to the above mentioned Rs 1,184.69 crore (12 per cent of TIO). Between FY-2004 and FY-2015, PAT CAGR declined to less than half at just 7.6 per cent.

Report background: Being a part of a multi-national group, the company is generally quite tight lipped about sharing financials unless it has to legally do so. Details about the company’s advertisement spends are not indicated even in the company’s annual reports – what you have is a combination of the Advertisement and Sales Promotion spends declared as a single entry in the notes forming the part of the company’s annual financials. There is really no way that one could pin an exact number for these spends unless one has an inside track on the company’s marketing budgets. The projections and numbers in this report are pure conjecture based on the author’s statistical tools used on the historical annual numbers revealed by the company in its annual reports. The author has no knowledge about Nestle or Nestle India’s strategy, past or present.

April 18, 2016
FY-2015: Nestle ups marketing spends to Rs 525 crore

BENGALURU: That the Maggi fiasco was going to cost Nestle India Limited (Nestle India) dear was a given. Post the relaunch of one of the most staple dishes of modern India, the company had to follow up with a massive damage control and marketing push. Not only has the company had to pay more towards marketing, for the first timein this century, it has reported a drop in revenues. Also for the first time in this century, profit margin in terms of profit after tax (PAT) as percentage of total revenue from operations (TIO) has slipped down to a single digit. Further, in September 2015, the company completed 100 years in India. In its corporate campaign, the Swiss major conspicuously avoided mention of its biggest brand Maggi noodles while mentioning features of its other brands such as Nescafe and KitKat .

Nestle India hired McCann World Group for the Maggi Noodles relaunch, with the agency’s India unit chief executive Prasoon Joshi in charge of the creatives for the campaign. Reportedly the largest food company in the world, Nestle India kicked off there launch campaign in October 2015 with a print advertisement that said: ‘Your Maggi is safe, has always been.’ The ad went on to explain that around 3,500 samples of the noodle brand were put to rigorous test in India and in places such as the USA, Canada, UK, Australia, New Zealand and Singapore.During the Maggi noodles recall and ban, the brand’s past and present endorsers, including actors Madhuri Dixit, Amitabh Bachchan and Priety Zinta, were served notices by the Uttarakhand Food and Drug Administration for making false claims.Further, since a court case had been filed against the brand’s ambassadors in Uttar Pradesh for their endorsement of Maggi, the relaunch communications did not carry any brand ambassadors.

As is known, Maggi noodles were banned by the Food Safety and Standards Authority of India (FSSAI) and the commissioner of Food Safety, Maharashtra (FDA) in June 2015, mainly due to the allegation that they contained higher than the permissible limits of the metal lead. The company had to stop production of Maggi noodles, recall existing stocks of the noodles from the market and destroy them.The company says that it conducted extensive tests of over 3,500 samples representing over 200 million (20 crore) packets of Maggi Noodles in both national and international accredited laboratories. It said that all the results showed that the levels of lead were below permissible limits The company~~also~~ claimed that several other countries also found Maggi noodles safe after testing samples of the product exported from India.

Court orders directing fresh testing of samples from three national laboratories, while revoking the ban on Maggi noodles, were issued. Nestle India says that all the results from three National Accreditation Board for Testing and Calibration Laboratories (NABL) said that 100 per cent of samples were clear, with lead within the permissible limits. Manufacture of Maggi noodles was recommenced from November 2015 onwards. FSSAI has challenged the judgement that lifted the ban on Maggi noodles and the matter is still in court.

Brand and trust had to be re-built, and is still an on-going process. Nestle India is one of the biggest spenders on advertising in the country. Nestle India’s new chairman and managing director Suresh Narayanan said in a financial release, “I am happy to report that despite the exceptional toll the Maggi noodles crisis took on our financials, our optimism about the future helps us with a healthy dividend payout. The high point of the last quarter has been the return of Maggi noodles to the market and the consumers to whom it rightfully belongs. The sales evolution and reception in the marketplace gives us satisfaction, but we have ambitions ahead to strengthen the brand. Following the reintroduction of the Maggi Masala variant, we have launched another favourite Maggi Chicken noodles. As a team we are committed to serving our consumers with more offerings from Maggi and our other brands by accelerating the pace of innovation and renovation.”

Ad spends and other numbers

Nestle India increased its advertisement and sales promotion (ASP, marketing) spends by 18.9 per cent for the year ended 31 December 2015 (FY-2015, current year) to Rs 525.21 crore (6.42 per cent of TIO) as compared to the Rs 445.47 crore (4.52 per cent of TIO) in the previous year (year ended 31 December 2014, FY-2014).

Note:(1) Nestle India financial year is the calendar year. It reports annual results for the period 1 January to 31 December. Hence FY-2015 represents the period between 1 January 2015 and 31 December 2015.

(2) The unit of currency in this report is the Indian rupee – Rs (also conventionally represented by INR or ).The Indian numbering system or the Vedic numbering system has been used to denote money values in this report. The basic conversion to the international norm would be:

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

(b) 10,000 lakh = 100 crore = 1 billion = 1 arab.

Over a 12 year period starting FY-2004 until FY-2015, Nestle India’s year on year ASP spends had been dropping in terms of percentage of TIO from a high of 5.5 per cent in 2005 to a low of 4.3 per cent in FY-2011, FY-2012 and FY-2013. The previous year saw a slight percentage increase of 20 basis points in ASP to 4.5 per cent, and this year saw a massive 190 basis points increase in ASP as percentage of TIO to the above mentioned 6.4 per cent as compared to FY-2014.

During the 12 year period under consideration, ASP has seen a CAGR of 14.3 per cent from the Rs 251.92 crore (5.4 per cent of TIO) to the above mentioned Rs 525.21 crore in the current year. Until the previous year, ASP at Rs 445.47 crore (4.5 per cent of TIO) had seen CAGR of 13.9 per cent since FY-2004.

The FMCG major’s TIO declined 17 per cent to Rs 8,175.31 crore in FY-2015 as compared to Rs 9,854.84 crore in FY-2014. Please refer to figures 1 and 2 below.

During the same twelve year period under consideration, Nestle India’s TIO has shown a CAGR of 12.5 per cent from Rs2,227.57 crore in FY-2004 to the above mentioned Rs 8,175.31 crore in FY-2015. Last year, the company’s TIO had a CAGR of 16 per cent since FY-2004 with TIO of Rs 9,854.84 crore in FY-2014. CAGR at 16.9 per cent since FY-2004 was even higher in FY-2013, when Nestle India had reported TIO of Rs9,101.05 crore.

Nestle India’sPAT had crossed the Rs 1,000 crore mark in FY-2013, when the company had reported PAT of Rs 1,067.93 crore (12.8 per cent margin) on TIO of Rs 8,334.53 crore.

PAT in the current year declined to less than half – declined by a massive 52.5 per cent to Rs 563.27 crore (6.9 per cent of TIO) as compared to the Rs 1,184.69 crore (12 per cent of TIO) in FY-2014. Please refer to figure 3 below.

In terms of percentage of TIO, Nestle India’s simple avarage PAT between FY-2004 and FY-2014 was 12.3 per cent. This has dropped to 11.8 per cent of TIO between FY-2004 and FY-2015.

Between FY-2004 and FY-2014, Nestle India’s PAT had shown a CAGR of 16.7 per cent growth from Rs 251.92 crore (11.3 per cent of TIO) to the above mentioned Rs 1,184.69 crore (12 per cent of TIO). Between FY-2004 and FY-2015, PAT CAGR declined to less than half at just 7.6 per cent.

Report background: Being a part of a multi-national group, the company is generally quite tight lipped about sharing financials unless it has to legally do so. Details about the company’s advertisement spends are not indicated even in the company’s annual reports – what you have is a combination of the Advertisement and Sales Promotion spends declared as a single entry in the notes forming the part of the company’s annual financials. There is really no way that one could pin an exact number for these spends unless one has an inside track on the company’s marketing budgets. The projections and numbers in this report are pure conjecture based on the author’s statistical tools used on the historical annual numbers revealed by the company in its annual reports. The author has no knowledge about Nestle or Nestle India’s strategy, past or present.

April 18, 2016
Hinduja Ventures declares 175 per cent interim dividend for FY-2016

BENGALURU: Hindustan Ventures Limited (HVL), the holding company of one of India’s largest integrated media companies, – IndusInd Media & Communications Limited (IMCL) and Grant Investrade Limited which has launched the headend in the sky (HITS) platform, announced an interim dividend of 175 per cent (Rs 17.50 per equity share of face value of Rs 10) for the current financial year. The dividend will result in a pay out of Rs 4329.53 lakh. (100,00,000 = 100 lakh = 10 million = 1 crore)

HVL had announced a standalone net profit after tax of Rs 86.41 crore for the nine month period ended December 31, 2015 as compared to a PAT of Rs 74.82 crore in the corresponding year ago period. The interim dividend will be paid on or after March 29, 2016.

HVL’s HITS platform was launched on September 16,2015 by the Union Minister of Finance, Corporate Affairs and Ministry of Information & Broadcasting Arun Jaitley, under the brand name NXT DIGITAL. The Hinduja‐HITS Network will enable seamless transition from analogue to digital in phase III and IV markets.

At the time of filing of this report, share price of HVL on the Bombay Stock Exchange was up by Rs 12, or 2.88 percent higher than the previous close of Rs 416 with a total turnover of 2.65 lakh. The share had opened today at Rs 425, with a high if Rs 428 and a low of Rs 421.50.

March 14, 2016
Hinduja Ventures declares 175 per cent interim dividend for FY-2016

BENGALURU: Hindustan Ventures Limited (HVL), the holding company of one of India’s largest integrated media companies, – IndusInd Media & Communications Limited (IMCL) and Grant Investrade Limited which has launched the headend in the sky (HITS) platform, announced an interim dividend of 175 per cent (Rs 17.50 per equity share of face value of Rs 10) for the current financial year. The dividend will result in a pay out of Rs 4329.53 lakh. (100,00,000 = 100 lakh = 10 million = 1 crore)

HVL had announced a standalone net profit after tax of Rs 86.41 crore for the nine month period ended December 31, 2015 as compared to a PAT of Rs 74.82 crore in the corresponding year ago period. The interim dividend will be paid on or after March 29, 2016.

HVL’s HITS platform was launched on September 16,2015 by the Union Minister of Finance, Corporate Affairs and Ministry of Information & Broadcasting Arun Jaitley, under the brand name NXT DIGITAL. The Hinduja‐HITS Network will enable seamless transition from analogue to digital in phase III and IV markets.

At the time of filing of this report, share price of HVL on the Bombay Stock Exchange was up by Rs 12, or 2.88 percent higher than the previous close of Rs 416 with a total turnover of 2.65 lakh. The share had opened today at Rs 425, with a high if Rs 428 and a low of Rs 421.50.

March 14, 2016
Q2-2016: TRAI Report: YoY and QoQ Radio ad revenue up 23 per cent

BENGALURU: The radio industry in India has reported the highest advertisement revenue so far for the quarter ended September 30, 2015 (Q2-2016) as per the latest TRAI report. Advertisement revenue in Q2-2016 reported to TRAI by 236 radio stations was Rs 481.56 crore, or Rs2.04 crore per station. The ad revenue per station reported in Q2-2016 increased 23.17 per cent year-on-year (YoY) as compared to Rs 1.66 crore in (Rs 399.26 crore reported by 241 radio stations) Q2-2015 and 23.81 per cent quarter-on-quarter (QoQ) as compared to Rs 1.65 crore (Rs 393.9 crore reported by 239 radio stations) in the immediate trailing quarter.

Before Q2-2016, the previous highest ad revenue was Rs 443.17 crore reported by 241 radio stations in Q3-2015 orRs 1.84 crore per station.

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

(b) The author has taken the liberty to introduce a measure – average revenue per radio station. This is a rough yardstick and may not necessarily be indicative of a station or a networks performance, because factors such as geography and market conditions within the area of operations are among many that will also determine performance.

(c) This report is skewed more towards general financial numbers in terms of revenue and results, and not operational performance.

Trends across 18 consecutive quarters (four fiscal years, plus two quarters of the current fiscal)

Please refer to Fig A below – Ad revenue per station has been calculated based on combined ad revenue figures disclosed by TRAI across 18 consecutive quarters starting Q1-2012 until Q2-2016. During the period, in general, ad revenue from radio stations shows an increasing linear trend as is indicted by the broken black trend line. Over the financial years 2012, 2013, 2014 and 2015, it has been noted that ad revenue increases in the following order from lowest to highest – Q1, Q2, Q4, Q3. It may be noted that in fiscals 2012 and 2013 ad revenue per station was actually higher in Q4 than Q3, but in fiscals 2014 and 2015, it was highest in Q3.

Fig B below shows how ad revenues have changed YoY and QoQ since Q1-2013 until Q2-2016 (across 14 quarters). During this periodboth the YoY and QoQincrease was highest in Q2-2016 at approximately 23 per cent plus each. The previous highest YoY increase was Q2-2014 at 21.31 per cent, while the previous highest QoQ increase was Q3-2013 at 18.85 per cent. While there has never been a YoY decline, in the case of QoQ, revenues have declined in Q1-2013, Q1-2014, Q4-2014, Q1-2015, Q4-2015 and Q1-2016, hence further substantiating the above observations that Q1 of a financial year generally has the lowest ad revenue in a fiscal, while Q3, which is the festival quarter in India, has the highest ad revenue. Further, the QoQ drop in Q4 was not steep, and hence Q4 over the past two fiscals has the next highest ad revenues.

For the year ended March 31, 2015 (FY-2015), the numbers reported by the radio industry for the year were the probably the best (indiantelevision link, radioandusic link) until then. Despite an 8.88 percent QoQ (quarter on quarter) fall in average ad revenue per station in Q1-2016, the ad average revenue per station of Rs 1.65 crore was the best yet for the first quarter over a period of 4 years. In Q1-2015, YoY ad revenue grew 11.90 percent as compared to Q1-2014.Combined with the great Q2-2016 numbers, historical trends indicate that FY-2016 could be an even better year in terms of average revenue per station and overall revenues.

As per the latest TRAI data, the sum of average ad revenues per station for the first two quarters of 2016 at Rs 3.69 crore is already 54.4 per cent of the average ad revenue per station of Rs 6.78 crore for fiscal 2015. As mentioned above, Q1 and Q2 generally report the lowest and second lowest ad revenues respectively in a financial year. Results reported by a few companies for the third quarter ended 31 December 2015 (Q3-2016) indicate that YoY and QoQ revenues have risen. Add to this the revenue of the new stations acquired in phase III auctions if/once they start operations in the fourth quarter, the radio industry should report substantial revenue increases from FY-2016 onwards.

Let us look at how a few radio networks performed.

Note (2): (a) This report considers PAT posted by 2 radio companies (ENIL – Radio Mirchi, 32 radio stations; JagranPrakashan – Radio City – 20 radio stations), along with operating results of DB Corp (My FM, 17 stations); B. A.G. Films (Radio Dhamaal, 10 stations); HT Media (Fever FM, 4 stations); and TV Today (Oye! FM, 6 stations), or a total of 6 radio networks that represent 89, or 36.63 percent of the 243 private FM radio stations in Q2-2016.

(b) The Q3-2016 numbers of individual players in this report have been obtained from their filings with regulatory bodies, the TRAI number for Q3-2016 has been extrapolated and could prove to be inaccurate.

(c)Revenues for the sample stations mean Total Income from Operations and generally include ad revenue and other operating revenues.

(d) Phase III and other radio stations acquisitions: ENIL has received permission from the Ministry of Information & Broadcasting (MIB) to acquire 4 stations from TV Today Network Limited (Oye! FM), viz., those at Amritsar, Patiala, Shimla and Jodhpur – which the company says have been/will be re-branded and re-launched shortly as Mirchi, adding to its North India network strength. With another 7 stations acquired in phase III auctions, the core Mirchi brand will now be available in 43 cities. There are/will be a total of 39 FM radio stations that JagranPrakashan Limited currently has. This includes the existing 20 radio stations plus 11 stations acquired in phase III auctions and 8 radio stations under the brand Radio Mantra. Radio Mantra was earlier operated by Shri Puran Multimedia, Jagran’s promoter group. Besides, the group also runs a web radio network with 21 web radio streams under Planetradiocity.com. During the Phase III auctions, DB Corp (My FM) acquired 14 frequencies, through which MY FM will extend its presence to seven states and 30 cities with 31 stations. HT Media acquired 10 radio frequencies during phase III auctions, taking its total radio stations to 14. However these changes are not considered here, for this report pertains to the period before all the new stations have started operations.

(e) In mid-December 2015, Radio Mirchi added two more station, those at Amritsar and Patalia. It is presumed by the author that the addition of these two mare station brought in no significant addition to income to Radio Mirchi in Q3-2016, hence Radio Mirchi’s revenue per station has been calculated on the basis of 32 stations in this paper for that quarter. However, actual facts could be different.

Entertainment Network India Limited (ENIL) that operates brand Radio Mirchi is the only separately listed radio company in India and one of the most profitable ones by far. It must be noted that in Q2-2016, ENIL’s revenue made up 50.6 per cent of the combined revenue of the six entities in this paper. In Q3-2016, ENIL contributed to 51.6 per cent of combined revenues. Other stations/radio brands of consequence, whose results are within the public domain have been considered in this report.

Please refer to Fig C below. It may be noted that the figure of Rs2.30 crore in blue for All India ad revenue per station is a projection based on certain assumptions made by the author, and could be incorrect.

In Q2-2016 (30 September 2015), combined revenues of the six entities in this report had increased 10.3 per cent YoY and had increased 15.5 per cent QoQ, much lower than the YoY andQoQ increases reported by TRAI (23.17 per cent and 23.81 per cent respectively)

Combined revenues of the 89 radio stations run by the six entities increased 19.2 per cent YoY to Rs 278.16 crore in Q3-2016 (31 December 2016) as compared to Rs 233.41 crore and increased 21 per cent QoQ as compared to Rs 229.95 crore.

Combined operating profit/PAT in Q3-2016 of the six entities declined 11.1 per cnt YoY to Rs 60.31 crore as compared to Rs 67.83 crore, but increased 36.6 per cent QoQ from Rs 44.15 crore.

Music Broadcast Limited (MBL) which runs Radio City reported 14.9 YoY (year-on-year) growth in operating revenue for Q3-2016 at Rs 64.80 crore as compared to Rs 56.39 crore for the corresponding prior year quarter. Revenue in Q3-2016 was 16.7 per cent higher QoQ (quarter-on-quarter) as compared to Rs 55.54 crore in the immediate trailing quarter.

B. A. G. Films Limited Radio segment Radio Dhamaalreported 1.8 per cent QoQ drop in operating revenue growth at Rs 2.18 crore as compared to Rs 2.22 crore and 10 per cent YoY decline in revenue as compared to Rs2.43 crore.

HT Media’s radio segment Fever 104 FM reported a 25 per cent YoY increase in operating revenue to Rs 32.26 crore as compared to Rs 28.81 crore and grew 10 per cent QoQ as compared to Rs 29.34 crore.

ENIL reported 22.9 percent YoY increase in Total Income from Operations (TIO) in the quarter ended December 31, 2015 (Q3-2016, current quarter) at Rs 143.57 crore as compared to the Rs 117.69 crore and 23.5 percent higher QoQ as compared to Rs 116.27 crore in the immediate trailing quarter.

DB Corp’s My FMrevenue increased 25.8 percent YoY at Rs 32.32 crore as compared to Rs 25.69 crore) and a 34.9 percent QoQ growth as compared to Rs 23.96 crore.

TV Today’s Network Limited radio segment Oye! reported49.4 percent YoY decline in operating revenue at Rs 2.02 crore as compared to Rs 4.00 crore, and 22.5 percent lower operating revenue as compared to Rs 2.61 crore in the immediate trailing quarter.

MBL’s (Radio City) profit after tax (PAT) in Q3-2016 declined 5.4 per cent YoY to Rs 16.17 crore (25 per cent margin) as compared to Rs 17.10 crore (30.3 per cent margin), but increased by more than a third (increased by 34.2 per cent) from Rs 12.05 crore (21.7 per cent margin). PAT for 9M-2016 declined 30.7 per cent to Rs 25.99 crore (15.5 per cent margin) from Rs 37.53 crore (24.9 per cent margin) in the corresponding period of the previous year.

Dhamaal’s operating profit in Q3-2016 was less than a third (down 68.1 per cent) QoQ at Rs 0.23 crore as compared to Rs 0.73 crore and less than a fourth (down 75.5 per cent) YoY as compared to Rs 0.94 crore in Q2-2015.

Fever reported 21 per cent decline in operating profit in Q3-2016 at Rs 7.46 crore as compared to Rs 9.44 crore, but was 94.3 per cent more QoQ than of Rs 3.84 crore.

ENIL’s profit after tax (PAT) in Q3-2016 declined 18.8 percent to Rs 26.99 crore (18.8 percent margin) as compared to Rs 32.84 crore (28.1 percent margin) and was flat QoQ as compared to Rs 26.97 crore (23.2 percent margin) in Q2-2016. The company had entered the Rs 100 crore PAT club in FY-2015 with a PAT of Rs 105.98 crore (24.2 percent margin) on a TIO of Rs 483.48 crore.

My FM reported almost double the operating profit (grew by 98.7 percent) QoQ at Rs 12 crore as compared to Rs 6.04 crore and increased 27.1 percent YoY as compared to Rs 9.44 crore.

Oye! loss in the current quarter was higher at Rs2.54 crore as compared to the operating loss of Rs1.94 crore in Q3-2015 but lower than the operating loss of Rs 5.48 crore in Q2-2016.

March 7, 2016
Q2-2016: TRAI Report: YoY and QoQ Radio ad revenue up 23 per cent

BENGALURU: The radio industry in India has reported the highest advertisement revenue so far for the quarter ended September 30, 2015 (Q2-2016) as per the latest TRAI report. Advertisement revenue in Q2-2016 reported to TRAI by 236 radio stations was Rs 481.56 crore, or Rs2.04 crore per station. The ad revenue per station reported in Q2-2016 increased 23.17 per cent year-on-year (YoY) as compared to Rs 1.66 crore in (Rs 399.26 crore reported by 241 radio stations) Q2-2015 and 23.81 per cent quarter-on-quarter (QoQ) as compared to Rs 1.65 crore (Rs 393.9 crore reported by 239 radio stations) in the immediate trailing quarter.

Before Q2-2016, the previous highest ad revenue was Rs 443.17 crore reported by 241 radio stations in Q3-2015 orRs 1.84 crore per station.

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

(b) The author has taken the liberty to introduce a measure – average revenue per radio station. This is a rough yardstick and may not necessarily be indicative of a station or a networks performance, because factors such as geography and market conditions within the area of operations are among many that will also determine performance.

(c) This report is skewed more towards general financial numbers in terms of revenue and results, and not operational performance.

Trends across 18 consecutive quarters (four fiscal years, plus two quarters of the current fiscal)

Please refer to Fig A below – Ad revenue per station has been calculated based on combined ad revenue figures disclosed by TRAI across 18 consecutive quarters starting Q1-2012 until Q2-2016. During the period, in general, ad revenue from radio stations shows an increasing linear trend as is indicted by the broken black trend line. Over the financial years 2012, 2013, 2014 and 2015, it has been noted that ad revenue increases in the following order from lowest to highest – Q1, Q2, Q4, Q3. It may be noted that in fiscals 2012 and 2013 ad revenue per station was actually higher in Q4 than Q3, but in fiscals 2014 and 2015, it was highest in Q3.

Fig B below shows how ad revenues have changed YoY and QoQ since Q1-2013 until Q2-2016 (across 14 quarters). During this periodboth the YoY and QoQincrease was highest in Q2-2016 at approximately 23 per cent plus each. The previous highest YoY increase was Q2-2014 at 21.31 per cent, while the previous highest QoQ increase was Q3-2013 at 18.85 per cent. While there has never been a YoY decline, in the case of QoQ, revenues have declined in Q1-2013, Q1-2014, Q4-2014, Q1-2015, Q4-2015 and Q1-2016, hence further substantiating the above observations that Q1 of a financial year generally has the lowest ad revenue in a fiscal, while Q3, which is the festival quarter in India, has the highest ad revenue. Further, the QoQ drop in Q4 was not steep, and hence Q4 over the past two fiscals has the next highest ad revenues.

For the year ended March 31, 2015 (FY-2015), the numbers reported by the radio industry for the year were the probably the best (indiantelevision link, radioandusic link) until then. Despite an 8.88 percent QoQ (quarter on quarter) fall in average ad revenue per station in Q1-2016, the ad average revenue per station of Rs 1.65 crore was the best yet for the first quarter over a period of 4 years. In Q1-2015, YoY ad revenue grew 11.90 percent as compared to Q1-2014.Combined with the great Q2-2016 numbers, historical trends indicate that FY-2016 could be an even better year in terms of average revenue per station and overall revenues.

As per the latest TRAI data, the sum of average ad revenues per station for the first two quarters of 2016 at Rs 3.69 crore is already 54.4 per cent of the average ad revenue per station of Rs 6.78 crore for fiscal 2015. As mentioned above, Q1 and Q2 generally report the lowest and second lowest ad revenues respectively in a financial year. Results reported by a few companies for the third quarter ended 31 December 2015 (Q3-2016) indicate that YoY and QoQ revenues have risen. Add to this the revenue of the new stations acquired in phase III auctions if/once they start operations in the fourth quarter, the radio industry should report substantial revenue increases from FY-2016 onwards.

Let us look at how a few radio networks performed.

Note (2): (a) This report considers PAT posted by 2 radio companies (ENIL – Radio Mirchi, 32 radio stations; JagranPrakashan – Radio City – 20 radio stations), along with operating results of DB Corp (My FM, 17 stations); B. A.G. Films (Radio Dhamaal, 10 stations); HT Media (Fever FM, 4 stations); and TV Today (Oye! FM, 6 stations), or a total of 6 radio networks that represent 89, or 36.63 percent of the 243 private FM radio stations in Q2-2016.

(b) The Q3-2016 numbers of individual players in this report have been obtained from their filings with regulatory bodies, the TRAI number for Q3-2016 has been extrapolated and could prove to be inaccurate.

(c)Revenues for the sample stations mean Total Income from Operations and generally include ad revenue and other operating revenues.

(d) Phase III and other radio stations acquisitions: ENIL has received permission from the Ministry of Information & Broadcasting (MIB) to acquire 4 stations from TV Today Network Limited (Oye! FM), viz., those at Amritsar, Patiala, Shimla and Jodhpur – which the company says have been/will be re-branded and re-launched shortly as Mirchi, adding to its North India network strength. With another 7 stations acquired in phase III auctions, the core Mirchi brand will now be available in 43 cities. There are/will be a total of 39 FM radio stations that JagranPrakashan Limited currently has. This includes the existing 20 radio stations plus 11 stations acquired in phase III auctions and 8 radio stations under the brand Radio Mantra. Radio Mantra was earlier operated by Shri Puran Multimedia, Jagran’s promoter group. Besides, the group also runs a web radio network with 21 web radio streams under Planetradiocity.com. During the Phase III auctions, DB Corp (My FM) acquired 14 frequencies, through which MY FM will extend its presence to seven states and 30 cities with 31 stations. HT Media acquired 10 radio frequencies during phase III auctions, taking its total radio stations to 14. However these changes are not considered here, for this report pertains to the period before all the new stations have started operations.

(e) In mid-December 2015, Radio Mirchi added two more station, those at Amritsar and Patalia. It is presumed by the author that the addition of these two mare station brought in no significant addition to income to Radio Mirchi in Q3-2016, hence Radio Mirchi’s revenue per station has been calculated on the basis of 32 stations in this paper for that quarter. However, actual facts could be different.

Entertainment Network India Limited (ENIL) that operates brand Radio Mirchi is the only separately listed radio company in India and one of the most profitable ones by far. It must be noted that in Q2-2016, ENIL’s revenue made up 50.6 per cent of the combined revenue of the six entities in this paper. In Q3-2016, ENIL contributed to 51.6 per cent of combined revenues. Other stations/radio brands of consequence, whose results are within the public domain have been considered in this report.

Please refer to Fig C below. It may be noted that the figure of Rs2.30 crore in blue for All India ad revenue per station is a projection based on certain assumptions made by the author, and could be incorrect.

In Q2-2016 (30 September 2015), combined revenues of the six entities in this report had increased 10.3 per cent YoY and had increased 15.5 per cent QoQ, much lower than the YoY andQoQ increases reported by TRAI (23.17 per cent and 23.81 per cent respectively)

Combined revenues of the 89 radio stations run by the six entities increased 19.2 per cent YoY to Rs 278.16 crore in Q3-2016 (31 December 2016) as compared to Rs 233.41 crore and increased 21 per cent QoQ as compared to Rs 229.95 crore.

Combined operating profit/PAT in Q3-2016 of the six entities declined 11.1 per cnt YoY to Rs 60.31 crore as compared to Rs 67.83 crore, but increased 36.6 per cent QoQ from Rs 44.15 crore.

Music Broadcast Limited (MBL) which runs Radio City reported 14.9 YoY (year-on-year) growth in operating revenue for Q3-2016 at Rs 64.80 crore as compared to Rs 56.39 crore for the corresponding prior year quarter. Revenue in Q3-2016 was 16.7 per cent higher QoQ (quarter-on-quarter) as compared to Rs 55.54 crore in the immediate trailing quarter.

B. A. G. Films Limited Radio segment Radio Dhamaalreported 1.8 per cent QoQ drop in operating revenue growth at Rs 2.18 crore as compared to Rs 2.22 crore and 10 per cent YoY decline in revenue as compared to Rs2.43 crore.

HT Media’s radio segment Fever 104 FM reported a 25 per cent YoY increase in operating revenue to Rs 32.26 crore as compared to Rs 28.81 crore and grew 10 per cent QoQ as compared to Rs 29.34 crore.

ENIL reported 22.9 percent YoY increase in Total Income from Operations (TIO) in the quarter ended December 31, 2015 (Q3-2016, current quarter) at Rs 143.57 crore as compared to the Rs 117.69 crore and 23.5 percent higher QoQ as compared to Rs 116.27 crore in the immediate trailing quarter.

DB Corp’s My FMrevenue increased 25.8 percent YoY at Rs 32.32 crore as compared to Rs 25.69 crore) and a 34.9 percent QoQ growth as compared to Rs 23.96 crore.

TV Today’s Network Limited radio segment Oye! reported49.4 percent YoY decline in operating revenue at Rs 2.02 crore as compared to Rs 4.00 crore, and 22.5 percent lower operating revenue as compared to Rs 2.61 crore in the immediate trailing quarter.

MBL’s (Radio City) profit after tax (PAT) in Q3-2016 declined 5.4 per cent YoY to Rs 16.17 crore (25 per cent margin) as compared to Rs 17.10 crore (30.3 per cent margin), but increased by more than a third (increased by 34.2 per cent) from Rs 12.05 crore (21.7 per cent margin). PAT for 9M-2016 declined 30.7 per cent to Rs 25.99 crore (15.5 per cent margin) from Rs 37.53 crore (24.9 per cent margin) in the corresponding period of the previous year.

Dhamaal’s operating profit in Q3-2016 was less than a third (down 68.1 per cent) QoQ at Rs 0.23 crore as compared to Rs 0.73 crore and less than a fourth (down 75.5 per cent) YoY as compared to Rs 0.94 crore in Q2-2015.

Fever reported 21 per cent decline in operating profit in Q3-2016 at Rs 7.46 crore as compared to Rs 9.44 crore, but was 94.3 per cent more QoQ than of Rs 3.84 crore.

ENIL’s profit after tax (PAT) in Q3-2016 declined 18.8 percent to Rs 26.99 crore (18.8 percent margin) as compared to Rs 32.84 crore (28.1 percent margin) and was flat QoQ as compared to Rs 26.97 crore (23.2 percent margin) in Q2-2016. The company had entered the Rs 100 crore PAT club in FY-2015 with a PAT of Rs 105.98 crore (24.2 percent margin) on a TIO of Rs 483.48 crore.

My FM reported almost double the operating profit (grew by 98.7 percent) QoQ at Rs 12 crore as compared to Rs 6.04 crore and increased 27.1 percent YoY as compared to Rs 9.44 crore.

Oye! loss in the current quarter was higher at Rs2.54 crore as compared to the operating loss of Rs1.94 crore in Q3-2015 but lower than the operating loss of Rs 5.48 crore in Q2-2016.

March 7, 2016
Q3-2016: Dabur marketing spends up 9.6% at Rs 350 crore

BENGALURU: Dabur India Limited spent 9.6 per cent more year on year (YoY) towards advertising and publicity expenses (ASP) in the quarter ended 31 December, 2015 (Q3-2016, current quarter) at Rs 350.01 crore (16.5 per cent of Consolidated Net Sales or Total Income from Operations or TIO) as compared to Rs 319.38 crore (15.4 per cent of TIO) and 25.7 per cent more quarter-on quarter (QoQ) than the Rs 278.42 crore (13.3 per cent of TIO).

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

All numbers are consolidated unless stated otherwise

Dabur’s products

Among the products that Dabur has include health supplements like Chyawanprash, Ratnaprash, Honey, Glucose; digestives like Hamjola – Hajmola Chuzkara and Natkhat Amrud, Pudin Hara Fizz; OTC and Ethicals such as Lal Tail, Honitus Syrup; Haircare products like Vatika, Vatika Brave and Beautiful digital, Anmol Jasmine Marks; toothpaste brands like Dabur Red, Babool and Meswak; skincare products like Fem Natural Fairness, Gold Bleach, Gulabari; homecare brands such as Odomos, Odonil and Sanifresh; food brands such as Real and Real Active.

“The macroeconomic environment continues to be challenging and we faced several headwinds in the form of geo-political disturbances in key geographies in the Middle East and delayed winters in India. The ongoing political unrest in Nepal and blockade of the India-Nepal border severely impacted Dabur’s Foods business. However, we have taken steps to mitigate the impact by ramping up the production of juices in Sri Lanka and India to cater to our demand requirement, and are hopeful of reporting normal growths going forward,” said Dabur India CEO Sunil Duggal.

“The overall demand environment remained tepid in the third quarter with some key segments showing deceleration while competitive intensity was at a high. We are pursuing a prudent growth strategy and have taken steps to efficiently manage the emerging risks and challenges. Despite a sharp fall in growth rates in most consumer products segments, Dabur continues to focus on brand-building and market expansion programmes that will pave the ground for future growth. Going forward, we will continue to pursue an aggressive growth strategy,” concluded Duggal.

Trends

The company’s ASP in Q3-2016 at Rs 350.01 crore (16.5 per cent of TIO) in the current quarter was the highest in terms of actual rupee spends as well as in terms of percentage of TIO during the 13 quarter period starting Q3-2013 until Q3-2016. In the current fiscal, in Q1-2016, the company had spent Rs 330.61 crore (16 per cent of TIO) towards ASP, which is the second highest ASP in absolute rupees and in terms of percentage of TIO during the period under consideration. It must be noted that in 9M-2016 (nine month period ended 31 December, 2016) the company’s ASP has already exceeded the total ASP in FY-2014. In 9M-2016, ASP was Rs 921.77 crore, while in FY-2014, it was Rs 913.92 crore.

Also, over the 13 quarter period under consideration, Dabur’s ASP in absolute rupees and ASP in terms of percentage of TIO both show a linear increasing trend.

Please refer to Fig 1 below, which indicates that ASP in terms of percentage of TIO follows a linearly increasing zigzag line, with peaks in Q1 (school holiday period) and Q3 (festival season in the country) and valleys in Q2 and Q4 of a financial year. This has been further substantiated by the company’s ASP in Q3-2016.

Dabur’s TIO for the current quarter marked 2.1 per cent YoY growth at Rs 2,127.00 crore as compared to Rs 2079.02 crore and 1.3 per cent higher QoQ as compared to Rs 2,096.23 crore. The company’s TIO shows a linear increasing trend during the twelve quarter period under consideration in this report.

Consolidated Net Profit for Q3-2016 reported a 12.6 per cent YoY jump to Rs 318.54 crore (15 per cent of TIO) as compared to Rs 282.78 crore (13.6 per cent of TIO) but was 6.6 per cent lower QoQ than Rs 341.1 crore (16.3 per cent margin). PAT in absolute rupees as well as in terms of percentage of TIO show linear increasing trends during the period under consideration in this report.

Category Growths

Dabur says that its oral care business led by Dabur Red Paste and Meswak, continued to grow ahead of the industry. The Skin Care business reported a near 10 per cent growth during the quarter, while the Home Care business grew by over eight per cent. The Over-The-Counter (OTC) & Ethicals category ended the third quarter of 2015-16 fiscal with a near eight per cent growth. The International Business Division for Dabur reported a 14.8 per cent growth during the third quarter of 2015-16.

February 27, 2016
Q3-2016: Dabur marketing spends up 9.6% at Rs 350 crore

BENGALURU: Dabur India Limited spent 9.6 per cent more year on year (YoY) towards advertising and publicity expenses (ASP) in the quarter ended 31 December, 2015 (Q3-2016, current quarter) at Rs 350.01 crore (16.5 per cent of Consolidated Net Sales or Total Income from Operations or TIO) as compared to Rs 319.38 crore (15.4 per cent of TIO) and 25.7 per cent more quarter-on quarter (QoQ) than the Rs 278.42 crore (13.3 per cent of TIO).

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

All numbers are consolidated unless stated otherwise

Dabur’s products

Among the products that Dabur has include health supplements like Chyawanprash, Ratnaprash, Honey, Glucose; digestives like Hamjola – Hajmola Chuzkara and Natkhat Amrud, Pudin Hara Fizz; OTC and Ethicals such as Lal Tail, Honitus Syrup; Haircare products like Vatika, Vatika Brave and Beautiful digital, Anmol Jasmine Marks; toothpaste brands like Dabur Red, Babool and Meswak; skincare products like Fem Natural Fairness, Gold Bleach, Gulabari; homecare brands such as Odomos, Odonil and Sanifresh; food brands such as Real and Real Active.

“The macroeconomic environment continues to be challenging and we faced several headwinds in the form of geo-political disturbances in key geographies in the Middle East and delayed winters in India. The ongoing political unrest in Nepal and blockade of the India-Nepal border severely impacted Dabur’s Foods business. However, we have taken steps to mitigate the impact by ramping up the production of juices in Sri Lanka and India to cater to our demand requirement, and are hopeful of reporting normal growths going forward,” said Dabur India CEO Sunil Duggal.

“The overall demand environment remained tepid in the third quarter with some key segments showing deceleration while competitive intensity was at a high. We are pursuing a prudent growth strategy and have taken steps to efficiently manage the emerging risks and challenges. Despite a sharp fall in growth rates in most consumer products segments, Dabur continues to focus on brand-building and market expansion programmes that will pave the ground for future growth. Going forward, we will continue to pursue an aggressive growth strategy,” concluded Duggal.

Trends

The company’s ASP in Q3-2016 at Rs 350.01 crore (16.5 per cent of TIO) in the current quarter was the highest in terms of actual rupee spends as well as in terms of percentage of TIO during the 13 quarter period starting Q3-2013 until Q3-2016. In the current fiscal, in Q1-2016, the company had spent Rs 330.61 crore (16 per cent of TIO) towards ASP, which is the second highest ASP in absolute rupees and in terms of percentage of TIO during the period under consideration. It must be noted that in 9M-2016 (nine month period ended 31 December, 2016) the company’s ASP has already exceeded the total ASP in FY-2014. In 9M-2016, ASP was Rs 921.77 crore, while in FY-2014, it was Rs 913.92 crore.

Also, over the 13 quarter period under consideration, Dabur’s ASP in absolute rupees and ASP in terms of percentage of TIO both show a linear increasing trend.

Please refer to Fig 1 below, which indicates that ASP in terms of percentage of TIO follows a linearly increasing zigzag line, with peaks in Q1 (school holiday period) and Q3 (festival season in the country) and valleys in Q2 and Q4 of a financial year. This has been further substantiated by the company’s ASP in Q3-2016.

Dabur’s TIO for the current quarter marked 2.1 per cent YoY growth at Rs 2,127.00 crore as compared to Rs 2079.02 crore and 1.3 per cent higher QoQ as compared to Rs 2,096.23 crore. The company’s TIO shows a linear increasing trend during the twelve quarter period under consideration in this report.

Consolidated Net Profit for Q3-2016 reported a 12.6 per cent YoY jump to Rs 318.54 crore (15 per cent of TIO) as compared to Rs 282.78 crore (13.6 per cent of TIO) but was 6.6 per cent lower QoQ than Rs 341.1 crore (16.3 per cent margin). PAT in absolute rupees as well as in terms of percentage of TIO show linear increasing trends during the period under consideration in this report.

Category Growths

Dabur says that its oral care business led by Dabur Red Paste and Meswak, continued to grow ahead of the industry. The Skin Care business reported a near 10 per cent growth during the quarter, while the Home Care business grew by over eight per cent. The Over-The-Counter (OTC) & Ethicals category ended the third quarter of 2015-16 fiscal with a near eight per cent growth. The International Business Division for Dabur reported a 14.8 per cent growth during the third quarter of 2015-16.

February 27, 2016